10-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-K

x ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 2014

¨ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the Transition period from                      to                     

Commission file number 1-14788

Blackstone Mortgage Trust, Inc.

(Exact name of Registrant as specified in its charter)

Maryland	94-6181186
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)

345 Park Avenue, 42nd Floor

New York, New York 10154

(Address of principal executive offices)(Zip Code)

Registrant’s telephone number, including area code: (212) 655-0220

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Name of each exchange on which registered
Class A common stock, par value $0.01 per share	New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.    Yes  x    No  ¨

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act.    Yes  ¨    No  x

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.    Yes  x    No  ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Website, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).    Yes  x    No  ¨ (not required)

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K (§229.405 of this chapter) is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer	x	Accelerated filer	¨
Non-accelerated filer	¨	Smaller reporting company	¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).    Yes  ¨    No  x

The aggregate market value of the outstanding class A common stock held by non-affiliates of the registrant was approximately $1,303,564,616 as of June 30, 2014 (the last business day of the registrant’s most recently completed second fiscal quarter) based on the closing sale price on the New York Stock Exchange on that date.

As of February 10, 2015, there were 58,270,028 outstanding shares of class A common stock. The class A common stock is listed on the New York Stock Exchange (trading symbol “BXMT”).

DOCUMENTS INCORPORATED BY REFERENCE

Part III of this annual report on Form 10-K incorporates information by reference from the registrant’s definitive proxy statement with respect to its 2015 annual meeting of stockholders to be filed with the Securities and Exchange Commission within 120 days after the close of the registrant’s fiscal year.

Table of Contents

		Page
PART I.
ITEM 1.	BUSINESS		1
ITEM 1A.	RISK FACTORS		8
ITEM 1B.	UNRESOLVED STAFF COMMENTS		50
ITEM 2.	PROPERTIES		50
ITEM 3.	LEGAL PROCEEDINGS		50
ITEM 4.	MINE SAFETY DISCLOSURES		50
PART II.
ITEM 5.	MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES		51
ITEM 6.	SELECTED FINANCIAL DATA		53
ITEM 7.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS		55
ITEM 7A.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK		74
ITEM 8.	FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA		76
ITEM 9.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE		76
ITEM 9A.	CONTROLS AND PROCEDURES		76
ITEM 9B.	OTHER INFORMATION		77
PART III.
ITEM 10.	DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE		78
ITEM 11.	EXECUTIVE COMPENSATION		78
ITEM 12.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS		78
ITEM 13.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE		78
ITEM 14.	PRINCIPAL ACCOUNTING FEES AND SERVICES		78
PART IV.
ITEM 15.	EXHIBITS, FINANCIAL STATEMENT SCHEDULES		79
SIGNATURES			86
INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULES			F-1

PART I.

ITEM 1. BUSINESS

References herein to “Blackstone Mortgage Trust,” “company,” “we,” “us,” or “our” refer to Blackstone Mortgage Trust, Inc., a Maryland corporation, and its subsidiaries unless the context specifically requires otherwise.

Our Company

Blackstone Mortgage Trust is a real estate finance company that originates and purchases senior loans collateralized by properties in North America and Europe. We are externally managed by BXMT Advisors L.L.C., or our Manager, a subsidiary of The Blackstone Group L.P., or Blackstone, and are a real estate investment trust, or REIT, traded on the New York Stock Exchange, or NYSE, under the symbol “BXMT.” Our principal executive offices are located at 345 Park Avenue, 42nd Floor, New York, New York 10154. We were incorporated in Maryland in 1998, when we reorganized from a California common law business trust into a Maryland corporation.

We conduct our operations as a Real Estate Investment Trust, or REIT, for U.S. federal income tax purposes. We generally will not be subject to U.S. federal income taxes on our taxable income to the extent that we annually distribute all of our net taxable income to stockholders and maintain our qualification as a REIT. We also operate our business in a manner that permits us to maintain an exclusion from registration under the Investment Company Act of 1940, as amended, or the Investment Company Act. We are organized as a holding company and conduct our business primarily through our various subsidiaries. Our business is organized into two operating segments: the Loan Origination segment; and the CT Legacy Portfolio segment.

Our Manager

We are externally managed and advised by our Manager, which is responsible for administering our business activities, day-to-day operations, and providing us the services of our executive management team, investment team, and appropriate support personnel.

Our Manager is a part of Blackstone’s alternative asset management business, which includes the management of real estate funds, private equity funds, hedge fund solutions, credit-oriented funds, and closed-end funds. Through its different businesses, Blackstone had total assets under management of approximately $290.4 billion as of December 31, 2014.

In connection with the performance of its duties, our Manager benefits from the resources, relationships, and expertise of the 320 investment professionals in Blackstone’s global real estate group, the largest private equity real estate manager in the world with $80.9 billion of investor capital under management as of December 31, 2014. Blackstone’s real estate group was co-founded in 1991 by John G. Schreiber, who currently serves as a member of our board of directors and is the chairman of our Manager’s investment committee. Jonathan D. Gray, who is the global head of Blackstone’s real estate group, is a member of the board of directors of Blackstone and is a member of our Manager’s investment committee.

Blackstone Real Estate Debt Strategies, or BREDS, was launched in 2008 within Blackstone’s global real estate group, to pursue opportunities relating to debt and preferred equity investments globally, with a focus on North America and Europe. Michael B. Nash, the chief investment officer and co-founder of BREDS, serves as the executive chairman of our board of directors and is a member of our Manager’s investment committee. As of December 31, 2014, 76 dedicated BREDS professionals, including 14 investment professionals based in London, managed approximately $9.0 billion of investor capital.

Our chief executive officer, chief financial officer, and other executive officers are senior Blackstone real estate professionals. None of our Manager, our executive officers, or other personnel supplied to us by our Manager is

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obligated to dedicate any specific amount of time to our business. Our Manager is subject to the supervision and oversight of our board of directors and has only such functions and authority as our board of directors delegates to it. Pursuant to a management agreement between our Manager and us, or our Management Agreement, our Manager is entitled to receive a base management fee, an incentive fee, and expense reimbursements. See Notes 10 and 15 to our consolidated financial statements and Item 13 “Certain Relationships and Related Transactions, and Director Independence” in this Annual Report on Form 10-K for more detail on the terms of the Management Agreement.

Our Investment Strategy

Our investment strategy is to originate loans and invest in debt and related instruments supported by institutional quality commercial real estate in attractive locations. Through our Manager, we draw on Blackstone’s extensive real estate debt investment platform and its established sourcing, underwriting, and structuring capabilities in order to execute our investment strategy. In addition, we have access to Blackstone’s extensive network and Blackstone’s substantial real estate and other investment holdings, which provide our Manager access to market data on a scale not available to many competitors. While the majority of our capital will likely continue to be invested in North America and Europe, we expect to benefit from Blackstone’s global real estate debt platform.

We directly originate, co-originate, and acquire debt instruments in conjunction with acquisitions, refinancings, and recapitalizations of commercial real estate around the world. In the case of loans we acquire, we focus on performing loans that are supported by well-capitalized properties and portfolios. We believe that the scale and flexibility of our capital, as well as our Manager’s and its affiliates’ relationships, enables us to target opportunities with strong sponsorship and invest in large loans or other debt that is collateralized by high-quality assets and portfolios.

Our business is currently focused on originating senior, floating rate mortgage loans that are secured by a first priority mortgage on commercial real estate assets primarily in the office, lodging, residential, retail, industrial, and healthcare sectors in North America and Europe. These investments may be in the form of whole loans or may also include pari passu participations within mortgage loans. Although originating senior mortgage loans is our primary area of focus, we also originate subordinate loans, including subordinate mortgage interests and mezzanine loans. This focused lending strategy is designed both to provide attractive current income and protect investors’ capital.

As market conditions evolve over time, we expect to adapt as appropriate. We believe our current investment strategy will produce significant opportunities to make investments with attractive risk-return profiles. However, to capitalize on the investment opportunities that may be present at various other points of an economic cycle, we may expand or change our investment strategy by targeting assets such as:

• Subordinate mortgage loans: These are interests, often referred to as “B Notes,” in a junior portion of a mortgage loan. The interests are subordinated to the “A Note” or senior participation interest by virtue of a contractual arrangement.

• Mezzanine loans: These are loans (including pari passu participations in such loans) made to the owners of a mortgage borrower and secured by a pledge of equity interests in the mortgage borrower. These loans are structurally subordinate to any loan made directly to the mortgage borrower.

• Preferred equity: These are investments subordinate to any mezzanine loan, but senior to the owners’ common equity.

• Real estate securities: These are interests in real estate which may take the form of commercial mortgage-backed securities, or CMBS, or collateralized loan obligations, or CLOs.

• Note financings: These are loans secured by other mortgage loans, subordinate mortgage interests, and mezzanine loans.

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We believe that the diversification of the portfolio of assets that we originate, our ability to aggressively manage those assets, and the flexibility of our strategy positions us to generate attractive returns for our stockholders in a variety of market conditions over the long term.

Our Portfolio

Since the re-launch of our business in May 2013, we have originated 64 loans, representing $5.9 billion of total commitments, with an average loan size of $92.2 million.

The following table details the overall statistics of our current Loan Origination segment portfolio as of December 31, 2014 and 2013 ($ in thousands):

	December 31, 2014			December 31, 2013
Number of loans		60			28
Principal balance	$	4,462,897		$	2,018,863
Net book value	$	4,428,500		$	2,000,223
Floating rate loans		100	%		100	%
Senior loans		98	%		90	%
Weighted-average origination loan-to-value		64	%		65	%
Weighted-average cash coupon(1)		L+4.36	%		L+4.64	%
Weighted-average all-in yield(1)		L+4.81	%		L+5.28	%
Weighted-average maximum maturity (years)(2)		3.9			4.2

(1) As of December 31, 2014, our floating rate loans and related liabilities were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Therefore the net exposure to each benchmark rate is in direct proportion to our net assets indexed to that rate. In addition, 14% of our loans earned interest based on LIBOR floors, with an average floor of 0.31%, as of December 31, 2014. In addition to cash coupon, all-in yield includes the amortization of deferred origination fees, loan origination costs, and accrual of both extension and exit fees.

(2) Maximum maturity assumes all extension options are exercised by the borrower, however our loans may be repaid prior to such date. As of December 31, 2014, 85% of our loans are subject to yield maintenance, lock-out provisions, or other prepayment restrictions and 15% are open to repayment by the borrower.

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Our loan portfolio is diversified by collateral property type and geographic location, and is comprised of senior mortgages and similar credit quality loans. The following presents the geographic distribution and types of properties securing our loan portfolio as of December 31, 2014:

For information regarding our Loan Origination segment’s portfolio as of December 31, 2014, see Item 7 –“Management’s Discussion and Analysis of Financial Condition and Results of Operations – II. Loan Origination Portfolio” and – “V. Loan Portfolio Details” in this Annual Report on Form 10-K.

Financing Strategy

In addition to raising capital through public offerings of our equity and debt securities, our financing strategy includes secured and unsecured revolving repurchase facilities, asset-specific repurchase agreements, and the sale of senior loan participations. In addition to our current mix of financing sources, we may also access additional forms of financings including credit facilities, securitizations, resecuritizations, and public and private, secured and unsecured debt issuances by us or our subsidiaries.

The amount of leverage we employ for particular assets will depend upon our Manager’s assessment of the credit, liquidity, price volatility, and other risks of those assets and the financing counterparties, the availability of particular types of financing at the time, and the financial covenants related to our credit facilities. Our decision to use leverage to finance our assets will be at the discretion of our Manager and will not be subject to the approval of our stockholders. We currently expect that our leverage will not exceed, on a debt to equity basis, a ratio of 4-to-1. We will endeavor to match the terms, currency, and indices of our assets and liabilities, including in certain instances through the use of derivatives. We will also seek to limit the risks associated with recourse borrowing.

Subject to maintaining our qualification as a REIT, we may engage in hedging transactions that seek to mitigate the effects of fluctuations in interest rates or currencies and their effects on our cash flows. These hedging transactions could take a variety of forms, including interest rate or currency swaps or cap agreements, options, futures contracts, forward rate or currency agreements or similar financial instruments.

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Floating Rate Portfolio

Our Loan Origination segment portfolio was 100% comprised of floating rate loans financed by floating rate secured debt as of December 31, 2014, resulting in a return on equity that is highly correlated to LIBOR. Generally, our business model is such that rising interest rates will increase our net income, while declining interest rates will decrease net income.

Investment Guidelines

Our board of directors has approved the following investment guidelines:

• our Manager shall seek to invest our capital in a broad range of investments in, or relating to, public and/or private debt, non-controlling equity, loans and/or other interests (including “mezzanine” interests and/or options or derivatives) relating to real estate assets (including pools thereof), real estate companies, and/or real estate-related holdings;

• prior to the deployment of capital into investments, our Manager may cause our capital to be invested in any short-term investments in money market funds, bank accounts, overnight repurchase agreements with primary federal reserve bank dealers collateralized by direct U.S. government obligations and other instruments or investments reasonable determined by our Manager to be of high quality;

• not more than 25% of our equity, as defined in the Management Agreement with our Manager, will be invested in any individual investment without the approval of a majority of the investment risk management committee of our board of directors (it being understood, however, that for purposes of the foregoing concentration limit, in the case of any investment that is comprised (whether through a structured investment vehicle or other arrangement) of securities, instruments or assets of multiple portfolio issuers, such investment for purposes of the foregoing limitation shall be deemed to be multiple investments in such underlying securities, instruments and assets and not such particular vehicle, product or other arrangement in which they are aggregated);

• any investment in excess of $250.0 million shall require the approval of a majority of the investment risk management committee of our board of directors;

• no investment shall be made that would cause us to fail to qualify as a REIT under the Internal Revenue Code of 1986, as amended, or the Internal Revenue Code; and

• no investment shall be made that would cause us or any of our subsidiaries to be regulated as an investment company under the Investment Company Act.

These investment guidelines may be amended, restated, modified, supplemented or waived pursuant to the approval of a majority of our board of directors, which must include a majority of the independent directors, without the approval of our stockholders.

Competition

We are engaged in a competitive business. In our lending and investing activities, we compete for opportunities with a variety of institutional lenders and investors, including other REITs, specialty finance companies, public and private funds (including other funds managed by Blackstone and its affiliates), commercial and investment banks, commercial finance and insurance companies and other financial institutions. Several other REITs have raised significant amounts of capital, and may have investment objectives that overlap with ours, which may create additional competition for lending and investment opportunities. Some competitors may have a lower cost of funds and access to funding sources, such as the U.S. Government, that are not available to us. Many of our competitors are not subject to the operating constraints associated with REIT rule compliance or maintenance of an exclusion from regulation under the Investment Company Act. In addition, some of our competitors may have higher risk tolerances or different risk assessments, which could allow them to consider a wider variety of loans

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and investments and offer more attractive pricing or other terms than we would. Furthermore, competition for originations of and investments in assets we target may lead to decreasing yields, which may further limit our ability to generate targeted returns.

In the face of this competition, we have access to our Manager’s and Blackstone’s professionals and their industry expertise and relationships, which we believe provide us with a competitive advantage and help us assess risks and determine appropriate pricing for potential investments. We believe these relationships will enable us to compete more effectively for attractive investment opportunities. However, we may not be able to achieve our business goals or expectations due to the competitive risks that we face. For additional information concerning these competitive risks, see Item 1A – “Risk Factors – Risks Related to Our Lending and Investment Activities.”

Employees

We do not have any employees. We are externally managed by our Manager pursuant to the Management Agreement between our Manager and us. Our executive officers serve as officers of our Manager, and are employed by an affiliate of our Manager.

Government Regulation

Our operations in the United States are subject, in certain instances, to supervision and regulation by state and federal governmental authorities and may be subject to various laws and judicial and administrative decisions imposing various requirements and restrictions, which, among other things: (i) regulate credit granting activities; (ii) establish maximum interest rates, finance charges and other charges; (iii) require disclosures to customers; (iv) govern secured transactions; and (v) set collection, foreclosure, repossession and claims-handling procedures and other trade practices. We are also required to comply with certain provisions of the Equal Credit Opportunity Act that are applicable to commercial loans. We intend to conduct our business so that neither we nor any of our subsidiaries are required to register as an investment company under the Investment Company Act. Furthermore, our international activities are also subject to applicable regulations in local jurisdictions.

In our judgment, existing statutes and regulations have not had a material adverse effect on our business. In the wake of the recent global financial crisis, legislators in the United States and in other countries have said that greater regulation of financial services firms is needed, particularly in areas such as risk management, leverage, and disclosure. While we expect that additional new regulations in these areas will be adopted in the future, it is not possible at this time to forecast the exact nature of any future legislation, regulations, judicial decisions, orders or interpretations, nor their impact upon our future business, financial condition, or results of operations or prospects.

Taxation of the Company

We made an election to be taxed as a REIT, effective January 1, 2003, under the Internal Revenue Code, for U.S. federal income tax purposes. We generally must distribute annually at least 90% of our net taxable income, subject to certain adjustments and excluding any net capital gain, in order for U.S. federal income tax not to apply to our earnings that we distribute. To the extent that we satisfy this distribution requirement, but distribute less than 100% of our net taxable income, we will be subject to U.S. federal income tax on our undistributed taxable income. In addition, we will be subject to a 4% nondeductible excise tax if the actual amount that we pay out to our stockholders in a calendar year is less than a minimum amount specified under U.S. federal tax laws. Our qualification as a REIT also depends on our ability to meet various other requirements imposed by the Internal Revenue Code, which relate to organizational structure, diversity of stock ownership, and certain restrictions with regard to the nature of our assets and the sources of our income. Even if we qualify as a REIT, we are subject to certain U.S. federal excise taxes and state and local taxes on our income and assets. If we fail to qualify as a REIT in any taxable year, we will be subject to U.S. federal income taxes at regular corporate rates, including any applicable alternative minimum tax, and will not be able to qualify as a REIT for the subsequent four full taxable years.

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Furthermore, we have formed several taxable REIT subsidiaries, or TRS. Any TRS we own will pay federal, state, and local income tax on its net taxable income. See Item 1A – “Risk Factors – Risks Related to our REIT Status and Certain Other Tax Items” for additional tax status information.

Website Access to Reports

We maintain a website at www.bxmt.com. We are providing the address to our website solely for the information of investors. The information on our website is not a part of, nor is it incorporated by reference into this report. Through our website, we make available, free of charge, our annual proxy statement, annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended, or the Exchange Act, as soon as reasonably practicable after we electronically file such material with, or furnish them to, the Securities and Exchange Commission, or the SEC. The SEC maintains a website that contains these reports at www.sec.gov.

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ITEM 1A. RISK FACTORS

FORWARD-LOOKING INFORMATION

This Annual Report on Form 10-K contains forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, or Securities Act, and Section 21E of the Exchange Act, which involve certain known and unknown risks and uncertainties. Forward-looking statements predict or describe our future operations, business plans, business and investment strategies and portfolio management and the performance of our investments. These forward-looking statements are generally identified by their use of such terms and phrases as “intend,” “goal,” “estimate,” “expect,” “project,” “projections,” “plans,” “seeks,” “anticipates,” “should,” “could,” “may,” “designed to,” “foreseeable future,” “believe,” and “scheduled” and similar expressions. Our actual results or outcomes may differ materially from those anticipated. You are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date the statement was made. We assume no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Our actual results may differ significantly from any results expressed or implied by these forward-looking statements. Some, but not all, of the factors that might cause such a difference include, but are not limited to:

• the general political, economic, and competitive conditions in the United States and foreign jurisdictions where we invest;

• the level and volatility of prevailing interest rates and credit spreads;

• adverse changes in the real estate and real estate capital markets;

• difficulty in obtaining financing or raising capital;

• the deterioration of performance and thereby credit quality of property securing our investments, borrowers and, in general, the risks associated with the ownership and operation of real estate that may cause cash flow deterioration to us and potentially principal losses on our investments;

• a compression of the yield on our investments and an increase in the cost of our liabilities, as well as the level of leverage available to us;

• adverse developments in the availability of desirable loan and investment opportunities whether they are due to competition, regulation, or otherwise;

• events, contemplated or otherwise, such as acts of God including hurricanes, earthquakes, and other natural disasters, acts of war and/or terrorism and others that may cause unanticipated and uninsured performance declines and/or losses to us or the owners and operators of the real estate securing our investments;

• the cost of operating our business, including, but not limited to, the cost of operating a real estate investment platform and the cost of operating as a publicly-traded company;

• authoritative generally accepted accounting principles, or GAAP, or policy changes from such standard-setting bodies as the Financial Accounting Standards Board, or FASB, the SEC, the Internal Revenue Service, or IRS, the New York Stock Exchange, or NYSE, and other authorities that we are subject to, as well as their counterparts in any foreign jurisdictions where we might do business; and

• other factors, including those items discussed in the risk factors set forth below.

Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, levels of activity, performance, or achievements. We caution you not to place undue reliance on these forward-looking statements. All written and oral forward-looking statements attributable to us or persons acting on our behalf are qualified in their entirety by these cautionary statements. Moreover, unless we

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are required by law to update these statements, we will not necessarily update or revise any forward-looking statements included or incorporated by reference in this Annual Report after the date hereof, either to conform them to actual results or to changes in our expectations.

Risks Related to Our Lending and Investment Activities

Our loans and investments expose us to risks associated with debt-oriented real estate investments generally.

We seek to invest primarily in debt instruments relating to real estate-related businesses, assets, or interests. Any deterioration of real estate fundamentals generally, and in North America and Europe in particular, could negatively impact our performance by making it more difficult for entities in which we have an investment, or Borrower Entities, to satisfy their debt payment obligations, increasing the default risk applicable to Borrower Entities, and/or making it relatively more difficult for us to generate attractive risk-adjusted returns. Changes in general economic conditions will affect the creditworthiness of Borrower Entities and may include economic and/or market fluctuations, changes in environmental, zoning and other laws, casualty or condemnation losses, regulatory limitations on rents, decreases in property values, changes in the appeal of properties to tenants, changes in supply and demand, fluctuations in real estate fundamentals (including average occupancy and room rates for hotel properties), energy supply shortages, various uninsured or uninsurable risks, natural disasters, changes in government regulations (such as rent control), changes in real property tax rates and operating expenses, changes in interest rates, changes in the availability of debt financing and/or mortgage funds which may render the sale or refinancing of properties difficult or impracticable, increased mortgage defaults, increases in borrowing rates, negative developments in the economy that depress travel activity, demand and/or real estate values generally and other factors that are beyond our control. The value of securities of companies that service the real estate business sector may also be affected by such risks.

We cannot predict the degree to which economic conditions generally, and the conditions for real estate debt investing in particular, will improve or decline. Declines in the performance of the U.S. and global economies or in the real estate debt markets could have a material adverse effect on our business, financial condition, and results of operations. In addition, while improved real estate fundamentals have resulted in increased investment opportunities for us, market conditions relating to real estate debt investments have evolved since the global financial crisis, which has resulted in a modification to certain loan structures and/or market terms. Any such changes in loan structures and/or market terms may make it relatively more difficult for us to monitor and evaluate our loans and investments.

Commercial real estate-related investments that are secured, directly or indirectly, by real property are subject to delinquency, foreclosure and loss, which could result in losses to us.

Commercial real estate debt instruments (e.g., mortgages, mezzanine loans and preferred equity) that are secured by commercial property are subject to risks of delinquency and foreclosure and risks of loss that are greater than similar risks associated with loans made on the security of single-family residential property. The ability of a borrower to repay a loan secured by an income-producing property typically is dependent primarily upon the successful operation of the property rather than upon the existence of independent income or assets of the borrower. If the net operating income of the property is reduced, the borrower’s ability to repay the loan may be impaired. Net operating income of an income-producing property can be affected by, among other things:

• tenant mix and tenant bankruptcies;

• success of tenant businesses;

• property management decisions, including with respect to capital improvements, particularly in older building structures;

• property location and condition;

• competition from other properties offering the same or similar services;

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• changes in laws that increase operating expenses or limit rents that may be charged;

• any need to address environmental contamination at the property;

• changes in national, regional, or local economic conditions and/or specific industry segments;

• declines in regional or local real estate values;

• declines in regional or local rental or occupancy rates;

• changes in interest rates and in the state of the debt and equity capital markets, including diminished availability or lack of debt financing for commercial real estate;

• changes in real estate tax rates and other operating expenses;

• changes in governmental rules, regulations and fiscal policies, including environmental legislation;

• acts of God, terrorism, social unrest and civil disturbances, which may decrease the availability of or increase the cost of insurance or result in uninsured losses; and

• adverse changes in zoning laws.

In addition, we are exposed to the risk of judicial proceedings with our borrowers and entities we invest in, including bankruptcy or other litigation, as a strategy to avoid foreclosure or enforcement of other rights by us as a lender or investor. In the event that any of the properties or entities underlying or collateralizing our loans or investments experiences any of the foregoing events or occurrences, the value of, and return on, such investments could be reduced, which would adversely affect our results of operations and financial condition.

Fluctuations in interest rates and credit spreads could reduce our ability to generate income on our loans and other investments, which could lead to a significant decrease in our results of operations, cash flows and the market value of our investments.

Our primary interest rate exposures relate to the yield on our loans and other investments and the financing cost of our debt, as well as our interest rate swaps that we may utilize for hedging purposes. Changes in interest rates and credit spreads may affect our net income from loans and other investments, which is the difference between the interest and related income we earn on our interest-earning investments and the interest and related expense we incur in financing these investments. Interest rate and credit spread fluctuations resulting in our interest and related expense exceeding interest and related income would result in operating losses for us. Changes in the level of interest rates and credit spreads also may affect our ability to make loans or investments, the value of our loans and investments and our ability to realize gains from the disposition of assets. Increases in interest rates and credit spreads may also negatively affect demand for loans and could result in higher borrower default rates.

Our operating results depend, in part, on differences between the income earned on our investments, net of credit losses, and our financing costs. The yields we earn on our assets and our borrowing costs tend to move in the same direction in response to changes in interest rates. However, one can rise or fall faster than the other, causing our net interest margin to expand or contract. In addition, we could experience a compression of the yield on our investments and our financing costs. Although we seek to match the terms of our liabilities to the expected lives of loans that we acquire or originate, circumstances may arise in which our liabilities are shorter in duration than our assets, resulting in their adjusting faster in response to changes in interest rates. For any period during which our investments are not match-funded, the income earned on such investments may respond more slowly to interest rate fluctuations than the cost of our borrowings. Consequently, changes in interest rates, particularly short-term interest rates, may immediately and significantly decrease our results of operations and cash flows and the market value of our investments. In addition, unless we enter into hedging or similar transactions with respect to the portion of our assets that we fund using our balance sheet, returns we achieve on such assets will generally increase as interest rates for those assets rise and decrease as interest rates for those assets decline.

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Prepayment rates may adversely affect the value of our portfolio of assets.

In periods of declining interest rates and/or credit spreads, prepayment rates on loans generally increase. If general interest rates or credit spreads decline at the same time, the proceeds of such prepayments received during such periods are likely to be reinvested by us in assets yielding less than the yields on the assets that were prepaid. In addition, the value of our assets may be affected by prepayment rates on loans. If we originate or acquire mortgage-related securities or a pool of mortgage securities, we anticipate that the underlying mortgages will prepay at a projected rate generating an expected yield. If we purchase assets at a premium to par value, when borrowers prepay their loans faster than expected, the corresponding prepayments on the mortgage-related securities may reduce the expected yield on such securities because we will have to amortize the related premium on an accelerated basis. Conversely, if we purchase assets at a discount to par value, when borrowers prepay their loans slower than expected, the decrease in corresponding prepayments on the mortgage-related securities may reduce the expected yield on such securities because we will not be able to accrete the related discount as quickly as originally anticipated. In addition, as a result of the risk of prepayment, the market value of the prepaid assets may benefit less than other fixed income securities from declining interest rates.

Prepayment rates on loans may be affected by a number of factors including, but not limited to, the then-current level of interest rates and credit spreads, the availability of mortgage credit, the relative economic vitality of the area in which the related properties are located, the servicing of the loans, possible changes in tax laws, other opportunities for investment, and other economic, social, geographic, demographic and legal factors and other factors beyond our control. Consequently, such prepayment rates cannot be predicted with certainty and no strategy can completely insulate us from prepayment or other such risks.

The lack of liquidity in certain of our target assets may adversely affect our business.

The illiquidity of certain of our target assets may make it difficult for us to sell such investments if the need or desire arises. Certain target assets such as mortgages, B Notes, mezzanine and other loans (including participations) and preferred equity, in particular, are relatively illiquid investments due to their short life, their potential unsuitability for securitization and the greater difficulty of recovery in the event of a borrower’s default. In addition, certain of our investments may become less liquid after our investment as a result of periods of delinquencies or defaults or turbulent market conditions, which may make it more difficult for us to dispose of such assets at advantageous times or in a timely manner. Moreover, many of the loans and securities we invest in will not be registered under the relevant securities laws, resulting in prohibitions against their transfer, sale, pledge or their disposition except in transactions that are exempt from registration requirements or are otherwise in accordance with such laws. As a result, we expect many of our investments will be illiquid, and if we are required to liquidate all or a portion of our portfolio quickly, for example as a result of margin calls, we may realize significantly less than the value at which we have previously recorded our investments. Further, we may face other restrictions on our ability to liquidate an investment to the extent that we or our Manager (and/or its affiliates) has or could be attributed as having material, non-public information regarding the borrower entity. As a result, our ability to vary our portfolio in response to changes in economic and other conditions may be relatively limited, which could adversely affect our results of operations and financial condition.

Any distressed loans or investments we make, or loans and investments that later become distressed, may subject us to losses and other risks relating to bankruptcy proceedings.

While our loans and investments focus primarily on “performing” real estate related interests, our loans and investments may also include making distressed investments from time to time (e.g., investments in defaulted, out-of-favor or distressed bank loans and debt securities) or may involve investments that become “non-performing” following our acquisition thereof. Certain of our investments may include properties that typically are highly leveraged, with significant burdens on cash flow and, therefore, involve a high degree of financial risk. During an economic downturn or recession, loans or securities of financially or operationally troubled borrowers or issuers are more likely to go into default than loans or securities of other borrowers or issuers. Loans or securities of financially or operationally troubled issuers are less liquid and more volatile than loans or securities

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of borrowers or issuers not experiencing such difficulties. The market prices of such securities are subject to erratic and abrupt market movements and the spread between bid and asked prices may be greater than normally expected. Investment in the loans or securities of financially or operationally troubled borrowers or issuers involves a high degree of credit and market risk.

In certain limited cases (e.g., in connection with a workout, restructuring and/or foreclosing proceedings involving one or more of our investments), the success of our investment strategy will depend, in part, on our ability to effectuate loan modifications and/or restructure and improve the operations of our borrower entities. The activity of identifying and implementing successful restructuring programs and operating improvements entails a high degree of uncertainty. There can be no assurance that we will be able to identify and implement successful restructuring programs and improvements with respect to any distressed loans or investments we may have from time to time.

These financial difficulties may never be overcome and may cause borrower entities to become subject to bankruptcy or other similar administrative proceedings. There is a possibility that we may incur substantial or total losses on our investments and in certain circumstances, become subject to certain additional potential liabilities that may exceed the value of our original investment therein. For example, under certain circumstances, a lender that has inappropriately exercised control over the management and policies of a debtor may have its claims subordinated or disallowed or may be found liable for damages suffered by parties as a result of such actions. In any reorganization or liquidation proceeding relating to our investments, we may lose our entire investment, may be required to accept cash or securities with a value less than our original investment and/or may be required to accept different terms, including payment over an extended period of time. In addition, under certain circumstances, payments to us may be reclaimed if any such payment or distribution is later determined to have been a fraudulent conveyance, preferential payment, or similar transaction under applicable bankruptcy and insolvency laws. Furthermore, bankruptcy laws and similar laws applicable to administrative proceedings may delay our ability to realize on collateral for loan positions held by us, may adversely affect the economic terms and priority of such loans through doctrines such as equitable subordination or may result in a restructuring of the debt through principles such as the “cramdown” provisions of the bankruptcy laws.

We may not have control over certain of our loans and investments.

Our ability to manage our portfolio of loans and investments may be limited by the form in which they are made. In certain situations, we may:

• acquire investments subject to rights of senior classes and servicers under intercreditor or servicing agreements;

• acquire only a minority and/or a non-controlling participation in an underlying investment;

• co-invest with others through partnerships, joint ventures or other entities, thereby acquiring non-controlling interests; or

• rely on independent third party management or servicing with respect to the management of an asset.

Therefore, we may not be able to exercise control over all aspects of our loans or investments. Such financial assets may involve risks not present in investments where senior creditors, junior creditors, servicers or third parties controlling investors are not involved. Our rights to control the process following a borrower default may be subject to the rights of senior or junior creditors or servicers whose interests may not be aligned with ours. A partner or co-venturer may have financial difficulties resulting in a negative impact on such asset, may have economic or business interests or goals that are inconsistent with ours, or may be in a position to take action contrary to our investment objectives. In addition, we may, in certain circumstances, be liable for the actions of our partners or co-venturers.

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B Notes, mezzanine loans, and other investments that are subordinated or otherwise junior in an issuer’s capital structure and that involve privately negotiated structures will expose us to greater risk of loss.

We may from time to time originate or acquire B Notes, mezzanine loans and other investments that are subordinated or otherwise junior in an issuer’s capital structure (such as preferred equity) and that involve privately negotiated structures. To the extent we invest in subordinated debt or mezzanine tranches of an entity’s capital structure, such investments and our remedies with respect thereto, including the ability to foreclose on any collateral securing such investments, will be subject to the rights of holders of more senior tranches in the issuer’s capital structure and, to the extent applicable, contractual intercreditor and/or participation agreement provisions. Significant losses related to such loans or investments could adversely affect our results of operations and financial condition.

As the terms of such loans and investments are subject to contractual relationships among lenders, co-lending agents and others, they can vary significantly in their structural characteristics and other risks. For example, the rights of holders of B Notes to control the process following a borrower default may vary from transaction to transaction. Further, B Notes typically are secured by a single property and accordingly reflect the risks associated with significant concentration.

Like B Notes, mezzanine loans are by their nature structurally subordinated to more senior property-level financings. If a borrower defaults on our mezzanine loan or on debt senior to our loan, or if the borrower is in bankruptcy, our mezzanine loan will be satisfied only after the property-level debt and other senior debt is paid in full. As a result, a partial loss in the value of the underlying collateral can result in a total loss of the value of the mezzanine loan. In addition, even if we are able to foreclose on the underlying collateral following a default on a mezzanine loan, we would be substituted for the defaulting borrower and, to the extent income generated on the underlying property is insufficient to meet outstanding debt obligations on the property, may need to commit substantial additional capital and/or deliver a replacement guarantee by a credit worthy entity, which could include us, to stabilize the property and prevent additional defaults to lenders with existing liens on the property.

Loans on properties in transition will involve a greater risk of loss than conventional mortgage loans.

We may invest in transitional loans to borrowers who are typically seeking short-term capital to be used in an acquisition or rehabilitation of a property. The typical borrower under a transitional loan has usually identified an undervalued asset that has been under-managed and/or is located in a recovering market. If the market in which the asset is located fails to improve according to the borrower’s projections, or if the borrower fails to improve the quality of the asset’s management and/or the value of the asset, the borrower may not receive a sufficient return on the asset to satisfy the transitional loan, and we bear the risk that we may not recover some or all of our investment.

In addition, borrowers usually use the proceeds of a conventional mortgage to repay a transitional loan. Transitional loans therefore are subject to risks of a borrower’s inability to obtain permanent financing to repay the transitional loan. In the event of any default under transitional loans that may be held by us, we bear the risk of loss of principal and non-payment of interest and fees to the extent of any deficiency between the value of the mortgage collateral and the principal amount and unpaid interest of the transitional loan. To the extent we suffer such losses with respect to these transitional loans, it could adversely affect our results of operations and financial condition.

Risks of cost overruns and noncompletion of renovations of properties in transition may result in significant losses.

The renovation, refurbishment or expansion of a property by a borrower involves risks of cost overruns and noncompletion. Estimates of the costs of improvements to bring an acquired property up to standards established for the market position intended for that property may prove inaccurate. Other risks may include rehabilitation costs exceeding original estimates, possibly making a project uneconomical, environmental risks, delays in legal

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and other approvals (e.g., for condominiums) and rehabilitation and subsequent leasing of the property not being completed on schedule. If such renovation is not completed in a timely manner, or if it costs more than expected, the borrower may experience a prolonged impairment of net operating income and may not be able to make payments on our investment on a timely basis or at all, which could result in significant losses.

There are increased risks involved with our construction lending activities.

We have in the past and may in the future invest in loans which fund the construction of commercial properties. Construction lending generally is considered to involve a higher degree of risk of non-payment and loss than other types of lending due to a variety of factors, including the difficulties in estimating construction costs and anticipating construction delays and, generally, the dependency on timely, successful completion and the lease-up and commencement of operations post-completion. In addition, since such loans generally entail greater risk than mortgage loans on income-producing property, we may need to increase our allowance for loan losses in the future to account for the likely increase in probable incurred credit losses associated with such loans. Further, as the lender under a construction loan, we may be obligated to fund all or a significant portion of the loan at one or more future dates. We may not have the funds available at such future date(s) to meet our funding obligations under the loan. In that event, we would likely be in breach of the loan unless we are able to raise the funds from alternative sources, which we may not be able to achieve on favorable terms or at all.

If a borrower fails to complete the construction of a project or experiences cost overruns, there could be adverse consequences associated with the loan, including a loss of the value of the property securing the loan, a borrower claim against us for failure to perform under the loan documents if we choose to stop funding, increased costs to the borrower that the borrower is unable to pay, a bankruptcy filing by the borrower, and abandonment by the borrower of the collateral for the loan.

Loans or investments involving international real estate-related assets are subject to special risks that we may not manage effectively, which would have a material adverse effect on our results of operations and our ability to make distributions to our stockholders.

We invest a material portion of our capital in assets outside the United States and may increase the percentage of our investments outside the United States if our Manager deems such investments appropriate in its discretion. To the extent that we invest in non-domestic real estate-related assets, we may be subject to certain risks associated with international investments generally, including, among others:

• currency exchange matters, including fluctuations in currency exchange rates and costs associated with conversion of investment principal and income from one currency into another;

• less developed or efficient financial markets than in the United States, which may lead to potential price volatility and relative illiquidity;

• the burdens of complying with international regulatory requirements and prohibitions that differ between jurisdictions;

• changes in laws or clarifications to existing laws that could impact our tax treaty positions, which could adversely impact the returns on our investments;

• a less developed legal or regulatory environment, differences in the legal and regulatory environment or enhanced legal and regulatory compliance;

• political hostility to investments by foreign investors;

• higher rates of inflation;

• higher transaction costs;

• greater difficulty enforcing contractual obligations;

• fewer investor protections;

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• certain economic and political risks, including potential exchange control regulations and restrictions on our non-U.S. investments and repatriation of profits on investments or of capital invested, the risks of political, economic or social instability, the possibility of expropriation or confiscatory taxation and adverse economic and political developments; and

• potentially adverse tax consequences.

If any of the foregoing risks were to materialize, they could adversely affect our results of operations and financial condition.

The ongoing Eurozone financial crisis may have an adverse effect on investments in Europe and could result in the exit of one or more member states from the Eurozone or a breakup of the Eurozone entirely, which creates uncertainty and could affect our investments directly.

A portion of our investments consists of assets secured by European collateral. The ongoing situation relating to the sovereign debt of several countries, including Greece, Ireland, Italy, Spain and Portugal, together with the risk of contagion to other more financially stable countries, has also raised a number of uncertainties regarding the stability and overall standing of the European Monetary Union. Any further deterioration in the global or Eurozone economy could have a significant adverse effect on our activities and the value of any European collateral.

In addition, we currently hold assets and may acquire additional assets that are denominated in British pounds sterling and in Euros. Further deterioration in the Eurozone economy could have a material adverse effect on the value of our investment in such assets and amplify the currency risks faced by us.

If any country were to leave the Eurozone, or if the Eurozone were to break up entirely, the treatment of debt obligations previously denominated in Euros is uncertain. A number of issues would be raised, such as whether obligations that are expressed to be payable in Euros would be re-denominated into a new currency. The answer to this and other questions is uncertain and would depend on the way in which the break-up occurred and also on the nature of the transaction; the law governing it; which courts have jurisdiction in relation to it; the place of payment; and the place of incorporation of the payor. If we were to hold any investments in Euros at the time of any Eurozone exits or break-up, this uncertainty and potential re-denomination could have a material adverse effect on the value of our investments and the income from them.

Transactions denominated in foreign currencies subject us to foreign currency risks.

We hold assets denominated in British pounds sterling, Euros, and Canadian dollars, and may acquire assets denominated in other foreign currencies, which exposes us to foreign currency risk. As a result, a change in foreign currency exchange rates may have an adverse impact on the valuation of our assets, as well as our income and distributions. Any such changes in foreign currency exchange rates may impact the measurement of such assets or income for the purposes of our REIT tests and may affect the amounts available for payment of dividends on our class A common stock.

Our success depends on the availability of attractive investments and our Manager’s ability to identify, structure, consummate, leverage, manage and realize returns on our investments.

Our operating results are dependent upon the availability of, as well as our Manager’s ability to identify, structure, consummate, leverage, manage and realize returns on our investments. In general, the availability of favorable investment opportunities and, consequently, our returns, will be affected by the level and volatility of interest rates and credit spreads, conditions in the financial markets, general economic conditions, the demand for investment opportunities in our target assets and the supply of capital for such investment opportunities. We cannot make any assurances that our Manager will be successful in identifying and consummating investments that satisfy our rate of return objectives or that such investments, once made, will perform as anticipated.

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Real estate valuation is inherently subjective and uncertain.

The valuation of real estate and therefore the valuation of any underlying security relating to loans made by us is inherently subjective due to, among other factors, the individual nature of each property, its location, the expected future rental revenues from that particular property and the valuation methodology adopted. In addition, where we invest in construction loans, initial valuations will assume completion of the project. As a result, the valuations of the real estate assets against which we will make loans are subject to a large degree of uncertainty and are made on the basis of assumptions and methodologies that may not prove to be accurate, particularly in periods of volatility, low transaction flow or restricted debt availability in the commercial or residential real estate markets.

We operate in a competitive market for lending and investment opportunities which has recently intensified, and competition may limit our ability to originate or acquire desirable loans and investments in assets we target and could also affect the yields of these assets and have a material adverse effect on our business, financial condition, and results of operation.

We operate in a competitive market for lending and investment opportunities, which recently has intensified. Our profitability depends, in large part, on our ability to originate or acquire our target assets on attractive terms. In originating or acquiring our target assets, we compete with a variety of institutional lenders and investors, including other REITs, specialty finance companies, public and private funds (including other funds managed by affiliates of Blackstone), commercial and investment banks, commercial finance and insurance companies and other financial institutions. Several other REITs have raised, or are expected to raise, significant amounts of capital, and may have investment objectives that overlap with ours, which may create additional competition for lending and investment opportunities. Some competitors may have a lower cost of funds and access to funding sources that are not available to us, such as the U.S. Government. Many of our competitors are not subject to the operating constraints associated with REIT tax compliance or maintenance of an exclusion from regulation under the Investment Company Act. In addition, some of our competitors may have higher risk tolerances or different risk assessments, which could allow them to consider a wider variety of investments, offer more attractive pricing or other terms and establish more relationships than us. Furthermore, competition for originations of and investments in our target assets may lead to the yields of such assets decreasing, which may further limit our ability to generate satisfactory returns. Also, as a result of this competition, desirable loans and investments in our target assets may be limited in the future and we may not be able to take advantage of attractive lending and investment opportunities from time to time, thereby limiting our ability to identify and originate loans or make investments that are consistent with our investment objectives. We cannot assure you that the competitive pressures we face will not have a material adverse effect on our business, financial condition and results of operations.

Our loans and investments may be concentrated in terms of geography, asset types, and sponsors.

We are not required to observe specific diversification criteria, except as may be set forth in the investment guidelines adopted by our board of directors. Therefore, our investments in our target assets may at times be concentrated in certain property types that are subject to higher risk of default or foreclosure, or secured by properties concentrated in a limited number of geographic locations.

To the extent that our portfolio is concentrated in any one region or type of asset, downturns relating generally to such region or type of asset may result in defaults on a number of our investments within a short time period, it could adversely affect our results of operations and financial condition.

The due diligence process that our Manager undertakes in regard to investment opportunities may not reveal all facts that may be relevant in connection with an investment and if our Manager incorrectly evaluates the risks of our investments, we may experience losses.

Before making investments for us, our Manager will conduct due diligence that it deems reasonable and appropriate based on the facts and circumstances relevant to each potential investment. When conducting due

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diligence, our Manager may be required to evaluate important and complex business, financial, tax, accounting, environmental and legal issues. Outside consultants, legal advisors, accountants and investment banks may be involved in the due diligence process in varying degrees depending on the type of potential investment. Relying on the resources available to it, our Manager will evaluate our potential investments based on criteria it deems appropriate for the relevant investment. Our Manager’s loss estimates may not prove accurate, as actual results may vary from estimates. If our Manager underestimates the asset-level losses relative to the price we pay for a particular investment, we may experience losses with respect to such investment.

Insurance on loans and real estate securities collateral may not cover all losses.

There are certain types of losses, generally of a catastrophic nature, such as earthquakes, floods, hurricanes, terrorism or acts of war, which may be uninsurable or not economically insurable. Inflation, changes in building codes and ordinances, environmental considerations and other factors, including terrorism or acts of war, also might result in insurance proceeds insufficient to repair or replace a property if it is damaged or destroyed. Under these circumstances, the insurance proceeds received with respect to a property relating one of our investments might not be adequate to restore our economic position with respect to our investment. Any uninsured loss could result in the corresponding nonperformance of or loss on our investment related to such property.

The impact of any future terrorist attacks and the availability of affordable terrorism insurance expose us to certain risks.

Terrorist attacks, the anticipation of any such attacks, and the consequences of any military or other response by the United States and its allies may have an adverse impact on the U.S. financial markets and the economy in general. We cannot predict the severity of the effect that any such future events would have on the U.S. financial markets, the economy or our business. Any future terrorist attacks could adversely affect the credit quality of some of our loans and investments. Some of our loans and investments will be more susceptible to such adverse effects than others, particularly those secured by properties in major cities or properties that are prominent landmarks or public attractions. We may suffer losses as a result of the adverse impact of any future terrorist attacks and these losses may adversely impact our results of operations.

In addition, the enactment of the Terrorism Risk Insurance Act of 2002, or TRIA, and the subsequent enactment of the Terrorism Risk Insurance Program Reauthorization Act of 2015, which extended TRIA through the end of 2020, requires insurers to make terrorism insurance available under their property and casualty insurance policies and provides federal compensation to insurers for insured losses. However, this legislation does not regulate the pricing of such insurance and there is no assurance that this legislation will be extended beyond 2020. The absence of affordable insurance coverage may adversely affect the general real estate lending market, lending volume and the market’s overall liquidity and may reduce the number of suitable investment opportunities available to us and the pace at which we are able to make investments. If the properties that we invest in are unable to obtain affordable insurance coverage, the value of those investments could decline and in the event of an uninsured loss, we could lose all or a portion of our investment.

We may need to foreclose on certain of the loans we originate or acquire, which could result in losses that harm our results of operations and financial condition.

We may find it necessary or desirable to foreclose on certain of the loans we originate or acquire, and the foreclosure process may be lengthy and expensive. Whether or not we have participated in the negotiation of the terms of any such loans, we cannot assure you as to the adequacy of the protection of the terms of the applicable loan, including the validity or enforceability of the loan and the maintenance of the anticipated priority and perfection of the applicable security interests. Furthermore, claims may be asserted by lenders or borrowers that might interfere with enforcement of our rights. Borrowers may resist foreclosure actions by asserting numerous claims, counterclaims and defenses against us, including, without limitation, lender liability claims and defenses, even when the assertions may have no basis in fact, in an effort to prolong the foreclosure action and seek to

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force the lender into a modification of the loan or a favorable buy-out of the borrower’s position in the loan. In some states, foreclosure actions can take several years or more to litigate. At any time prior to or during the foreclosure proceedings, the borrower may file for bankruptcy, which would have the effect of staying the foreclosure actions and further delaying the foreclosure process and potentially results in a reduction or discharge of a borrower’s debt. Foreclosure may create a negative public perception of the related property, resulting in a diminution of its value. Even if we are successful in foreclosing on a loan, the liquidation proceeds upon sale of the underlying real estate may not be sufficient to recover our cost basis in the loan, resulting in a loss to us. Furthermore, any costs or delays involved in the foreclosure of the loan or a liquidation of the underlying property will further reduce the net proceeds and, thus, increase any such loss.

Liability relating to environmental matters may impact the value of properties that we may acquire upon foreclosure of the properties underlying our investments.

To the extent we foreclose on properties with respect to which we have extended loans, we may be subject to environmental liabilities arising from such foreclosed properties. Under various U.S. federal, state and local laws, an owner or operator of real property may become liable for the costs of removal of certain hazardous substances released on its property. These laws often impose liability without regard to whether the owner or operator knew of, or was responsible for, the release of such hazardous substances.

If we foreclose on any properties underlying our investments, the presence of hazardous substances on a property may adversely affect our ability to sell the property and we may incur substantial remediation costs, thus harming our financial condition. The discovery of material environmental liabilities attached to such properties could adversely affect our results of operations and financial condition.

We may be subject to lender liability claims, and if we are held liable under such claims, we could be subject to losses.

In recent years, a number of judicial decisions have upheld the right of borrowers to sue lending institutions on the basis of various evolving legal theories, collectively termed “lender liability.” Generally, lender liability is founded on the premise that a lender has either violated a duty, whether implied or contractual, of good faith and fair dealing owed to the borrower or has assumed a degree of control over the borrower resulting in the creation of a fiduciary duty owed to the borrower or its other creditors or stockholders. We cannot assure prospective investors that such claims will not arise or that we will not be subject to significant liability if a claim of this type did arise.

Any investments we make in CMBS, CLOs, CDOs and other similar structured finance investments would pose additional risks, including the risks of the securitization process and the risk that any special servicer may take actions that could adversely affect our interests.

We may from time to time invest in CMBS, CLOs, CDOs and other similar securities, which are subordinated classes of securities in a structure of securities secured by a pool of mortgages or loans. Accordingly, such securities are the first or among the first to bear the loss upon a restructuring or liquidation of the underlying collateral and the last to receive payment of interest and principal. Thus, there is generally only a nominal amount of equity or other debt securities junior to such positions, if any, issued in such structures. The estimated fair values of such subordinated interests tend to be much more sensitive to adverse economic downturns and underlying borrower developments than more senior securities. A projection of an economic downturn, for example, could cause a decline in the price of lower credit quality CMBS, CLOs or CDOs because the ability of borrowers to make principal and interest payments on the mortgages or loans underlying such securities may be impaired, as has occurred throughout the recent economic recession and weak recovery.

Subordinate interests such as CLOs, CDOs and similar structured finance investments generally are not actively traded and are relatively illiquid investments and volatility in CLO and CDO trading markets may cause the

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value of these investments to decline. In addition, if the underlying mortgage portfolio has been overvalued by the originator, or if the values subsequently decline and, as a result, less collateral value is available to satisfy interest and principal payments and any other fees in connection with the trust or other conduit arrangement for such securities, we may incur significant losses.

With respect to the CMBS, CLOs and CDOs in which we may invest, control over the related underlying loans will be exercised through a special servicer or collateral manager designated by a “directing certificateholder” or a “controlling class representative,” or otherwise pursuant to the related securitization documents. We may acquire classes of CMBS, CLOs or CDOs, for which we may not have the right to appoint the directing certificateholder or otherwise direct the special servicing or collateral management. With respect to the management and servicing of those loans, the related special servicer or collateral manager may take actions that could adversely affect our interests.

Any credit ratings assigned to our investments will be subject to ongoing evaluations and revisions and we cannot assure you that those ratings will not be downgraded.

Some of our investments may be rated by rating agencies such as Moody’s Investors Service, Fitch Ratings, Standard & Poor’s, DBRS, Inc., Realpoint LLC or Kroll Bond Rating Agency. Any credit ratings on our investments are subject to ongoing evaluation by credit rating agencies, and we cannot assure you that any such ratings will not be changed or withdrawn by a rating agency in the future if, in its judgment, circumstances warrant. If rating agencies assign a lower-than-expected rating or reduce or withdraw, or indicate that they may reduce or withdraw, their ratings of our investments in the future, the value and liquidity of our investments could significantly decline, which would adversely affect the value of our investment portfolio and could result in losses upon disposition or the failure of borrowers to satisfy their debt service obligations to us.

Investments in non-conforming and non-investment grade rated loans or securities involve increased risk of loss.

Many of our investments may not conform to conventional loan standards applied by traditional lenders and either will not be rated (as is typically the case for private loans) or will be rated as non-investment grade by the rating agencies. Private loans often are not rated by credit rating agencies. Non-investment grade ratings typically result from the overall leverage of the loans, the lack of a strong operating history for the properties underlying the loans, the borrowers’ credit history, the underlying properties’ cash flow or other factors. As a result, these investments should be expected to have a higher risk of default and loss than investment-grade rated assets. Any loss we incur may be significant and may adversely affect our results of operations and financial condition. There are no limits on the percentage of unrated or non-investment grade rated assets we may hold in our investment portfolio.

Some of our investments and investment opportunities may be in synthetic form.

Synthetic investments are contracts between parties whereby payments are exchanged based upon the performance of another security or asset, or “reference asset.” In addition to the risks associated with the performance of the reference asset, these synthetic interests carry the risk of the counterparty not performing its contractual obligations. Market standards, GAAP accounting methodology, regulatory oversight and compliance requirements, tax and other regulations related to these investments are evolving, and we cannot be certain that their evolution will not adversely impact the value or sustainability of these investments. Furthermore, our ability to invest in synthetic investments, other than through taxable REIT subsidiaries, may be severely limited by the REIT qualification requirements because synthetic investment contracts generally are not qualifying assets and do not produce qualifying income for purposes of the REIT asset and income tests.

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We may invest in derivative instruments, which would subject us to increased risk of loss.

Subject to maintaining our qualification as a REIT, we may invest in derivative instruments. Derivative instruments, especially when purchased in large amounts, may not be liquid in all circumstances, so that in volatile markets we may not be able to close out a position without incurring a loss. The prices of derivative instruments, including swaps, futures, forwards and options, are highly volatile and such instruments may subject us to significant losses. The value of such derivatives also depends upon the price of the underlying instrument or commodity. Such derivatives and other customized instruments also are subject to the risk of non-performance by the relevant counterparty. In addition, actual or implied daily limits on price fluctuations and speculative position limits on the exchanges or over-the-counter markets in which we may conduct our transactions in derivative instruments may prevent prompt liquidation of positions, subjecting us to the potential of greater losses. Derivative instruments that may be purchased or sold by us may include instruments that are traded over-the-counter and not on an exchange. The risk of nonperformance by the obligor on such an instrument may be greater and the ease with which we can dispose of or enter into closing transactions with respect to such an instrument may be less than in the case of an exchange-traded instrument. In addition, significant disparities may exist between “bid” and “asked” prices for derivative instruments that are traded over-the-counter and not on an exchange. Such over-the-counter derivatives are also subject to types and levels of investor protections or governmental regulation that may differ from exchange traded instruments.

In addition, we may invest in derivative instruments that are neither presently contemplated nor currently available, but which may be developed in the future, to the extent such opportunities are both consistent with our investment objectives and legally permissible. Any such investments may expose us to unique and presently indeterminate risks, the impact of which may not be capable of determination until such instruments are developed and/or we determine to make such an investment.

We may experience a decline in the fair value of our assets.

A decline in the fair value of our assets may require us to recognize an “other-than-temporary” impairment against such assets under GAAP if we were to determine that, with respect to any assets in unrealized loss positions, we do not have the ability and intent to hold such assets to maturity or for a period of time sufficient to allow for recovery to the original acquisition cost of such assets. If such a determination were to be made, we would recognize unrealized losses through earnings and write down the amortized cost of such assets to a new cost basis, based on the fair value of such assets on the date they are considered to be other-than-temporarily impaired. Such impairment charges reflect non-cash losses at the time of recognition; subsequent disposition or sale of such assets could further affect our future losses or gains, as they are based on the difference between the sale price received and adjusted amortized cost of such assets at the time of sale. If we experience a decline in the fair value of our assets, it could adversely affect our results of operations and financial condition.

Some of our portfolio investments may be recorded at fair value and, as a result, there will be uncertainty as to the value of these investments.

Some of our portfolio investments may be in the form of positions or securities that are not publicly traded. The fair value of securities and other investments that are not publicly traded may not be readily determinable. We will value these investments quarterly at fair value, which may include unobservable inputs. Because such valuations are subjective, the fair value of certain of our assets may fluctuate over short periods of time and our determinations of fair value may differ materially from the values that would have been used if a ready market for these securities existed. Our results of operations and financial condition could be adversely affected if our determinations regarding the fair value of these investments were materially higher than the values that we ultimately realize upon their disposal.

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Risks Related to Our Financing and Hedging

We may incur a significant amount of debt, which may subject us to increased risk of loss and could adversely affect our results of operations and financial condition.

We currently have outstanding indebtedness and, subject to market conditions and availability, we may incur a significant amount of additional debt through repurchase agreements, bank credit facilities (including term loans and revolving facilities), warehouse facilities and structured financing arrangements, public and private debt issuances and derivative instruments, in addition to transaction or asset specific funding arrangements. We may also issue additional debt or equity securities to fund our growth. The percentage of leverage we employ will vary depending on our available capital, our ability to obtain and access financing arrangements with lenders, the type of asset we are funding, whether the financing is recourse or non-recourse, debt restrictions contained in those financing arrangements and the lenders’ and rating agencies’ estimate of the stability of our investment portfolio’s cash flow. We may significantly increase the amount of leverage we utilize at any time without approval of our board of directors. In addition, we may leverage individual assets at substantially higher levels. Incurring substantial debt could subject us to many risks that, if realized, would materially and adversely affect us, including the risk that:

• our cash flow from operations may be insufficient to make required payments of principal of and interest on our debt, which is likely to result in (a) acceleration of such debt (and any other debt containing a cross-default or cross-acceleration provision), which we then may be unable to repay from internal funds or to refinance on favorable terms, or at all, (b) our inability to borrow undrawn amounts under our financing arrangements, even if we are current in payments on borrowings under those arrangements, which would result in a decrease in our liquidity, and/or (c) the loss of some or all of our collateral assets to foreclosure or sale;

• our debt may increase our vulnerability to adverse economic and industry conditions with no assurance that investment yields will increase in an amount sufficient to offset the higher financing costs;

• we may be required to dedicate a substantial portion of our cash flow from operations to payments on our debt, thereby reducing funds available for operations, future business opportunities, stockholder distributions or other purposes; and

• we may not be able to refinance any debt that matures prior to the maturity (or realization) of an underlying investment it was used to finance on favorable terms or at all.

There can be no assurance that a leveraging strategy will be successful and may subject us to increased risk of loss and could adversely affect our results of operations and financial condition.

Our master repurchase agreements impose, and additional lending facilities may impose, restrictive covenants, which would restrict our flexibility to determine our operating policies and investment strategy.

We borrow funds under master repurchase agreements with various counterparties. The documents that govern these master repurchase agreements and the related guarantees contain, and additional lending facilities may contain, customary affirmative and negative covenants, including financial covenants applicable to us that may restrict our flexibility to determine our operating policies and investment strategy. In particular, our master repurchase agreements require us to maintain a certain amount of cash or set aside assets sufficient to maintain a specified liquidity position that would allow us to satisfy our collateral obligations. As a result, we may not be able to leverage our assets as fully as we would otherwise choose, which could reduce our return on assets. If we are unable to meet these collateral obligations, our financial condition and prospects could deteriorate rapidly. In addition, lenders may require that our Manager or one or more of our Manager’s executives continue to serve in such capacity. If we fail to meet or satisfy any of these covenants, we would be in default under these agreements, and our lenders could elect to declare outstanding amounts due and payable, terminate their commitments, require the posting of additional collateral and enforce their interests against existing collateral. We may also be subject to cross-default and acceleration rights in our other debt facilities. Further, this could also make it difficult for us to satisfy the requirements necessary to maintain our qualification as a REIT for U.S. federal income tax purposes.

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Our master repurchase agreements require, and bank credit facilities, repurchase agreements or other financing that we may use in the future to finance our assets may require, us to provide additional collateral or pay down debt.

Our master repurchase agreements with various counterparties, any bank credit facilities (including term loans and revolving facilities), and additional repurchase agreements or other financing we may enter into in the future, would involve the risk that the market value of the assets pledged or sold by us to the provider of the financing may decline in value, in which case the lender or counterparty may require us to provide additional collateral or lead to margin calls that may require us to repay all or a portion of the funds advanced. We may not have the funds available to repay our debt at that time, which would likely result in defaults unless we are able to raise the funds from alternative sources including by selling assets at a time when we might not otherwise choose to do so, which we may not be able to achieve on favorable terms or at all. Posting additional margin would reduce our cash available to make other, higher yielding investments (thereby decreasing our return on equity). If we cannot meet these requirements, the lender or counterparty could accelerate our indebtedness, increase the interest rate on advanced funds and terminate our ability to borrow funds from it, which could materially and adversely affect our financial condition and ability to implement our investment strategy. In the case of repurchase transactions, if the value of the underlying security has declined as of the end of that term, or if we default on our obligations under the repurchase agreement, we will likely incur a loss on our repurchase transactions. In addition, if a lender or counterparty files for bankruptcy or becomes insolvent, our loans may become subject to bankruptcy or insolvency proceedings, thus depriving us, at least temporarily, of the benefit of these assets. Such an event could restrict our access to financing and increase our cost of capital.

Our use of leverage may create a mismatch with the duration and index of the investments that we are financing.

We intend to structure our leverage such that we minimize the difference between the term of our investments and the leverage we use to finance such investments. In the event that our leverage is for a shorter term than the financed investment, we may not be able to extend or find appropriate replacement leverage and that would have an adverse impact on our liquidity and our returns. In the event that our leverage is for a longer term than the financed investment, we may not be able to repay such leverage or replace the financed investment with an optimal substitute or at all, which will negatively impact our desired leveraged returns.

We attempt to structure our leverage such that we minimize the difference between the index of our investments and the index of our leverage – financing floating rate investments with floating rate leverage and fixed rate investments with fixed rate leverage. If such a product is not available to us from our lenders on reasonable terms, we may use hedging instruments to effectively create such a match. For example, in the case of fixed rate investments, we may finance such an investment with floating rate leverage, but effectively convert all or a portion of the attendant leverage to fixed rate using hedging strategies.

Our attempts to mitigate such risk are subject to factors outside of our control, such as the availability to us of favorable financing and hedging options, which is subject to a variety of factors, of which duration and term matching are only two. A duration mismatch may occur when borrowers prepay their loans faster or slower than expected. The risks of a duration mismatch are also magnified by the potential for the extension of loans in order to maximize the likelihood and magnitude of their recovery value in the event the loans experience credit or performance challenges. Employment of this asset management practice would effectively extend the duration of our investments, while our liabilities may have set maturity dates.

Interest rate fluctuations could increase our financing costs, which could lead to a significant decrease in our results of operations, cash flows and the market value of our investments.

To the extent that our financing costs will be determined by reference to floating rates, such as LIBOR or a Treasury index, the amount of such costs will depend on the level and movement of interest rates. In a period of rising interest rates, our interest expense on floating rate debt would increase, while any additional interest

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income we earn on our floating rate investments may be subject to caps and may not compensate for such increase in interest expense. At the same time, the interest income we earn on our fixed rate investments would not change, the duration and weighted average life of our fixed rate investments would increase and the market value of our fixed rate investments would decrease. Similarly, in a period of declining interest rates, our interest income on floating rate investments would decrease, while any decrease in the interest we are charged on our floating rate debt may be subject to floors and may not compensate for such decrease in interest income and interest we are charged on our fixed rate debt would not change. Any such scenario could adversely affect our results of operations and financial condition.

Our loans and investments may be subject to fluctuations in interest rates that may not be adequately protected, or protected at all, by our hedging strategies.

Our investments may include loans with either floating interest rates or fixed interest rates. Floating rate investments earn interest at rates that adjust from time to time (typically monthly) based upon an index (typically one-month LIBOR). These floating rate loans are insulated from changes in value specifically due to changes in interest rates; however, the coupons they earn fluctuate based upon interest rates (again, typically one-month LIBOR) and, in a declining and/or low interest rate environment, these loans will earn lower rates of interest and this will impact our operating performance. Fixed interest rate investments, however, do not have adjusting interest rates and the relative value of the fixed cash flows from these investments will decrease as prevailing interest rates rise or increase as prevailing interest rates fall, causing potentially significant changes in value. We may employ various hedging strategies to limit the effects of changes in interest rates (and in some cases credit spreads), including engaging in interest rate swaps, caps, floors and other interest rate derivative products. We believe that no strategy can completely insulate us from the risks associated with interest rate changes and there is a risk that such strategies may provide no protection at all and potentially compound the impact of changes in interest rates. Hedging transactions involve certain additional risks such as counterparty risk, leverage risk, the legal enforceability of hedging contracts, the early repayment of hedged transactions and the risk that unanticipated and significant changes in interest rates may cause a significant loss of basis in the contract and a change in current period expense. We cannot make assurances that we will be able to enter into hedging transactions or that such hedging transactions will adequately protect us against the foregoing risks.

Accounting for derivatives under GAAP is extremely complicated. Any failure by us to account for our derivatives properly in accordance with GAAP on our consolidated financial statements could adversely affect our earnings. In particular, cash flow hedges which are not perfectly correlated (and appropriately designated and/or documented as such) with variable rate financing will impact our reported income as gains and losses on the ineffective portion of such hedges.

We depend on repurchase agreements and may depend on bank credit facilities, warehouse facilities and structured financing arrangements, public and private debt issuances and derivative instruments, in addition to transaction or asset specific funding arrangements and other sources of financing to execute our business plan, and our inability to access funding could have a material adverse effect on our results of operations, financial condition and business.

Our ability to fund our investments may be impacted by our ability to secure bank credit facilities (including term loans and revolving facilities), warehouse facilities and structured financing arrangements, public and private debt issuances and derivative instruments, in addition to transaction or asset specific funding arrangements and additional repurchase agreements on acceptable terms. We may also rely on short-term financing that would be especially exposed to changes in availability. Our access to sources of financing will depend upon a number of factors, over which we have little or no control, including:

• general economic or market conditions;

• the market’s view of the quality of our assets;

• the market’s perception of our growth potential;

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• our current and potential future earnings and cash distributions; and

• the market price of the shares of our class A common stock.

We will need to periodically access the capital markets to raise cash to fund new investments. Unfavorable economic or capital market conditions, such as the severe dislocation in the capital and credit markets that existed during the recent economic recession, may increase our funding costs, limit our access to the capital markets or could result in a decision by our potential lenders not to extend credit. An inability to successfully access the capital markets could limit our ability to grow our business and fully execute our business strategy and could decrease our earnings and liquidity. In addition, any dislocation or weakness in the capital and credit markets, such as the dislocation that existed during the recent economic recession, could adversely affect our lenders and could cause one or more of our lenders to be unwilling or unable to provide us with financing or to increase the costs of that financing. In addition, as regulatory capital requirements imposed on our lenders are increased, they may be required to limit, or increase the cost of, financing they provide to us. In general, this could potentially increase our financing costs and reduce our liquidity or require us to sell assets at an inopportune time or price. No assurance can be given that we will be able to obtain any additional financing on favorable terms or at all.

Any warehouse facilities that we may obtain in the future may limit our ability to originate or acquire assets, and we may incur losses if the collateral is liquidated.

We may utilize, if available, warehouse facilities pursuant to which we would accumulate loans in anticipation of a securitization or other financing, which assets would be pledged as collateral for such facilities until the securitization or other transaction is consummated. In order to borrow funds to originate or acquire assets under any future warehouse facilities, we expect that our lenders thereunder would have the right to review the potential assets for which we are seeking financing. We may be unable to obtain the consent of a lender to originate or acquire assets that we believe would be beneficial to us and we may be unable to obtain alternate financing for such assets. In addition, no assurance can be given that a securitization or other financing would be consummated with respect to the assets being warehoused. If the securitization or other financing is not consummated, the lender could demand repayment of the facility, and in the event that we were unable to timely repay, could liquidate the warehoused collateral and we would then have to pay any amount by which the original purchase price of the collateral assets exceeds its sale price, subject to negotiated caps, if any, on our exposure. In addition, regardless of whether the securitization or other financing is consummated, if any of the warehoused collateral is sold before the completion, we would have to bear any resulting loss on the sale.

We may use securitizations to finance our loans and investments, which may expose us to risks that could result in losses.

We may, to the extent consistent with the REIT requirements, seek to securitize certain of our portfolio investments to generate cash for funding new investments. This would involve creating a special-purpose vehicle, contributing a pool of our assets to the entity, and selling interests in the entity on a non-recourse basis to purchasers (whom we would expect to be willing to accept a lower interest rate to invest in investment-grade loan pools). We would expect to retain all or a portion of the equity in the securitized pool of portfolio investments. We may use short-term facilities to finance the acquisition of securities until a sufficient quantity of securities had been accumulated, at which time we would refinance these facilities through a securitization, such as a CMBS, or issuance of CLOs, or the private placement of loan participations or other long-term financing. If we were to employ this strategy, we would be subject to the risk that we would not be able to acquire, during the period that our short-term facilities are available, a sufficient amount of eligible securities to maximize the efficiency of a CMBS, CLO or private placement issuance. We also would be subject to the risk that we would not be able to obtain short-term credit facilities or would not be able to renew any short-term credit facilities after they expire should we find it necessary to extend our short-term credit facilities to allow more time to seek and acquire the necessary eligible securities for a long-term financing. The inability to consummate securitizations of our portfolio to finance our investments on a long-term basis could require us to seek other forms of potentially

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less attractive financing or to liquidate assets at an inopportune time or price, which could adversely affect our performance and our ability to grow our business. Additionally, the securitization of our portfolio might magnify our exposure to losses because any equity interest we retain in the issuing entity would be subordinate to the notes issued to investors and we would, therefore, absorb all of the losses sustained with respect to a securitized pool of assets before the owners of the notes experience any losses. The inability to securitize our portfolio may hurt our performance and our ability to grow our business. At the same time, the securitization of our portfolio investments might expose us to losses, as the residual portfolio investments in which we do not sell interests will tend to be riskier and more likely to generate losses.

We may be subject to losses arising from current and future guarantees of debt and contingent obligations of our subsidiaries or joint venture or co-investment partners.

We currently guarantee certain obligations of our subsidiaries under the various master repurchase agreements that provide for significant aggregate borrowings and we may in the future guarantee the performance of additional subsidiaries’ obligations, including, but not limited to, additional repurchase agreements, derivative agreements and unsecured indebtedness. In the future we may also agree to guarantee indebtedness incurred by a joint venture or co-investment partner. Such a guarantee may be on a joint and several basis with such joint venture or co-investment partner, in which case we may be liable in the event such partner defaults on its guarantee obligation. The non-performance of such obligations may cause losses to us in excess of the capital we initially may have invested or committed under such obligations and there is no assurance that we will have sufficient capital to cover any such losses.

We are subject to counterparty risk associated with our debt obligations.

Our counterparties for critical financial relationships may include both domestic and international financial institutions. Many of them have been severely impacted by the recent credit market turmoil and have been experiencing financial pressures. In the past, certain of our counterparties have filed for bankruptcy, leading to financial losses for us.

Hedging may adversely affect our earnings, which could reduce our cash available for distribution to our stockholders.

Subject to maintaining our qualification as a REIT, we may pursue various hedging strategies to seek to reduce our exposure to adverse changes in interest rates and fluctuations in currencies. Our hedging activity will vary in scope based on the level and volatility of interest rates, the type of assets held and other changing market conditions. Interest rate and currency hedging may fail to protect or could adversely affect us because, among other things:

• interest, currency and/or credit hedging can be expensive and may result in us receiving less interest income;

• available interest or currency rate hedges may not correspond directly with the interest rate or currency risk for which protection is sought;

• due to a credit loss, prepayment or asset sale, the duration of the hedge may not match the duration of the related asset or liability;

• the amount of income that a REIT may earn from hedging transactions (other than hedging transactions that satisfy certain requirements of the Internal Revenue Code or that are done through a taxable REIT subsidiary, or TRS) to offset interest rate losses is limited by U.S. federal income tax provisions governing REITs;

• the credit quality of the hedging counterparty owing money on the hedge may be downgraded to such an extent that it impairs our ability to sell or assign our side of the hedging transaction;

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• the hedging counterparty owing money in the hedging transaction may default on its obligation to pay;

• we may fail to recalculate, readjust and execute hedges in an efficient manner; and

• legal, tax and regulatory changes could occur and may adversely affect our ability to pursue our hedging strategies and/or increase the costs of implementing such strategies.

Any hedging activity in which we engage may materially and adversely affect our results of operations and cash flows. Therefore, while we may enter into such transactions seeking to reduce risks, unanticipated changes in interest rates, credit spreads or currencies may result in poorer overall investment performance than if we had not engaged in any such hedging transactions. In addition, the degree of correlation between price movements of the instruments used in a hedging strategy and price movements in the portfolio positions or liabilities being hedged may vary materially. Moreover, for a variety of reasons, we may not seek to establish a perfect correlation between such hedging instruments and the portfolio positions or liabilities being hedged. Any such imperfect correlation may prevent us from achieving the intended hedge and expose us to risk of loss.

In addition, some hedging instruments involve additional risk because they are not traded on regulated exchanges, guaranteed by an exchange or its clearing house, or regulated by any U.S. or foreign governmental authorities. Consequently, we cannot assure you that a liquid secondary market will exist for hedging instruments purchased or sold, and we may be required to maintain a position until exercise or expiration, which could result in significant losses. In addition, certain regulatory requirements with respect to derivatives, including record keeping, financial responsibility or segregation of customer funds and positions are still under development and could impact our hedging transactions and how we and our counterparty must manage such transactions.

We are subject to counterparty risk associated with our hedging activities.

We are subject to credit risk with respect to the counterparties to derivative contracts (whether a clearing corporation in the case of exchange-traded instruments or another third party in the case of over-the-counter instruments). If a counterparty becomes bankrupt or otherwise fails to perform its obligations under a derivative contract due to financial difficulties, we may experience significant delays in obtaining any recovery under the derivative contract in a dissolution, assignment for the benefit of creditors, liquidation, winding-up, bankruptcy, or other analogous proceeding. In the event of the insolvency of a counterparty to a derivative transaction, the derivative transaction would typically be terminated at its fair market value. If we are owed this fair market value in the termination of the derivative transaction and its claim is unsecured, we will be treated as a general creditor of such counterparty, and will not have any claim with respect to the underlying security. We may obtain only a limited recovery or may obtain no recovery in such circumstances. In addition, the business failure of a hedging counterparty with whom we enter into a hedging transaction will most likely result in its default, which may result in the loss of unrealized profits and force us to cover our commitments, if any, at the then current market price. Counterparty risk with respect to certain exchange-traded and over-the-counter derivatives may be further complicated by recently enacted U.S. financial reform legislation.

We may enter into hedging transactions that could expose us to contingent liabilities in the future.

Subject to maintaining our qualification as a REIT, part of our investment strategy may involve entering into hedging transactions that could require us to fund cash payments in certain circumstances (such as the early termination of the hedging instrument caused by an event of default or other early termination event, or the decision by a counterparty to request margin securities it is contractually owed under the terms of the hedging instrument). The amount due with respect to an early termination would generally be equal to the unrealized loss of such open transaction positions with the respective counterparty and could also include other fees and charges. These economic losses will be reflected in our results of operations, and our ability to fund these obligations will depend on the liquidity of our assets and access to capital at the time, and the need to fund these obligations could adversely affect our results of operations and financial condition.

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We may fail to qualify for, or choose not to elect, hedge accounting treatment.

We intend to record derivative and hedging transactions in accordance with Topic 815 of the Financial Accounting Standards Board’s Accounting Standard Codification, or Topic 815. Under these standards, we may fail to qualify for, or choose not to elect, hedge accounting treatment for a number of reasons, including if we use instruments that do not meet the Topic 815 definition of a derivative (such as short sales), we fail to satisfy Topic 815 hedge documentation and hedge effectiveness assessment requirements or our instruments are not highly effective. If we fail to qualify for, or choose not to elect, hedge accounting treatment, our operating results may suffer because losses on the derivatives that we enter into may not be offset by a change in the fair value of the related hedged transaction or item.

If we enter into certain hedging transactions or otherwise invest in certain derivative instruments, failure to obtain and maintain an exemption from being regulated as a commodity pool operator could subject us to additional regulation and compliance requirements which could materially adversely affect our business and financial condition.

Rules under the Dodd-Frank Act Wall Street Reform and Consumer Protection Act of 2010, or Dodd-Frank Act, establish a comprehensive new regulatory framework for derivative contracts commonly referred to as “swaps.” Under this regulatory framework, mortgage real estate investment trusts, or mREITs, that trade in commodity interest positions (including swaps) are considered “commodity pools” and the operators of such mREITs would be considered “commodity pool operators,” or CPOs. Absent relief, a CPO must register with the U.S. Commodity Futures Trading Commission, or CFTC, and become a member of the National Futures Association, or NFA, which requires compliance with NFA’s rules and renders such CPO subject to regulation by the CFTC, including with respect to disclosure, reporting, recordkeeping and business conduct. We may from time to time, directly or indirectly, invest in instruments that meet the definition of “swap” under the new rules which may subject us to oversight by the CFTC. Our board of directors has appointed our Manager to act as our CPO in the event we are deemed a commodity pool.

In the event that we invest in commodity interests, absent relief, our Manager would be required to register as a CPO. Our Manager may therefore seek and rely on no-action relief from registration with the CFTC or claim an exemption from registration as a CPO with the CFTC, including pursuant to CFTC Rule 4.13(a)(3). CFTC Rule 4.13(a)(3) requires that, among other things, the pool’s trading in commodity interest positions (including both hedging and speculative positions, and positions in security futures) is limited so that either (i) no more than 5% of the liquidation value of the pool’s portfolio is used as initial margin, premiums and required minimum security deposits to establish such positions, or (ii) the aggregate net notional value of the pool’s trading in such positions does not exceed 100% of the pool’s liquidation value. Therefore, unlike a registered CPO, we will not be required to provide prospective investors with a CFTC compliant disclosure document, nor will we be required to provide investors with periodic account statements or certified annual reports that satisfy the requirements of CFTC rules applicable to registered CPOs, in connection with any offerings of shares.

As an alternative to the exemption from registration, our Manager may register as a CPO with the CFTC and avail itself of certain disclosure, reporting and record-keeping relief under CFTC Rule 4.7.

The CFTC has substantial enforcement power with respect to violations of the laws over which it has jurisdiction, including their anti-fraud and anti-manipulation provisions. Among other things, the CFTC may suspend or revoke the registration of a person who fails to comply, prohibit such a person from trading or doing business with registered entities, impose civil money penalties, require restitution and seek fines or imprisonment for criminal violations. Additionally, a private right of action exists against those who violate the laws over which the CFTC has jurisdiction or who willfully aid, abet, counsel, induce or procure a violation of those laws. In the event we fail to receive interpretive relief from the CFTC on this matter, are unable to claim an exemption from registration and fail to comply with the regulatory requirements of these new rules, we may be unable to use certain types of hedging instruments or we may be subject to significant fines, penalties and other civil or governmental actions or proceedings, any of which could adversely affect our results of operations and financial condition.

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Risks Related to Our Relationship with Our Manager and its Affiliates

We depend on our Manager and its personnel for our success. We may not find a suitable replacement for our Manager if the Management Agreement is terminated, or if key personnel leave the employment of our Manager or Blackstone or otherwise become unavailable to us.

We are externally managed and advised by our Manager, an affiliate of Blackstone. We have no employees and all of our officers are employees of Blackstone or its affiliates. We are completely reliant on our Manager, which has significant discretion as to the implementation of our investment and operating policies and strategies.

Our success will depend to a significant extent upon the efforts, experience, diligence, skill, and network of business contacts of the executive officers and key personnel of our Manager and its affiliates. Our Manager is managed by senior professionals of Blackstone. These individuals will evaluate, negotiate, execute and monitor our investments and advise us regarding maintenance of our REIT status and exclusion from regulation under the Investment Company Act; therefore, our success will depend on their continued service with our Manager and its affiliates. The departure of one or more of the executive officers or key personnel from our Manager and its affiliates could have a material adverse effect on our performance.

In addition, we can offer no assurance that our Manager will remain our investment manager or that we will continue to have access to our Manager’s officers and key personnel. The initial term of the Management Agreement only extends until December 19, 2015. Thereafter, the Management Agreement will be renewable for one-year terms; provided, however, that our Manager may terminate the Management Agreement annually upon 180 days’ prior notice. If the Management Agreement is terminated and no suitable replacement is found to manage us, we may not be able to execute our business plan. Furthermore, we may incur certain costs in connection with a termination of the Management Agreement.

The personnel of our Manager, as our external manager, are not required to dedicate a specific portion of their time to the management of our business.

Neither our Manager nor any other Blackstone affiliate is obligated to dedicate any specific personnel exclusively to us, nor are they or their personnel obligated to dedicate any specific portion of their time to the management of our business. As a result, we cannot provide any assurances regarding the amount of time our Manager or its affiliates will dedicate to the management of our business and our Manager may have conflicts in allocating its time, resources and services among our business and any other investment vehicles and accounts our Manager (or its personnel) may manage. Each of our officers is also an employee of our Manager or another Blackstone affiliate, who has now or may be expected to have significant responsibilities for other investment vehicles currently managed by Blackstone and its affiliates. Consequently, we may not receive the level of support and assistance that we otherwise might receive if we were internally managed. Our Manager and its affiliates are not restricted from entering into other investment advisory relationships or from engaging in other business activities.

Our Manager manages our portfolio pursuant to very broad investment guidelines and is not required to seek the approval of our board of directors for each investment, financing, asset allocation or hedging decision made by it, which may result in our making riskier loans and investments and which could adversely affect our results of operations and financial condition.

Our Manager is authorized to follow very broad investment guidelines that provide it with broad discretion in investment, financing, asset allocation and hedging decisions. Our board of directors will periodically review our investment guidelines and our investment portfolio but will not, and will not be required to, review and approve in advance all of our proposed investments or the Manager’s financing, asset allocation or hedging decisions. In addition, in conducting periodic reviews, our directors may rely primarily on information provided to them by our Manager or its affiliates. Subject to maintaining our REIT qualification and our exclusion from regulation under the Investment Company Act, our Manager has significant latitude within the broad investment guidelines

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in determining the types of investments it makes for us, and how such investments are financing or hedged, which could result in investment returns that are substantially below expectations or that result in losses, which could adversely affect our results of operations and financial condition.

Our Manager’s fee structure may not create proper incentives or may induce our Manager and its affiliates to make certain investments, including speculative investments, which increase the risk of our investment portfolio.

We pay our Manager base management fees regardless of the performance of our portfolio. Our Manager’s entitlement to base management fees, which is not based upon performance metrics or goals, might reduce its incentive to devote its time and effort to seeking investments that provide attractive risk-adjusted returns for our portfolio. Because the base management fees are also based in part on our outstanding equity, our Manager may also be incentivized to advance strategies that increase our equity, and there may be circumstances where increasing our equity will not optimize the returns for our stockholders. Consequently, we may be required to pay our Manager base management fees in a particular period despite experiencing a net loss or a decline in the value of our portfolio during that period.

In addition, our Manager has the ability to earn incentive fees each quarter based on our earnings, which may create an incentive for our Manager to invest in assets with higher yield potential, which are generally riskier or more speculative, or sell an asset prematurely for a gain, in an effort to increase our short-term net income and thereby increase the incentive fees to which it is entitled. If our interests and those of our Manager are not aligned, the execution of our business plan and our results of operations could be adversely affected, which could adversely affect our results of operations and financial condition.

We may compete with existing and future private and public investment vehicles established and/or managed by Blackstone or its affiliates, which may present various conflicts of interest that restrict our ability to pursue certain investment opportunities or take other actions that are beneficial to our business and result in decisions that are not in the best interests of our stockholders.

We are subject to conflicts of interest arising out of our relationship with Blackstone, including our Manager and its affiliates. Blackstone has appointed two nominees to serve on our board of directors (one of whom serves as executive chairman of our board of directors), and Stephen D. Plavin, our chief executive officer and a member of our board, Paul D. Quinlan, our chief financial officer, and our other executive officers are also executives of Blackstone and/or one or more of its affiliates, and we are managed by our Manager, a Blackstone affiliate. There is no guarantee that the policies and procedures adopted by us, the terms and conditions of the Management Agreement or the policies and procedures adopted by our Manager, Blackstone and their affiliates, will enable us to identify, adequately address or mitigate these conflicts of interest.

Some examples of conflicts of interest that may arise by virtue of our relationship with our Manager and Blackstone include:

• Broad and Wide-Ranging Activities. Our Manager, Blackstone and their affiliates engage in a broad spectrum of activities, including a broad range of activities relating to investments in the real estate industry, and have invested or committed billions of dollars in capital through various investment funds, managed accounts and other vehicles affiliated with Blackstone. In the ordinary course of their business activities, our Manager, Blackstone and their affiliates may engage in activities where the interests of certain divisions of Blackstone and its affiliates, including our Manager, or the interests of their clients may conflict with the interests of our stockholders. Certain of these divisions and entities affiliated with our Manager have or may have an investment strategy similar to our investment strategy and therefore may compete with us. In particular, Blackstone Real Estate Debt Strategies, or BREDS, part of Blackstone’s real estate investment business, seeks to invest in a broad range of real estate-related debt investments via several different investment funds, managed accounts and other vehicles.

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• Blackstone’s Policies and Procedures. Specified policies and procedures implemented by Blackstone and its affiliates, including our Manager, to mitigate potential conflicts of interest and address certain regulatory requirements and contractual restrictions may reduce the advantages across Blackstone’s and its affiliates’ various businesses that Blackstone expects to draw on for purposes of pursuing attractive investment opportunities. Because Blackstone has many different asset management, advisory and other businesses, it is subject to a number of actual and potential conflicts of interest, greater regulatory oversight and more legal and contractual restrictions than that to which it would otherwise be subject if it had just one line of business. In addressing these conflicts and regulatory, legal and contractual requirements across its various businesses, Blackstone has implemented certain policies and procedures (e.g., information walls) that may reduce the benefits that Blackstone expects to utilize for purposes of identifying and managing its investments. For example, Blackstone may come into possession of material non-public information with respect to companies in which our Manager may be considering making an investment in companies that are Blackstone’s and its affiliates’ advisory clients. As a consequence, that information, which could be of benefit to our Manager, might become restricted to those other businesses and otherwise be unavailable to our Manager, and could also restrict our Manager’s activities. Additionally, the terms of confidentiality or other agreements with or related to companies in which any investment vehicle of Blackstone has or has considered making an investment or which is otherwise an advisory client of Blackstone and its affiliates may restrict or otherwise limit the ability of Blackstone or its affiliates, including our Manager, to engage in businesses or activities competitive with such companies.

• Allocation of Investment Opportunities. Certain inherent conflicts of interest arise from the fact that Blackstone and its affiliates, including our Manager, will provide investment management and other services both to us and to any other person or entity, whether or not the investment objectives or policies of any such other person or entity are similar to ours, including, without limitation, the sponsoring, closing and/or managing of any investment funds, vehicles, accounts, products and/or other similar arrangements sponsored, advised, and/or managed by Blackstone or its affiliates, whether currently in existence or subsequently established (in each case, including any related successor funds, alternative vehicles, supplemental capital vehicles, co-investment vehicles and other entities formed in connection with Blackstone or its affiliates side-by-side or additional general partner investments with respect thereto), which we refer to as the Blackstone Funds. The respective investment guidelines and programs of our business and the Blackstone Funds may or may not overlap, in whole or in part, and if there is any such overlap investment opportunities will be allocated between us and the Blackstone Funds in a manner that may result in fewer investment opportunities being allocated to us than would have otherwise been the case in the absence of such Blackstone Funds. In particular, while the primary investment strategies of Blackstone Mortgage Trust and Blackstone’s latest flagship successor real estate debt fund, Blackstone Real Estate Debt Strategies II, L.P., or BREDS II, are materially different in that Blackstone Mortgage Trust will generally seek to invest primarily in senior mortgage loans and other similar interests and BREDS II will generally seek to invest primarily in junior mortgage debt (e.g., B Notes) and mezzanine debt, a significant portion of the capital of BREDS II may nonetheless be invested in investments that would also be appropriate for Blackstone Mortgage Trust. Our Manager, Blackstone or their affiliates may also give advice to the Blackstone Funds that may differ from advice given to us even though their investment objectives may be the same or similar to ours.

While our Manager will seek to manage potential conflicts of interest in a fair and reasonable manner in accordance with the investment allocation policy and procedures of our Manager and/or its affiliates with respect to the allocation of investment opportunities among us and one or more Blackstone Funds (as the same may be amended, updated or revised from time to time without prior notice from our Manager or our consent), which we refer to as the Allocation Policy, and as required pursuant to the Management Agreement, the portfolio strategies employed by our Manager, Blackstone or their affiliates in managing the Blackstone Funds could conflict with the strategies employed by our Manager in managing our business and may adversely affect the marketability, exit strategy, prices and availability of the securities and instruments in which we invest. Conversely, participation in specific

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investment opportunities may be appropriate, at times, for both us and the Blackstone Funds. Our Manager has an investment allocation policy in place which provides that investment opportunities falling within the shared investment objectives of our business and the Blackstone Funds will generally be allocated on a basis that our Manager and applicable Blackstone affiliates determine to be fair and reasonable in accordance with the Allocation Policy, subject to legal, tax, regulatory, accounting and other considerations and taking into account a variety of factors. Our Manager is entitled to amend the Allocation Policy at any time without prior notice or our consent.

• Investments in Different Levels or Classes of an Issuer’s Securities. From time to time, we and the Blackstone Funds may make investments at different levels of an issuer’s or borrower’s capital structure (e.g., an investment by a Blackstone Fund in an equity or mezzanine interest with respect to the same portfolio entity in which we own a debt interest or vice versa) or otherwise in different classes of the same issuer’s securities. We may make investments that are senior or junior to, or have rights and interests different from or adverse to, the investments made by the Blackstone Funds. Such investments may conflict with the interests of such Blackstone Funds in related investments, and the potential for any such conflicts of interests may be heightened in the event of a default or restructuring of any such investments. Our Management Agreement requires our Manager to keep our board of directors reasonably informed on a periodic basis in connection with the foregoing, including with respect to transactions that involve investments at different levels of an issuer’s or borrower’s capital structure, as to which our Manager has agreed to provide our board of directors with quarterly updates. We currently hold mortgage and mezzanine loans and other investments in which Blackstone affiliates have interests in the collateral securing or backing such investments. While Blackstone will seek to resolve any such conflicts in a fair and equitable manner in accordance with the Allocation Policy and its prevailing policies and procedures with respect to conflicts resolution among the Blackstone Funds generally, such transactions are not required to be presented to our board of directors for approval, and there can be no assurance that any conflicts will be resolved in our favor.

• Pursuit of Differing Strategies. At times, the investment professionals employed by our Manager or its affiliates and other investment vehicles affiliated with our Manager and/or Blackstone may determine that an investment opportunity may be appropriate for only some of the accounts, clients, entities, funds and/or investment companies for which he or she exercises investment responsibility, or may decide that certain of the accounts, clients, entities, funds and/or investment companies should take differing positions with respect to a particular security. In these cases, the investment professionals may place separate transactions for one or more accounts, clients, entities, funds and/or investment companies which may affect the market price of the security or the execution of the transaction, or both, to the detriment or benefit of one or more other accounts, clients, entities, funds and/or investment companies. For example, an investment professional may determine that it would be in the interest of another account to sell a security that we hold long, potentially resulting in a decrease in the market value of the security held by us.

• Variation in Financial and Other Benefits. A conflict of interest arises where the financial or other benefits available to our Manager or its affiliates differ among the accounts, clients, entities, funds and/or investment companies that it manages. If the amount or structure of the base management fee, incentive fee and/or our Manager’s compensation differs among accounts, clients, entities, funds and/or investment companies (such as where certain funds or accounts pay higher base management fees, incentive fees, performance-based management fees or other fees), our Manager might be motivated to help certain accounts, clients, entities, funds and/or investment companies over others. Similarly, the desire to maintain assets under management or to enhance our Manager’s performance record or to derive other rewards, financial or otherwise, could influence our Manager in affording preferential treatment to those accounts, clients, entities, funds and/or investment companies that could most significantly benefit our Manager. Our Manager may, for example, have an incentive to allocate favorable or limited opportunity investments or structure the timing of investments to favor such accounts, clients, entities, funds and/or investment companies. Additionally, our Manager might be

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motivated to favor accounts, clients, entities, funds and/or investment companies in which it has an ownership interest or in which Blackstone and/or its affiliates have ownership interests. Conversely, if an investment professional at our Manager or its affiliates does not personally hold an investment in the fund but holds investments in other Blackstone affiliated vehicles, such investment professional’s conflicts of interest with respect to us may be more acute.

• Investment Banking, Underwriting Advisory and Other Relationships. As part of its regular business, Blackstone provides a broad range of investment banking, underwriting, advisory, and other services. In the regular course of its investment banking and advisory businesses, Blackstone represents potential purchasers, sellers and other involved parties, including corporations, financial buyers, management, stockholders and institutions, with respect to transactions that could give rise to investments that are suitable for us. Blackstone will be under no obligation to decline any such engagements in order to make an investment opportunity available to us. In connection with its investment banking, advisory and other businesses, Blackstone may come into possession of information that limits its ability to engage in potential transactions. Our activities may be constrained as a result of the inability of Blackstone personnel to use such information. For example, employees of Blackstone not serving as employees of our Manager or its affiliates may be prohibited by law or contract from sharing information with members of our Manager’s investment team. Additionally, there may be circumstances in which one or more of certain individuals associated with Blackstone will be precluded from providing services to our Manager because of certain confidential information available to those individuals or to other parts of Blackstone. In certain sell-side assignments, the seller may permit Blackstone to act as a participant in such transaction, which would raise conflicts of interest inherent in such a situation. In addition, in connection with selling investments by way of a public offering, a Blackstone broker-dealer may act as the managing underwriter or a member of the underwriting syndicate on a firm commitment basis and purchase securities on that basis. Blackstone may retain any commissions, remuneration, or other profits and receive compensation from such underwriting activities, which have the potential to create conflicts of interest. Blackstone may also participate in underwriting syndicates from time to time with respect to us or portfolio companies of Blackstone Funds, or may otherwise be involved in the private placement of debt or equity securities issued by us or such portfolio companies, or otherwise in arranging financings with respect thereto. Subject to applicable law, Blackstone may receive underwriting fees, placement commissions, or other compensation with respect to such activities, which are not required to be shared with us or our stockholders. Where Blackstone serves as underwriter with respect to a portfolio company’s securities, we or the applicable Blackstone fund holding such securities may be subject to a “lock-up” period following the offering under applicable regulations during which time our ability to sell any securities that we continue to hold is restricted. This may prejudice our ability to dispose of such securities at an opportune time.

Blackstone has long-term relationships with a significant number of corporations and their senior management. In determining whether to invest in a particular transaction on our behalf, our Manager may consider those relationships (subject to its obligations under the Management Agreement), which may result in certain transactions that our Manager will not undertake on our behalf in view of such relationships.

Blackstone and its affiliates may represent creditors or debtors in proceedings under Chapter 11 of the Bankruptcy Code or prior to such filings. From time to time Blackstone and its affiliates may serve as advisor to creditor or equity committees. This involvement, for which Blackstone and its affiliates may be compensated, may limit or preclude the flexibility that we may otherwise have to participate in restructurings.

• Service Providers. Certain of our service providers (including lenders, brokers, attorneys, and investment banking firms) may be sources of investment opportunities, counterparties therein or advisors with respect thereto. This may influence our Manager in deciding whether to select such a service provider. In addition, in instances where multiple Blackstone businesses may be exploring a potential individual investment, certain of these service providers may choose to be engaged by other Blackstone affiliates rather than us.

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• Material, Non-Public Information. We, directly or through Blackstone, our Manager or certain of their respective affiliates may come into possession of material non-public information with respect to an issuer in which we have invested or may invest. Should this occur, our Manager may be restricted from buying or selling securities, derivatives or loans of the issuer on our behalf until such time as the information becomes public or is no longer deemed material. Disclosure of such information to the personnel responsible for management of our business may be on a need-to-know basis only, and we may not be free to act upon any such information. Therefore, we and/or our Manager may not have access to material non-public information in the possession of Blackstone which might be relevant to an investment decision to be made by our Manager on our behalf, and our Manager may initiate a transaction or purchase or sell an investment which, if such information had been known to it, may not have been undertaken. Due to these restrictions, our Manager may not be able to initiate a transaction on our behalf that it otherwise might have initiated and may not be able to purchase or sell an investment that it otherwise might have purchased or sold, which could negatively affect our operations.

• Possible Future Activities. Our Manager and its affiliates may expand the range of services that they provide over time. Except as and to the extent expressly provided in the Management Agreement, our Manager and its affiliates will not be restricted in the scope of its business or in the performance of any such services (whether now offered or undertaken in the future) even if such activities could give rise to conflicts of interest, and whether or not such conflicts are described herein. Our Manager, Blackstone and their affiliates continue to develop relationships with a significant number of companies, financial sponsors and their senior managers, including relationships with clients who may hold or may have held investments similar to those intended to be made by us. These clients may themselves represent appropriate investment opportunities for us or may compete with us for investment opportunities.

• Transactions with Blackstone Funds. From time to time, we may enter into purchase and sale transactions with Blackstone Funds. Such transactions will be conducted in accordance with, and subject to, the terms and conditions of the Management Agreement (including the requirement that sales to or acquisitions of investments from Blackstone, any Blackstone Fund or any of their affiliates be approved in advance by a majority of our independent directors) and our code of business conduct and ethics and applicable laws and regulations.

• Loan Refinancings. We may from time to time seek to participate in investments relating to the refinancing of loans held by the Blackstone Funds (including the BREDS funds). While it is expected that our participation in connection with such refinancing transactions will be at arms’ length and on market/contract terms, such transactions may give rise to potential or actual conflicts of interest.

• Other Affiliate Transactions. Our Manager may on our behalf acquire debt issued by a borrower in which a separate equity or another debt investment has been made by Blackstone or its other affiliates, including the BREDS funds. In connection with investments in which we participate alongside other Blackstone Funds (including the BREDS funds), we may from time to time share certain rights with such other Blackstone Funds relating to such investments for legal, tax, regulatory or other similar reasons, including, in certain instances, certain control-related rights with respect to jointly-held investments. When making any such investments, there may be conflicting interests. There can be no assurance that the return on our investment will be equivalent to or better than the returns obtained by Blackstone or its other affiliates.

Further conflicts could arise once we and Blackstone or its affiliates have made their respective investments. For example, if a company goes into bankruptcy or reorganization, becomes insolvent or otherwise experiences financial distress or is unable to meet its payment obligations or comply with covenants relating to securities held by us or by the Blackstone or its affiliates, Blackstone or its affiliates may have an interest that conflicts with our interests or Blackstone or its affiliates may have information regarding the company that we do not have access to. If additional financing is necessary as a result of financial or other difficulties, it may not be in our best

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interests to provide such additional financing. If Blackstone or its affiliates were to lose their respective investments as a result of such difficulties, the ability of our Manager to recommend actions in our best interests might be impaired.

Termination of the Management Agreement would be costly.

Termination of the Management Agreement without cause will be difficult and costly. Our independent directors will review our Manager’s performance annually and, following the initial three-year term, the Management Agreement may be terminated each year upon the affirmative vote of at least two-thirds of our independent directors, based upon a determination that (i) our Manager’s performance is unsatisfactory and materially detrimental to us or (ii) the base management fee and incentive fee payable to our Manager are not fair (provided that in this instance, our Manager will be afforded the opportunity to renegotiate the management fee and incentive fees prior to termination). We are required to provide our Manager with 180 days prior notice of any such termination. Additionally, upon such a termination, or if we materially breach the Management Agreement and our Manager terminates the Management Agreement, the Management Agreement provides that we will pay our Manager a termination fee equal to three times the sum of the average annual base management fee and the average annual incentive fee earned during the 24-month period immediately preceding the date of termination, calculated as of the end of the most recently completed fiscal quarter prior to the date of termination. These provisions increase the cost to us of terminating the Management Agreement and adversely affect our ability to terminate our Manager without cause.

Our Manager maintains a contractual as opposed to a fiduciary relationship with us. Our Manager’s liability is limited under the Management Agreement and we have agreed to indemnify our Manager against certain liabilities.

Pursuant to the Management Agreement, our Manager does not assume any responsibility other than to render the services called for thereunder and is not responsible for any action of our board of directors in following or declining to follow its advice or recommendations. Our Manager maintains a contractual as opposed to a fiduciary relationship with us. Under the terms of the Management Agreement, our Manager and its affiliates and their respective directors, officers, employees and stockholders are not liable to us, our directors, our stockholders or any subsidiary of ours, or their directors, officers, employees or stockholders for any acts or omissions performed in accordance with and pursuant to the Management Agreement, except by reason of acts or omissions constituting bad faith, willful misconduct, gross negligence, or reckless disregard of their duties under the Management Agreement. We have agreed to indemnify our Manager and its affiliates and their respective directors, officers, employees and stockholders with respect to all expenses, losses, damages, liabilities, demands, charges and claims arising from acts or omissions of our Manager not constituting bad faith, willful misconduct, gross negligence, or reckless disregard of duties, performed or not performed in good faith in accordance with and pursuant to the Management Agreement. As a result, we could experience poor performance or losses for which our Manager would not be liable.

We do not own the Blackstone name, but we may use it as part of our corporate name pursuant to a trademark license agreement with an affiliate of Blackstone. Use of the name by other parties or the termination of our trademark license agreement may harm our business.

We have entered into a trademark license agreement, or Trademark License Agreement, with an affiliate of Blackstone pursuant to which it has granted us a fully paid-up, royalty-free, non-exclusive, non-transferable license to use the name “Blackstone Mortgage Trust, Inc.” and the ticker symbol “BXMT”. Under this agreement, we have a right to use this name for so long as our Manager (or another affiliate of Blackstone TM L.L.C., or Licensor) serves as our Manager (or another managing entity) and the Manager remains an affiliate of the Licensor under the Trademark License Agreement. The Trademark License Agreement may also be earlier terminated by either party as a result of certain breaches or for convenience upon 90 days’ prior written notice; provided that upon notification of such termination by us, the Licensor may elect to effect termination of the

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Trademark License Agreement immediately at any time after 30 days from the date of such notification. The Licensor and its affiliates, such as Blackstone, will retain the right to continue using the “Blackstone” name. We will further be unable to preclude the Licensor from licensing or transferring the ownership of the “Blackstone” name to third parties, some of whom may compete with us. Consequently, we will be unable to prevent any damage to goodwill that may occur as a result of the activities of the Licensor, Blackstone or others. Furthermore, in the event that the Trademark License Agreement is terminated, we will be required to, among other things, change our name and NYSE ticker symbol. Any of these events could disrupt our recognition in the market place, damage any goodwill we may have generated and otherwise harm our business.

Risks Related to Our Company

Our investment strategy or guidelines, asset allocation and financing strategy may be changed without stockholder consent.

Our Manager is authorized to follow broad investment guidelines that have been approved by our board of directors. Those investment guidelines, as well as our financing strategy or hedging policies with respect to investments, originations, acquisitions, growth, operations, indebtedness, capitalization and distributions, may be changed at any time without the consent of our stockholders. This could result in an investment portfolio with a different risk profile. A change in our investment strategy may increase our exposure to interest rate risk, default risk and real estate market fluctuations. Furthermore, a change in our asset allocation could result in our making investments in asset categories different from those described in this report. These changes could adversely affect our results of operations and financial condition.

We must manage our portfolio so that we do not become an investment company that is subject to regulation under the Investment Company Act.

We conduct our operations so that we avail ourselves of the statutory exclusion provided in Section 3(c)(5)(C) for companies engaged primarily in investment in mortgages and other liens on or interests in real estate. In order to qualify for this exclusion, we must maintain, on the basis of positions taken by the SEC’s Division of Investment Management, or the Division, in interpretive and no-action letters, a minimum of 55% of the value of our total assets in mortgage loans and other related assets that are considered “mortgages and other liens on and interests in real estate,” which we refer to as Qualifying Interests, and a minimum of 80% in Qualifying Interests and real estate-related assets. In the absence of SEC or Division guidance that supports the treatment of other investments as Qualifying Interests, we will treat those other investments appropriately as real estate-related assets or miscellaneous assets depending on the circumstances.

The SEC staff has commenced an advance notice rulemaking initiative, indicating that it is reconsidering its interpretive policy under Section 3(c)(5)(C) and whether to advance rulemaking to define the basis for the exclusion. We cannot predict the outcome of this reconsideration or potential rulemaking initiative and its impact on our ability to rely on the exclusion. To the extent that the SEC or its staff provides more specific guidance regarding any of the matters bearing upon the requirements of Section 3(c)(5)(C) of the Investment Company Act, we may be required to adjust our strategy accordingly. Any additional guidance from the SEC or its staff could further inhibit our ability to pursue the strategies we have chosen.

Because registration as an investment company would significantly affect our ability to engage in certain transactions or be structured in the manner we currently are, we intend to conduct our business so that we will continue to satisfy the requirements to avoid regulation as an investment company. If we do not meet these requirements, we could be forced to alter our investment portfolios by selling or otherwise disposing of a substantial portion of the assets that do not satisfy the applicable requirements or by acquiring a significant position in assets that are Qualifying Interests. In the past, when required due to the mix of assets in our balance sheet portfolio, and in connection with our reliance on the Section 3(c)(5)(C) exclusion, we have purchased agency residential mortgage-backed securities that represent the entire beneficial interests in the underlying pools of whole residential mortgage loans, which are treated as Qualifying Interests based on Division positions. Such

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investments may not represent an optimum use of capital when compared to the available investments we and our subsidiaries target pursuant to our investment strategy. These investments present additional risks to us, and these risks are compounded by our inexperience with such investments. We continue to analyze our investments and may acquire other pools of whole loan residential mortgage-backed securities when and if required for compliance purposes. Altering our portfolio in this manner may have an adverse effect on our investments if we are forced to dispose of or acquire assets in an unfavorable market, and may adversely affect our stock price.

If it were established that we were an unregistered investment company, there would be a risk that we would be subject to monetary penalties and injunctive relief in an action brought by the SEC, that we would be unable to enforce contracts with third parties, that third parties could seek to obtain rescission of transactions undertaken during the period it was established that we were an unregistered investment company, and that we would be subject to limitations on corporate leverage that would have an adverse impact on our investment returns. In order to comply with provisions that allow us to avoid the consequences of registration under the Investment Company Act, we may need to forego otherwise attractive opportunities and limit the manner in which we conduct our operations. Thus, compliance with the requirements of the Investment Company Act may hinder our ability to operate solely on the basis of maximizing profits.

Rapid changes in the values of our other real estate-related investments may make it more difficult for us to maintain our qualification as a REIT or exclusion from regulation under the Investment Company Act.

If the market value or income potential of real estate-related investments declines as a result of increased interest rates, prepayment rates or other factors, we may need to increase our real estate investments and income and/or liquidate our non-qualifying assets in order to maintain our REIT qualification or exclusion from the Investment Company Act regulation. If the decline in real estate asset values and/or income occurs quickly, this may be especially difficult to accomplish. This difficulty may be exacerbated by the illiquid nature of any non-qualifying assets that we may own. We may have to make investment decisions that we otherwise would not make absent the REIT and Investment Company Act considerations.

Changes in laws or regulations governing our operations, changes in the interpretation thereof or newly enacted laws or regulations and any failure by us to comply with these laws or regulations, could require changes to certain of our business practices, negatively impact our operations, cash flow or financial condition, impose additional costs on us or otherwise adversely affect our business.

The laws and regulations governing our operations, as well as their interpretation, may change from time to time, and new laws and regulations may be enacted. Accordingly, any change in these laws or regulations, changes in their interpretation, or newly enacted laws or regulations and any failure by us to comply with these laws or regulations, could require changes to certain of our business practices, negatively impact our operations, cash flow or financial condition, impose additional costs on us or otherwise adversely affect our business. Furthermore, if regulatory capital requirements – whether under the Dodd-Frank Act, Basel III, or other regulatory action – are imposed on private lenders that provide us with funds, or were to be imposed on us, they or we may be required to limit, or increase the cost of, financing they provide to us or that we provide to others. Among other things, this could potentially increase our financing costs, reduce our ability to originate or acquire loans and reduce our liquidity or require us to sell assets at an inopportune time or price.

Over the last several years, there also has been an increase in regulatory attention to the extension of credit outside of the traditional banking sector, raising the possibility that some portion of the non-bank financial sector will be subject to new regulation. While it cannot be known at this time whether any regulation will be implemented or what form it will take, increased regulation of non-bank credit extension could negatively impact our operations, cash flows or financial condition, impose additional costs on us, intensify the regulatory supervision of us or otherwise adversely affect our business.

In addition, the Iran Threat Reduction and Syria Human Rights Act of 2012, or ITRA, expands the scope of U.S. sanctions against Iran and Section 219 of the ITRA amended the Exchange Act to require companies subject to

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SEC reporting obligations under Section 13 of the Exchange Act to disclose in their periodic reports specified dealings or transactions involving Iran or other individuals and entities targeted by certain sanctions promulgated by the Office of Foreign Assets Control of the U.S. Department of the Treasury, or Treasury, engaged in by the reporting company or any of its affiliates during the period covered by the relevant periodic report. In some cases, ITRA requires companies to disclose these types of transactions even if they were permissible under U.S. law. Travelport Limited , which may be considered an affiliate of Blackstone, and therefore our affiliate, has publicly filed and/or provided to Blackstone the disclosures reproduced on Exhibit 99.1 of this report, which disclosures are hereby incorporated by reference herein. We have not independently verified or participated in the preparation of these disclosures. We are required to separately file with the SEC a notice that such activities have been disclosed in our reports, and the SEC is required to post those notices of disclosure on its website and send the report to the U.S. President and certain U.S. Congressional committees. The U.S. President thereafter is required to initiate an investigation and, within 180 days of initiating such an investigation, to determine whether sanctions should be imposed. Disclosure of such activity, even if such activity is not subject to sanctions under applicable law, and any sanctions actually imposed on us or our affiliates as a result of these activities, could harm our reputation and have a negative impact on our business.

Actions of the U.S. government, including the U.S. Congress, Federal Reserve Board, Treasury and other governmental and regulatory bodies, to stabilize or reform the financial markets, or market response to those actions, may not achieve the intended effect and may adversely affect our business.

In July 2010, President Obama signed into law the Dodd-Frank Act, which imposes significant investment restrictions and capital requirements on banking entities and other organizations that are significant to U.S. financial stability. For instance, the so-called “Volcker Rule” provisions of the Dodd-Frank Act impose significant restrictions on the proprietary trading activities of banking entities and on their ability to sponsor or invest in private equity and hedge funds. It also subjects nonbank financial companies that have been designated as “systemically important” by the Financial Stability Oversight Council to increased capital requirements and quantitative limits for engaging in such activities, as well as consolidated supervision by the Federal Reserve Board. The Dodd-Frank Act also seeks to reform the asset-backed securitization market (including the mortgage-backed securities market) by requiring the retention of a portion of the credit risk inherent in the pool of securitized assets and by imposing additional registration and disclosure requirements. In October 2014, five federal banking and housing agencies and the SEC issued final credit risk retention rules, which generally require sponsors of asset-backed securities to retain at least 5% of the credit risk relating to the assets that underlie such asset-backed securities. These rules, which generally become effective in December 2016 with respect to new securitization transactions backed by mortgage loans other than residential mortgage loans, could restrict credit availability and could negatively affect the terms and availability of credit to fund our investments. While the full impact of the Dodd-Frank Act cannot be fully assessed, the Dodd-Frank Act’s extensive requirements may have a significant effect on the financial markets and may affect the availability or terms of financing from our lender counterparties and the availability or terms of mortgage-backed securities, which may, in turn, have an adverse effect on our business.

In addition, the Federal Reserve Board, Treasury and other governmental and regulatory bodies have taken or are taking other actions to address the global financial crisis. We cannot predict whether or when such actions may occur or what effect, if any, such actions could have on our business, results of operations and financial condition.

Operational risks may disrupt our businesses, result in losses or limit our growth.

We rely heavily on our and Blackstone’s financial, accounting, communications and other data processing systems. Such systems may fail to operate properly or become disabled as a result of tampering or a breach of the network security systems or otherwise. In addition, such systems are from time to time subject to cyberattacks. Breaches of our network security systems could involve attacks that are intended to obtain unauthorized access to our proprietary information, destroy data or disable, degrade or sabotage our systems, often through the

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introduction of computer viruses, cyberattacks and other means and could originate from a wide variety of sources, including unknown third parties outside the firm. Although Blackstone takes various measures to ensure the integrity of such systems, there can be no assurance that these measures will provide protection. If such systems are compromised, do not operate properly or are disabled, we could suffer financial loss, a disruption of our businesses, liability to investors, regulatory intervention or reputational damage.

In addition, we are highly dependent on information systems and technology. Our information systems and technology may not continue to be able to accommodate our growth, and the cost of maintaining such systems may increase from its current level. Such a failure to accommodate growth, or an increase in costs related to such information systems, could have a material adverse effect on us.

Furthermore, we depend on our headquarters in New York City, where most of our personnel are located, for the continued operation of our business. A disaster or a disruption in the infrastructure that supports our business, including a disruption involving electronic communications or other services used by us or third parties with whom we conduct business, or directly affecting our headquarters, could have a material adverse impact on our ability to continue to operate our business without interruption. Blackstone’s disaster recovery programs may not be sufficient to mitigate the harm that may result from such a disaster or disruption. In addition, insurance and other safeguards might only partially reimburse us for our losses, if at all.

Finally, we rely on third party service providers for certain aspects of our business, including for certain information systems, technology and administration. Any interruption or deterioration in the performance of these third parties or failures of their information systems and technology could impair the quality of our operations and could affect our reputation and hence adversely affect our business.

Under the agreements that govern the Blackstone Transactions, we have retained responsibility for certain liabilities of our historical investment management and special servicing business, which could be substantial.

Under the purchase and sale agreement, dated September 27, 2012, or Purchase Agreement, by and between us and Huskies Acquisition, LLC, or Huskies Acquisition, an affiliate of Blackstone, relating to our December 19, 2012 disposition of our investment management and special servicing business, including CTIMCO, and related private investment fund co-investments, we are required to indemnify Huskies Acquisition and its affiliates for all pre-closing liabilities relating to our prior ownership, management and operation of our historical investment management and special servicing business. The Purchase Agreement does not limit the duration of our obligations to Huskies Acquisition or its affiliates with respect to these indemnities. In the event that the amount of these liabilities were to exceed our expectations, we could be responsible to Huskies Acquisition and its affiliates for substantial indemnification obligations, which could adversely affect our results of operations and financial condition. In addition, claims for indemnification could result in conflicts with our Manager.

Accounting rules for certain of our transactions are highly complex and involve significant judgment and assumptions. Changes in accounting interpretations or assumptions could impact our ability to timely prepare consolidated financial statements.

Accounting rules for transfers of financial assets, securitization transactions, consolidation of variable interest entities, and other aspects of our operations are highly complex and involve significant judgment and assumptions. These complexities could lead to a delay in preparation of financial information and the delivery of this information to our stockholders. Changes in accounting interpretations or assumptions could impact our consolidated financial statements and our ability to timely prepare our consolidated financial statements. Our inability to timely prepare our consolidated financial statements in the future would likely have a significant adverse effect on our stock price.

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Risks Related to our REIT Status and Certain Other Tax Items

If we do not maintain our qualification as a REIT, we will be subject to tax as a regular corporation and could face a substantial tax liability. Our taxable REIT subsidiaries are subject to income tax.

We expect to continue to operate so as to qualify as a REIT under the Internal Revenue Code. However, qualification as a REIT involves the application of highly technical and complex Internal Revenue Code provisions for which only a limited number of judicial or administrative interpretations exist. Notwithstanding the availability of cure provisions in the Internal Revenue Code, various compliance requirements could be failed and could jeopardize our REIT status. Furthermore, new tax legislation, administrative guidance or court decisions, in each instance potentially with retroactive effect, could make it more difficult or impossible for us to qualify as a REIT. If we fail to qualify as a REIT in any tax year, then:

• we would be taxed as a regular domestic corporation, which under current laws, among other things, means being unable to deduct distributions to stockholders in computing taxable income and being subject to federal income tax on our taxable income at regular corporate income tax rates;

• any resulting tax liability could be substantial and could have a material adverse effect on our book value;

• unless we were entitled to relief under applicable statutory provisions, we would be required to pay taxes, and thus, our cash available for distribution to stockholders would be reduced for each of the years during which we did not qualify as a REIT and for which we had taxable income; and

• we generally would not be eligible to requalify as a REIT for the subsequent four full taxable years.

REITs, in certain circumstances, may incur tax liabilities that would reduce our cash available for distribution to our stockholders.

Even if we qualify and maintain our status as a REIT, we may become subject to U.S. federal income taxes and related state and local taxes. For example, net income from the sale of properties that are “dealer” properties sold by a REIT (a “prohibited transaction” under the Internal Revenue Code) will be subject to a 100% tax. We may not make sufficient distributions to avoid excise taxes applicable to REITs. Similarly, if we were to fail an income test (and did not lose our REIT status because such failure was due to reasonable cause and not willful neglect) we would be subject to tax on the income that does not meet the income test requirements. We also may decide to retain net capital gain we earn from the sale or other disposition of our investments and pay income tax directly on such income. In that event, our stockholders would be treated as if they earned that income and paid the tax on it directly. However, stockholders that are tax-exempt, such as charities or qualified pension plans, would have no benefit from their deemed payment of such tax liability unless they file U.S. federal income tax returns and thereon seek a refund of such tax. We also may be subject to state and local taxes on our income or property, including franchise, payroll, mortgage recording and transfer taxes, either directly or at the level of the other companies through which we indirectly own our assets, such as our TRSs, which are subject to full U.S. federal, state, local and foreign corporate-level income taxes. Any taxes we pay directly or indirectly will reduce our cash available for distribution to our stockholders.

Complying with REIT requirements may cause us to forego otherwise attractive opportunities and limit our expansion opportunities.

In order to qualify as a REIT for U.S. federal income tax purposes, we must continually satisfy tests concerning, among other things, our sources of income, the nature of our investments in commercial real estate and related assets, the amounts we distribute to our stockholders and the ownership of our stock. We may also be required to make distributions to stockholders at disadvantageous times or when we do not have funds readily available for distribution. Thus, compliance with REIT requirements may hinder our ability to operate solely on the basis of maximizing profits.

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Complying with REIT requirements may force us to liquidate or restructure otherwise attractive investments.

In order to qualify as a REIT, we must also ensure that at the end of each calendar quarter, at least 75% of the value of our assets consists of cash, cash items, government securities and qualified REIT real estate assets. The remainder of our investments in securities cannot include more than 10% of the outstanding voting securities of any one issuer or 10% of the total value of the outstanding securities of any one issuer unless we and such issuer jointly elect for such issuer to be treated as a “taxable REIT subsidiary” under the Internal Revenue Code. The total value of all of our investments in taxable REIT subsidiaries cannot exceed 25% of the value of our total assets. In addition, no more than 5% of the value of our assets can consist of the securities of any one issuer other than a taxable REIT subsidiary. If we fail to comply with these requirements, we must dispose of a portion of our assets within 30 days after the end of the calendar quarter in order to avoid losing our REIT status and suffering adverse tax consequences.

Complying with REIT requirements may limit our ability to hedge effectively and may cause us to incur tax liabilities.

The REIT provisions of the Internal Revenue Code substantially limit our ability to hedge our liabilities. Any income from a hedging transaction we enter into to manage risk of interest rate changes with respect to borrowings made or to be made to acquire or carry real estate assets does not constitute “gross income” for purposes of the 75% or 95% gross income tests that we must satisfy in order to maintain our qualification as a REIT. To the extent that we enter into other types of hedging transactions, the income from those transactions is likely to be treated as non-qualifying income for purposes of both of these gross income tests. As a result of these rules, we intend to limit our use of advantageous hedging techniques or implement those hedges through a domestic TRS. This could increase the cost of our hedging activities because our TRS would be subject to tax on gains or expose us to greater risks associated with changes in interest rates than we would otherwise want to bear. In addition, losses in our TRS will generally not provide any tax benefit, except for being carried forward against future taxable income in the TRS.

Complying with REIT requirements may force us to borrow to make distributions to stockholders.

From time to time, our taxable income may be greater than our cash flow available for distribution to stockholders. If we do not have other funds available in these situations, we may be unable to distribute substantially all of our taxable income as required by the REIT provisions of the Internal Revenue Code. Thus, we could be required to borrow funds, sell a portion of our assets at disadvantageous prices or find another alternative. These options could increase our costs or reduce our equity.

Our charter does not permit any individual (including certain entities treated as individuals for this purpose) to own more than 9.9% of our class A common stock or of our capital stock, and attempts to acquire our class A common stock or any of our capital stock in excess of this 9.9% limit would not be effective without a prior exemption from those prohibitions by our board of directors.

For us to qualify as a REIT under the Internal Revenue Code, not more than 50% of the value of our outstanding stock may be owned directly or indirectly, by five or fewer individuals (including certain entities treated as individuals for this purpose) during the last half of a taxable year. For the purpose of preserving our qualification as a REIT for federal income tax purposes, among other purposes, our charter prohibits beneficial or constructive ownership by any individual (including certain entities treated as individuals for this purpose) of more than a certain percentage, currently 9.9%, by value or number of shares, whichever is more restrictive, of the outstanding shares of our class A common stock or our capital stock, which we refer to as the “ownership limit.” The constructive ownership rules under the Internal Revenue Code and our charter are complex and may cause shares of the outstanding class A common stock owned by a group of related individuals or entities to be deemed to be constructively owned by one individual. As a result, the acquisition of less than 9.9% of our outstanding class A common stock or our capital stock by an individual or entity could cause an individual to own constructively in excess of 9.9% of our outstanding class A common stock or our capital stock, respectively, and

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thus violate the ownership limit. There can be no assurance that our board of directors, as permitted in the charter, will increase, or will not decrease, this ownership limit in the future. Any attempt to own or transfer shares of our class A common stock in excess of the ownership limit without the consent of our board of directors either will result in the shares being transferred by operation of the charter to a charitable trust, and the person who attempted to acquire such excess shares will not have any rights in such excess shares, or in the transfer being void.

The ownership limit may have the effect of precluding a change in control of us by a third party, even if such change in control would be in the best interests of our stockholders or would result in receipt of a premium to the price of our class A common stock (and even if such change in control would not reasonably jeopardize our REIT status). The exemptions to the ownership limit granted to date may limit our board of directors’ power to increase the ownership limit or grant further exemptions in the future.

We may choose to make distributions in our own stock, in which case you may be required to pay income taxes without receiving any cash dividends.

In connection with our qualification as a REIT, we are required to annually distribute to our stockholders at least 90% of our REIT taxable income (which does not equal net income, as calculated in accordance with GAAP), determined without regard to the deduction for dividends paid and excluding net capital gain. In order to satisfy this requirement, we may make distributions that are payable in cash and/or shares of our class A common stock (which could account for up to 90% of the aggregate amount of such distributions) at the election of each stockholder. Taxable stockholders receiving such distributions will be required to include the full amount of such distributions as ordinary dividend income to the extent of our current or accumulated earnings and profits, as determined for U.S. federal income tax purposes. As a result, U.S. stockholders may be required to pay income taxes with respect to such distributions in excess of the cash portion of the distribution received. Accordingly, U.S. stockholders receiving a distribution of our shares may be required to sell shares received in such distribution or may be required to sell other stock or assets owned by them, at a time that may be disadvantageous, in order to satisfy any tax imposed on such distribution. If a U.S. stockholder sells the stock that it receives as part of the distribution in order to pay this tax, the sales proceeds may be less than the amount it must include in income with respect to the distribution, depending on the market price of our stock at the time of the sale. Furthermore, with respect to certain non-U.S. stockholders, we may be required to withhold U.S. tax with respect to such distribution, including in respect of all or a portion of such distribution that is payable in stock, by withholding or disposing of part of the shares included in such distribution and using the proceeds of such disposition to satisfy the withholding tax imposed. In addition, if a significant number of our stockholders determine to sell shares of our class A common stock in order to pay taxes owed on dividend income, such sale may put downward pressure on the market price of our class A common stock.

Various tax aspects of such a taxable cash/stock distribution are uncertain and have not yet been addressed by the IRS. No assurance can be given that the IRS will not impose requirements in the future with respect to taxable cash/stock distributions, including on a retroactive basis, or assert that the requirements for such taxable cash/stock distributions have not been met.

Dividends payable by REITs do not qualify for the reduced tax rates available for some dividends.

The maximum tax rate applicable to qualified dividend income payable to certain non-corporate U.S. stockholders has been reduced by legislation to 20%. Dividends payable by REITs, however, generally are not eligible for the reduced rates. Although this legislation does not adversely affect the taxation of REITs or dividends payable by REITs, the more favorable rates applicable to regular corporate qualified dividends could cause certain non-corporate investors to perceive investments in REITs to be relatively less attractive than investments in the stocks of non-REIT corporations that pay dividends, which could adversely affect the value of the shares of REITs, including our class A common stock.

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We will be dependent on external sources of capital to finance our growth.

As with other REITs, but unlike corporations generally, our ability to finance our growth must largely be funded by external sources of capital because we generally will have to distribute to our stockholders 90% of our taxable income in order to qualify as a REIT, including taxable income where we do not receive corresponding cash. Our access to external capital will depend upon a number of factors, including general market conditions, the market’s perception of our growth potential, our current and potential future earnings, cash distributions and the market price of our class A common stock.

We may be subject to adverse legislative or regulatory tax changes that could increase our tax liability, reduce our operating flexibility and reduce the price of our class A common stock.

In recent years, numerous legislative, judicial and administrative changes have been made in the provisions of U.S. federal income tax laws applicable to investments similar to an investment in shares of our class A common stock. Additional changes to the tax laws are likely to continue to occur, and we cannot assure you that any such changes will not adversely affect the taxation of a stockholder. Any such changes could have an adverse effect on an investment in our shares or on the market value or the resale potential of our assets. You are urged to consult with your tax advisor with respect to the impact of recent legislation on your investment in our shares and the status of legislative, regulatory or administrative developments and proposals and their potential effect on an investment in our shares. Although REITs generally receive certain tax advantages compared to entities taxed as regular corporations, it is possible that future legislation would result in a REIT having fewer tax advantages, and it could become more advantageous for a company that invests in real estate to elect to be treated for U.S. federal income tax purposes as a corporation. As a result, our charter provides our board of directors with the power, under certain circumstances, to revoke or otherwise terminate our REIT election and cause us to be taxed as a regular corporation, without the vote of our stockholders. Our board of directors has duties to us and could only cause such changes in our tax treatment if it determines in good faith that such changes are in the best interest of our company.

Our investments in certain debt instruments may cause us to recognize “phantom income” for U.S. federal income tax purposes even though no cash payments have been received on the debt instruments, and certain modifications of such debt by us could cause the modified debt to not qualify as a good REIT asset, thereby jeopardizing our REIT qualification.

Our taxable income may substantially exceed our net income as determined based on GAAP, or differences in timing between the recognition of taxable income and the actual receipt of cash may occur. For example, we may acquire assets, including debt securities requiring us to accrue original issue discount, or OID, or recognize market discount income, that generate taxable income in excess of economic income or in advance of the corresponding cash flow from the assets referred to as “phantom income.” In addition, if a borrower with respect to a particular debt instrument encounters financial difficulty rendering it unable to pay stated interest as due, we may nonetheless be required to continue to recognize the unpaid interest as taxable income with the effect that we will recognize income but will not have a corresponding amount of cash available for distribution to our stockholders.

As a result of the foregoing, we may generate less cash flow than taxable income in a particular year and find it difficult or impossible to meet the REIT distribution requirements in certain circumstances. In such circumstances, we may be required to (a) sell assets in adverse market conditions, (b) borrow on unfavorable terms, (c) distribute amounts that would otherwise be used for future acquisitions or used to repay debt, or (d) make a taxable distribution of our shares of class A common stock as part of a distribution in which stockholders may elect to receive shares of class A common stock or (subject to a limit measured as a percentage of the total distribution) cash, in order to comply with the REIT distribution requirements.

Moreover, we may acquire distressed debt investments that require subsequent modification by agreement with the borrower. If the amendments to the outstanding debt are “significant modifications” under the applicable

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Treasury Regulations, the modified debt may be considered to have been reissued to us in a debt-for-debt taxable exchange with the borrower. In certain circumstances, this deemed reissuance may prevent the modified debt from qualifying as a good REIT asset if the underlying security has declined in value and would cause us to recognize income to the extent the principal amount of the modified debt exceeds our adjusted tax basis in the unmodified debt.

The “taxable mortgage pool” rules may increase the taxes that we or our stockholders may incur, and may limit the manner in which we effect future securitizations.

Securitizations could result in the creation of taxable mortgage pools for federal income tax purposes. As a REIT, so long as we own 100% of the equity interests in a taxable mortgage pool, we generally would not be adversely affected by the characterization of the securitization as a taxable mortgage pool. Certain categories of stockholders, however, such as foreign stockholders eligible for treaty or other benefits, stockholders with net operating losses, and certain tax-exempt stockholders that are subject to unrelated business income tax, could be subject to increased taxes on a portion of their dividend income from us that is attributable to the taxable mortgage pool. In addition, to the extent that our stock is owned by tax-exempt “disqualified organizations,” such as certain government-related entities and charitable remainder trusts that are not subject to tax on unrelated business income, we may incur a corporate level tax on a portion of our income from the taxable mortgage pool. In that case, we may reduce the amount of our distributions to any disqualified organization whose stock ownership gave rise to the tax. Moreover, we would be precluded from selling equity interests in these securitizations to outside investors, or selling any debt securities issued in connection with these securitizations that might be considered to be equity interests for tax purposes. These limitations may prevent us from using certain techniques to maximize our returns from securitization transactions.

The failure of a mezzanine loan to qualify as a real estate asset could adversely affect our ability to qualify as a REIT.

We may originate or acquire mezzanine loans, for which the IRS has provided a safe harbor but not rules of substantive law. Pursuant to the safe harbor, if a mezzanine loan meets certain requirements, it will be treated by the IRS as a real estate asset for purposes of the REIT asset tests, and interest derived from the mezzanine loan will be treated as qualifying mortgage interest for purposes of the REIT 75% income test. We may originate or acquire mezzanine loans that do not meet all of the requirements of this safe harbor. In the event we own a mezzanine loan that does not meet the safe harbor, the IRS could challenge such loan’s treatment as a real estate asset for purposes of the REIT asset and income tests and, if such a challenge were sustained, we could fail to qualify as a REIT.

The failure of assets subject to repurchase agreements to qualify as real estate assets could adversely affect our ability to qualify as a REIT.

We have entered into financing arrangements that are structured as sale and repurchase agreements pursuant to which we would nominally sell certain of our assets to a counterparty and simultaneously enter into an agreement to repurchase these assets at a later date in exchange for a purchase price. Economically, these agreements are financings which are secured by the assets sold pursuant thereto. We believe that we would be treated for REIT asset and income test purposes as the owner of the assets that are the subject of any such sale and repurchase agreement notwithstanding that such agreements may transfer record ownership of the assets to the counterparty during the term of the agreement. It is possible, however, that the IRS could assert that we did not own the assets during the term of the sale and repurchase agreement, in which case we could fail to qualify as a REIT.

Liquidation of assets may jeopardize our REIT qualification.

To qualify as a REIT, we must comply with requirements regarding our assets and our sources of income. If we are compelled to liquidate our investments to repay obligations to our lenders, we may be unable to comply with

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these requirements, ultimately jeopardizing our qualification as a REIT, or we may be subject to a 100% tax on any resultant gain if we sell assets that are treated as dealer property or inventory.

Our ownership of and relationship with any TRS will be restricted, and a failure to comply with the restrictions would jeopardize our REIT status and may result in the application of a 100% excise tax.

A REIT may own up to 100% of the stock of one or more TRSs. A TRS may earn income that would not be qualifying income if earned directly by the parent REIT. Both the subsidiary and the REIT must jointly elect to treat the subsidiary as a TRS. A corporation of which a TRS directly or indirectly owns more than 35% of the voting power or value of the stock will automatically be treated as a TRS. Overall, no more than 25% of the value of a REIT’s assets may consist of stock or securities of one or more TRSs. The value of our interests in and thus the amount of assets held in a TRS may also be restricted by our need to qualify for an exclusion from regulation as an investment company under the Investment Company Act. A TRS will pay federal, state and local income tax at regular corporate rates on any income that it earns. In addition, the TRS rules limit the deductibility of interest paid or accrued by a TRS to its parent REIT to assure that the TRS is subject to an appropriate level of corporate taxation. The rules also impose a 100% excise tax on certain transactions between a TRS and its parent REIT that are not conducted on an arm’s-length basis.

Any TRS we own, as a domestic TRS, will pay federal, state and local income tax on its taxable income, and its after-tax net income is available for distribution to us but is not required to be distributed to us. The aggregate value of the TRS stock and securities owned by us should be less than 25% of the value of our total assets (including the TRS stock and securities). Although we plan to monitor our investments in TRSs, there can be no assurance that we will be able to comply with the 25% limitation discussed above or to avoid application of the 100% excise tax discussed above.

Risks Related to Our Class A Common Stock

The market price of our class A common stock may fluctuate significantly.

The capital and credit markets have recently experienced a period of extreme volatility and disruption. The market price and liquidity of the market for shares of our class A common stock may be significantly affected by numerous factors, some of which are beyond our control and may not be directly related to our operating performance. Some of the factors that could negatively affect the market price of our class A common stock include:

• our actual or projected operating results, financial condition, cash flows and liquidity, or changes in business strategy or prospects;

• actual or perceived conflicts of interest with our Manager or other affiliates of Blackstone and individuals, including our executives;

• equity issuances by us, or share resales by our stockholders, or the perception that such issuances or resales may occur;

• loss of a major funding source;

• actual or anticipated accounting problems;

• publication of research reports about us or the real estate industry;

• changes in market valuations of similar companies;

• adverse market reaction to the level of leverage we employ;

• additions to or departures of our Manager’s or Blackstone’s key personnel;

• speculation in the press or investment community;

• our failure to meet, or the lowering of, our earnings estimates or those of any securities analysts;

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• increases in market interest rates, which may lead investors to demand a higher distribution yield for our class A common stock, and would result in increased interest expenses on our debt;

• a compression of the yield on our investments and an increase in the cost of our liabilities;

• failure to maintain our REIT qualification or exclusion from Investment Company Act regulation;

• price and volume fluctuations in the overall stock market from time to time;

• general market and economic conditions, and trends including inflationary concerns, and the current state of the credit and capital markets;

• significant volatility in the market price and trading volume of securities of publicly traded REITs or other companies in our sector, including Blackstone Mortgage Trust, which is not necessarily related to the operating performance of these companies;

• changes in law, regulatory policies or tax guidelines, or interpretations thereof, particularly with respect to REITs;

• changes in the value of our portfolio;

• any shortfall in revenue or net income or any increase in losses from levels expected by investors or securities analysts;

• operating performance of companies comparable to us;

• short-selling pressure with respect to shares of our class A common stock or REITs generally; and

• uncertainty surrounding the strength of the U.S. economic recovery particularly in light of the recent debt ceiling and budget deficit concerns.

As noted above, market factors unrelated to our performance could also negatively impact the market price of our class A common stock. One of the factors that investors may consider in deciding whether to buy or sell our class A common stock is our distribution rate as a percentage of our stock price relative to market interest rates. If market interest rates increase, prospective investors may demand a higher distribution rate or seek alternative investments paying higher dividends or interest. As a result, interest rate fluctuations and conditions in the capital markets may affect the market value of our class A common stock.

Because a limited number of stockholders, including affiliates of our Manager and members of our management team, own a substantial number of our shares, in addition to Blackstone’s board designation rights, they have the power to make decisions or take actions that may be detrimental to your interests.

Our directors and executive officers, along with vehicles for the benefit of their families, collectively own and control 383,072 shares of our class A common stock, representing approximately 0.7% of our outstanding shares of class A common stock as of February 10, 2015. Blackstone and certain of its affiliates, with whom three of our directors are associated, owns 3,580,495 shares of our class A common stock, which represented approximately 6.1% of our outstanding class A common stock as of February 10, 2015. By virtue of their voting power, in addition to Blackstone’s board designation rights, these stockholders have the power to significantly influence our business and affairs and are able to influence the outcome of matters required to be submitted to stockholders for approval, including the election of our directors, amendments to our charter, mergers or sales of assets. The influence exerted by these stockholders over our business and affairs might not be consistent with the interests of some or all of our stockholders. In addition, the concentration of ownership in our officers or directors or stockholders associated with them may have the effect of delaying or preventing a change in control of our company, including transactions which would be in the best interests of our stockholders and would result in receipt of a premium to the price of our class A common stock (and even if such change in control would not reasonably jeopardize our REIT status), and might negatively affect the market price of our class A common stock.

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Some provisions of our charter and bylaws and Maryland law may deter takeover attempts, which may limit the opportunity of our stockholders to sell their shares at a favorable price.

Some of the provisions of Maryland law and our charter and bylaws discussed below could make it more difficult for a third party to acquire us, even if doing so might be beneficial to our stockholders by providing them with the opportunity to sell their shares at a premium to the then current market price.

Issuance of Stock Without Stockholder Approval. Our charter authorizes our board of directors, without stockholder approval, to authorize the issuance of up to 100,000,000 shares of preferred stock and up to 100,000,000 shares of class A common stock. Our charter also authorizes our board of directors, without stockholder approval, to classify or reclassify any unissued shares of our class A common stock and preferred stock into other classes or series of stock and to amend our charter to increase or decrease the aggregate number of shares of stock or the number of shares of stock of any class or series that are authorized by the charter to be issued. Preferred stock may be issued in one or more classes or series, the terms of which may be determined by our board of directors without further action by stockholders. Prior to issuance of any such class or series, our board of directors will set the terms of any such class or series, including the preferences, conversion or other rights, voting powers, restrictions, limitations as to dividends or other distributions, qualifications and terms or conditions of redemption. The issuance of any preferred stock could materially adversely affect the rights of holders of our class A common stock and, therefore, could reduce the value of the class A common stock. In addition, specific rights granted to future holders of our preferred stock could be used to restrict our ability to merge with, or sell assets to, a third party. The power of our board of directors to cause us to issue preferred stock could, in certain circumstances, make it more difficult, delay, discourage, prevent or make it more costly to acquire or effect a change in control, thereby preserving the current stockholders’ control.

Advance Notice Bylaw. Our bylaws contain advance notice procedures for the introduction by a stockholder of new business and the nomination of directors by a stockholder. These provisions could, in certain circumstances, discourage proxy contests and make it more difficult for you and other stockholders to elect stockholder-nominated directors and to propose and, consequently, approve stockholder proposals opposed by management.

Maryland Takeover Statutes. We are subject to the Maryland Business Combination Act, which could delay or prevent an unsolicited takeover of us. The statute substantially restricts the power of third parties who acquire, or seek to acquire, control of us to complete mergers and other business combinations without the approval of our board of directors even if such transaction would be beneficial to stockholders. “Business combinations” between such a third party acquirer or its affiliate and us are prohibited for five years after the most recent date on which the acquirer becomes an “interested stockholder.” An “interested stockholder” is defined as any person who beneficially owns 10% or more of the voting power of our outstanding voting stock or an affiliate or associate of ours who, at any time within the two-year period immediately prior to the date in question, was the beneficial owner of 10% or more of the voting power of our then outstanding stock. If our board of directors approved in advance the transaction that would otherwise give rise to the acquirer attaining such status, the acquirer would not become an interested stockholder and, as a result, it could enter into a business combination with us. Our board of directors may, however, provide that its approval is subject to compliance, at or after the time of approval, with any terms and conditions determined by it. Even after the lapse of the five-year prohibition period, any business combination with an interested stockholder must be recommended by our board of directors and approved by the affirmative vote of at least:

• 80% of the votes entitled to be cast by stockholders; and

• two-thirds of the votes entitled to be cast by stockholders other than the interested stockholder and affiliates and associates thereof.

The super-majority vote requirements do not apply if the transaction complies with a minimum price and form of consideration requirements prescribed by the statute.

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The statute permits various exemptions from its provisions, including business combinations that are exempted by the board of directors prior to the time that an interested stockholder becomes an interested stockholder. Our board of directors has exempted any business combination involving a limited liability company indirectly controlled by a trust for the benefit of Samuel Zell, our former chairman of the board, and his family and approved in advance the issuance of shares to W.R. Berkley. In addition, our board of directors has exempted any business combination involving Huskies Acquisition, an affiliate of Blackstone, or its present affiliates or Blackstone and its present and future affiliates; provided, however, that Huskies Acquisition or any of its present affiliates and Blackstone and any of its present or future affiliates may not enter into any “business combination” with us without the prior approval of at least a majority of the members of our board of directors who are not affiliates or associates of Huskies Acquisition or Blackstone. As a result, these parties may enter into business combinations with us without compliance with the five-year prohibition or the super-majority vote requirements and the other provisions of the statute.

We are also subject to the Maryland Control Share Acquisition Act. With certain exceptions, the Maryland General Corporation Law provides that a holder of “control shares” of a Maryland corporation acquired in a “control share acquisition” has no voting rights except to the extent approved by a vote of two-thirds of the votes entitled to be cast on the matter, excluding shares owned by the acquiring person or by our officers or by our directors who are our employees.

Control shares are voting shares of stock which, if aggregated with all other shares of stock owned or entitled to be voted (except solely by virtue of a revocable proxy) by the acquirer, would entitle the acquirer to exercise voting power in electing directors within one of the specified ranges of voting power. Control shares do not include shares the acquirer is then entitled to vote as a result of having previously obtained stockholder approval. A control share acquisition means the acquisition of issued and outstanding control shares subject to certain exceptions. A person who has made or proposes to make a control share acquisition, upon satisfaction of certain conditions, including an undertaking to pay expenses, may compel our board to call a special meeting of stockholders to be held within 50 days of demand to consider the voting rights of the control shares in question. If no request for a meeting is made, we may present the question at any stockholders meeting.

If voting rights are not approved at a stockholders meeting or if the acquiring person does not deliver the statement required by Maryland law, then, subject to certain conditions and limitations, we may redeem for fair value (determined without regard to the absence of voting rights) any or all of the control shares, except those for which voting rights have previously been approved. If voting rights for control shares are approved at a stockholders meeting and the acquirer may then vote a majority of the shares entitled to vote, then all other stockholders may exercise appraisal rights. The fair value of the shares for purposes of these appraisal rights may not be less than the highest price per share paid by the acquirer in the control share acquisition. The control share acquisition statute does not apply to shares acquired in a merger, consolidation or share exchange if we are a party to the transaction, nor does it apply to acquisitions approved or exempted by our charter or bylaws. Our bylaws contain a provision exempting the following persons from this statute: (i) a limited liability company indirectly controlled by a trust for the benefit of Samuel Zell and his family; (ii) W.R. Berkley Corporation and any of its controlled affiliates; and (iii) Huskies Acquisition, or any person or entity that was an affiliate of Huskies Acquisition as of September 27, 2012 or by Blackstone or any of its affiliates.

We are also eligible to elect to be subject to the Maryland Unsolicited Takeovers Act, which permits our board of directors, without stockholder approval, to, among other things and notwithstanding any provision in our charter or bylaws, elect on our behalf to classify the terms of directors and to increase the stockholder vote required to remove a director. Such an election would significantly restrict the ability of third parties to wage a proxy fight for control of our board of directors as a means of advancing a takeover offer. If an acquirer were discouraged from offering to acquire us, or prevented from successfully completing a hostile acquisition, you could lose the opportunity to sell your shares at a favorable price.

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Our charter contains provisions that are designed to reduce or eliminate duties of Blackstone and our directors with respect to corporate opportunities and competitive activities.

Our charter contains provisions designed to reduce or eliminate duties of Blackstone and its affiliates (as such term is defined in the charter), and of our directors or any person our directors control to refrain from competing with us or to present to us business opportunities that otherwise may exist in the absence of such charter provisions. Under our charter, Blackstone and its affiliates and our directors or any person our directors control will not be obligated to present to us opportunities unless those opportunities are expressly offered to such person in his or her capacity as a director or officer of Blackstone Mortgage Trust and those persons will be able to engage in competing activities without any restriction imposed as a result of Blackstone’s or its affiliates’ status as a stockholder or Blackstone’s affiliates’ status as officers or directors of Blackstone Mortgage Trust.

We have not established a minimum distribution payment level and we cannot assure you of our ability to pay distributions in the future.

We are generally required to distribute to our stockholders at least 90% of our REIT taxable income each year for us to qualify as a REIT under the Internal Revenue Code, which requirement we currently intend to satisfy through quarterly distributions of all or substantially all of our REIT taxable income in such year, subject to certain adjustments. Although we intend to make regular quarterly distributions to holders of our class A common stock and we generally intend to pay quarterly distributions in an amount at least equal to our REIT taxable income, we have not established a minimum distribution payment level and our ability to pay distributions may be adversely affected by a number of factors, including the risk factors described in this report. All distributions will be made at the discretion of our board of directors and will depend on our earnings, our financial condition, debt covenants, maintenance of our REIT qualification, applicable law and other factors as our board of directors may deem relevant from time to time. We believe that a change in any one of the following factors could adversely affect our results of operations and impair our ability to pay distributions to our stockholders:

• our ability to make profitable investments;

• margin calls or other expenses that reduce our cash flow;

• defaults in our asset portfolio or decreases in the value of our portfolio; and

• the fact that anticipated operating expense levels may not prove accurate, as actual results may vary from estimates.

As a result, no assurance can be given that the level of any distributions we make to our stockholders will achieve a market yield or increase or even be maintained over time, any of which could materially and adversely affect the market price of our class A common stock. We may use our net operating losses, to the extent available, carried forward to offset future REIT taxable income, and therefore reduce our dividend requirements. In addition, some of our distributions may include a return of capital, which would reduce the amount of capital available to operate our business.

In addition, distributions that we make to our stockholders will generally be taxable to our stockholders as ordinary income. However, a portion of our distributions may be designated by us as long-term capital gains to the extent that they are attributable to capital gain income recognized by us or may constitute a return of capital to the extent that they exceed our earnings and profits as determined for U.S. federal income tax purposes. A return of capital is not taxable, but has the effect of reducing the basis of a stockholder’s investment in our class A common stock.

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Investing in our class A common stock may involve a high degree of risk.

The investments that we make in accordance with our investment objectives may result in a high amount of risk when compared to alternative investment options and volatility or loss of principal. Our investments may be highly speculative and aggressive, and therefore an investment in our class A common stock may not be suitable for someone with lower risk tolerance.

Future issuances of equity or debt securities, which may include securities that would rank senior to our class A common stock, may adversely affect the market price of the shares of our class A common stock.

The issuance of additional shares of our class A common stock, including in connection with the conversion of our outstanding 5.25% Convertible Senior Notes due 2018, or other future issuances of our class A common stock or shares of preferred stock or securities convertible or exchangeable into equity securities, may dilute the ownership interest of our existing holders of class A common stock. If we decide to issue debt or equity securities which would rank senior to our class A common stock, it is likely that they will be governed by an indenture or other instrument containing covenants restricting our operating flexibility. Additionally, any convertible or exchangeable securities that we issue may have rights, preferences and privileges more favorable than those of our class A common stock and may result in dilution to owners of our class A common stock. We and, indirectly, our stockholders will bear the cost of issuing and servicing such securities. Because our decision to issue additional equity or debt securities in any future offering will depend on market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing or nature of our future issuances. Also, we cannot predict the effect, if any, of future sales of our class A common stock, or the availability of shares for future sales, on the market price of our class A common stock. Sales of substantial amounts of class A common stock or the perception that such sales could occur may adversely affect the prevailing market price for the shares of our class A common stock. Thus holders of our class A common stock will bear the risk of our future issuances reducing the market price of our class A common stock and diluting the value of their stock holdings in us.

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ITEM 1B. UNRESOLVED STAFF COMMENTS

None.

ITEM 2. PROPERTIES

Our principal executive and administrative offices are located in leased space at 345 Park Avenue, 42^nd Floor, New York, New York 10154. We do not own any real property. We consider these facilities to be suitable and adequate for the management and operations of our business.

ITEM 3. LEGAL PROCEEDINGS

None.

ITEM 4. MINE SAFETY DISCLOSURES

Not applicable.

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PART II.

ITEM 5. MARKET FOR REGISTRANT’S COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND ISSUER PURCHASES OF EQUITY SECURITIES

Our class A common stock is listed for trading on the NYSE under the symbol “BXMT.” The table below sets forth, for the calendar quarters indicated, the reported high and low sale prices for our class A common stock as reported on the NYSE composite transaction tape, and the per share cash dividends declared on our class A common stock. All amounts have been retroactively updated to reflect the one-for-ten reverse stock split which we effected as of May 6, 2013.

	2014						2013
	High		Low		Dividend		High		Low		Dividend
First Quarter	$	29.68	$	26.95	$	0.48	$	29.50	$	18.10	$	—
Second Quarter	$	30.04	$	27.84	$	0.48	$	29.28	$	20.60	$	—
Third Quarter	$	29.25	$	27.08	$	0.50	$	26.55	$	23.89	$	0.27
Fourth Quarter	$	29.70	$	26.51	$	0.52	$	28.20	$	24.31	$	0.45
Total					$	1.98					$	0.72

The last reported sale price of our class A common stock on February 10, 2015 as reported on the NYSE composite transaction tape was $28.91. As of February 5, 2015, there were 197 holders of record of our class A common stock. By including persons holding shares in broker accounts under street names, however, we estimate our stockholder base to be approximately 21,326 holders as of February 5, 2015.

During the year ended December 31, 2014, we declared aggregate quarterly dividends of $1.98 per share, of which approximately $1.92 will be included as taxable dividends for 2014 and approximately $0.06 will be recognized in 2015. Substantially all of the 2014 dividends represented ordinary income. During the year ended December 31, 2013, we declared aggregate quarterly dividends of $0.72 per share, all of which represented ordinary income. We generally intend to distribute each year substantially all of our taxable income (which does not necessarily equal net income as calculated in accordance with generally accepted accounting principles, or GAAP) to our stockholders so as to comply with the REIT provisions of the Internal Revenue Code, as amended. In addition, our dividend policy remains subject to revision at the discretion of our board of directors. All distributions will be made at the discretion of our board of directors and will depend upon, among other things, our actual results of operations and liquidity. These results and our ability to pay distributions will be affected by various factors, including our taxable income, our financial condition, our maintenance of REIT status, applicable law, and other factors as our board of directors deems relevant. In accordance with Internal Revenue Service guidance, we are required to report the amount of excess inclusion income earned by us. We calculated excess inclusion income to be de minimis.

Issuer Purchases of Equity Securities

We did not repurchase any of our class A common stock during the three months ended December 31, 2014.

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Equity Compensation Plan Information

The following table summarizes information, as of December 31, 2014, relating to our equity compensation plans pursuant to which shares of our class A common stock or other equity securities may be granted from time to time:

Plan category	(a) Number of securities to be issued upon exercise of outstanding options, warrants, and rights		(b) Weighted average exercise price of outstanding options, warrants, and  rights		(c) Number of securities remaining available for future issuance under equity  compensation plans (excluding securities reflected in column (a))
Equity compensation plans approved by security holders(1)		—	$	—		939,319
Equity compensation plans not approved by security holders(2)		—		—		—
Total		—	$	—		939,319

(1) The number of securities remaining for future issuances consists of an aggregate 939,319 shares issuable under our 2013 stock incentive plan and our 2013 manager incentive plan which were approved by our stockholders. Awards under the plan may include restricted stock, unrestricted stock, stock options, stock units, stock appreciation rights, performance shares, performance units, deferred share units, or other equity-based awards, as the board of directors may determine.

(2) All of our equity compensation plans have been approved by security holders.

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ITEM 6. SELECTED FINANCIAL DATA

The following selected consolidated historical financial data should be read in conjunction with the information set forth under “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations” and the consolidated financial statements and the related notes thereto that appear on pages F-2 to F-41 of this report.

	Years ended December 31,(1)
	2014			2013			2012			2011			2010
	(in thousands, except for per share data)
Revenues
Interest and related income	$	184,766		$	53,164		$	34,939		$	117,161		$	158,792
Total revenues		184,766			53,164			34,939			117,161			158,792
Expenses
Interest expense		69,143			18,017			38,138			96,974			123,963
Management and incentive fees		19,491			5,937			—			—			—
General and administrative expenses		27,799			11,505			10,369			8,982			6,035
Total expenses		116,433			35,459			48,507			105,956			129,998
Impairments, provisions, and valuation adjustments		13,258			8,676			87,891			(31,251	)		(220,963	)
Gain on extinguishment of debt		—			—			—			271,031			3,134
(Loss) gain on deconsolidation of subsidiaries		(8,615	)		—			200,283			—			—
Other income		—			38			6,000			—			—
Income from equity investments in unconsolidated subsidiaries		28,036			—			1,781			3,649			3,608
Income (loss) before income taxes		101,012			26,419			282,387			254,634			(185,427	)
Income tax provision		518			995			174			1,425			14
Net income (loss) from continuing operations		100,494			25,424			282,213			253,209			(185,441	)
Net (loss) income from discontinued operations, net of tax		—			—			(2,138	)		(890	)		97
Loss on sale of discontinued operations		—			—			(271	)		—			—
Net income (loss)		100,494			25,424			279,804			252,319			(185,344	)
Net (income) loss attributable to non-controlling interests		(10,449	)		(10,392	)		(98,780	)		5,823			—
Net income (loss) attributable to Blackstone Mortgage Trust, Inc.	$	90,045		$	15,032		$	181,024		$	258,142		$	(185,344	)
Net income (loss) from continuing operations per share of common stock
Basic	$	1.86		$	0.81		$	78.19		$	114.31		$	(82.89	)
Diluted	$	1.86		$	0.81		$	74.16		$	108.17		$	(82.89	)
Net (loss) income from discontinued operations per share of common stock
Basic	$	—		$	—		$	(1.03	)	$	(0.39	)	$	0.04
Diluted	$	—		$	—		$	(1.03	)	$	(0.39	)	$	0.04
Net income (loss) per share of common stock
Basic	$	1.86		$	0.81		$	77.16		$	113.92		$	(82.85	)
Diluted	$	1.86		$	0.81		$	73.13		$	107.78		$	(82.85	)
Weighted-average shares of common stock outstanding
Basic		48,394			18,520			2,346			2,266			2,237
Diluted		48,394			18,520			2,475			2,395			2,237
Dividends declared per share of common stock	$	1.98		$	0.72		$	20.00		$	—		$	—

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	As of December 31,
	2014		2013		2012		2011			2010
	(in thousands)
Balance Sheet Data
Total assets	$	4,588,521	$	2,212,780	$	322,343	$	1,366,316		$	4,120,690
Total liabilities		3,087,635		1,456,030		168,890		1,495,255			4,531,877
Non-controlling interests		35,515		38,841		80,009		(18,515	)		—
Total equity (deficit)		1,500,886		756,750		73,444		(110,424	)		(411,187	)

(1) The consolidated historical financial data above may not be comparable due to the significant impact on our consolidated financial statements of (i) the Investment Management Business Sale in December 2012 and (ii) a corporate debt restructuring we completed in March 2011. Refer to Note 11 to our consolidated financial statements for additional details of the Investment Management Business sale. In addition, on April 26, 2013, our board of directors approved a one-for-ten reverse stock split of our class A common stock which we effected on May 6, 2013. As a result, share and per share amounts have been retroactively updated to reflect the one-for-ten reverse stock split.

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ITEM 7. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

References herein to “Blackstone Mortgage Trust,” “Company,” “we,” “us” or “our” refer to Blackstone Mortgage Trust, Inc. and its subsidiaries unless the context specifically requires otherwise.

The following discussion should be read in conjunction with the consolidated financial statements and notes thereto appearing elsewhere in this Annual Report on Form 10-K. In addition to historical data, this discussion contains forward-looking statements about our business, operations and financial performance based on current expectations that involve risks, uncertainties and assumptions. Our actual results may differ materially from those in this discussion as a result of various factors, including but not limited to those discussed in Part, 1. Item 1A, “Risk Factors” in this Annual Report on Form 10-K.

Introduction

Blackstone Mortgage Trust is a real estate finance company that originates and purchases senior loans collateralized by properties in North America and Europe. We are externally managed by BXMT Advisors L.L.C., or our Manager, a subsidiary of The Blackstone Group L.P., or Blackstone, and are a real estate investment trust, or REIT, traded on the New York Stock Exchange, or NYSE, under the symbol “BXMT.” We are headquartered in New York City.

We conduct our operations as a REIT for U.S. federal income tax purposes. We generally will not be subject to U.S. federal income taxes on our taxable income to the extent that we annually distribute all of our net taxable income to stockholders and maintain our qualification as a REIT. We also operate our business in a manner that permits us to maintain an exclusion from registration under the Investment Company Act of 1940, as amended. We are organized as a holding company and conduct our business primarily through our various subsidiaries. Our business is organized into two operating segments: the Loan Origination segment and the CT Legacy Portfolio segment.

2014 Highlights

Operating results:

• Net income of $1.86 per share in 2014 represents an increase of 129.6% compared to 2013, reflecting the launch of our senior lending program in May 2013.

• Achieved Core Earnings of $91.6 million during 2014 compared to $18.9 million during 2013.

• Declared aggregate dividends of $1.98 per share in 2014, with the fourth quarter representing an annualized yield of 8.3% on our December 31, 2014 book value of $25.10.

• Issued 28,275,000 shares of class A common stock at a weighted-average price of $27.14 per share, contributing to a net $0.85 per share increase in book value during 2014.

Loan originations:

• Continued to grow our floating-rate Loan Origination portfolio with 35 loans closed during 2014, representing total commitments of $3.4 billion. As of December 31, 2014, 20% of our portfolio was secured by collateral located outside of the United States.

• Total Loan Origination segment portfolio of $4.4 billion with a weighted-average loan-to-value of 64%, all of which are performing floating-rate loans.

Secured financings:

• Credit capacity of $4.4 billion includes six revolving repurchase facilities, three asset-specific financings, four senior-loan participations sold, and one non-consolidated senior interest.

• All-in cost of revolving repurchase facilities of L+2.11% as of December 31, 2014, providing stable, non-capital markets based mark-to-market financings.

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I. Key Financial Measures and Indicators

As a real estate finance company, we believe the key financial measures and indicators for our business are earnings per share, dividends per share, Core Earnings per share, and book value per share. For the year ended December 31, 2014 we recorded earnings per share of $1.86, declared dividends of $1.98 per share, and reported $1.89 per share of Core Earnings. In addition, our book value per share as of December 31, 2014 was $25.10. As further described below, Core Earnings is a measure that is not prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP. We use Core Earnings to evaluate our performance excluding the effects of certain transactions and GAAP adjustments that are not necessarily indicative of our current Loan Origination segment portfolio and operations.

Earnings Per Share and Dividends Declared

The following table sets forth the calculation of basic and diluted net income per share and the allocation of basic and diluted net income per share between our two reportable segments based on the weighted average of our shares of class A common stock, including restricted class A common stock and deferred stock units outstanding ($ in thousands, except per share data):

	Three Months Ended December 31, 2014							Year Ended December 31, 2014
	Loan Origination		CT Legacy Portfolio			Total
Net income (loss)(1)	$	26,323	$	(4,833	)	$	21,490	$	90,045
Weighted-average shares outstanding, basic and diluted		58,190,324		58,190,324			58,190,324		48,394,478
Net income (loss) per share,basic and diluted	$	0.45	$	(0.08	)	$	0.37	$	1.86
Dividends per share						$	0.52	$	1.98

(1) Represents net income attributable to Blackstone Mortgage Trust, Inc.

Core Earnings

Core Earnings is a non-GAAP measure, which we define as GAAP net income (loss), including realized gains and losses not otherwise included in GAAP net income (loss), and excluding (i) net income (loss) attributable to our CT Legacy Portfolio segment, (ii) non-cash equity compensation expense, (iii) incentive management fees, (iv) depreciation and amortization, (v) unrealized gains (losses), and (vi) certain non-cash items. Core Earnings may also be adjusted from time to time to exclude one-time events pursuant to changes in GAAP and certain other non-cash charges as determined by our Manager, subject to approval by a majority of our independent directors.

We believe that Core Earnings provides meaningful information to consider in addition to our net income and cash flow from operating activities determined in accordance with GAAP. This adjusted measure helps us to evaluate our performance excluding the effects of certain transactions and GAAP adjustments that we believe are not necessarily indicative of our current Loan Origination segment portfolio and operations. We also use Core Earnings to calculate the incentive and base management fees due to our Manager under our management agreement and, as such, we believe that the disclosure of Core Earnings is useful to our investors.

Core Earnings does not represent net income or cash generated from operating activities and should not be considered as an alternative to GAAP net income, or an indication of our GAAP cash flows from operations, a measure of our liquidity, or an indication of funds available for our cash needs. In addition, our methodology for calculating Core Earnings may differ from the methodologies employed by other companies to calculate the same or similar supplemental performance measures, and accordingly, our reported Core Earnings may not be comparable to the Core Earnings reported by other companies.

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The following table provides a reconciliation of Core Earnings to GAAP net income ($ in thousands, except share and per share data):

	Three Months Ended December 31, 2014		Year Ended December 31, 2014
Net income(1)	$	21,490	$	90,045
CT Legacy Portfolio segment net loss (income)		4,833		(9,839	)
Incentive management fees		817		1,659
Amortization of discount on convertible notes		408		1,600
Unrealized gain on foreign currency remeasurement		—		(203	)
Non-cash compensation expense		2,528		8,363
Core Earnings	$	30,076	$	91,625
Weighted-average shares outstanding, basic and diluted		58,190,324		48,394,478
Core Earnings per share, basic and diluted	$	0.52	$	1.89

(1) Represents net income attributable to Blackstone Mortgage Trust, Inc.

Book Value Per Share

The following table calculates our book value per share and the allocation of our book value per share between our two reportable segments ($ in thousands, except share and per share data):

	December 31, 2014						December 31, 2013
	Loan Origination		CT Legacy Portfolio		Total
Stockholders’ equity	$	1,442,891	$	22,480	$	1,465,371	$	717,909
Shares
Class A common stock		57,350,170		57,350,170		57,350,170		28,801,651
Restricted class A common stock		919,719		919,719		919,719		700,000
Deferred stock units		118,919		118,919		118,919		101,233
		58,388,808		58,388,808		58,388,808		29,602,884
Book value per share	$	24.71	$	0.39	$	25.10	$	24.25

II. Loan Origination Portfolio

During the year ended December 31, 2014, our Loan Origination segment funded $3.1 billion of new loan commitments and generated interest income of $180.7 million. Our loan originations were financed with $1.7 billion of secured financings, $766.1 million of net proceeds from the sale of our class A common stock, and $571.2 million of loan principal collections. We incurred interest expense of $68.1 million during the year, which resulted in $112.6 million of net interest income during the year.

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Portfolio Overview

The following table details our loan originations activity during the three months and year ended December 31, 2014 ($ in thousands):

	Three Months Ended December 31, 2014				Year Ended December 31, 2014
	Loan Commitments(2)		Loan Fundings(3)		Loan Commitments(2)		Loan Fundings(3)
Senior loans(1)	$	780,880	$	769,613	$	3,441,255	$	3,066,810
Subordinate loans		—		105		—		453
Total	$	780,880	$	769,718	$	3,441,255	$	3,067,263

(1) Includes senior mortgages and similar credit quality loans, including related contiguous subordinate loans, and pari passu participations in senior mortgage loans.

(2) Includes new originations and additional commitments made under existing loan agreements.

(3) Loan fundings during the three months ended December 31, 2014 included $137.1 million of additional fundings under existing loan commitments as of September 30, 2014, and loan fundings during the year ended December 31, 2014 included $53.8 million of additional fundings under existing loan commitments as of December 31, 2013.

As of December 31, 2014, the majority of loans in the Loan Origination segment were senior mortgages and similar credit quality loans.

The following table details overall statistics for our loan portfolio within the Loan Origination segment ($ in thousands):

	December 31, 2014			December 31, 2013
Number of loans		60			28
Principal balance	$	4,462,897		$	2,018,863
Net book value	$	4,428,500		$	2,000,223
Unfunded loan commitments(1)	$	513,229		$	164,283
Weighted-average cash coupon(2)		L+4.36	%		L+4.64	%
Weighted-average all-in yield(2)		L+4.81	%		L+5.28	%
Weighted-average maximum maturity (years)(3)		3.9			4.2

(1) Unfunded commitments will primarily be funded to finance property improvements or lease-related expenditures by the borrowers. These future commitments will expire over the next five years.

(2) As of December 31, 2014, our floating rate loans and related liabilities were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Therefore the net exposure to each benchmark rate is in direct proportion to our net assets indexed to that rate. In addition, 14% of our loans earned interest based on LIBOR floors, with an average floor of 0.31%, as of December 31, 2014. In addition to cash coupon, all-in yield includes the amortization of deferred origination fees, loan origination costs, and accrual of both extension and exit fees.

(3) Maximum maturity assumes all extension options are exercised by the borrower, however our loans may be repaid prior to such date. As of December 31, 2014, 85% of our loans are subject to yield maintenance, lock-out provisions, or other prepayment restrictions and 15% are open to repayment by the borrower.

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The charts below detail the geographic distribution and types of properties securing these loans, as of December 31, 2014 ($ in millions):

Refer to section V of this Item 7 for details of our loan portfolio, on a loan-by-loan basis.

Asset Management and Performance

We actively manage the investments in our Loan Origination segment portfolio and exercise the rights afforded to us as a lender, including collateral level budget approvals, lease approvals, loan covenant enforcement, escrow/reserve management/collection, collateral release approvals and other rights that we may negotiate.

As discussed in Note 2 to our consolidated financial statements, our Manager performs a quarterly review of our loan portfolio, assesses the performance of each loan, and assigns it a risk rating between “1” and “5,” from less risk to greater risk. Previously, our Manager assigned risk ratings between “1” and “8,” from less risk to greater risk.

As of December 31, 2014, all of the investments in the Loan Origination segment are performing as expected and the weighted-average risk rating of our loan portfolio is 2.2.

Secured Financings

Our secured financings included revolving repurchase facilities, asset-specific repurchase agreements, and loan participations sold. The following table details our revolving repurchase facilities outstanding ($ in thousands):

	December 31, 2014										Dec. 31, 2013 Borrowings Outstanding
	Maximum Facility Size(1)		Collateral Assets(2)		Repurchase Borrowings(3)
Lender					Potential		Outstanding		Available
Wells Fargo	$	1,000,000	$	747,256	$	585,737	$	484,365	$	101,372	$	—
Citibank		500,000		621,025		472,080		392,455		79,625		334,692
Bank of America		500,000		557,810		441,201		389,347		51,854		271,320
JP Morgan(4)		488,155		544,654		422,249		341,487		80,762		257,610
MetLife		500,000		476,499		366,902		305,889		61,013		—
Morgan Stanley(5)		389,050		174,297		137,181		127,240		9,941		—
	$	3,377,205	$	3,121,541	$	2,425,350	$	2,040,783	$	384,567	$	863,622

(1) Maximum facility size represents the total amount of borrowings in each repurchase agreement; however these borrowings are only available to us once sufficient collateral assets have been pledged under each facility at the discretion of the lender.

(2) Represents the principal balance of the collateral assets.

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(3) Potential borrowings represent the total amount we could draw under each facility based on collateral already approved and pledged. When undrawn, these amounts are immediately available to us at our sole discretion under the terms of each revolving credit facility.

(4) The JP Morgan maximum facility size is composed of a $250.0 million facility and a £153.0 million ($238.2 million) facility.

(5) The Morgan Stanley maximum facility size represents a £250.0 million ($389.1 million) facility.

As of December 31, 2014, we had aggregate borrowings of $2.0 billion outstanding under our revolving repurchase facilities, with a weighted-average cash coupon of LIBOR plus 1.88% per annum and a weighted-average all-in cost of credit, including associated fees and expenses, of LIBOR plus 2.11% per annum. As of December 31, 2014, outstanding borrowings under these facilities had a weighted-average maturity, excluding extension options and term-out provisions, of 1.8 years.

The following table details our asset-specific repurchase agreements and loan participations sold as of December 31, 2014 ($ in thousands):

	Asset-specific Repurchase Agreements						Loan Participations Sold(2)(3)
	Repurchase Agreements			Collateral Assets			Participations Sold			Underlying Loans
Number of loans		3			4			4			4
Principal balance	$	324,553		$	429,197		$	499,433		$	635,701
Weighted-average cash coupon(1)		L+2.68	%		L+5.07	%		L+2.51	%		L+4.10	%
Weighted-average all-in yield / cost(1)		L+3.16	%		L+5.53	%		L+2.71	%		L+4.71	%

(1) As of December 31, 2014, our floating rate loans and related liabilities were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Therefore the net exposure to each benchmark rate is in direct proportion to our net assets indexed to that rate. In addition to cash coupon, all-in yield / cost includes the amortization of deferred origination fees / financing costs.

(2) We also sold a $110.0 million senior interest in a loan that qualified for sale accounting under GAAP and is therefore no longer included on our consolidated balance sheet.

(3) During 2014, we recorded $12.4 million of interest expense related to our loan participations sold.

Refer to Note 6 to our consolidated financial statements for additional terms and details of our secured financings, including certain financial covenants.

Floating Rate Portfolio

Our Loan Origination segment portfolio as of December 31, 2014 was comprised of floating rate loans financed by floating rate secured debt, which results in a return on equity that is correlated to LIBOR. Generally, our business model is such that rising interest rates will increase our net income, while declining interest rates will decrease net income. For instance, all other things being equal, as of December 31, 2014, a 100 basis point increase in LIBOR would have increased our net income by $15.2 million per annum, or $0.26 per share, while a 10 basis point decrease in LIBOR would have decreased our net income to $902,000 per annum, or $0.02 per share.

The following table details our Loan Origination segment’s sensitivity to interest rates ($ in thousands):

	December 31, 2014
Floating rate loans(1)	$	4,462,897
Floating rate debt(1)(2)		(2,864,769	)
Net floating rate exposure	$	1,598,128
Net income impact from 100 bps increase in LIBOR(3)	$	15,160
Per share impact, basic and diluted	$	0.26

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(1) As of December 31, 2014, our floating rate loans and related liabilities were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Therefore the net exposure to each benchmark rate is in direct proportion to our net assets indexed to that rate.

(2) Includes borrowings under revolving repurchase facilities, asset-specific repurchase agreements, and loan participations sold.

(3) Annualized net income includes the impact of LIBOR floors for our loan receivable investments where such floors are paying relative to LIBOR of 0.17% as of December 31, 2014.

Convertible Notes

In November 2013, we issued $172.5 million of 5.25% convertible senior notes due on December 1, 2018, or the Convertible Notes. The Convertible Notes issuance costs, including underwriter discounts, are amortized through interest expense over the life of the Convertible Notes using the effective interest method. Including this amortization, our all-in cash cost of the Convertible Notes is 5.87%.

Refer to Notes 2 and 7 to our consolidated financial statements for additional discussion of our Convertible Notes.

III. CT Legacy Portfolio

As of December 31, 2014, Our CT Legacy Portfolio segment consists of: (i) our interests in CT Legacy Partners, LLC, or CT Legacy Partners and (ii) our carried interest in CTOPI, a private investment fund that was previously under our management and is now managed by an affiliate of our Manager.

During the year ended December 31, 2014, our CT Legacy Portfolio segment recorded net income of $9.8 million driven primarily by (i) $28.0 million of revenue from our carried interest in CTOPI and (ii) $13.3 million of net unrealized gains on investments carried at fair value in CT Legacy Partners. This was offset by (i) $12.9 million of compensation expenses triggered by CTOPI carried interest distributions received and (ii) the recognition of an $8.6 million loss as a result of the 100% impairment of our subordinate interests in CT CDOI which resulted in its deconsolidation.

CT Legacy Partners

As of December 31, 2014, the CT Legacy Partners portfolio consisted of cash, loans, securities, and other assets. As of December 31, 2014, CT Legacy Partners’ total equity was $60.8 million, of which $25.3 million was owned by Blackstone Mortgage Trust, Inc., and $35.5 million was allocated to non-controlling interests. Assuming a $3.5 million fully-vested payment of the related management incentive awards plan, our net interest in CT Legacy Partners would be $21.8 million. We periodically accrue a payable for the management incentive awards plan based on the vesting schedule for the awards and continued employment with an affiliate of our Manager of the award recipients. As of December 31, 2014, our balance sheet includes $2.8 million in accounts payable and accrued expenses for the management incentive awards plan. Refer to Note 10 to our consolidated financial statements for additional discussion of the CT Legacy Partners management incentive plan.

Carried Interest in CTOPI

In 2012, we transferred our management of CTOPI and sold our 4.6% co-investment to Blackstone. However, we retained our carried interest in CTOPI following the sale, which entitles us to earn carried interest distributions in an amount equal to 17.7% of the fund’s profits, after a 9% preferred return and 100% return of capital to the CTOPI partners. We own a net 55% of the carried interest of CTOPI’s general partner; the remaining 45% is payable under previously issued incentive awards. Refer to Note 5 to our consolidated financial statements for additional discussion of the CTOPI incentive awards.

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During the year ended December 31, 2014, CTOPI returned all capital to its limited partners and made a $17.9 million carried interest distribution to us. In addition, the return of investor capital by CTOPI eliminated the remaining contingencies related to our recognition of $10.2 million of prior tax advance distributions, resulting in total carried interest revenue recognized of $28.0 million.

As of December 31, 2014, we had been allocated $5.8 million of carried interest revenue from CTOPI based on a hypothetical liquidation of the fund at its net asset value, and after payment of the related incentive awards. Generally, we defer the recognition of income on our carried interest in CTOPI until cash is collected or appropriate contingencies have been eliminated. As a result, our net investment in the CTOPI carried interest had a book value of zero as of December 31, 2014.

IV. Our Results of Operations and Liquidity

Results of Operations

The following table sets forth information regarding our consolidated results of operations and certain key operating metrics for the years ended December 31, 2014, 2013, and 2012 ($ in thousands, except per share data):

	Year Ended December 31,						2014 vs 2013			Year Ended December 31,						2013 vs 2012
	2014			2013			$			2013			2012			$
Income from loans and other investments
Interest and related income	$	184,766		$	53,164		$	131,602		$	53,164		$	34,939		$	18,225
Less: Interest and related expenses		69,143			18,017			51,126			18,017			38,138			(20,121	)
Income (loss) from loans and other investments, net		115,623			35,147			80,476			35,147			(3,199	)		38,346
Other expenses
Management and incentive fees		19,491			5,937			13,554			5,937			—			5,937
General and administrative expenses		27,799			11,505			16,294			11,505			10,369			1,136
Total other expenses		47,290			17,442			29,848			17,442			10,369			7,073
Impairments, provisions, and valuation adjustments		13,258			8,676			4,582			8,676			87,891			(79,215	)
(Loss) gain on deconsolidation of subsidiary		(8,615	)		—			(8,615	)		—			200,283			(200,283	)
Other income (loss)		—			38			(38	)		38			6,000			(5,962	)
Income from equity investments in unconsolidated subsidiaries		28,036			—			28,036			—			1,781			(1,781	)
Income before income taxes		101,012			26,419			74,593			26,419			282,387			(255,968	)
Income tax provision		518			995			(477	)		995			174			821
Income from continuing operations	$	100,494		$	25,424		$	75,070		$	25,424		$	282,213		$	(256,789	)
Loss from discontinued operations, net of tax		—			—			—			—			(2,138	)		2,138
Loss on sale of discontinued operations		—			—			—			—			(271	)		271
Net income	$	100,494		$	25,424		$	75,070		$	25,424		$	279,804		$	(254,380	)
Net income attributable to non-controlling interests		(10,449	)		(10,392	)		(57	)		(10,392	)		(98,780	)		88,388
Net income attributable to Blackstone Mortgage Trust, Inc.	$	90,045		$	15,032		$	75,013		$	15,032		$	181,024		$	(165,992	)
Income from continuing operations per share – diluted	$	1.86		$	0.81					$	0.81		$	74.16
Net income per share – diluted	$	1.86		$	0.81					$	0.81		$	73.13
Dividends per share	$	1.98		$	0.72					$	0.72		$	20.00

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Income from loans and other investments, net

Income from loans and other investments, net increased by $80.5 million during 2014 compared to 2013. This increase is comprised of $84.0 million related to our Loan Origination segment offset by a decrease of $3.5 million related to our CT Legacy Portfolio segment. The increase in our Loan Origination segment is a result of operating our originations business for a full year in 2014, compared to only a partial year of operations in 2013. The decrease in the CT Legacy Portfolio segment was driven by loan repayments received during the year.

Income from loans and other investments, net increased by $38.3 million during 2013 compared to 2012. This increase is comprised of $28.6 million related to our Loan Origination segment and $9.7 million related to our CT Legacy Portfolio segment. The increase in our Loan Origination segment is a result of the re-launch of our originations business in May 2013. The increase in the CT Legacy Portfolio segment relates to the deconsolidation of CT CDOs II and IV in December 2013 as well as a $10.2 million one-time expense in 2012 relating to the acceleration of discount associated with the $83.0 million CT Legacy Partners mezzanine loan.

Other expenses

Other expenses includes management and incentive fees paid to our Manager and general and administrative expenses. All general and administrative expenses incurred during 2012 related to our former investment management business have been reclassified to loss from discontinued operations.

Other expenses increased by $29.8 million during 2014 compared to 2013 primarily due to (i) an increase of $13.6 million of management and incentive fees payable to our Manager, primarily as a result of additional net proceeds received from the sale of shares of our class A common stock, (ii) $9.3 million of non-cash compensation expenses associated with our CT Legacy Portfolio segment incentive plans, and (iii) $6.9 million of non-cash restricted stock amortization related to shares awarded under our long-term incentive plans.

Other expenses increased by $7.1 million during 2013 compared to 2012 primarily due to (i) an increase of $6.0 million of management fees payable to our Manager, (ii) $2.5 million of non-cash compensation expenses driven by the accelerated vesting of certain awards under the CT Legacy Partners incentive plan, (iii) $1.7 million of additional professional fees and other operating costs, and (iv) $787,000 of additional expenses of our consolidated securitized vehicles. These were partially offset by a decrease of $3.8 million of transaction costs incurred during 2012 related to sale of our investment management business.

Impairments, provisions, and valuation adjustments

During 2014, we recognized $13.3 million of net gains on investments held by CT Legacy Partners.

During 2013, we recognized (i) $7.4 million of net gains on investments held by CT Legacy Partners and (ii) a $1.3 million positive valuation adjustment on CT CDO I’s loan classified as held-for-sale.

During 2012, we recognized (i) a $51.9 million positive fair value adjustment on our net investment in CT Legacy Asset, (ii) a $36.1 million net recovery of provision for loan losses, and (iii) a $160,000 impairment, representing an additional credit loss on one of the securities in CT CDO I.

Income from equity investments in unconsolidated subsidiaries

During 2014, we recognized $28.0 million of promote revenue from CTOPI. No such income was recognized during 2013.

The income from equity investments during 2012 of $1.8 million was comprised of income from our co-investments in CTOPI and CT High Grade II. In December 2012, these co-investments were sold as a component of the sale of our investment management business.

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(Loss) gain on deconsolidation of subsidiary

During 2014, we recognized a loss of $8.6 million on the deconsolidation of CT CDO I resulting from the write-off of our subordinate interests in that securitization vehicle. Refer to Note 2 to our consolidated financial statements for further details.

During 2012, we recognized a gain of $146.4 million on the deconsolidation of CT Legacy Asset and $53.9 million on the deconsolidation of CT CDOs II and IV. These gains were primarily the result of a reversal of charges to GAAP equity resulting from losses previously recorded in excess of our economic interests in these vehicles.

Other significant items

Our income tax provision decreased by $477,000 during 2014 compared to 2013. The decrease was primarily driven by the repayment of investments held by our taxable REIT subsidiaries during 2013. During 2012, we recorded an income tax provision primarily related to alternative minimum taxes incurred as a result of our use of net operating losses, or NOLs, to offset 2012 taxable income.

As a result of the sale of our investment management business in December 2012, our 2014 and 2013 operating results do not include any income or expense items related to our former investment management business. The income and expense items related to our investment management business in 2012 have been reclassified to loss from discontinued operations.

Dividends per share

During 2014, we declared aggregate dividends of $101.3 million, or $1.98 per share. During 2013, we declared aggregate dividends of $21.1 million, or $0.72 per share. During 2012, we declared a special dividend of $48.6 million, or $20.00 per share.

Liquidity and Capital Resources

Capitalization

During 2014, we issued 28,275,000 shares of our class A common stock in public offerings at a weighted-average price to the underwriters of $27.14 per share. We generated aggregate net proceeds from these issuances of $766.1 million after deducting underwriting discounts and other offering expenses.

See Note 9 to our consolidated financial statements for additional details regarding our recent equity offerings.

During 2014, we entered into three revolving repurchase facilities, two asset-specific repurchase agreements, and sold three senior loan participations, providing $2.2 billion of financing capacity. As of December 31, 2014, we had aggregate borrowings of $2.0 billion outstanding under our revolving repurchase facilities, with a weighted-average cash coupon of LIBOR plus 1.88% per annum and a weighted-average all-in cost of credit, including associated fees and expenses, of LIBOR plus 2.11% per annum. We also had three asset-specific repurchase agreements outstanding with an aggregate outstanding balance of $324.6 million, a cash coupon of LIBOR plus 2.68%, and an all-in cost of LIBOR plus 3.16%, as well as loan participations sold outstanding with an aggregate book balance of $499.4 million, a cash coupon of LIBOR plus 2.51%, and an all-in cost of LIBOR plus 2.71%.

See Note 6 to our consolidated financial statements for additional details regarding our secured financings.

As of December 31, 2014, we also had $172.5 million aggregate principal amount of convertible notes with a net book value of $161.9 million, which carry a cash coupon of 5.25% and an all-in cost of 5.87%. These notes mature in December 2018.

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Sources of Liquidity

Our primary sources of liquidity include cash and cash equivalents and available borrowings under our repurchase facilities, which are set forth in the following table ($ in thousands):

	As of December 31,
	2014		2013
Cash and cash equivalents	$	51,810	$	52,342
Available borrowings under repurchase facilities		384,567		218,555
	$	436,377	$	270,897

In addition to our current sources of liquidity, we have access to liquidity through public offerings of debt and equity securities. To facilitate such offerings, in July 2013, we filed a shelf registration statement with the SEC that is effective for a term of three years and will expire in July 2016. The amount of securities to be issued pursuant to this shelf registration statement was not specified when it was filed and there is no specific dollar limit on the amount of securities we may issue. The securities covered by this registration statement include: (i) class A common stock, (ii) preferred stock, (iii) debt securities, (iv) depositary shares representing preferred stock, (v) warrants, (vi) subscription rights, (vii) purchase contracts, and (viii) units consisting of one or more of such securities or any combination of these securities. The specifics of any future offerings, along with the use of proceeds of any securities offered, will be described in detail in a prospectus supplement, or other offering materials, at the time of any offering.

We may also access liquidity through a dividend reinvestment plan and direct stock purchase plan, under which we registered and reserved for issuance, in the aggregate, 10,000,000 shares of class A common stock, and our at-the-market stock offering program, pursuant to which we may sell, from time to time, up to an aggregate of $200.0 million of our class A common stock.

Our existing loan portfolio also provides us with liquidity as loans are repaid, in whole or in part, and the proceeds from such repayments become available for us to reinvest.

Liquidity Needs

In addition to our ongoing loan origination activity, our primary liquidity needs include interest and principal payments under our $3.0 billion of outstanding debt obligations, our $513.2 million of unfunded loan commitments, dividend distributions to our stockholders, and operating expenses.

Contractual Obligations and Commitments

Our contractual obligations and commitments as of December 31, 2014 were as follows ($ in thousands):

	Total		Less than 1 year		1 to 3 years		3 to 5 years		More than 5 years
Unfunded loan commitments(1)	$	513,229	$	70,135	$	403,019	$	40,075	$	—
Revolving repurchase facilities(2)		2,040,783		253,825		1,729,769		57,189		—
Asset-specific repurchase agreements(3)		348,092		54,311		293,781		—		—
Loan participations sold(3)		556,388		43,997		114,138		398,253		—
Convertible notes, net		209,228		9,937		18,364		180,927		—
Total	$	3,667,720	$	432,205	$	2,559,071	$	676,444	$	—

(1) The allocation of our unfunded loan commitments is based on the earlier of the commitment expiration date or the loan maturity date.

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(2) The allocation of our revolving repurchase facilities is based on the initial maturity date of each individual borrowing under our revolving repurchase facilities. Excludes the related future interest payment obligations, which are not fixed and determinable due to the revolving nature of these facilities.

(3) Obligations were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Future interest payment obligations are determined using the relevant benchmark rates in effect as of December 31, 2014.

We are also required to pay our Manager a base management fee, an incentive fee, and reimbursements for certain expenses pursuant to our Management Agreement. The table above does not include the amounts payable to our Manager under our Management Agreement as they are not fixed and determinable. Refer to Note 10 to our consolidated financial statements for additional terms and details of the fees payable under our Management Agreement.

As a REIT, we generally must distribute substantially all of our net taxable income to shareholders in the form of dividends to comply with the REIT provisions of the Internal Revenue Code. Our taxable income does not necessarily equal our net income as calculated in accordance with GAAP, or our Core Earnings as described above.

Cash Flows

The following table provides a breakdown of the net change in our cash and cash equivalents ($ in thousands):

	For the years ended December 31,
	2014			2013			2012
Cash flows from operating activities	$	80,637		$	28,669		$	6,768
Cash flows from investing activities		(2,412,896	)		(1,782,491	)		189,601
Cash flows from financing activities		2,333,936			1,790,718			(215,764	)
Net increase (decrease) in cash and cash equivalents	$	1,677		$	36,896		$	(19,395	)

We experienced a net increase in cash of $1.7 million for the year ended December 31, 2014, compared to a net increase of $36.9 million for the year ended December 31, 2013. During 2014, we (i) borrowed $1.2 billion under our repurchase facilities, (ii) generated $766.1 million of net proceeds from the sale of our class A common stock, (iii) received $620.4 million of proceeds from loan sales and principal collections, and (iv) and sold $432.5 million of loan participations. We used the proceeds from our debt and equity financing activities to originate $3.1 billion of new loans during the year ended December 31, 2014. Refer to Notes 6 and 9 to our consolidated financial statements for additional discussion of our sale of shares of class A common stock and our debt obligations, respectively. Refer to Note 3 to our consolidated financial statements for further discussion of our loan origination activity.

We experienced a net increase in cash of $36.9 million for the year ended December 31, 2013, compared to a net decrease of $19.4 million for the year ended December 31, 2012. The increase was primarily due to the receipt of cash interest on loans in our Loan Origination segment which was partially offset by cash paid for interest and other operating expenses.

Income Taxes

We elected to be taxed as a REIT, effective January 1, 2003, under the Internal Revenue Code for U.S. federal income tax purposes. We generally must distribute annually at least 90% of our net taxable income, subject to certain adjustments and excluding any net capital gain, in order for U.S. federal income tax not to apply to our earnings that we distribute. To the extent that we satisfy this distribution requirement, but distribute less than 100% of our net taxable income, we will be subject to U.S. federal income tax on our undistributed taxable income. In addition, we will be subject to a 4% nondeductible excise tax if the actual amount that we pay out to our stockholders in a calendar year is less than a minimum amount specified under U.S. federal tax laws.

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Our qualification as a REIT also depends on our ability to meet various other requirements imposed by the Internal Revenue Code, which relate to organizational structure, diversity of stock ownership, and certain restrictions with regard to the nature of our assets and the sources of our income. Even if we qualify as a REIT, we may be subject to certain U.S. federal income and excise taxes and state and local taxes on our income and assets. If we fail to maintain our qualification as a REIT for any taxable year, we may be subject to material penalties as well as federal, state and local income tax on our taxable income at regular corporate rates and we would not be able to qualify as a REIT for the subsequent four full taxable years. As of December 31, 2014 and 2013, we were in compliance with all REIT requirements.

Refer to Note 12 to our consolidated financial statements for additional discussion of our income taxes.

Off-Balance Sheet Arrangements

We have no off-balance sheet arrangements.

Critical Accounting Policies

Our discussion and analysis of our financial condition and results of operations is based upon our consolidated financial statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires our Manager to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses, and related disclosure of contingent assets and liabilities. Actual results could differ from these estimates. During 2014, our Manager reviewed and evaluated our critical accounting policies and believes them to be appropriate. The following is a summary of our significant accounting policies that we believe are the most affected by our Manager’s judgments, estimates and assumptions:

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with GAAP and include, on a consolidated basis, our accounts, the accounts of our wholly-owned subsidiaries, majority-owned subsidiaries, and variable interest entities, or VIEs, of which we are the primary beneficiary. All intercompany balances and transactions have been eliminated in consolidation. Certain of the assets and credit of our consolidated subsidiaries are not available to satisfy the debt or other obligations of us, our affiliates, or other entities.

One of our subsidiaries, CT Legacy Partners, LLC, or CT Legacy Partners, accounts for its operations in accordance with industry-specific GAAP accounting guidance for investment companies, pursuant to which it reports its investments at fair value. We have retained this accounting treatment in consolidation and, accordingly, report the loans and other investments of CT Legacy Partners at fair value on our consolidated balance sheets.

Certain reclassifications have been made in the presentation of the prior period consolidated financial statements to conform to the current presentation including reclassifying (i) loans receivable, at fair value, into accrued interest receivable, prepaid expenses, and other assets, (ii) securitized debt obligations into accounts payable, accrued expenses, and other liabilities, and (iii) restricted class A common stock into class A common stock.

Principles of Consolidation

We consolidate all entities that we control through either majority ownership or voting rights. In addition, we consolidate all VIEs of which we are considered the primarily beneficiary. VIEs are defined as entities in which equity investors (i) do not have the characteristics of a controlling financial interest and/or (ii) do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. The entity that consolidates a VIE is known as its primary beneficiary and is generally the

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entity with (i) the power to direct the activities that most significantly affect the VIE’s economic performance and (ii) the right to receive benefits from the VIE or the obligation to absorb losses of the VIE that could be significant to the VIE.

Assets of consolidated VIEs can only be used to satisfy the obligations of those VIEs. The liabilities of consolidated VIEs are non-recourse to us. Determination of the primary beneficiary can involve significant judgment by our Manager.

Revenue Recognition

Interest income from our loans receivable is recognized over the life of each investment using the effective interest method and is recorded on the accrual basis. Recognition of fees, premiums, discounts, and direct costs associated with these investments is deferred until the loan is advanced and is then recorded over the term of the loan as an adjustment to yield. Income accrual is generally suspended for loans at the earlier of the date at which payments become 90 days past due or when, in the opinion of our Manager, recovery of income and principal becomes doubtful. Income is then recorded on the basis of cash received until accrual is resumed when the loan becomes contractually current and performance is demonstrated to be resumed.

Loans Receivable and Provision for Loan Losses

We originate and purchase commercial real estate debt and related instruments generally to be held as long-term investments at amortized cost. We are required to periodically evaluate each of these loans for possible impairment. Impairment is indicated when it is deemed probable that we will not be able to collect all amounts due to us pursuant to the contractual terms of the loan. If a loan is determined to be impaired, we write down the loan through a charge to the provision for loan losses. Impairment of these loans, which are collateral dependent, is measured by comparing the estimated fair value of the underlying collateral to the book value of the respective loan. These valuations require significant judgments, which include assumptions regarding capitalization rates, leasing, creditworthiness of major tenants, occupancy rates, availability of financing, exit plan, loan sponsorship, actions of other lenders, and other factors deemed necessary by our Manager. Actual losses, if any, could ultimately differ from these estimates.

Our Manager performs a quarterly review of our portfolio of loans. In conjunction with this review, our Manager assesses the risk factors of each loan, and assigns a risk rating based on a variety of factors, including, without limitation, loan-to-value ratio, debt yield, property type, geographic and local market dynamics, physical condition, cash flow volatility, leasing and tenant profile, loan structure and exit plan, and project sponsorship. Based on a 5-point scale, our loans are rated “1” through “5,” from less risk to greater risk, which ratings are defined as follows:

1 - Very Low Risk

2 - Low Risk

3 - Medium Risk

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

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

Previously, our Manager assigned risk ratings between “1” and “8,” from less risk to greater risk.

Derivative Financial Instruments

We classify all derivative financial instruments as other assets or other liabilities on our consolidated balance sheets at fair value. The designation of derivative contracts as hedges, the measurement of their effectiveness, and the estimate of the fair value of the contracts all may involve significant judgments by our Manager, and changes to those judgments could significantly impact our reported results of operations.

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On the date we enter into a derivative contract, we designate each contract as (i) a hedge of a net investment in a foreign operation, or net investment hedge, (ii) a hedge of a forecasted transaction or of the variability of cash flows to be received or paid related to a recognized asset or liability, or cash flow hedge, (iii) a hedge of a recognized asset or liability, or fair value hedge, or (iv) a derivative instrument not to be designated as a hedging derivative, or freestanding derivative. For all derivatives other than those designated as freestanding derivatives, we formally document our hedge relationships and designation at inception. This documentation includes the identification of the hedging instruments and the hedged items, its risk management objectives, strategy for undertaking the hedge transaction and our evaluation of the effectiveness of its hedged transaction.

On a quarterly basis, we also formally assess whether the derivative we designated in each hedging relationship is expected to be, and has been, highly effective in offsetting changes in the value or cash flows of the hedged items. If it is determined that a derivative is not highly effective at hedging the designated exposure, hedge accounting is discontinued. Changes in the fair value of the effective portion of our hedges are reflected in accumulated other comprehensive income (loss) on our consolidated financial statements. Changes in the fair value of the ineffective portion of our hedges are included in net income (loss). Amounts are reclassified out of accumulated other comprehensive income (loss) and into net income (loss) when the hedged item is either sold or substantially liquidated. To the extent a derivative does not qualify for hedge accounting and is deemed a freestanding derivative, the changes in its value are included in net income (loss).

Convertible Notes

The “Debt with Conversion and Other Options” Topic of the Financial Accounting Standards Board, or FASB, Accounting Standards Codification, or Codification, requires the liability and equity components of convertible debt instruments that may be settled in cash upon conversion, including partial cash settlement, to be separately accounted for in a manner that reflects the issuer’s nonconvertible debt borrowing rate. The initial proceeds from the sale of convertible notes are allocated between a liability component and an equity component in a manner that reflects interest expense at the rate of similar nonconvertible debt that could have been issued at such time. The equity component represents the excess initial proceeds received over the fair value of the liability component of the notes as of the date of issuance. We measured the fair value of the debt component of our convertible notes as of the issuance date based on our nonconvertible debt borrowing rate. The equity component of the convertible notes is reflected within additional paid-in capital on our consolidated balance sheet, and the resulting debt discount is amortized over the period during which the convertible notes are expected to be outstanding (through the maturity date) as additional non-cash interest expense. The additional non-cash interest expense attributable to the convertible notes will increase in subsequent periods through the maturity date as the notes accrete to their par value over the same period.

Fair Value of Financial Instruments

The “Fair Value Measurements and Disclosures” Topic of the Codification defines fair value, establishes a framework for measuring fair value, and requires certain disclosures about fair value measurements under GAAP. Specifically, this guidance defines fair value based on exit price, or the price that would be received upon the sale of an asset or the transfer of a liability in an orderly transaction between market participants at the measurement date.

The “Fair Value Measurement and Disclosures” Topic of the Codification also establishes a fair value hierarchy that prioritizes and ranks the level of market price observability used in measuring financial instruments. Market price observability is affected by a number of factors, including the type of financial instrument, the characteristics specific to the financial instrument, and the state of the marketplace, including the existence and transparency of transactions between market participants. Financial instruments with readily available quoted prices in active markets generally will have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value.

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Financial instruments measured and reported at fair value are classified and disclosed based on the observability of inputs used in the determination, as follows:

• Level 1: Generally includes only unadjusted quoted prices that are available in active markets for identical financial instruments as of the reporting date.

• Level 2: Pricing inputs include quoted prices in active markets for similar instruments, quoted prices in less active or inactive markets for identical or similar instruments where multiple price quotes can be obtained, and other observable inputs, such as interest rates, yield curves, credit risks, and default rates.

• Level 3: Pricing inputs are unobservable for the financial instruments and include situations where there is little, if any, market activity for the financial instrument. These inputs require significant judgment or estimation by management of third parties when determining fair value and generally represent anything that does not meet the criteria of Levels 1 and 2.

The value of each asset reported at fair value using Level 3 inputs is determined by an internal committee composed of members of senior management of our Manager, including our Chief Executive Officer, Chief Financial Officer, and other senior officers.

Certain of our other assets are reported at fair value either (i) on a recurring basis, as of each quarter-end, or (ii) on a nonrecurring basis, as a result of impairment or other events. Our assets that are recorded at fair value are discussed further in Note 14 to our consolidated financial statements. We generally value our assets recorded at fair value by either (i) discounting expected cash flows based on assumptions regarding the collection of principal and interest and estimated market rates, or (ii) obtaining assessments from third-party dealers. For collateral-dependent loans that are identified as impaired, we measure impairment by comparing our Manager’s estimation of fair value of the underlying collateral, less costs to sell, to the book value of the respective loan. These valuations may require significant judgments, which include assumptions regarding capitalization rates, leasing, creditworthiness of major tenants, occupancy rates, availability of financing, exit plan, loan sponsorship, actions of other lenders, and other factors deemed necessary by our Manager. The use of different assumptions or methodologies could have a material effect on our estimated fair value amounts.

We are also required by GAAP to disclose fair value information about financial instruments, that are not otherwise reported at fair value in our consolidated balance sheet, to the extent it is practicable to estimate a fair value for those instruments. These disclosure requirements exclude certain financial instruments and all non-financial instruments.

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

• Cash and cash equivalents: The carrying amount of cash on deposit and in money market funds approximates fair value.

• Restricted cash: The carrying amount of restricted cash approximates fair value.

• Loans receivable, net: The fair values for these loans were estimated by our Manager taking into consideration factors, including capitalization rates, leasing, occupancy rates, availability and cost of financing, exit plan, sponsorship, actions of other lenders, and indications of market value from other market participants. In the case of impaired loans receivable, fair value was determined based on the lower of amortized cost and the value of the underlying real estate collateral.

• Derivative financial instruments: The fair value of our foreign currency contracts were valued using advice from a third party derivative specialist, based on contractual cash flows and observable inputs comprising foreign currency rates and credit spreads.

• Repurchase obligations: The fair values for these instruments were estimated based on the rate at which a similar credit facility would have currently priced.

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• Convertible notes, net: The convertible notes are actively traded and their fair values were obtained using quoted market prices based on recent transactions.

• Participations sold: The fair value of these instruments were estimated based on the value of the related loan receivable asset.

Income Taxes

Our financial results generally do not reflect provisions for current or deferred income taxes on our REIT taxable income. We believe that we operate in a manner that will continue to allow us to be taxed as a REIT and, as a result, we generally do not expect to pay substantial corporate level taxes other than those payable by our taxable REIT subsidiaries. If we were to fail to meet these requirements, we may be subject to federal, state, and local income tax on current and past income, and penalties. Refer to Note 12 to our consolidated financial statements for additional information.

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V. Loan Portfolio Details

The following table provides details of the Loan Origination segment’s portfolio, on a loan-by-loan basis, as of December 31, 2014 ($ in millions):

	Loan Type(1)	Principal Balance		Book Balance		Cash Coupon(2)			All-in Yield(2)			Maximum Maturity(3)		Geographic Location	Property Type	Origination LTV			Risk Rating
1	Senior loan	$	311.2	$	307.1		L + 4.00	%		L + 4.34	%		5/22/2019	UK	Hotel		57	%		2
2	Senior loan		181.0		179.8		L + 4.50	%		L + 4.86	%		11/9/2018	NY	Condo		68	%		3
3	Senior loan		163.3		161.8		L + 3.80	%		L + 4.31	%		12/9/2019	US diversified	Office		65	%		2
4	Senior loan		153.9		152.8		L + 3.50	%		L + 4.01	%		8/9/2019	IL	Office		71	%		2
5	Senior loan		151.8		150.6		L + 4.75	%		L + 5.14	%		1/7/2019	US diversified	Other		71	%		2
6	Senior loan		149.4		147.9		L + 3.40	%		L + 3.62	%		11/20/2019	UK	Hotel		62	%		2
7	Senior loan		139.8		139.1		L + 4.75	%		L + 5.27	%		1/9/2019	NY	Office		70	%		2
8	Senior loan		138.6		137.0		L + 5.50	%		L + 5.96	%		12/9/2019	CAN	Office		53	%		3
9	Senior loan		133.4		133.0		L + 4.30	%		L + 4.63	%		12/1/2017	NY	Hotel		39	%		3
10	Senior loan		120.4		119.4		L + 5.75	%		L + 6.39	%		6/20/2016	CA	Hotel		44	%		3
11	Senior loan		119.4		118.0		L + 4.40	%		L + 4.81	%		3/9/2019	US diversified	Hotel		51	%		2
12	Senior loan		97.7		97.4		L + 4.40	%		L + 4.58	%		3/9/2019	NY	Office		70	%		2
13	Senior loan		97.7		97.3		L + 4.38	%		L + 4.61	%		11/9/2018	CA	Hotel		72	%		2
14	Senior loan		95.1		94.0		L + 4.00	%		L + 4.58	%		3/4/2018	UK	Office		55	%		2
15	Senior loan		89.5		89.4		L + 3.70	%		L + 3.83	%		9/30/2020	NY	Multifamily		62	%		3
16	Senior loan		87.0		86.3		L + 4.30	%		L + 4.83	%		7/15/2019	NY	Multifamily		77	%		2
17	Senior loan		87.5		86.3		L + 4.00	%		L + 4.34	%		11/20/2019	ES	Retail		71	%		2
18	Senior loan		84.5		83.9		L + 4.35	%		L + 4.77	%		12/9/2018	NY	Office		64	%		3
19	Senior loan		81.6		80.8		L + 3.75	%		L + 4.12	%		11/9/2019	NY	Retail		78	%		2
20	Senior loan		80.0		79.4		L + 4.00	%		L + 4.54	%		6/9/2019	DC	Office		79	%		2
21	Senior loan		78.9		78.8		L + 4.75	%		L + 4.91	%		12/28/2016	NY	Condo		70	%		2
22	Senior loan		78.2		77.8		L + 5.00	%		L + 5.38	%		9/14/2018	US diversified	Other		64	%		2
23	Senior loan		77.5		77.0		L + 3.85	%		L + 4.15	%		6/9/2019	FL	Office		74	%		2
24	Senior loan		76.0		75.3		L + 3.65	%		L + 4.03	%		8/9/2019	IL	Office		64	%		2
25	Senior loan		73.8		73.7		L + 3.95	%		L + 4.04	%		6/9/2018	CA	Office		73	%		1
26	Senior loan		69.9		69.8		L + 3.85	%		L + 4.02	%		7/9/2018	GA	Multifamily		74	%		2
27	Senior loan		69.9		69.2		L + 4.50	%		L + 4.92	%		6/15/2019	CA	Office		67	%		2
28	Senior loan		68.0		67.9		L + 4.00	%		L + 4.23	%		6/10/2016	NY	Office		68	%		2
29	Senior loan		61.0		60.6		L + 3.85	%		L + 4.23	%		10/10/2018	US diversified	Multifamily		76	%		2
30	Senior loan		60.5		60.3		L + 5.00	%		L + 5.75	%		8/9/2018	VA	Office		70	%		2
31	Senior loan		60.5		60.1		L + 4.35	%		L + 4.71	%		1/9/2019	NY	Office		70	%		2
32	Senior loan		58.2		58.0		L + 4.25	%		L + 4.67	%		8/10/2018	US diversified	Diversified		60	%		2
33	Senior loan		57.0		56.5		L + 4.50	%		L + 4.92	%		4/9/2019	NY	Multifamily		66	%		3

continued…

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	Loan Type(1)	Principal Balance		Book Balance		Cash Coupon(2)			All-in Yield(2)			Maximum Maturity(3)		Geographic Location	Property Type	Origination LTV			Risk Rating
34	Sub. Mortgage part.		54.4		53.8		L + 5.66	%		L + 9.47	%		4/9/2015	WA	Office		21	%		1
35	Senior loan		50.0		49.7		L + 4.20	%		L + 4.73	%		4/9/2019	HI	Hotel		69	%		2
36	Senior loan		48.4		48.6		L + 5.00	%		L + 5.67	%		12/9/2016	IL	Hotel		50	%		2
37	Senior loan		48.5		48.1		L + 4.00	%		L + 4.31	%		9/9/2019	FL	Office		71	%		2
38	Senior loan		48.0		47.7		L + 3.85	%		L + 4.25	%		9/10/2018	US diversified	Multifamily		76	%		2
39	Senior loan		46.3		46.0		L + 4.25	%		L + 4.64	%		7/10/2018	CO	Hotel		69	%		2
40	Senior loan		46.0		45.8		L + 4.25	%		L + 4.78	%		10/9/2018	CA	Hotel		51	%		2
41	Senior loan		45.1		44.8		L + 4.50	%		L + 4.86	%		6/5/2019	UK	Retail		80	%		2
42	Senior loan		45.0		44.6		L + 4.50	%		L + 4.89	%		1/9/2019	AZ	Office		68	%		2
43	Senior loan		45.0		44.4		L + 4.15	%		L + 4.63	%		10/9/2019	NY	Hotel		65	%		2
44	Senior loan		44.0		43.6		L + 4.25	%		L + 4.94	%		1/9/2017	NY	Multifamily		50	%		2
45	Senior loan		43.5		43.4		L + 4.50	%		L + 5.11	%		7/16/2017	NY	Retail		69	%		2
46	Senior loan		40.1		39.7		L + 4.00	%		L + 4.67	%		10/9/2019	TX	Office		70	%		2
47	Senior loan		39.8		39.5		L + 4.30	%		L + 4.70	%		4/9/2019	CA	Office		71	%		2
48	Senior loan		39.4		39.1		L + 3.85	%		L + 4.04	%		8/9/2018	IL	Office		69	%		1
49	Senior loan		40.0		38.8		L + 4.00	%		L + 6.14	%		6/30/2018	CA	Office		71	%		3
50	Mezzanine loan(4)		34.0		34.1		L + 12.56	%		L + 12.35	%		12/13/2017	NY	Condo		75	%		3
51	Senior loan		34.0		33.5		L + 4.00	%		L + 4.46	%		7/20/2019	NL	Office		69	%		2
52	Senior loan		32.9		33.0		L + 3.95	%		L + 4.07	%		8/9/2017	CO	Hotel		64	%		1
53	Senior loan		31.0		30.7		L + 4.10	%		L + 4.64	%		1/9/2019	CA	Office		43	%		2
54	Senior loan		29.3		28.9		L + 4.63	%		L + 5.49	%		11/27/2018	UK	Office		68	%		2
55	Senior loan		28.0		27.8		L + 4.35	%		L + 4.71	%		12/9/2018	CA	Hotel		55	%		2
56	Senior loan		27.9		27.7		L + 4.25	%		L + 4.66	%		4/9/2019	CA	Office		65	%		2
57	Senior loan		26.0		25.9		L + 4.00	%		L + 4.27	%		3/9/2019	AZ	Other		69	%		2
58	Senior loan		25.0		24.9		L + 6.83	%		L + 7.59	%		10/1/2017	NY	Condo		48	%		3
59	Senior loan		9.5		9.5		L + 5.00	%		L + 5.29	%		11/6/2016	NY	Condo		20	%		1
60	Senior loan		9.6		8.6		L + 5.00	%		L + 5.77	%		8/9/2019	GA	Office		43	%		3
		$	4,462.9	$	4,428.5		L + 4.36	%		L + 4.81	%		3.9 years				64	%		2.2

(1) Includes senior mortgages and similar credit quality loans, including related contiguous subordinate loans, note financings of senior mortgage loans, and pari passu participations in senior mortgage loans.

(2) As of December 31, 2014, our floating rate loans and related liabilities were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Therefore the net exposure to each benchmark rate is in direct proportion to our net assets indexed to that rate. In addition, 14% of our loans currently earn interest based on LIBOR floors, with an average floor of 0.31%, as of December 31, 2014. In addition to cash coupon, all-in yield includes the amortization of deferred origination fees, loan origination costs, and accrual of exit fees.

(3) Maximum maturity assumes all extension options are exercised, however our loans may be repaid prior to such date.

(4) We originated the loan directly senior to this subordinate loan, but sold the senior loan to finance our overall investment.

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ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Interest Rate Risk

Our business is exposed to the risks related to interest rate fluctuations. We generally originate floating rate assets and finance those assets with index-matched floating rate liabilities. As a result, we significantly reduce our exposure to changes in portfolio value and cash flow variability related to changes in interest rates.

Loan Origination Portfolio

Our Loan Origination segment investments are exposed to the risks related to interest rate fluctuations discussed above. For instance, all other things being equal, as of December 31, 2014, a 100 basis point increase in LIBOR would have increased our net income by $15.2 million per annum, or $0.26 per share, while a 10 basis point decrease in LIBOR would have decreased our net income by $902,000 per annum or $0.02 per share. The table below details our interest rate exposure to this portfolio ($ in thousands):

	December 31, 2014
Floating rate loans(1)	$	4,462,897
Floating rate debt(1)(2)		(2,864,769	)
Net floating rate exposure	$	1,598,128
Net income impact from 100 bps increase in LIBOR(3)	$	15,160
Per share impact, basic and diluted	$	0.26

(1) As of December 31, 2014, our floating rate loans and related liabilities were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Therefore the net exposure to each benchmark rate is in direct proportion to our net assets indexed to that rate.

(2) Includes borrowings under revolving repurchase facilities, asset-specific repurchase agreements, and loan participations sold.

(3) Annualized net income includes the impact of LIBOR floors for our loan receivable investments where such floors are paying relative to LIBOR of 0.17% as of December 31, 2014.

CT Legacy Portfolio

Our investments in CT Legacy Partners are also exposed to the risks related to interest rate fluctuations discussed above, however as a liquidating portfolio these investments are more sensitive to credit risk than interest rate risk.

Although our carried interest investment in CTOPI generally relates to a portfolio of interest earning assets, our economic interest in this portfolio relates primarily to the realization of investments purchased at a discount by CTOPI. Accordingly, our investment in this portfolio is not exposed to a significant degree of interest rate risk. Refer to Note 5 to our consolidated financial statements for additional discussion of CTOPI.

Risk of Non-Performance

In addition to the risks related to fluctuations in asset values and cash flows associated with movements in interest rates, there is also the risk of non-performance on floating rate assets. In the case of a significant increase in interest rates, the additional debt service payments due from our borrowers may strain the operating cash flows of the collateral real estate assets and, potentially, contribute to non-performance or, in severe cases, default. This risk is partially mitigated by certain facts we consider during our underwriting process, which in certain cases include a requirement for our borrower to purchase an interest rate cap contract.

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Credit Risks

Our loans and investments are also subject to credit risk. The performance and value of our loans and investments depend upon the owners’ ability to operate the properties that serve as our collateral so that they produce cash flows adequate to pay interest and principal due to us. To monitor this risk, our Manager’s asset management team reviews our investment portfolios and in certain instances is in regular contact with our borrowers, monitoring performance of the collateral and enforcing our rights as necessary.

In addition, we are exposed to the risks generally associated with the commercial real estate market, including variances in occupancy rates, capitalization rates, absorption rates, and other macroeconomic factors beyond our control. We seek to manage these risks through our underwriting and asset management processes.

Capital Market Risks

We are exposed to risks related to the equity capital markets, and our related ability to raise capital through the issuance of our class A common stock or other equity instruments. We are also exposed to risks related to the debt capital markets, and our related ability to finance our business through borrowings under credit facilities or other debt instruments. As a REIT, we are required to distribute a significant portion of our taxable income annually, which constrains our ability to accumulate operating cash flow and therefore requires us to utilize debt or equity capital to finance our business. We seek to mitigate these risks by monitoring the debt and equity capital markets to inform our decisions on the amount, timing, and terms of capital we raise.

Counterparty Risk

The nature of our business requires us to hold our cash and cash equivalents and obtain financing from various financial institutions. This exposes us to the risk that these financial institutions may not fulfill their obligations to us under these various contractual arrangements. We mitigate this exposure by depositing our cash and cash equivalents and entering into financing agreements with high credit-quality institutions.

The nature of our loans and investments also exposes us to the risk that our counterparties do not make required interest and principal payments on scheduled due dates. We seek to manage this risk through a comprehensive credit analysis prior to making an investment and active monitoring of the asset portfolios that serve as our collateral.

Currency Risk

Our loans and investments that are denominated in a foreign currency are also subject to risks related to fluctuations in currency rates. Generally, we mitigate this exposure by matching the currency of our foreign currency assets to the currency of the borrowings that finance those assets. As a result, we substantially reduce our exposure to changes in portfolio value related to changes in foreign currency rates. In certain circumstances, we may also enter into foreign currency derivative contracts to further mitigate this exposure.

The following table outlines our assets and liabilities that are denominated in a foreign currency (£/€/C$ in thousands):

	December 31, 2014
Foreign currency assets	£	405,331		€	101,137		C$	162,434
Foreign currency liabilities		(324,954	)		(22,684	)		(113,270	)
Foreign currency contracts – notional		—			—			(48,400	)
Net exposure to exchange rate fluctuations	£	80,377		€	78,453		C$	764

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We estimate that a 10% appreciation of the United States dollar relative to the British Pound Sterling and the Euro would result in a decline in our net assets in US dollar terms of $12.5 million and $9.5 million, respectively, as of December 31, 2014. Our net asset exposure to the Canadian dollar has been hedged with foreign currency forward contracts.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The financial statements required by this item and the reports of the independent accountants thereon required by Item 14(a)(2) appear on pages F-2 to F-40. See accompanying Index to the Consolidated Financial Statements on page F-1. The supplementary financial data required by Item 302 of Regulation S-K appears in Note 19 to the consolidated financial statements.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE

None.

ITEM 9A. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

The company maintains disclosure controls and procedures (as that term is defined in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) that are designed to ensure that information required to be disclosed in the company’s reports under the Exchange Act is recorded, processed, and summarized and reported within the time periods specified in the SEC’s rules and forms, and that such information is accumulated and communicated to the company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. Any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives. An evaluation of the effectiveness of the design and operation of our disclosure controls and procedures as of the end of the period covered by this annual report on Form 10-K was made under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer. Based upon this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and procedures (a) are effective to ensure that information required to be disclosed by us in reports filed or submitted under the Exchange Act is timely recorded, processed, summarized and reported and (b) include, without limitation, controls and procedures designed to ensure that information required to be disclosed by us in reports filed or submitted under the Exchange Act is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

Changes in Internal Controls

There were no changes in our internal control over financial reporting (as such term is defined in Rules 13a–15(f) and 15d–15(f) under the Exchange Act) that occurred during our most recent quarter, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Management’s Report on Internal Control Over Financial Reporting

Management of Blackstone Mortgage Trust, Inc. and subsidiaries, or Blackstone Mortgage Trust, is responsible for establishing and maintaining adequate internal control over financial reporting. Blackstone Mortgage Trust’s internal control over financial reporting is a process designed under the supervision of its principal executive and principal financial officers to provide reasonable assurance regarding the reliability of financial reporting and the preparation of its consolidated financial statements for external reporting purposes in accordance with accounting principles generally accepted in the United States of America (“generally accepted accounting principles”).

76

Blackstone Mortgage Trust’s internal control over financial reporting includes policies and procedures that pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect transactions and dispositions of assets of the company; provide reasonable assurances that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures are being made only in accordance with authorizations of the company’s management and directors; and provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of assets that could have a material effect on its financial statements.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. In addition, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

Management conducted an assessment of the effectiveness of Blackstone Mortgage Trust’s internal control over financial reporting as of December 31, 2014, based on the framework established in Internal Control – Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission in 2013. Based on this assessment, management has determined that Blackstone Mortgage Trust’s internal control over financial reporting as of December 31, 2014, was effective.

Deloitte & Touche LLP, an independent registered public accounting firm, has audited Blackstone Mortgage Trust’s financial statements included in this report on Form 10-K and issued its report on the effectiveness of Blackstone Mortgage Trust’s internal control over financial reporting as of December 31, 2014, which is included herein.

ITEM 9B. OTHER INFORMATION

None.

77

PART III.

ITEM 10. DIRECTORS, EXECUTIVE OFFICERS AND CORPORATE GOVERNANCE

The information required by this item is incorporated by reference to the Company’s definitive proxy statement to be filed not later than April 30, 2015 with the SEC pursuant to Regulation 14A under the Exchange Act.

ITEM 11. EXECUTIVE COMPENSATION

The information required by this item is incorporated by reference to the Company’s definitive proxy statement to be filed not later than April 30, 2015 with the SEC pursuant to Regulation 14A under the Exchange Act.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS

The information required by this item is incorporated by reference to the Company’s definitive proxy statement to be filed not later than April 30, 2015 with the SEC pursuant to Regulation 14A under the Exchange Act.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS, AND DIRECTOR INDEPENDENCE

The information required by this item is incorporated by reference to the Company’s definitive proxy statement to be filed not later than April 30, 2015 with the SEC pursuant to Regulation 14A under the Exchange Act.

ITEM 14. PRINCIPAL ACCOUNTING FEES AND SERVICES

The information required by this item is incorporated by reference to the Company’s definitive proxy statement to be filed not later than April 30, 2015 with the SEC pursuant to Regulation 14A under the Exchange Act.

78

PART IV.

ITEM 15. EXHIBITS, FINANCIAL STATEMENT SCHEDULES

(a) (1)	Financial Statements
	See the accompanying Index to Financial Statement Schedule on page F-1.
(a) (2)	Consolidated Financial Statement Schedules
	See the accompanying Index to Financial Statement Schedule on page F-1.
(a) (3)	Exhibits

79

EXHIBIT INDEX

Exhibit Number	Exhibit Description
2.1	Purchase and Sale Agreement, dated September 27, 2012, by and between Capital Trust, Inc. and Huskies Acquisition LLC (filed as Exhibit 2.1 to the Registrant’s Current Report on Form 8-K (File No. 1-14788) filed on October 3, 2012 and incorporated herein by reference)
3.1.a	Articles of Amendment and Restatement (filed as Exhibit 3.1.a to the Registrant’s Current Report on Form 8-K (File No. 1-14788) filed on April 2, 2003 and incorporated herein by reference)
3.1.b	Certificate of Notice (filed as Exhibit 3.1 to the Registrant’s Current Report on Form 8-K (File No. 1-14788) filed on February 27, 2007 and incorporated herein by reference)
3.1.c	Articles Supplementary for Series A Junior Participating Preferred Stock (filed as Exhibit 3.1 to the Registrant’s Current Report on Form 8-K (File No. 1-14788) filed on March 3, 2011 and incorporated herein by reference)
3.1.d	Articles of Amendment (filed as Exhibit 3.1 to the Registrant’s Current Report on Form 8-K (File No. 1-14788) filed on December 21, 2012 and incorporated herein by reference)
3.1.e	Articles of Amendment (filed as Exhibit 3.1 to the Registrant’s Current Report on Form 8-K (File No. 1-14788) filed on May 7, 2013 and incorporated herein by reference)
3.1.f	Articles Supplementary (filed as Exhibit 3.1 to the Registrant’s Current Report on Form 8-K (File No. 1-14788) filed on May 29, 2013 and incorporated herein by reference)
3.2	Fourth Amended and Restated Bylaws of Blackstone Mortgage Trust, Inc. (filed as Exhibit 3.1 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on October 28, 2014 and incorporated herein by reference)
4.1	Indenture, dated as of November 25, 2013, between Blackstone Mortgage Trust, Inc. and The Bank of New York Mellon Trust Company, N.A., as trustee (filed as Exhibit 4.1 to the Registrant’s Current Report on Form 8-K (File No. 1-14788) filed on November 25, 2013 and incorporated herein by reference).
4.2	First Supplemental Indenture, dated as of November 25, 2013, between Blackstone Mortgage Trust, Inc. and The Bank of New York Mellon Trust Company, N.A., as trustee (filed as Exhibit 4.2 to the Registrant’s Current Report on Form 8-K (File No. 1-14788) filed on November 25, 2013 and incorporated herein by reference)
4.3	Form of 5.25% Convertible Senior Note due 2018 (included as Exhibit A in Exhibit 4.5)
10.1	Second Amended and Restated Management Agreement, dated as of October 23, 2014, by and between Blackstone Mortgage Trust, Inc. and BXMT Advisors L.L.C. (filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on October 28, 2014 and incorporated herein by reference)
10.2	Trademark License Agreement, dated May 6, 2013, by and between Blackstone Mortgage Trust, Inc. (f/k/a Capital Trust, Inc.) and Blackstone TM L.L.C. (filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No. 1-14788) filed on May 7, 2013 and incorporated herein by reference)
10.3	Assignment Agreement, dated as of December 19, 2012, by and among Huskies Acquisition LLC, Blackstone Holdings III L.P. and Capital Trust, Inc. (filed as Exhibit 10.2 to the Registrant’s Current Report on Form 8-K (File No. 1-14788) filed on December 21, 2012 and incorporated herein by reference)

80

Exhibit Number		Exhibit Description
10.4	+	Capital Trust, Inc. Amended and Restated 1997 Non-Employee Director Stock Plan (filed as Exhibit 10.2 to the Registrant’s Current Report on Form 8-K (File No. 1-14788) filed on January 29, 1999 and incorporated herein by reference)
10.5	+	Capital Trust, Inc. 2007 Long-Term Incentive Plan (the “2007 Plan”) (filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No. 1-14788) filed on June 12, 2007 and incorporated herein by reference)
10.6	+	2007 Amendment to the 2007 Plan (filed as Exhibit 10.20 to the Registrant’s Annual Report on Form 10-K (File No. 1-14788) filed on March 5, 2008 and incorporated herein by reference)
10.7	+	Capital Trust, Inc. 2011 Long-Term Incentive Plan (filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No. 1-14788) filed on June 28, 2011 and incorporated herein by reference)
10.8	+	Form of Annual Bonus Award Agreement (filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on August 1, 2012 and incorporated herein by reference)
10.9	+	Form of Restricted Share Award Agreement relating to the Capital Trust, Inc. 2011 Long-Term Incentive Plan (filed as Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on August 1, 2012 and incorporated herein by reference)
10.10	+	Form of Special Transaction Bonus Award Agreement (filed as Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on August 1, 2012 and incorporated herein by reference)
10.11	+	Blackstone Mortgage Trust, Inc. 2013 Stock Incentive Plan (filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No. 1-14788) filed on July 1, 2013 and incorporated herein by reference)
10.12	+	Form of Restricted Stock Award of Blackstone Mortgage Trust, Inc. 2013 Stock Incentive Plan (filed as Exhibit 10.5 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on October 29, 2013 and incorporated herein by reference)
10.13	+	Form of Restricted Stock Award of Blackstone Mortgage Trust, Inc. 2013 Stock Incentive Plan (filed as Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on October 28, 2014 and incorporated herein by reference)
10.14	+	Blackstone Mortgage Trust, Inc. 2013 Manager Incentive Plan (filed as Exhibit 10.5 to the Registrant’s Current Report on Form 8-K (File No. 1-14788) filed on July 1, 2013 and incorporated herein by reference)
10.15	+	Form of Restricted Stock Award of Blackstone Mortgage Trust, Inc. 2013 Manager Incentive Plan (filed as Exhibit 10.6 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on October 29, 2013 and incorporated herein by reference)
10.16	+	Form of Restricted Stock Award of Blackstone Mortgage Trust, Inc. 2013 Manager Incentive Plan (filed as Exhibit 10.4 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on October 28, 2014 and incorporated herein by reference)
10.17	+	Form of Indemnification Agreement (filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No. 1-14788) filed on December 21, 2012 and incorporated herein by reference)
10.18		Amended and Restated Registration Rights Agreement, dated May 6, 2013, by and among Blackstone Mortgage Trust, Inc., Blackstone Holdings III L.P. and BREDS/CT Advisors L.L.C. (filed as Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on May 6, 2013 and incorporated herein by reference)

81

Exhibit Number		Exhibit Description
10.19		Limited Liability Company Agreement of 42-16 Partners, LLC, dated as of May 13, 2013, by and between Blackstone Mortgage Trust, Inc. and Blackstone Holdings Finance Co. L.L.C. (filed as Exhibit 10.1 to the Registrant’s Current Report on Form 8-K (File No. 1-14788) filed on May 17, 2013 and incorporated herein by reference)
10.20		Letter Agreement, dated as of May 13, 2013, by and between Blackstone Mortgage Trust, Inc. and Blackstone Holdings Finance Co. L.L.C. (filed as Exhibit 10.2 to the Registrant’s Current Report on Form 8-K (File No. 1-14788) filed on May 17, 2013 and incorporated herein by reference)
10.21		Master Repurchase Agreement, dated as of May 21, 2013, by and between Bank of America, N.A. and Parlex 1 Finance, LLC (filed as Exhibit 10.25 of the Registrant’s Registration Statement on Form S-11 (No. 333-187541) filed on May 22, 2013 and incorporated herein by reference)
10.22		Joinder Agreement, dated as of September 23, 2013, by Parlex 1 Finance, LLC, Parlex 3 Finance LLC and Bank of America, N.A. (filed as Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on October 29, 2013 and incorporated herein by reference)
10.23		Amendment No. 1 to Master Repurchase Agreement, dated as of September 23, 2013, by and between Bank of America, N.A. and Parlex 1 Finance, LLC (filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on October 29, 2013 and incorporated herein by reference)
10.24		Guarantee Agreement, dated as of May 21, 2013, made by Blackstone Mortgage Trust, Inc. in favor of Bank of America, N.A. (filed as Exhibit 10.26 of the Registrant’s Registration Statement on Form S-11 (No. 333-187541) filed on May 22, 2013 and incorporated herein by reference)
10.25		Amendment No. 1 to Guarantee Agreement, dated as of September 23, 2013, made by Blackstone Mortgage Trust, Inc. in favor of Bank of America, N.A. (filed as Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on October 29, 2013 and incorporated herein by reference)
10.26		Amendment No. 2 to Guarantee Agreement, dated as of February 21, 2014, made by Blackstone Mortgage Trust, Inc. in favor of Bank of America, N.A. (filed as Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on April 29, 2014 and incorporated herein by reference)
10.27		Master Repurchase and Securities Contract, dated as of June 7, 2013, by and between Wells Fargo Bank, National Association and SVP 2013 Finance, LLC (filed as Exhibit 10.8 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on July 30, 2013 and incorporated herein by reference)
10.28		Limited Guarantee Agreement, dated as of June 7, 2013, made by Blackstone Mortgage Trust, Inc. in favor of Wells Fargo Bank, National Association (filed as Exhibit 10.9 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on July 30, 2013 and incorporated herein by reference)
10.29		Master Repurchase Agreement, dated as of June 12, 2013, by and between Citibank, N.A. and Parlex 2 Finance, LLC (filed as Exhibit 10.10 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on July 30, 2013 and incorporated herein by reference)
10.30		First Amendment to Master Repurchase Agreement, dated as of July 26, 2013, by and between Citibank, N.A., Parlex 2 Finance, LLC, and Blackstone Mortgage Trust, Inc. (filed as Exhibit 10.16 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on July 30, 2013 and incorporated herein by reference)
10.31	*	Second Amendment to Master Repurchase Agreement, dated as of September 11, 2013, by and between Citibank, N.A., Parlex 2 Finance, LLC, and Blackstone Mortgage Trust, Inc.

82

Exhibit Number		Exhibit Description
10.32	*	Third Amendment to Master Repurchase Agreement, dated as of November 20, 2013, by and between Citibank, N.A., Parlex 2 Finance, LLC, and Blackstone Mortgage Trust, Inc.
10.33	*	Amended and Restated Master Repurchase Agreement, dated as of July 28, 2014, by and between Citibank, N.A., Parlex 2 Finance, LLC, and Blackstone Mortgage Trust, Inc.
10.34		Fourth Amendment to Master Repurchase Agreement, dated as of January 31, 2014, by and between Citibank, N.A. and Parlex 2 Finance, LLC (filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on April 29, 2014 and incorporated herein by reference)
10.35		Limited Guaranty, dated as of June 12, 2013, made by Blackstone Mortgage Trust, Inc. in favor of Citibank, N.A. (filed as Exhibit 10.11 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on July 30, 2013 and incorporated herein by reference)
10.36	*	First Amendment to Limited Guaranty, dated as of November 20, 2013, made by Blackstone Mortgage Trust, Inc. in favor of Citibank, N.A.
10.37		Second Amendment to Limited Guaranty, dated as of February 24, 2014, made by Blackstone Mortgage Trust, Inc. in favor of Citibank, N.A. (filed as Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on April 29, 2014 and incorporated herein by reference)
10.38		Master Repurchase Agreement, dated as of June 28, 2013, by and between JPMorgan Chase Bank, National Association and Parlex 4 Finance, LLC (filed as Exhibit 10.12 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on July 30, 2013 and incorporated herein by reference)
10.39		Amendment No. 1 to Master Repurchase Agreement, dated as of December 20, 2013, by and between JPMorgan Chase Bank, National Association and Parlex 4 Finance, LLC (filed as Exhibit 10.34 to the Registrant’s Annual Report on Form 10-K (File No. 1-14788) filed on February 18, 2014 and incorporated herein by reference)
10.40		Guarantee Agreement, dated as of June 28, 2013, made by Blackstone Mortgage Trust, Inc. in favor of JPMorgan Chase Bank, National Association (filed as Exhibit 10.13 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on July 30, 2013 and incorporated herein by reference)
10.41		Amendment No. 1 to Guarantee Agreement, dated as of March 3, 2014, made by Blackstone Mortgage Trust, Inc. in favor of JPMorgan Chase Bank, National Association (filed as Exhibit 10.4 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on April 29, 2014 and incorporated herein by reference)
10.42		Master Repurchase Agreement, dated as of December 20, 2013, among JPMorgan Chase Bank, National Association and Parlex 4 UK Finance, LLC and Parlex 4 Finance, LLC (filed as Exhibit 10.36 to the Registrant’s Annual Report on Form 10-K (File No. 1-14788) filed on February 18, 2014 and incorporated herein by reference)
10.43		Guarantee Agreement, dated as of December 20, 2013, made by Blackstone Mortgage Trust, Inc. in favor of JPMorgan Chase Bank, National Association (filed as Exhibit 10.37 to the Registrant’s Annual Report on Form 10-K (File No. 1-14788) filed on February 18, 2014 and incorporated herein by reference)
10.44		Amendment No. 1 to Guarantee Agreement, dated as of March 3, 2014, made by Blackstone Mortgage Trust, Inc. in favor of JPMorgan Chase Bank, National Association (filed as Exhibit 10.5 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on April 29, 2014 and incorporated herein by reference)

83

Exhibit Number	Exhibit Description
10.45	Master Repurchase and Securities Contract Agreement, dated as of March 3, 2014, among Parlex 6 UK Finco, LLC, Blackstone Mortgage Trust, Inc. and Morgan Stanley Bank, N.A. (filed as Exhibit 10.6 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on April 29, 2014 and incorporated herein by reference)
10.46	Parent Guaranty and Indemnity, dated as of March 3, 2014, made by Blackstone Mortgage Trust, Inc. in favor of Morgan Stanley Bank, N.A. (filed as Exhibit 10.7 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on April 29, 2014 and incorporated herein by reference)
10.47	Master Repurchase and Securities Contract, dated as of March 13, 2014, between Parlex 5 Finco, LLC and Wells Fargo Bank, National Association (filed as Exhibit 10.8 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on April 29, 2014 and incorporated herein by reference)
10.48	Amendment No. 1 to Master Repurchase and Securities Contract, dated as of March 21, 2014, between Parlex 5 Finco, LLC and Wells Fargo Bank, National Association (filed as Exhibit 10.9 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on April 29, 2014 and incorporated herein by reference)
10.49	Guarantee Agreement, dated as of March 13, 2014, made by Blackstone Mortgage Trust, Inc. in favor of Wells Fargo Bank, N.A. (filed as Exhibit 10.10 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on April 29, 2014 and incorporated herein by reference)
10.50	Master Repurchase Agreement, dated as of April 25, 2014, between 643 Single Family Finco 2014, LLC and Goldman Sachs Bank USA (filed as Exhibit 10.1 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on July 29, 2014 and incorporated herein by reference)
10.51	Guaranty, dated as of April 25, 2014, made by Blackstone Mortgage Trust, Inc, in favor of Goldman Sachs Bank USA (filed as Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on July 29, 2014 and incorporated herein by reference)
10.52	Master Repurchase Agreement, dated as of June 27, 2014, between Parlex 7 Finco, LLC and Metropolitan Life Insurance Company (filed as Exhibit 10.3 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on July 29, 2014 and incorporated herein by reference)
10.53	Guaranty, dated as of June 27, 2014, made by Blackstone Mortgage Trust, Inc, in favor of Metropolitan Life Insurance Company (filed as Exhibit 10.2 to the Registrant’s Quarterly Report on Form 10-Q (File No. 1-14788) filed on October 28, 2014 and incorporated herein by reference)
10.54	Agreement of Lease dated as of May 3, 2000, between 410 Park Avenue Associates, L.P., owner, and Capital Trust, Inc., tenant (filed as Exhibit 10.11 to the Registrant’s Annual Report on Form 10-K (File No. 1-14788) filed on April 2, 2001 and incorporated herein by reference)
10.55	Additional Space, Lease Extension and First Lease Modification Agreement, dated as of May 23, 2007, by and between 410 Park Avenue Associates, L.P. and Capital Trust, Inc. (filed as Exhibit 10.74 to the Registrant’s Annual Report on Form 10-K (File No. 1-14788) filed on March 5, 2008 and incorporated herein by reference)
10.56	Assignment and Assumption of Lease, dated as of December 19, 2012, by and between Capital Trust, Inc. and Blackstone Holdings I L.P. (filed as Exhibit 10.5 to the Registrant’s Current Report on Form 8-K (File No. 1-14788) filed on December 21, 2012 and incorporated herein by reference)

84

Exhibit Number		Exhibit Description
10.57		Consent to Assignment of Lease, and Fifth Lease Modification Agreement, dated December 19, 2012, between 410 Park Avenue Associates, L.P., Blackstone Holdings I L.P. and Capital Trust, Inc. (filed as Exhibit 10.6 to the Registrant’s Current Report on Form 8-K (File No. 1-14788) filed on December 21, 2012 and incorporated herein by reference)
21.1	*	Subsidiaries of Blackstone Mortgage Trust, Inc.
23.1	*	Consent of Deloitte & Touche LLP
23.2	*	Consent of Ernst & Young LLP
31.1	*	Certification of Chief Executive Officer, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
31.2	*	Certification of Chief Financial Officer, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002
32.1	*	Certification of Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)
32.2	*	Certification of Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (furnished herewith)
99.1	*	Section 13(r) Disclosure
101.INS	++	XBRL Instance Document
101.SCH	++	XBRL Taxonomy Extension Schema Document
101.CAL	++	XBRL Taxonomy Extension Calculation Linkbase Document
101.LAB	++	XBRL Taxonomy Extension Label Linkbase Document
101.PRE	++	XBRL Taxonomy Extension Presentation Linkbase Document
101.DEF	++	XBRL Taxonomy Extension Definition Linkbase Document

* Filed herewith.

+ This document has been identified as a management contract or compensatory plan or arrangement.

++ This exhibit shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) or otherwise subject to the liability of that Section. Such exhibit shall not be deemed incorporated into any filing under the Securities Act of 1933, as amended (the “Securities Act”), or the Exchange Act.

The agreements and other documents filed as exhibits to this report are not intended to provide factual information or other disclosure other than with respect to the terms of the agreements or other documents themselves, and you should not rely on them for that purpose. In particular, any representations and warranties made by us in these agreements or other documents were made solely within the specific context of the relevant agreement or document and may not describe the actual state of affairs as of the date they were made or at any other time.

85

SIGNATURES

Pursuant to the requirements of Section 13 or Section 15(d) of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

February 17, 2015	/s/ Stephen D. Plavin
Date	Stephen D. Plavin Chief Executive Officer (Principal executive officer)

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the Registrant and in the capacities and on the dates indicated.

February 17, 2015 Date	/s/ Michael B. Nash Michael B. Nash Executive Chairman of the Board of Directors
February 17, 2015 Date	/s/ Stephen D. Plavin Stephen D. Plavin Chief Executive Officer and Director (Principal executive officer)
February 17, 2015 Date	/s/ Paul D. Quinlan Paul D. Quinlan Chief Financial Officer (Principal financial officer)
February 17, 2015 Date	/s/ Anthony F. Marone, Jr. Anthony F. Marone, Jr. Principal Accounting Officer
February 17, 2015 Date	/s/ Leonard W. Cotton Leonard W. Cotton, Director
February 17, 2015 Date	/s/ Thomas E. Dobrowski Thomas E. Dobrowski, Director
February 17, 2015 Date	/s/ Martin L. Edelman Martin L. Edelman, Director
February 17, 2015 Date	/s/ Henry N. Nassau Henry N. Nassau, Director
February 17, 2015 Date	/s/ Lynne B. Sagalyn Lynne B. Sagalyn, Director
February 17, 2015 Date	/s/ John G. Schreiber John G. Schreiber, Director

86

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS AND SCHEDULE

Reports of Independent Registered Public Accounting Firms	F-2
Consolidated Balance Sheets as of December 31, 2014 and 2013	F-5
Consolidated Statements of Operations for the Years Ended December 31, 2014, 2013, and 2012	F-6
Consolidated Statements of Comprehensive Income for the Years Ended December 31, 2014, 2013, and 2012	F-7
Consolidated Statements of Changes in (Deficit) Equity for the Years Ended December  31, 2014, 2013, and 2012	F-8
Consolidated Statements of Cash Flows for the Years Ended December 31, 2014, 2013, and 2012	F-9
Notes to Consolidated Financial Statements	F-11
Schedule IV – Mortgage Loans on Real Estate	S-1

Schedules other than those listed are omitted as they are not applicable or the required or equivalent information has been included in the consolidated financial statements or notes thereto.

F-1

Report of Independent Registered Public Accounting Firm

To the Board of Directors and Stockholders of

Blackstone Mortgage Trust, Inc.

New York, New York

We have audited the accompanying consolidated balance sheets of Blackstone Mortgage Trust, Inc. and subsidiaries (the “Company”) as of December 31, 2014 and 2013, and the related consolidated statements of operations, comprehensive income, changes in (deficit) equity, and cash flows for the years then ended. Our audits also included the 2014 and 2013 information in the financial statement schedule listed in the Index at Item 15(a). The consolidated financial statements of the Company for the year ended December 31, 2012, before the effects of the adjustments to retrospectively apply the one-for-ten reverse stock split discussed in Note 13 to the consolidated financial statements, and the 2012 information in the financial statement schedule were audited by other auditors whose report, dated March 26, 2013, expressed an unqualified opinion on those financial statements and schedule. We also have audited the Company’s internal control over financial reporting as of December 31, 2014, based on criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission. The Company’s management is responsible for these financial statements and financial statement schedule, for maintaining effective internal control over financial reporting, and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on these financial statements and financial statement schedule and an opinion on the Company’s internal control over financial reporting based on our audit.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement and whether effective internal control over financial reporting was maintained in all material respects. Our audits of the financial statements included examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audits also included performing such other procedures as we considered necessary in the circumstances. We believe that our audits provide a reasonable basis for our opinions.

A company’s internal control over financial reporting is a process designed by, or under the supervision of, the company’s principal executive and principal financial officers, or persons performing similar functions, and effected by the company’s board of directors, management, and other personnel to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.

Because of the inherent limitations of internal control over financial reporting, including the possibility of collusion or improper management override of controls, material misstatements due to error or fraud may not be prevented or detected on a timely basis. Also, projections of any evaluation of the effectiveness of the internal

F-2

control over financial reporting to future periods are subject to the risk that the controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

In our opinion, the 2014 and 2013 consolidated financial statements present fairly, in all material respects, the financial position of Blackstone Mortgage Trust, Inc. and subsidiaries as of December 31, 2014, and 2013 and the results of their operations and their cash flows for the years then ended, in conformity with accounting principles generally accepted in the United States of America. Also, in our opinion, such 2014 and 2103 information in the financial statement schedule, when considered in relation to the basic 2014 and 2013 consolidated financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein. Also, in our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of December 31, 2014, based on the criteria established in Internal Control – Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission.

We have also audited the adjustments to the 2012 consolidated financial statements to retrospectively apply the one-for-ten reverse stock split, as discussed in Note 13 to the consolidated financial statements. Our procedures included (1) comparing the amounts shown in the earnings per share disclosures for 2012 to the Company’s underlying accounting analysis, (2) comparing the previously reported shares outstanding and income statement amounts per the Company’s accounting analysis to the previously issued consolidated financial statements, and (3) recalculating the amounts to give effect to the reverse stock split and testing the mathematical accuracy of the underlying analysis. In our opinion, such adjustments are appropriate and have been properly applied. However, we were not engaged to audit, review, or apply any procedures to the 2012 consolidated financial statements of the Company other than with respect to such adjustments and, accordingly, we do not express an opinion or any other form of assurance on the 2012 consolidated financial statements taken as a whole.

/s/ Deloitte & Touche LLP

New York, New York

February 17, 2015

F-3

Report of Independent Registered Public Accounting Firm

The Board of Directors and Shareholders of Capital Trust, Inc.

We have audited the accompanying consolidated statements of operations, comprehensive income, changes in (deficit) equity, and cash flows of Capital Trust, Inc. and Subsidiaries (the “Company”) for the year ended December 31, 2012. Our audit also included the 2012 information in the financial statement schedule listed in the Index at Item 15(a). These financial statements and schedule are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements and schedule based on our audit.

We conducted our audit in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the consolidated results of the Company’s operations and its cash flows for the year ended December 31, 2012, in conformity with U.S. generally accepted accounting principles. Also, in our opinion, such 2012 information in the related financial statement schedule, when considered in relation to the basic financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.

/s/ Ernst & Young LLP

New York, New York

March 26, 2013

F-4

Blackstone Mortgage Trust, Inc.

Consolidated Balance Sheets

(in thousands, except share and per share data)

	December 31, 2014			December 31, 2013
Assets
Cash and cash equivalents	$	51,810		$	52,342
Restricted cash		11,591			10,096
Loans receivable, net		4,428,500			2,047,223
Equity investments in unconsolidated subsidiaries		10,604			22,480
Accrued interest receivable, prepaid expenses, and other assets		86,016			80,639
Total assets	$	4,588,521		$	2,212,780
Liabilities and Equity
Accounts payable, accrued expenses, and other liabilities	$	61,013		$	97,153
Revolving repurchase facilities		2,040,783			863,622
Asset-specific repurchase agreements		324,553			245,731
Loan participations sold		499,433			90,000
Convertible notes, net		161,853			159,524
Total liabilities		3,087,635			1,456,030
Equity
Class A common stock, $0.01 par value, 100,000,000 shares authorized, 58,269,889 and 29,501,651 shares issued and outstanding as of December 31, 2014 and 2013, respectively		583			295
Additional paid-in capital		2,027,404			1,252,986
Accumulated other comprehensive (loss) income		(15,024	)		798
Accumulated deficit		(547,592	)		(536,170	)
Total Blackstone Mortgage Trust, Inc. stockholders’ equity		1,465,371			717,909
Non-controlling interests		35,515			38,841
Total equity		1,500,886			756,750
Total liabilities and equity	$	4,588,521		$	2,212,780

See accompanying notes to consolidated financial statements.

F-5

Blackstone Mortgage Trust, Inc.

Consolidated Statements of Operations

(in thousands, except share and per share data)

	Year Ended December 31,
	2014			2013			2012
Income from loans and other investments
Interest and related income	$	184,766		$	53,164		$	34,939
Less: Interest and related expenses		69,143			18,017			38,138
Income (loss) from loans and other investments, net		115,623			35,147			(3,199	)
Other expenses
Management and incentive fees		19,491			5,937			—
General and administrative expenses		27,799			11,505			10,369
Total other expenses		47,290			17,442			10,369
Recovery of provision for loan losses		—			—			36,147
Valuation allowance on loans held-for-sale		—			1,259			—
Unrealized gain on investments at fair value		13,258			7,417			51,904
(Loss) gain on deconsolidation of subsidiary		(8,615	)		—			200,283
Other income		—			38			5,840
Income from equity investments in unconsolidated subsidiaries		28,036			—			1,781
Income before income taxes		101,012			26,419			282,387
Income tax provision		518			995			174
Income from continuing operations		100,494			25,424			282,213
Loss from discontinued operations, net of tax		—			—			(2,138	)
Loss on sale of discontinued operations		—			—			(271	)
Net income		100,494			25,424			279,804
Net income attributable to non-controlling interests		(10,449	)		(10,392	)		(98,780	)
Net income attributable to Blackstone Mortgage Trust, Inc.	$	90,045		$	15,032		$	181,024
Income from continuing operations per share of common stock
Basic	$	1.86		$	0.81		$	78.19
Diluted	$	1.86		$	0.81		$	74.16
Loss from discontinued operations per share of common stock
Basic	$	—		$	—		$	(1.03	)
Diluted	$	—		$	—		$	(1.03	)
Net income per share of common stock
Basic	$	1.86		$	0.81		$	77.16
Diluted	$	1.86		$	0.81		$	73.13
Weighted-average shares of common stock outstanding
Basic		48,394,478			18,520,052			2,345,943
Diluted		48,394,478			18,520,052			2,475,294

See accompanying notes to consolidated financial statements.

F-6

Blackstone Mortgage Trust, Inc.

Consolidated Statements of Comprehensive Income

(in thousands)

	Year Ended December 31,
	2014			2013			2012
Net income	$	100,494		$	25,424		$	279,804
Other comprehensive income
Unrealized (loss) gain on foreign currency remeasurement		(15,822	)		798			—
Unrealized gain on derivative financial instruments		—			—			8,367
Gain on interest rate swaps no longer designated as cash flow hedges		—			—			2,481
Amortization of unrealized gains and losses on securities		—			—			(775	)
Amortization of net deferred gains on settlement of swaps		—			—			(56	)
Other-than-temporary impairments of securities related to fair value adjustments in excess of expected credit losses, net of amortization		—			—			688
Other comprehensive (loss) income		(15,822	)		798			10,705
Comprehensive income		84,672			26,222			290,509
Comprehensive income attributable to non-controlling interests		(10,449	)		(10,392	)		(98,790	)
Comprehensive income attributable to Blackstone Mortgage Trust, Inc.	$	74,223		$	15,830		$	191,719

See accompanying notes to consolidated financial statements.

F-7

Blackstone Mortgage Trust, Inc.

Consolidated Statements of Changes in (Deficit) Equity

(in thousands)

	Blackstone Mortgage Trust, Inc.
	Common Stock			Additional Paid-In Capital			Accumulated Other Comprehensive Income (loss)			Accumulated Deficit			Stockholders’ Equity			Non-Controlling Interests			Total Equity
Balance at December 31, 2011	$	222		$	597,049		$	(40,584	)	$	(667,111	)	$	(110,424	)	$	(18,515	)	$	(128,939	)
Shares of class A common stock issued		50			9,950			—			—			10,000			—			10,000
Restricted class A common stock earned		4			993			—			—			997			—			997
Shares issued upon exercise of warrants		17			(17	)		—			—			—			—			—
Deferred directors’ compensation		—			1,027			—			—			1,027			—			1,027
Other comprehensive income		—			—			10,695			—			10,695			10			10,705
Deconsolidation of subsidiaries		—			—			29,889			—			29,889			—			29,889
Net income		—			—			—			181,024			181,024			98,780			279,804
Dividends declared on common stock		—			—			—			(49,764	)		(49,764	)		—			(49,764	)
Distributions to non-controlling interests		—			—			—			—			—			(266	)		(266	)
Balance at December 31, 2012	$	293		$	609,002		$	—		$	(535,851	)	$	73,444		$	80,009		$	153,453
Shares of class A common stock issued		265			633,549			—			—			633,807			—			633,807
Adjustment to par value for reverse stock split and charter amendment		(263	)		263			—			—			—			—			—
Restricted class A common stock earned		—			1,057			—			—			1,064			—			1,064
Issuance of convertible notes		—			8,826			—			—			8,826			—			8,826
Deferred directors’ compensation		—			289			—			—			289			—			289
Other comprehensive income		—			—			798			—			798			—			798
Consolidation of subsidiaries		—			—			—			5,727			5,727			6,235			11,962
Net income		—			—			—			15,032			15,032			10,392			25,424
Dividends declared on common stock		—			—			—			(21,078	)		(21,078	)		—			(21,078	)
Contributions from non-controlling interests		—			—			—			—			—			15,000			15,000
Distributions to non-controlling interests		—			—			—			—			—			(72,795	)		(72,795	)
Balance at December 31, 2013	$	295		$	1,252,986		$	798		$	(536,170	)	$	717,909		$	38,841		$	756,750
Shares of class A common stock issued		288			765,855			—			—			766,143			—			766,143
Restricted class A common stock earned		—			7,983			—			—			7,983			—			7,983
Dividends reinvested		—			205			—			(205	)		—			—			—
Deferred directors’ compensation		—			375			—			—			375			—			375
Other comprehensive income		—			—			(15,822	)		—			(15,822	)		—			(15,822	)
Net income		—			—			—			90,045			90,045			10,449			100,494
Dividends declared on common stock		—			—			—			(101,262	)		(101,262	)		—			(101,262	)
Distributions to non-controlling interests		—			—			—			—			—			(13,775	)		(13,775	)
Balance at December 31, 2014	$	583		$	2,027,404		$	(15,024	)	$	(547,592	)	$	1,465,371		$	35,515		$	1,500,886

See accompanying notes to consolidated financial statements.

F-8

continued…

See accompanying notes to consolidated financial statements.

Blackstone Mortgage Trust, Inc.

Consolidated Statements of Cash Flows

(in thousands)

	Year Ended December 31,
	2014			2013			2012
Cash flows from operating activities
Net income	$	100,494		$	25,424		$	279,804
Adjustments to reconcile net income to net cash provided by operating activities
Recovery of provision for loan losses		—			—			(36,147	)
Valuation allowance on loans held-for-sale		—			(1,259	)		—
Unrealized gain on investments at fair value		(13,258	)		(7,417	)		(51,904	)
Income from equity investments in unconsolidated subsidiaries		(28,036	)		—			(1,781	)
Loss (gain) on deconsolidation of subsidiary		8,615			—			(200,283	)
Other non-cash income (loss)		—			(38	)		(5,896	)
Non-cash compensation expense		9,716			6,242			3,808
Distributions of income from unconsolidated subsidiaries		17,867			8,795			1,933
Distributions from CT Legacy Asset		—			—			9,581
Loss on sale of discontinued operations		—			—			271
Amortization of deferred interest on loans		(19,785	)		(6,290	)		(566	)
Amortization of deferred financing costs and premiums/discount on debt obligations		9,900			4,935			12,133
Changes in assets and liabilities, net
Accrued interest receivable, prepaid expenses, and other assets		(13,166	)		116			(1,751	)
Accounts payable, accrued expenses, and other liabilities		8,290			(1,839	)		(2,434	)
Net cash provided by operating activities		80,637			28,669			6,768
Cash flows from investing activities
Proceeds from Investment Management Business Sale		—			—			21,424
Origination and fundings of loans receivable		(3,067,263	)		(2,327,913	)		—
Origination and exit fees received on loans receivable		35,449			25,402			—
Principal collections and proceeds from the sale of loans receivable and other assets		620,413			508,718			172,462
Distributions from equity investments		—			7,151			—
Contributions to unconsolidated subsidiaries		—			—			(4,030	)
Distributions from unconsolidated subsidiaries		—			—			1,006
(Increase) decrease in restricted cash		(1,495	)		4,151			(1,261	)
Net cash (used in) provided by investing activities		(2,412,896	)		(1,782,491	)		189,601

F-9

Blackstone Mortgage Trust, Inc.

Consolidated Statements of Cash Flows

(in thousands)

	Year Ended December 31,
	2014			2013			2012
Cash flows from financing activities
Repayment and purchase of secured notes		—			(11,059	)		—
Borrowings under revolving repurchase facilities		2,898,427			1,356,796			123,977
Repayments under revolving repurchase facilities		(1,709,740	)		(571,380	)		(58,464	)
Borrowings under asset-specific repurchase agreements		298,512			310,827			—
Repayments under asset-specific repurchase agreements		(216,904	)		(7,104	)		—
Proceeds from issuance of convertible notes		—			168,415			—
Repayment of other liabilities		(20,794	)		(98,965	)		(241,945	)
Proceeds from sale of loan participations		494,306			90,000			—
Repayment of loan participations		(61,836	)		—			—
Payment of deferred financing costs		(16,160	)		(8,867	)		—
Settlement of interest rate swaps		—			(6,123	)		—
Contributions from non-controlling interests		—			15,000			—
Purchase of and distributions to non-controlling interests		(13,775	)		(72,853	)		(16	)
Proceeds from issuance of common stock		766,138			633,807			10,000
Dividends paid on class A common stock		(84,238	)		(7,776	)		(48,960	)
Vesting of restricted class A common stock		—			—			(356	)
Net cash provided by (used in) financing activities		2,333,936			1,790,718			(215,764	)
Net increase (decrease) in cash and cash equivalents		1,677			36,896			(19,395	)
Cash and cash equivalents at beginning of year		52,342			15,423			34,818
Effects of currency translation on cash and cash equivalents		(2,209	)		23			—
Cash and cash equivalents at end of year	$	51,810		$	52,342		$	15,423
Supplemental disclosure of cash flows information
Payments of interest	$	(55,174	)	$	(12,702	)	$	(26,363	)
(Payments) receipts of income taxes	$	(1,473	)	$	8		$	(2,747	)
Supplemental disclosure of non-cash investing and financing activities
Dividends declared, not paid	$	30,357		$	13,302		$	804
Participations sold, net		432,470			90,000			—
Deconsolidation (consolidation) of subsidiaries	$	8,615		$	(38,913	)	$	371,621

See accompanying notes to consolidated financial statements.

F-10

Blackstone Mortgage Trust, Inc.

Notes to Consolidated Financial Statements

1. ORGANIZATION

References herein to “Blackstone Mortgage Trust,” “Company,” “we,” “us” or “our” refer to Blackstone Mortgage Trust, Inc. and its subsidiaries unless the context specifically requires otherwise.

Blackstone Mortgage Trust is a real estate finance company that originates and purchases senior loans collateralized by properties in North America and Europe. We are externally managed by BXMT Advisors L.L.C., or our Manager, a subsidiary of The Blackstone Group L.P., or Blackstone, and are a real estate investment trust, or REIT, traded on the New York Stock Exchange, or NYSE, under the symbol “BXMT.” We are headquartered in New York City.

We conduct our operations as a REIT for U.S. federal income tax purposes. We generally will not be subject to U.S. federal income taxes on our taxable income to the extent that we annually distribute all of our net taxable income to stockholders and maintain our qualification as a REIT. We also operate our business in a manner that permits us to maintain an exclusion from registration under the Investment Company Act of 1940, as amended. We are organized as a holding company and conduct our business primarily through our various subsidiaries. Our business is organized into two operating segments: the Loan Origination segment and the CT Legacy Portfolio segment.

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP, and include, on a consolidated basis, our accounts, the accounts of our wholly-owned subsidiaries, majority-owned subsidiaries, and variable interest entities, or VIEs, of which we are the primary beneficiary. All intercompany balances and transactions have been eliminated in consolidation. Certain of the assets and credit of our consolidated subsidiaries are not available to satisfy the debt or other obligations of us, our affiliates, or other entities.

One of our subsidiaries, CT Legacy Partners, LLC, or CT Legacy Partners, accounts for its operations in accordance with industry-specific GAAP accounting guidance for investment companies, pursuant to which it reports its investments at fair value. We have retained this accounting treatment in consolidation and, accordingly, report the loans and other investments of CT Legacy Partners at fair value on our consolidated balance sheets.

Certain reclassifications have been made in the presentation of the prior period consolidated financial statements to conform to the current presentation including reclassifying (i) loans receivable, at fair value, into accrued interest receivable, prepaid expenses, and other assets, (ii) securitized debt obligations into accounts payable, accrued expenses, and other liabilities, and (iii) restricted class A common stock into class A common stock.

Principles of Consolidation

We consolidate all entities that we control through either majority ownership or voting rights. In addition, we consolidate all VIEs of which we are considered the primarily beneficiary. VIEs are defined as entities in which equity investors (i) do not have the characteristics of a controlling financial interest and/or (ii) do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. The entity that consolidates a VIE is known as its primary beneficiary and is generally the entity with (i) the power to direct the activities that most significantly affect the VIE’s economic performance and (ii) the right to receive benefits from the VIE or the obligation to absorb losses of the VIE that could be significant to the VIE.

F-11

Blackstone Mortgage Trust, Inc.

Notes to Consolidated Financial Statements (continued)

Assets of consolidated VIEs can only be used to satisfy the obligations of those VIEs. The liabilities of consolidated VIEs are non-recourse to us. As of December 31, 2013, our consolidated balance sheet included $49.8 million of other assets and $40.2 million of other liabilities that were attributable to CT CDO I, a consolidated VIE which was part of our CT Legacy Portfolio segment. During 2014, we recorded a 100% impairment of our residual interests in CT CDO I. As a result of this impairment, we no longer have a variable interest in CT CDO I, and therefore ceased to be its primary beneficiary. This resulted in the recognition of an $8.6 million loss on the deconsolidation of CT CDO I on our consolidated statement of operations. As of December 31, 2014, we no longer had any assets or liabilities on our consolidated balance sheet attributable to a consolidated VIE.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results may ultimately differ from those estimates.

Revenue Recognition

Interest income from our loans receivable is recognized over the life of each investment using the effective interest method and is recorded on the accrual basis. Recognition of fees, premiums, discounts, and direct costs associated with these investments is deferred until the loan is advanced and is then recorded over the term of the loan as an adjustment to yield. Income accrual is generally suspended for loans at the earlier of the date at which payments become 90 days past due or when, in the opinion of our Manager, recovery of income and principal becomes doubtful. Income is then recorded on the basis of cash received until accrual is resumed when the loan becomes contractually current and performance is demonstrated to be resumed.

Cash and Cash Equivalents

Cash and cash equivalents represent cash held in banks, cash on hand, and liquid investments with original maturities of three months or less. We may have bank balances in excess of federally insured amounts; however, we deposit our cash and cash equivalents with high credit-quality institutions to minimize credit risk exposure. We have not experienced, and do not expect, any losses on our cash or cash equivalents.

Restricted Cash

We classify the cash balances held by CT Legacy Partners as restricted because, while these cash balances are available for use by CT Legacy Partners for its operations, they cannot be used by us until our allocable share is distributed from CT Legacy Partners and cannot be commingled with any of our unrestricted cash balances.

Loans Receivable and Provision for Loan Losses

We originate and purchase commercial real estate debt and related instruments generally to be held as long-term investments at amortized cost. We are required to periodically evaluate each of these loans for possible impairment. Impairment is indicated when it is deemed probable that we will not be able to collect all amounts due to us pursuant to the contractual terms of the loan. If a loan is determined to be impaired, we write down the loan through a charge to the provision for loan losses. Impairment of these loans, which are collateral dependent, is measured by comparing the estimated fair value of the underlying collateral to the book value of the respective loan. These valuations require significant judgments, which include assumptions regarding capitalization rates, leasing, creditworthiness of major tenants, occupancy rates, availability of financing, exit plan, loan sponsorship, actions of other lenders, and other factors deemed necessary by our Manager. Actual losses, if any, could ultimately differ from these estimates.

F-12

Blackstone Mortgage Trust, Inc.

Notes to Consolidated Financial Statements (continued)

Our Manager performs a quarterly review of our portfolio of loans. In conjunction with this review, our Manager assesses the risk factors of each loan, and assigns a risk rating based on a variety of factors, including, without limitation, loan-to-value ratio, debt yield, property type, geographic and local market dynamics, physical condition, cash flow volatility, leasing and tenant profile, loan structure and exit plan, and project sponsorship. Based on a 5-point scale, our loans are rated “1” through “5,” from less risk to greater risk, which ratings are defined as follows:

1  – Very Low Risk

2  – Low Risk

3  – Medium Risk

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

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

Previously, our Manager assigned risk ratings between “1” and “8,” from less risk to greater risk.

Loans Held-for-Sale and Related Allowance

In certain cases, we may classify loans as held-for-sale based upon the specific facts and circumstances of particular loans, including known or expected transactions. Loans held-for-sale are carried at the lower of their amortized cost basis or fair value, less costs to sell. A reduction in the fair value of loans held-for-sale is recorded as a charge to our consolidated statements of operations as a valuation allowance on loans held-for-sale.

Equity Investments in Unconsolidated Subsidiaries

Our carried interest in CT Opportunity Partners I, LP, or CTOPI, is accounted for using the equity method. CTOPI’s assets and liabilities are not consolidated into our financial statements due to our determination that (i) it is not a VIE and (ii) the other investors in CTOPI have sufficient rights to preclude consolidation by us. As such, we report our allocable percentage of the net assets of CTOPI on our consolidated balance sheets. The recognition of income from CTOPI is generally deferred until cash is collected or appropriate contingencies have been eliminated.

Derivative Financial Instruments

We classify all derivative financial instruments as other assets or other liabilities on our consolidated balance sheets at fair value.

On the date we enter into a derivative contract, we designate each contract as (i) a hedge of a net investment in a foreign operation, or net investment hedge, (ii) a hedge of a forecasted transaction or of the variability of cash flows to be received or paid related to a recognized asset or liability, or cash flow hedge, (iii) a hedge of a recognized asset or liability, or fair value hedge, or (iv) a derivative instrument not to be designated as a hedging derivative, or freestanding derivative. For all derivatives other than those designated as freestanding derivatives, we formally document our hedge relationships and designation at inception. This documentation includes the identification of the hedging instruments and the hedged items, its risk management objectives, strategy for undertaking the hedge transaction and our evaluation of the effectiveness of its hedged transaction.

On a quarterly basis, we also formally assess whether the derivative we designated in each hedging relationship is expected to be, and has been, highly effective in offsetting changes in the value or cash flows of the hedged

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Notes to Consolidated Financial Statements (continued)

items. If it is determined that a derivative is not highly effective at hedging the designated exposure, hedge accounting is discontinued. Changes in the fair value of the effective portion of our hedges are reflected in accumulated other comprehensive income (loss) on our consolidated financial statements. Changes in the fair value of the ineffective portion of our hedges are included in net income (loss). Amounts are reclassified out of accumulated other comprehensive income (loss) and into net income (loss) when the hedged item is either sold or substantially liquidated. To the extent a derivative does not qualify for hedge accounting and is deemed a freestanding derivative, the changes in its value are included in net income (loss).

Repurchase Agreements

We record investments financed with repurchase agreements as separate assets and the related borrowings under any repurchase agreements are recorded as separate liabilities on our consolidated balance sheets. Interest income earned on the investments and interest expense incurred on the repurchase agreements are reported separately on our consolidated statements of operations.

Loan Participations Sold

Loan participations sold represent senior interests in certain loans that we sold, however we present such loan participations sold as liabilities because these arrangements do not qualify as sales under GAAP. These participations are non-recourse and remain on our consolidated balance sheet until the loan is repaid. The gross presentation of loan participations sold does not impact stockholders’ equity or net income.

Convertible Notes

The “Debt with Conversion and Other Options” Topic of the Financial Accounting Standards Board, or FASB, Accounting Standards Codification, or Codification, requires the liability and equity components of convertible debt instruments that may be settled in cash upon conversion, including partial cash settlement, to be separately accounted for in a manner that reflects the issuer’s nonconvertible debt borrowing rate. The initial proceeds from the sale of convertible notes are allocated between a liability component and an equity component in a manner that reflects interest expense at the rate of similar nonconvertible debt that could have been issued at such time. The equity component represents the excess initial proceeds received over the fair value of the liability component of the notes as of the date of issuance. We measured the estimated fair value of the debt component of our convertible notes as of the issuance date based on our nonconvertible debt borrowing rate. The equity component of the convertible notes is reflected within additional paid-in capital on our consolidated balance sheet, and the resulting debt discount is amortized over the period during which the convertible notes are expected to be outstanding (through the maturity date) as additional non-cash interest expense. The additional non-cash interest expense attributable to the convertible notes will increase in subsequent periods through the maturity date as the notes accrete to their par value over the same period.

Deferred Financing Costs

The deferred financing costs that are included in accrued interest receivable, prepaid expenses, and other assets on our consolidated balance sheets include issuance and other costs related to our debt obligations. These costs are amortized as interest expense using the effective interest method over the life of the related obligations.

Fair Value of Financial Instruments

The Codification defines fair value, establishes a framework for measuring fair value, and requires certain disclosures about fair value measurements under GAAP. Specifically, this guidance defines fair value based on exit price, or the price that would be received upon the sale of an asset or the transfer of a liability in an orderly transaction between market participants at the measurement date.

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Notes to Consolidated Financial Statements (continued)

The “Fair Value Measurement and Disclosures” Topic of the Codification also establishes a fair value hierarchy that prioritizes and ranks the level of market price observability used in measuring financial instruments. Market price observability is affected by a number of factors, including the type of financial instrument, the characteristics specific to the financial instrument, and the state of the marketplace, including the existence and transparency of transactions between market participants. Financial instruments with readily available quoted prices in active markets generally will have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value.

Financial instruments measured and reported at fair value are classified and disclosed based on the observability of inputs used in the determination, as follows:

• Level 1: Generally includes only unadjusted quoted prices that are available in active markets for identical financial instruments as of the reporting date.

• Level 2: Pricing inputs include quoted prices in active markets for similar instruments, quoted prices in less active or inactive markets for identical or similar instruments where multiple price quotes can be obtained, and other observable inputs, such as interest rates, yield curves, credit risks, and default rates.

• Level 3: Pricing inputs are unobservable for the financial instruments and include situations where there is little, if any, market activity for the financial instrument. These inputs require significant judgment or estimation by management of third parties when determining fair value and generally represent anything that does not meet the criteria of Levels 1 and 2.

The estimated value of each asset reported at fair value using Level 3 inputs is determined by an internal committee composed of members of senior management of our Manager, including our Chief Executive Officer, Chief Financial Officer, and other senior officers.

Certain of our other assets are reported at fair value either (i) on a recurring basis, as of each quarter-end, or (ii) on a nonrecurring basis, as a result of impairment or other events. Our assets that are recorded at fair value are discussed further in Note 14. We generally value our assets recorded at fair value by either (i) discounting expected cash flows based on assumptions regarding the collection of principal and interest and estimated market rates, or (ii) obtaining assessments from third-party dealers. For collateral-dependent loans that are identified as impaired, we measure impairment by comparing our Manager’s estimation of fair value of the underlying collateral, less costs to sell, to the book value of the respective loan. These valuations may require significant judgments, which include assumptions regarding capitalization rates, leasing, creditworthiness of major tenants, occupancy rates, availability of financing, exit plan, loan sponsorship, actions of other lenders, and other factors deemed necessary by our Manager.

We are also required by GAAP to disclose fair value information about financial instruments, that are not otherwise reported at fair value in our consolidated balance sheet, to the extent it is practicable to estimate a fair value for those instruments. These disclosure requirements exclude certain financial instruments and all non-financial instruments.

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

• Cash and cash equivalents: The carrying amount of cash on deposit and in money market funds approximates fair value.

• Restricted cash: The carrying amount of restricted cash approximates fair value.

• Loans receivable, net: The fair values for these loans were estimated by our Manager taking into consideration factors, including capitalization rates, leasing, occupancy rates, availability and cost of

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Notes to Consolidated Financial Statements (continued)

financing, exit plan, sponsorship, actions of other lenders, and indications of market value from other market participants. In the case of impaired loans receivable, fair value was determined based on the lower of amortized cost and the value of the underlying real estate collateral.

• Derivative financial instruments: The fair value of our foreign currency contracts was valued using advice from a third party derivative specialist, based on contractual cash flows and observable inputs comprising foreign currency rates and credit spreads.

• Repurchase obligations: The fair values for these instruments were estimated based on the rate at which a similar credit facility would have currently priced.

• Convertible notes, net: The convertible notes are actively traded and their fair values were obtained using quoted market prices based on recent transactions.

• Participations sold: The fair value of these instruments were estimated based on the value of the related loan receivable asset.

Income Taxes

Our financial results generally do not reflect provisions for current or deferred income taxes on our REIT taxable income. We believe that we operate in a manner that will continue to allow us to be taxed as a REIT and, as a result, we generally do not expect to pay substantial corporate level taxes other than those payable by our taxable REIT subsidiaries. If we were to fail to meet these requirements, we may be subject to federal, state, and local income tax on current and past income, and penalties. Refer to Note 12 for additional information.

Stock-Based Compensation

Our stock-based compensation consists of awards issued to our Manager and certain of its employees that vest over the life of the awards as well as deferred stock units issued to certain members of our Board of Directors. Stock-based compensation expense is recognized for these awards in net income on a variable basis over the applicable vesting period of the awards, based on the value of our class A common stock. Refer to Note 13 for additional information.

Earnings per Share

Basic earnings per share, or Basic EPS, is computed in accordance with the two-class method and is based on the net earnings allocable to our class A common stock, including restricted class A common stock and deferred stock units, divided by the weighted-average number of shares of class A common stock, including restricted class A common stock and deferred stock units outstanding during the period. Our restricted class A common stock is considered a participating security, as defined by GAAP, and has been included in our Basic EPS under the two-class method as these restricted shares have the same rights as our other shares of class A common stock, including participating in any gains or losses.

Diluted earnings per share, or Diluted EPS, is determined using the treasury stock method, and is based on the net earnings allocable to our class A common stock, including restricted class A common stock and deferred stock units, divided by the weighted-average number of shares of class A common stock, including restricted class A common stock and deferred stock units. Refer to Note 9 for additional discussion of earnings per share.

Foreign Currency

In the normal course of business, we enter into transactions not denominated in United States, or U.S., dollars. Foreign exchange gains and losses arising on such transactions are recorded as a gain or loss in our consolidated

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Notes to Consolidated Financial Statements (continued)

statements of operations. In addition, we consolidate entities that have a non-U.S. dollar functional currency. Non-U.S. dollar denominated assets and liabilities are translated to U.S. dollars at the exchange rate prevailing at the reporting date and income, expenses, gains, and losses are translated at the prevailing exchange rate on the dates that they were recorded. Cumulative translation adjustments arising from the translation of non-U.S. dollar denominated subsidiaries are recorded in other comprehensive income.

Underwriting Commissions and Offering Costs

Underwriting commissions and offering costs incurred in connection with common stock offerings are reflected as a reduction of additional paid-in capital. Costs incurred that are not directly associated with the completion of a common stock offering are expensed when incurred.

Segment Reporting

We operate our real estate finance business through a Loan Origination segment and a CT Legacy Portfolio segment. The Loan Origination segment includes our activities associated with loan origination and acquisition, the capitalization of our loan portfolio, and the costs associated with operating our business generally. The CT Legacy Portfolio segment includes our activities specifically related to CT Legacy Partners and our equity investment in CTOPI. Our Manager makes operating decisions and assesses the performance of each of our business segments based on financial and operating data and metrics generated from our internal information systems.

Recent Accounting Pronouncements

In January 2013, the FASB issued ASU 2013-01, “Balance Sheet (Topic 210): Clarifying the Scope of Disclosures About Offsetting Assets and Liabilities,” or ASU 2013-01. ASU 2013-01 was developed to clarify which instruments and transactions are subject to the offsetting disclosure requirements set forth by ASU 2011-11 “Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities.” ASU 2013-01 was effective for the first interim or annual period beginning on or after January 1, 2013, and was applied retrospectively for all comparative periods presented. The adoption of ASU 2013-01 did not have a material impact on our consolidated financial statements.

In February 2013, the FASB issued ASU 2013-02, “Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income,” or ASU 2013-02. ASU 2013-02 implements the previously deferred requirement to disclose reclassification adjustments into and out of accumulated other comprehensive income in either a note or on the face of the financial statements. ASU 2013-02 was effective for the first interim or annual period beginning after December 15, 2012, and was applied prospectively. As we have not reclassified any balances into or out of accumulated other comprehensive income, the adoption of ASU 2013-02 did not have a material impact on our consolidated financial statements.

In June 2013, the FASB issued ASU 2013-08, “Financial Services-Investment Companies (Topic 946): Amendments to the Scope, Measurement, and Disclosure Requirements,” or ASU 2013-08. ASU 2013-08 amends the criteria for qualification as an investment company under Topic 946 of the FASB Accounting Standards Codification, or Topic 946, and requires additional disclosure by investment companies. ASU 2013-08 is effective for the first interim or annual period beginning after December 15, 2013, and is to be applied prospectively. We currently consolidate CT Legacy Partners, which accounts for its operations as an investment company under Topic 946. We do not expect the adoption of ASU 2013-08 to impact CT Legacy Partners’ status as an investment company. Further, because ASU 2013-08 specifically excludes REITs from its scope, it will not otherwise impact our consolidated financial statements.

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Notes to Consolidated Financial Statements (continued)

In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606),” or ASU 2014-09. ASU 2014-09 broadly amends the accounting guidance for revenue recognition. ASU 2014-09 is effective for the first interim or annual period beginning after December 15, 2016, and is to be applied prospectively. We do not anticipate that the adoption of ASU 2014-09 will have a material impact on our consolidated financial statements.

In June 2014, the FASB issued ASU 2014-11, “Transfers and Servicing (Topic 860): Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosures,” or ASU 2014-11. ASU 2014-11 amends the accounting guidance for repurchase-to-maturity transactions and repurchase agreements executed as repurchase financings, and requires additional disclosure about certain transactions by the transferor. ASU 2014-11 is effective for certain transactions that qualify for sales treatment for the first interim or annual period beginning after December 15, 2014. The new disclosure requirements for repurchase agreements, securities lending transactions, and repurchase-to-maturity transactions that qualify for secured borrowing treatment is effective for annual periods beginning after December 15, 2014, and for interim periods beginning after March 15, 2015. We currently record our repurchase arrangements as secured borrowings and do not anticipate that ASU 2014-11 will have a material impact on our consolidated financial statements.

In August 2014, the FASB issued ASU 2014-15, “Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” or ASU 2014-15. ASU 2014-15 introduces an explicit requirement for management to assess and provide certain disclosures if there is substantial doubt about an entity’s ability to continue as a going concern. ASU 2014-15 is effective for the annual period ending after December 15, 2016. We do not anticipate that the adoption of ASU 2014-15 will have a material impact on our consolidated financial statements.

3. LOANS RECEIVABLE

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

	December 31, 2014			December 31, 2013
Number of loans		60			31
Principal balance	$	4,462,897		$	2,077,227
Net book value	$	4,428,500		$	2,047,223
Unfunded loan commitments(1)	$	513,229		$	164,283
Weighted-average cash coupon(2)		L+4.36	%		L+4.64	%
Weighted-average all-in yield(2)		L+4.81	%		L+5.26	%
Weighted-average maximum maturity (years)(3)		3.9			4.1

(1) Unfunded commitments will primarily be funded to finance property improvements or lease-related expenditures by the borrowers. These future commitments will expire over the next four years.

(2) As of December 31, 2014, our floating rate loans and related liabilities were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Therefore the net exposure to each benchmark rate is in direct proportion to our net assets indexed to that rate. In addition, 14% of our loans earned interest based on LIBOR floors, with an average floor of 0.31%, as of December 31, 2014. In addition to cash coupon, all-in yield includes the amortization of deferred origination fees, loan origination costs, and accrual of both extension and exit fees.

(3) Maximum maturity assumes all extension options are exercised by the borrower, however our loans may be repaid prior to such date. As of December 31, 2014, 85% of our loans are subject to yield maintenance, lock-out provisions, or other prepayment restrictions and 15% are open to repayment by the borrower.

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Notes to Consolidated Financial Statements (continued)

Activity relating to our loans receivable was ($ in thousands):

	Principal Balance			Deferred Fees and Other Items			Net Book Value
December 31, 2013	$	2,077,227		$	(30,004	)	$	2,047,223
Loan fundings		3,067,263			—			3,067,263
Loan repayments and sales		(591,246	)		—			(591,246	)
Unrealized loss on foreign currency translation		(52,801	)		725			(52,076	)
Deferred origination fees and expenses		—			(35,449	)		(35,449	)
Amortization of deferred fees and expenses		—			19,785			19,785
Realized loan losses(1)		(10,546	)		10,546			—
Reclassification to other assets		(27,000	)		—			(27,000	)
December 31, 2014	$	4,462,897		$	(34,397	)	$	4,428,500

(1) Includes a loan loss reserve of $10.5 million as of December 31, 2013, related to one loan in the CT Legacy Portfolio segment, owned by CT CDO I, with a principal balance of $10.5 million. This loan was subsequently written off in 2014 resulting in an aggregate loan loss reserve of zero as of December 31, 2014.

The tables below detail the types of loans in our loan portfolio, as well as the property type and geographic distribution of the properties securing these loans ($ in thousands):

	December 31, 2014					December 31, 2013
Asset Type	Net Book Value		Percentage			Net Book Value		Percentage
Senior loans(1)	$	4,340,586		98	%	$	1,800,329		88	%
Subordinate loans(2)		87,914		2			246,894		12
	$	4,428,500		100	%	$	2,047,223		100	%

Property Type	Net Book Value		Percentage			Net Book Value		Percentage
Office	$	1,878,605		42	%	$	864,666		42	%
Hotel		1,267,486		29			390,492		19
Multifamily		426,094		10			341,819		17
Condominium		315,686		7			275,645		13
Retail		270,812		6			43,115		2
Other		269,817		6			131,486		7
	$	4,428,500		100	%	$	2,047,223		100	%

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Notes to Consolidated Financial Statements (continued)

Geographic Location	Net Book Value		Percentage			Net Book Value		Percentage
United States
Northeast	$	1,383,258		31	%	$	828,571		40	%
Southeast		657,484		15			243,798		12
West		628,275		14			469,262		23
Southwest		405,741		9			216,429		11
Midwest		335,406		8			85,708		4
Northwest		138,796		3			166,207		8
Subtotal		3,548,960		80			2,009,975		98
International
United Kingdom		622,692		14			37,248		2
Canada		137,024		3			—		—
Spain		86,289		2			—		—
Netherlands		33,535		1			—		—
Subtotal		879,540		20			37,248		2
Total	$	4,428,500		100	%	$	2,047,223		100	%

(1) Includes senior mortgages and similar credit quality loans, including related contiguous subordinate loans, and pari passu participations in senior mortgage loans.

(2) Includes subordinate interests in mortgages and mezzanine loans.

Loan Risk Ratings

As described in Note 2, our Manager evaluates our loan portfolio on a quarterly basis. In conjunction with our quarterly loan portfolio review, our Manager assesses the risk factors of each loan, and assigns a risk rating based on several factors. One of the primary factors considered is how senior or junior each loan is relative to other debt obligations of the borrower. Additional factors considered in the assessment include risk of loss, current LTV, collateral performance, structure, exit plan, and sponsorship. Loans are rated “1” (less risk) through “5” (greater risk), which ratings are defined in Note 2.

The following table allocates the principal balance and net book value of our loans receivable based on our internal risk ratings as of December 31, 2014 ($ in thousands):

	Senior Loans(1)						Subordinate Loans(2)
Risk Rating	Number of Loans		Principal Balance		Net Book Value		Number of Loans		Principal Balance		Net Book Value		Total Net Book Value
1 – 3		58	$	4,374,532	$	4,340,586		2	$	88,365	$	87,914	$	4,428,500
4 – 5		—		—		—		—		—		—		—
		58	$	4,374,532	$	4,340,586		2	$	88,365	$	87,914	$	4,428,500

(1) Includes senior mortgages and similar credit quality loans, including related contiguous subordinate loans, and pari passu participations in senior mortgage loans.

(2) Includes subordinate interests in mortgages and mezzanine loans.

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Notes to Consolidated Financial Statements (continued)

The following table allocates the principal balance and net book value of our loans receivable based on our internal risk ratings as of December 31, 2013 ($ in thousands):

	Senior Loans(1)						Subordinate Loans(2)
Risk Rating	Number of Loans		Principal Balance		Net Book Value		Number of Loans		Principal Balance		Net Book Value		Total Net Book Value
1 – 3		26	$	1,811,513	$	1,800,329		3	$	227,350	$	219,894	$	2,020,223
4 – 5		—		—		—		2		37,548		27,000		27,000
		26	$	1,811,513	$	1,800,329		5	$	264,898	$	246,894	$	2,047,223

(1) Includes senior mortgages and similar credit quality loans, including related contiguous subordinate loans, and pari passu participations in senior mortgage loans.

(2) Includes subordinate interests in mortgages and mezzanine loans.

Loan Impairments and Nonaccrual Loans

We do not have any loan impairments, nonaccrual loans, or loans in maturity default as of December 31, 2014. We did not have any material interest receivable accrued on nonperforming loans as of December 31, 2014 or 2013. As of December 31, 2013, CT CDO I, which was a component of our CT Legacy Portfolio segment, had one impaired subordinate interest in a mortgage loan with a gross book value of $10.5 million that was delinquent on its contractual payments. As of December 31, 2013, this loan was on nonaccrual status and we had recorded a 100% loan loss reserve on this loan. This loan was subsequently written off resulting in a loan loss reserve of zero as of December 31, 2014. As of December 31, 2013, CT CDO I had one loan with a net book value of $27.0 million in maturity default, but which had no reserve recorded due to our expectation of future repayment. In June 2014, this loan was restructured and reclassified to other assets.

4. LOANS HELD-FOR-SALE

During the first quarter of 2013, we reclassified a $6.6 million subordinate mortgage loan and its related $4.6 million provision for loan losses to loans held-for-sale. We subsequently sold this loan and recorded a $1.3 million valuation adjustment to reflect the position at its fair value based on the proceeds received from the sale. We did not have any loans classified as held-for-sale as of December 31, 2014 or 2013.

5. EQUITY INVESTMENTS IN UNCONSOLIDATED SUBSIDIARIES

As of December 31, 2014, our equity investments in unconsolidated subsidiaries consisted solely of our carried interest in CTOPI, a fund sponsored and managed by an affiliate of our Manager. Activity relating to our equity investments in unconsolidated subsidiaries was ($ in thousands):

	CTOPI Carried Interest
Total as of December 31, 2013	$	22,480
Distributions		(17,867	)
Deferred income allocation(1)		5,991
Total as of December 31, 2014	$	10,604

(1) In instances where we have not received cash or all appropriate contingencies have not been eliminated, we have deferred the

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Notes to Consolidated Financial Statements (continued)

recognition of revenue allocated to us from CTOPI in respect of our carried interest in CTOPI, and recorded an offsetting liability as a component of accounts payable, accrued expenses, and other liabilities on our consolidated balance sheets.

Our carried interest in CTOPI entitles us to earn carried interest revenue in an amount equal to 17.7% of the fund’s profits, after a 9% preferred return and 100% return of capital to the CTOPI partners. As of December 31, 2014, we had been allocated $10.6 million of carried interest revenue from CTOPI based on a hypothetical liquidation of the fund at its net asset value. Accordingly, we have recognized this allocation as an equity investment in CTOPI on our consolidated balance sheets. Generally, we defer recognition of income from CTOPI until cash is received and appropriate contingencies have been eliminated. During the year ended December 31, 2014, we received a $17.9 million distribution from CTOPI in respect of our carried interest and recorded such amount as income in our consolidated statement of operations. In addition, we had previously recorded, but deferred recognition of, $10.2 million of advance distributions in respect of our carried interest to allow us to pay any taxes owed on phantom taxable income allocated to us from the partnership. We recognized $28.0 million of distributions as income during the year ended December 31, 2014 as all fund-level contingencies had been satisfied.

CTOPI Incentive Management Fee Grants

In January 2011, we created a management compensation pool for employees equal to 45% of the CTOPI carried interest distributions received by us. As of December 31, 2014, we had granted 96% of the pool, and the remainder was unallocated. If any awards remain unallocated at the time carried interest distributions are received by us, any amounts otherwise payable to the unallocated awards will be distributed pro rata to the plan participants then employed by an affiliate of our Manager.

Approximately 65% of these grants have the following vesting schedule: (i) one-third on the date of grant; (ii) one-third on September 13, 2012; and (iii) the remainder is contingent on continued employment with an affiliate of our Manager and upon our receipt of carried interest distributions from CTOPI. Of the remaining 35% of these grants, 31% are fully vested as a result of an acceleration event, and 4% vest solely upon our receipt of carried interest distributions from CTOPI or the disposition of certain investments owned by CTOPI.

During the year ended December 31, 2014, we made payments of $12.9 million under the CTOPI incentive plan, which amount was recognized as a component of general and administrative expenses in our consolidated statement of operations.

6. SECURED FINANCINGS

As of December 31, 2014, our secured financings included revolving repurchase facilities, asset-specific financings, and senior loan participations sold. During the year ended December 31, 2014, we entered into three revolving repurchase facilities, two asset-specific repurchase agreements, and sold three senior loan participations, providing an additional $2.2 billion of credit capacity.

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Notes to Consolidated Financial Statements (continued)

Repurchase Agreements

Revolving Repurchase Facilities

The following table details our revolving repurchase facilities outstanding ($ in thousands):

	December 31, 2014										Dec. 31, 2013 Borrowings Outstanding
	Maximum Facility Size(1)		Collateral Assets(2)		Repurchase Borrowings(3)
Lender					Potential		Outstanding		Available
Wells Fargo	$	1,000,000	$	747,256	$	585,737	$	484,365	$	101,372	$	—
Citibank		500,000		621,025		472,080		392,455		79,625		334,692
Bank of America		500,000		557,810		441,201		389,347		51,854		271,320
JP Morgan(4)		488,155		544,654		422,249		341,487		80,762		257,610
MetLife		500,000		476,499		366,902		305,889		61,013		—
Morgan Stanley(5)		389,050		174,297		137,181		127,240		9,941		—
	$	3,377,205	$	3,121,541	$	2,425,350	$	2,040,783	$	384,567	$	863,622

(1) Maximum facility size represents the total amount of borrowings in each repurchase agreement, however these borrowings are only available to us once sufficient collateral assets have been pledged under each facility at the discretion of the lender.

(2) Represents the principal balance of the collateral assets.

(3) Potential borrowings represent the total amount we could draw under each facility based on collateral already approved and pledged. When undrawn, these amounts are immediately available to us at our sole discretion under the terms of each revolving credit facility.

(4) The JP Morgan maximum facility size is composed of a $250.0 million facility and a £153.0 million ($238.2 million) facility.

(5) The Morgan Stanley maximum facility size represents a £250.0 million ($389.1 million) facility.

The weighted-average outstanding balance of our revolving repurchase facilities was $1.4 billion for the year ended December 31, 2014. As of December 31, 2014, we had aggregate borrowings of $2.0 billion outstanding under our revolving repurchase facilities, with a weighted-average cash coupon of LIBOR plus 1.88% per annum and a weighted-average all-in cost of credit, including associated fees and expenses, of LIBOR plus 2.11% per annum. As of December 31, 2014, outstanding borrowings under these facilities had a weighted-average maturity, excluding extension options and term-out provisions, of 1.8 years. Borrowings under each facility are subject to the initial approval of eligible collateral loans by the lender and the maximum advance rate and pricing rate of individual advances are determined with reference to the attributes of the respective collateral loan.

The following table outlines the key terms of our revolving repurchase facilities:

Lender	Rate(1)(2)			Guarantee(1)(3)			Advance Rate(1)			Margin Call(4)	Term/Maturity
Wells Fargo		L+1.82	%		25	%		78.82	%	Collateral marks only	Term matched(5)
Citibank		L+1.93	%		25	%		76.68	%	Collateral marks only	Term matched(5)
Bank of America		L+1.77	%		50	%		79.59	%	Collateral marks only	May 21, 2019(6)
JP Morgan		L+1.94	%		25	%		77.92	%	Collateral marks only	Term matched(5)(7)
MetLife		L+1.81	%		50	%		77.27	%	Collateral marks only	June 29, 2020(8)
Morgan Stanley		L+2.32	%		25	%		78.71	%	Collateral marks only	March 3, 2017

(1) Represents a weighted-average based on collateral assets pledged and borrowings outstanding as of December 31, 2014.

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Notes to Consolidated Financial Statements (continued)

(2) Represents weighted-average cash coupon on borrowings outstanding as of December 31, 2014. As of December 31, 2014, our floating rate loans and related liabilities were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Therefore the net exposure to each benchmark rate is in direct proportion to our net assets indexed to that rate.

(3) Other than amounts guaranteed based on specific collateral asset types, borrowings under our revolving repurchase facilities are not recourse to us.

(4) Margin call provisions under our revolving repurchase facilities do not permit valuation adjustments based on capital markets activity, and are limited to collateral-specific credit marks.

(5) These revolving repurchase facilities have various availability periods during which new advances can be made and which are generally subject to each lender’s discretion. Maturity dates for advances outstanding are tied to the term of each respective collateral asset.

(6) Includes two one-year extension options which may be exercised at our sole discretion.

(7) Borrowings denominated in British pound sterling under this facility mature on December 30, 2016.

(8) Includes five one-year extension options which may be exercised at our sole discretion.

Asset-Specific Repurchase Agreements

The following table details statistics for our asset-specific repurchase agreements ($ in thousands):

	December 31, 2014						December 31, 2013
	Repurchase Agreements			Collateral Assets			Repurchase Agreements			Collateral Assets
Number of loans		3			4			4			4
Principal balance	$	324,553		$	429,197		$	245,731		$	334,857
Weighted-average cash coupon(1)		L+2.68	%		L+5.07	%		L+2.55	%		L+4.79	%
Weighted-average all-in yield / cost(1)		L+3.16	%		L+5.53	%		L+3.03	%		L+5.38	%

(1) As of December 31, 2014, our floating rate loans and related liabilities were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Therefore the net exposure to each benchmark rate is in direct proportion to our net assets indexed to that rate. In addition to cash coupon, all-in yield / cost includes the amortization of deferred origination fees / financing costs.

The weighted-average outstanding asset-specific balance was $257.9 million for the year ended December 31, 2014.

Debt Covenants

Each of the guarantees related to our revolving repurchase facilities and asset-specific repurchase agreements contain the following uniform financial covenants: (i) our ratio of earnings before interest, taxes, depreciation, and amortization, or EBITDA, to fixed charges shall be not less than 1.40 to 1.0; (ii) our tangible net worth, as defined in the agreements, shall not be less than $1.1 billion as of December 31, 2014 plus 75% of the net cash proceeds of future equity issuances subsequent to December 31, 2014; (iii) cash liquidity shall not be less than the greater of (x) $10.0 million or (y) 5% of our recourse indebtedness; and (iv) our indebtedness shall not exceed 83.33% of our total assets. As of December 31, 2014 and 2013, we were in compliance with these covenants.

Loan Participations Sold

The financing of a loan by the non-recourse sale of a senior interest in the loan through a participation agreement does not qualify as a sale under GAAP. Therefore, in the instance of such sales, we present the whole loan as an asset and the loan participation sold as a liability on our consolidated balance sheet until the loan is repaid. The gross presentation of loan participations sold does not impact stockholders’ equity or net income.

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Blackstone Mortgage Trust, Inc.

Notes to Consolidated Financial Statements (continued)

The following table details statistics for our loan participations sold ($ in thousands):

	December 31, 2014						December 31, 2013
	Participations Sold			Underlying Loans			Participations Sold			Underlying Loans
Number of loans		4			4			1			1
Principal balance	$	499,433		$	635,701		$	90,000		$	173,837
Weighted-average cash coupon(1)		L+2.51	%		L+4.10	%		L+5.12	%		L+5.66	%
Weighted-average all-in yield / cost(1)		L+2.71	%		L+4.71	%		L+5.26	%		L+9.25	%

(1) As of December 31, 2014, our floating rate loans and related liabilities were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Therefore the net exposure to each benchmark rate is in direct proportion to our net assets indexed to that rate. In addition to cash coupon, all-in yield / cost includes the amortization of deferred origination fees / financing costs.

7. CONVERTIBLE NOTES, NET

In November 2013, we issued $172.5 million of 5.25% convertible senior notes due on December 1, 2018, or Convertible Notes. The Convertible Notes’ issuance costs are amortized through interest expense over the life of the Convertible Notes using the effective interest method. Including this amortization, our all-in cost of the Convertible Notes is 5.87% per annum. As of December 31, 2014, the Convertible Notes were carried on our consolidated balance sheet at $161.9 million, net of an unamortized discount of $7.3 million.

The Convertible Notes are convertible at the holders’ option into shares of our class A common stock, only under specific circumstances, prior to the close of business on August 31, 2018, at the applicable conversion rate in effect on the conversion date. Thereafter, the Convertible Notes are convertible at the option of the holder at any time until the second scheduled trading day immediately preceding the maturity date. The Convertible Notes were not convertible as of December 31, 2014. The conversion rate was initially set to equal 34.8943 shares of class A common stock per $1,000 principal amount of Convertible Notes, which is equivalent to an initial conversion price of $28.66 per share of class A common stock, subject to adjustment upon the occurrence of certain events including distributions above $0.50 per share, subject to certain limited exceptions. We may not redeem the Convertible Notes prior to maturity. As of December 31, 2014 we had the intent and ability to settle the Convertible Notes in cash. As a result, the Convertible Notes did not have any impact on our diluted earnings per share. As of December 31, 2014, the closing price of our class A common stock was $29.14 which exceeds our Convertible Notes conversion price of $28.66. As a result, the if-converted value of our convertible notes exceeded the principal balance by $2.9 million as of December 31, 2014.

We recorded a $9.1 million discount upon issuance of the Convertible Notes based on the implied value of the conversion option and an assumed effective interest rate of 6.50%. Including the amortization of this discount and the issuance costs, our total cost of the Convertible Notes is 7.16% per annum. For the year ended December 31, 2014, we incurred total interest on our convertible notes of $11.5 million, of which $9.1 million related to cash coupon and $2.4 million related to the amortization of discount and certain issuance costs. We incurred total interest on our convertible notes of $1.1 million for the year ended December 31, 2013, of which $874,000 related to cash coupon and $197,000 related to the amortization of discount and certain issuance costs. Refer to Note 2 for additional discussion of our accounting policies for the Convertible Notes.

8. DERIVATIVE FINANCIAL INSTRUMENTS

We may, from time to time, enter into derivative contracts to achieve certain risk management objectives. Currently, we use derivative financial instruments to manage, or hedge, the variability in the carrying value of certain of our net investments in consolidated, foreign currency-denominated subsidiaries caused by the

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Blackstone Mortgage Trust, Inc.

Notes to Consolidated Financial Statements (continued)

fluctuations in foreign currency exchange rates. Historically, our consolidated subsidiary, CT Legacy Partners, also used derivative financial instruments to manage, or hedge, the cash flow variability caused by the fluctuations in interest rates.

As of and during the year ended December 31, 2014, we had a net investment hedge on one Canadian dollar-denominated subsidiary which consisted of two Canadian dollar forward contracts. These foreign currency contracts had an aggregate notional value of $42.5 million, and their fair value of $1.1 million has been included as part of accrued interest receivable, prepaid expenses, and other assets on our consolidated balance sheet. The following table summarizes the notional and fair value amounts of our derivative financial instruments as of December 31, 2014 and 2013 ($ in thousands):

	December 31, 2014				December 31, 2013
	Notional Amount		Fair Value		Notional Amount		Fair Value
Foreign Currency Contracts	$	42,525	$	1,138	$	—	$	—
	$	42,525	$	1,138	$	—	$	—

The following table summarizes the impact of our derivative financial instruments to our consolidated statement of operations and consolidated statement of comprehensive income for the year ended December 31, 2014, 2013, and 2012 ($ in thousands):

	For the year ended December 31,
	2014		2013		2012
Net investment hedges – Foreign currency contracts
Gain recognized in other comprehensive income	$	1,138	$	—	$	—
Gain reclassified from AOCI into net income	$	—	$	—	$	—
Gain recognized in net income	$	—	$	—	$	—
Freestanding derivatives – Interest rate contracts(1)
Loss recognized in other comprehensive income	$	—	$	—	$	(10,449	)
Loss reclassified from AOCI into net income	$	—	$	—	$	(15,066	)
Gain recognized in net income	$	—	$	136	$	—

(1) The interest rate derivatives represent five interest rate swaps that our consolidated subsidiary, CT Legacy Partners was party to during 2013. In June 2013, CT Legacy Partners terminated these interest rate swaps and recorded a gain of $136,000 which was included as a component of interest expense on our consolidated statements of operations for the year ended December 31, 2013. CT Legacy Partners is no longer party to any derivative financial instruments as of December 31, 2014.

9. EQUITY

Total equity increased by $744.1 million during the year ended December 31, 2014 to $1.5 billion. This increase was primarily driven by the issuance of additional shares of our class A common stock. See below for further discussion of our share issuances.

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Blackstone Mortgage Trust, Inc.

Notes to Consolidated Financial Statements (continued)

Share and Share Equivalents

Authorized Capital

We have the authority to issue up to 200,000,000 shares of stock, consisting of 100,000,000 shares of class A common stock and 100,000,000 shares of preferred stock. Subject to applicable NYSE listing requirements, our board of directors is authorized to cause us to issue additional shares of authorized stock without stockholder approval. In addition, to the extent not issued, currently authorized stock may be reclassified between class A common stock and preferred stock. We do not have any shares of preferred stock issued and outstanding as of December 31, 2014.

Class A Common Stock and Deferred Stock Units

Holders of shares of our class A common stock are entitled to vote on all matters submitted to a vote of stockholders and are entitled to receive such dividends as may be authorized by our board of directors and declared by us, in all cases subject to the rights of the holders of shares of outstanding preferred stock, if any.

The following table details our issuances of class A common stock during the year ended December 31, 2014 ($ in thousands, except share and per share data):

	Class A Common Stock Offerings								2014 Total / Wtd.-Avg.
	January 2014		April 2014		September 2014		December 2014(3)
Shares Issued		9,775,000		9,200,000		9,200,000		100,000		28,275,000
Issue Price(1)	$	26.25	$	27.72	$	27.49	$	27.58	$	27.14
Net Proceeds(2)	$	256,092	$	254,758	$	252,530	$	2,758	$	766,138

(1) Represents price per share paid to the underwriters.

(2) Net proceeds represents proceeds received from the underwriters less applicable transaction costs.

(3) Issuance represents 100,000 shares issued over a five-day period in December, with a weighted average issue price of $27.58, and generating net proceeds of $2.8 million.

We also issue restricted class A common stock under our stock-based incentive plans. Refer to Note 13 for additional discussion of these long-term incentive plans.

In addition to our class A common stock, we also issue deferred stock units to certain members of our board of directors in lieu of cash compensation for services rendered. These deferred stock units are non-voting, but carry the right to receive dividends in the form of additional deferred stock units in an amount equivalent to the cash dividends paid to holders of shares of class A common stock. During 2014, we issued 2,851 shares of class A common stock to Joshua A. Polan in exchange for his deferred stock units upon his decision not to stand for reelection to our board of directors.

The following table details the movement in our outstanding shares of class A common stock, including restricted class A common stock and deferred stock units:

	Year Ended December 31,
Common Stock Outstanding(1)(2)	2014		2013		2012
Beginning balance		29,602,884		3,016,407		2,277,344
Issuance of class A common stock		28,275,006		25,875,000		669,047
Issuance of restricted class A common stock, net		490,381		700,000		36,493
Issuance of deferred stock units		20,537		11,477		33,523
Ending balance		58,388,808		29,602,884		3,016,407

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Blackstone Mortgage Trust, Inc.

Notes to Consolidated Financial Statements (continued)

(1) Deferred stock units held by members of our board of directors totalled 118,919, 101,233, and 89,754 as of December 31, 2014, 2013, and 2012, respectively.

(2) Share amounts have been retroactively updated to reflect the one-for-ten reverse stock split which we effected as of May 6, 2013. See below for further discussion.

Dividend Reinvestment and Direct Stock Purchase Plan

On March 25, 2014, we adopted a dividend reinvestment and direct stock purchase plan, under which we registered and reserved for issuance, in the aggregate, 10,000,000 shares of class A common stock. Under the dividend reinvestment component of this plan, our class A common stockholders can designate all or a portion of their cash dividends to be reinvested in additional shares of class A common stock. The direct stock purchase component allows stockholders and new investors, subject to our approval, to purchase shares of class A common stock directly from us. During the year ended December 31, 2014, we issued six shares of class A common stock under the dividend reinvestment component and zero shares under the direct stock purchase plan component. As of December 31, 2014, 9,999,994 shares of class A common stock, in the aggregate, remain available for issuance under the dividend reinvestment and direct stock purchase plan.

At the Market Stock Offering Program

On May 9, 2014, we entered into equity distribution agreements, or ATM Agreements, pursuant to which we may sell, from time to time, up to an aggregate sales price of $200.0 million of our class A common stock. Sales of class A common stock made pursuant to the ATM Agreements, if any, may be made in negotiated transactions or transactions that are deemed to be “at the market” offerings as defined in Rule 415 under the Securities Act of 1933, as amended. Actual sales will depend on a variety of factors including market conditions, the trading price of our class A common stock, our capital needs, and our determination of the appropriate sources of funding to meet such needs. During the year ended December 31, 2014, we sold 100,000 shares of class A common stock under the ATM Agreements, with net proceeds totaling $2.8 million. As of December 31, 2014, sales of our class A common stock with an aggregate sales price of $197.2 million remain available for issuance under the ATM Agreements.

Reverse Stock Split

On April 26, 2013, our board of directors approved a one-for-ten reverse stock split of our class A common stock which we effected on May 6, 2013. As a result of the reverse stock split, the number of outstanding shares of our class A common stock was reduced to 2,926,651. In addition, there was a reclassification of $263,000 from the par value of our class A common stock to additional paid-in capital to reflect the impact of the reverse stock split.

Dividends

We generally intend to distribute substantially all of our taxable income, which does not necessarily equal net income as calculated in accordance with GAAP, to our stockholders each year to comply with the REIT provisions of the Internal Revenue Code of 1986, as amended, or the Internal Revenue Code.

Our dividend policy remains subject to revision at the discretion of our board of directors. All distributions will be made at the discretion of our board of directors and will depend upon our taxable income, our financial condition, our maintenance of REIT status, applicable law, and other factors as our board of directors deems relevant.

During the years ended December 31, 2014, 2013, and 2012 we declared dividends per share of $1.98, $0.72, and $20.00, respectively, representing aggregate dividends payment of $101.3 million, $21.1 million, and $49.8 million during each year.

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Blackstone Mortgage Trust, Inc.

Notes to Consolidated Financial Statements (continued)

Earnings Per Share

We calculate our basic and diluted earnings per share using the two-class method for all periods presented as the unvested shares of our restricted class A common stock qualify as participating securities, as defined by GAAP. These restricted shares have the same rights as our other shares of class A common stock, including participating in any gains and losses, and therefore have been included in our basic and diluted net income per share calculation.

The following table sets forth the calculation of basic and diluted net income per share of class A common stock based on the weighted-average of both restricted and unrestricted class A common stock outstanding for the indicated periods ($ in thousands, except per share data):

	Year Ended December 31,
	2014		2013		2012
Net income	$	90,045	$	15,032	$	181,024
Weighted-average shares outstanding(1)		48,394,478		18,520,052		2,345,943
Warrants and options outstanding for the purchase of class A common stock		—		—		129,351
Weighted-average shares outstanding, diluted		48,394,478		18,520,052		2,475,294
Per share amount, basic	$	1.86	$	0.81	$	77.16
Per share amount, diluted	$	1.86	$	0.81	$	73.13

(1) Share and per share amounts have been retroactively updated to reflect the one-for-ten reverse stock split which we effected as of May 6, 2013. See above for further discussion.

The following table sets forth the calculation of basic and diluted income from continuing operations per share based on the weighted-average of our shares of class A common stock, including restricted class A common stock and deferred stock units outstanding ($ in thousands, except per share data):

	Year Ended December 31,
	2014			2013			2012
Income from continuing operations	$	100,494		$	25,424		$	282,213
Net income attributable to non-controlling interests		(10,449	)		(10,392	)		(98,780	)
Income from continuing operations attributable to Blackstone Mortgage Trust, Inc.		90,045			15,032			183,433
Weighted-average shares outstanding(1)		48,394,478			18,520,052			2,345,943
Warrants and options outstanding for the purchase of class A common stock		—			—			129,351
Weighted-average shares outstanding, diluted		48,394,478			18,520,052			2,475,294
Per share amount, basic	$	1.86		$	0.81		$	78.19
Per share amount, diluted	$	1.86		$	0.81		$	74.16

(1) Share and per share amounts have been retroactively updated to reflect the one-for-ten reverse stock split which we effected as of May 6, 2013. See above for further discussion.

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Blackstone Mortgage Trust, Inc.

Notes to Consolidated Financial Statements (continued)

Other Balance Sheet Items

Accumulated Other Comprehensive Loss

As of December 31, 2014, total accumulated other comprehensive loss was $15.0 million, representing the cumulative currency translation adjustment on assets and liabilities denominated in foreign currencies. During the year ended December 31, 2014, we recorded a $15.8 million currency translation loss in other comprehensive income. As of and during the year ended December 31, 2013, total accumulated other comprehensive income was $798,000 representing the currency translation adjustment on assets denominated in foreign currencies. The following table details the primary components of accumulated other comprehensive loss as of, and for the year ended, December 31, 2012 ($ in thousands):

Accumulated Other Comprehensive Loss	Mark-to-Market on Interest Rate Hedges			Deferred Gains on Settled Hedges			Other-than- Temporary Impairments			Unrealized Gains on Securities			Total
Total as of December 31, 2011		(27,423	)		56			(16,578	)		3,361			(40,584	)
Unrealized gain on derivative financial instruments		8,367			—			—			—			8,367
Ineffective portion of cash flow hedges(1)		2,481			—			—			—			2,481
Amortization of net unrealized gains on securities		—			—			—			(775	)		(775	)
Amortization of net deferred gains on settlement of swaps		—			(56	)		—			—			(56	)
Other-than-temporary impairments of securities		—			—			678			—			678
Deconsolidation of subsidiaries		16,575			—			15,900			(2,586	)		29,889
Total as of December 31, 2012	$	—		$	—		$	—		$	—		$	—

(1) As a result of the deconsolidation of CT Legacy Asset in the first quarter of 2012, the balance of accumulated other comprehensive income related to cash flow hedges of CT Legacy Asset was reclassified to interest expense.

Non-controlling Interests

The non-controlling interests included on our consolidated balance sheets represent the equity interests in CT Legacy Partners that are not owned by us. A portion of CT Legacy Partners’ consolidated equity and results of operations are allocated to these non-controlling interests based on their pro rata ownership of CT Legacy Partners. As of December 31, 2014, CT Legacy Partners’ total equity was $60.8 million, of which $25.3 million was owned by Blackstone Mortgage Trust, Inc., and $35.5 million was allocated to non-controlling interests.

10. OTHER EXPENSES

Our other expenses consist of the management and incentive fees we pay to our Manager and our general and administrative expenses.

Management and Incentive Fees

Pursuant to our management agreement, our Manager earns a base management fee in an amount equal to 1.50% per annum multiplied by our average outstanding Equity balance, as defined in the management agreement. In addition, our Manager is entitled to an incentive fee in an amount equal to the product of (i) 20% and (ii) the excess of (a) our Core Earnings (as defined in the management agreement) for the previous 12-month

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Notes to Consolidated Financial Statements (continued)

period over (b) an amount equal to 7.00% per annum multiplied by our average outstanding Equity, provided that our Core Earnings over the prior three-year period (or the period since May 29, 2013, the date of the first offering of our class A common stock following December 19, 2012, whichever is shorter) is greater than zero. Core Earnings is generally equal to our net income (loss) prepared in accordance with GAAP, excluding (i) certain non-cash items and (ii) the net income (loss) related to our CT Legacy Portfolio segment.

During the years ended December 31, 2014 and 2013, we incurred $17.8 million and $5.9 million of management fees payable to our Manager, respectively. We did not incur any management fees payable to our Manager during the year ended December 31, 2012. During the year ended December 31, 2014, we incurred $1.7 million of incentive fees payable to our Manager. We did not incur any incentive fees payable to our Manager during the years ended December 31, 2013 and 2012.

General and Administrative Expenses

General and administrative expenses consisted of the following ($ in thousands):

	Year Ended December 31, 2014
	2014		2013		2012
Professional services	$	2,627	$	2,441	$	895
Operating and other costs		2,009		1,797		1,732
Transaction costs – investment management sale		—		—		3,870
		4,636		4,238		6,497
Non-cash and CT Legacy Portfolio compensation expenses
Management incentive awards plan – CTOPI(1)		12,898		—		—
Management incentive awards plan – CT Legacy Partners(2)		1,374		5,089		2,232
Restricted class A common stock earned		7,988		1,064		1,353
Director stock-based compensation		375		263		223
		22,635		6,416		3,808
Expenses of consolidated securitization vehicles		528		851		64
	$	27,799	$	11,505	$	10,369

(1) Represents the portion of CTOPI carried interest revenue paid under compensation awards. See Note 5 for further discussion.

(2) Represents the accrual of amounts payable under the CT Legacy Partners management incentive awards during the period. See below for discussion of the CT Legacy Partners management incentive awards plan.

CT Legacy Partners Management Incentive Awards Plan

In conjunction with our March 2011 Restructuring, we created an employee pool for up to 6.75% of the distributions paid to the common equity holders of CT Legacy Partners (subject to certain caps and priority distributions). As of December 31, 2014, incentive awards for 94% of the pool have been granted, and the remainder was unallocated. If any awards remain unallocated at the time distributions are paid, any amounts otherwise payable to the unallocated awards will be distributed pro rata to the plan participants then employed by an affiliate of our Manager.

Approximately 53% of these grants have the following vesting schedule: (i) 25% on the date of grant; (ii) 25% in March 2013; (iii) 25% in March 2014; and (iv) the remainder is contingent on continued employment with an

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Notes to Consolidated Financial Statements (continued)

affiliate of our Manager and our receipt of distributions from CT Legacy Partners. Of the remaining 47% of these grants, 29% are fully vested as a result of an acceleration event, and 18% vest only upon our receipt of distributions from CT Legacy Partners.

We accrue a liability for the amounts due under these grants based on the value of CT Legacy Partners and the periodic vesting of the awards granted. Accrued payables for these awards were $2.8 million as of both December 31, 2014 and 2013.

11. DISCONTINUED OPERATIONS

Investment Management Business Sale

On December 19, 2012, pursuant to a purchase and sale agreement, dated as of September 27, 2012, or Purchase Agreement, by and between us and an affiliate of Blackstone, we completed the disposition of our investment management and special servicing business for a purchase price of $21.4 million. The sale included our equity interests in CT Investment Management Co., LLC, our related private investment fund co-investments, and 100% of the outstanding class A preferred stock of CT Legacy REIT. We refer to the entire transaction as our Investment Management Business Sale. As a result of the Investment Management Business Sale, the income and expense items related to our investment management business have been reclassified to income from discontinued operations on our consolidated statements of operations for the year ended December 31, 2012.

The following table provides additional information on the components of discontinued operations ($ in thousands):

	Year Ended December 31,
	2014		2013		2012
Servicing fees	$	—	$	—	$	9,686
Management fees from affiliates		—		—		6,312
Total revenues				—		15,998
General and administrative expenses		—		—		12,938
Income from discontinued operations before income taxes		—		—		3,060
Income tax provision		—		—		(5,198	)
Loss from discontinued operations	$	—	$	—	$	(2,138	)
Loss on sale of discontinued operations		—		—		(271	)
Loss from discontinued operations per share common stock:
Basic	$	—	$	—	$	(1.03	)
Diluted	$	—	$	—	$	(1.03	)

12. INCOME TAXES

We made an election to be taxed as a REIT, effective January 1, 2003, under the Internal Revenue Code, for U.S. federal income tax purposes. We generally must distribute annually at least 90% of our net taxable income, subject to certain adjustments and excluding any net capital gain, in order for U.S. federal income tax not to apply to our earnings that we distribute. To the extent that we satisfy this distribution requirement, but distribute less than 100% of our net taxable income, we will be subject to U.S. federal income tax on our undistributed taxable income. In addition, we will be subject to a 4% nondeductible excise tax if the actual amount that we pay out to our stockholders in a calendar year is less than a minimum amount specified under U.S. federal tax laws.

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Blackstone Mortgage Trust, Inc.

Notes to Consolidated Financial Statements (continued)

Our qualification as a REIT also depends on our ability to meet various other requirements imposed by the Internal Revenue Code, which relate to organizational structure, diversity of stock ownership and certain restrictions with regard to the nature of our assets and the sources of our income. Even if we qualify as a REIT, we may be subject to certain U.S. federal excise taxes and state and local taxes on our income and assets. If we fail to qualify as a REIT in any taxable year, we will be subject to U.S. federal income taxes at regular corporate rates (including any applicable alternative minimum tax) and will not be able to qualify as a REIT for the subsequent four full taxable years.

During the years ended December 31, 2014, 2013, and 2012, we recorded a current income tax provision of $518,000, $995,000, and $174,000, respectively, primarily related to activities of our taxable REIT subsidiaries and various state and local taxes. We did not have any deferred tax assets or liabilities as of December 31, 2014 or 2013.

As a result of our issuance of 25,875,000 shares of class A common stock in May 2013, the availability of our net operating losses, or NOLs, and net capital losses, or NCLs, is generally limited to $2.0 million per annum by change of control provisions promulgated by the Internal Revenue Service with respect to the ownership of Blackstone Mortgage Trust. As of December 31, 2014, we had estimated NOLs of $159.0 million and NCLs of $32.0 million available to be carried forward and utilized in current or future periods. To the extent we are unable to utilize our NOLs, they will expire in 2029. To the extent we are unable to utilize our NCLs, $31.4 million will expire in 2015, and $602,000 will expire in 2017.

As of December 31, 2014, tax years 2011 through 2014 remain subject to examination by taxing authorities.

13. STOCK-BASED INCENTIVE PLANS

We do not have any employees as we are externally managed by our Manager. However, our Manager, certain individuals employed by an affiliate of our Manager, and certain members of our board of directors are compensated, in part, through the issuance of stock-based instruments.

We had stock-based incentive awards outstanding under five benefit plans as of December 31, 2014: (i) our amended and restated 1997 non-employee director stock plan, or 1997 Plan; (ii) our 2007 long-term incentive plan, or 2007 Plan; (iii) our 2011 long-term incentive plan, or 2011 Plan; (iv) our 2013 stock incentive plan, or 2013 Plan; and (v) our 2013 manager incentive plan, or 2013 Manager Plan. We refer to our 1997 Plan, our 2007 Plan, and our 2011 Plan collectively as our Expired Plans and we refer to our 2013 Plan and 2013 Manager Plan collectively as our Current Plans.

Our Expired Plans have expired and no new awards may be issued under them. Under our Current Plans, a maximum of 2,160,106 shares of our class A common stock may be issued to our Manager, our directors and officers, and certain employees of affiliates of our Manager. As of December 31, 2014, there were 939,319 shares available under the Current Plans.

We issued 490,381 and 700,000 shares of restricted class A common stock under our Current Plans during 2014 and 2013, respectively. These shares generally vest in quarterly installments over a three-year period, pursuant to the terms of the respective award agreements and the terms of the Current Plans. The 919,719 shares of restricted class A common stock outstanding as of December 31, 2014 will vest as follows; 398,751 shares will vest in 2015; 357,511 shares will vest in 2016; and 163,457 shares will vest in 2017.

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Blackstone Mortgage Trust, Inc.

Notes to Consolidated Financial Statements (continued)

The following table details the movement in our outstanding shares of restricted class A common stock and the weighted-average grant date fair value per share:

	Restricted Class A Common Stock			Weighted-Average Grant Date Fair Value Per Share
Balance as of December 31, 2013		700,000		$	25.69
Granted		490,381			27.82
Vested		(270,662	)		25.57
Balance as of December 31, 2014		919,719		$	26.86

14. FAIR VALUES

Assets Recorded at Fair Value

The following table summarizes our assets measured and reported at fair value on a recurring basis ($ in thousands):

	Level 1		Level 2		Level 3		Fair Value
December 31, 2014
Other assets, at fair value(1)	$	—	$	2,648	$	47,507	$	50,155
December 31, 2013
Other assets, at fair value(1)	$	—	$	1,944	$	54,461	$	56,405

(1) Other assets include loans, securities, equity investments, and other receivables carried at fair value.

The following table reconciles the beginning and ending balances of assets measured at fair value on a recurring basis using Level 3 inputs ($ in thousands):

	2014 Other Assets			2013
				Loans Held-for-Sale, net			Other Assets			Investment in CT Legacy Assets
January 1,	$	54,461		$	—		$	—		$	132,000
Consolidation of CT Legacy Partners		—			—			164,780			(132,000	)
Transfer from loans receivable, at fair value		—			2,000			—			—
Proceeds from investments		(20,231	)		(3,259	)		(118,635	)		—
Adjustments to fair value included in earnings
Gain on investments at fair value		13,277			—			7,332			—
Valuation allowance on loans held-for-sale		—			1,259			—			—
Deferred interest		—			—			984			—
December 31,	$	47,507		$	—		$	54,461		$	—

Our other assets include loans, securities, equity investments, and other receivables that are carried at fair value. The following describes the key assumptions used in arriving at the fair value of each of these assets as of December 31, 2014 and 2013.

Securities: As of December 31, 2014 and 2013, our securities, which had a book value of $10.0 million and $9.4 million, respectively, were valued by obtaining assessments from third-party dealers.

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Blackstone Mortgage Trust, Inc.

Notes to Consolidated Financial Statements (continued)

Loans: The following table lists the range of key assumptions for each type of loans receivable as of December 31, 2014 and December 31, 2013 ($ in millions):

	Discount Rate			Recovery Percentage(1)			Fair Value as of
Collateral Type							December 31, 2014		December 31, 2013
Hotel		(2	)		100	%	$	15.0	$	15.0
Office		(3	)		100	%		4.0		25.7
							$	19.0	$	40.7

(1) Represents the proportion of the principal expected to be collected relative to the loan balances as of December 31, 2014 and 2013, excluding loans for which there is no expectation of future cash flows.

(2) The discount rate used to value our hotel loan portfolio was 7% as of December 31, 2014 and 2013. A 100 bp discount rate increase would result in a decrease in fair value of 0.3% and 1.4% as of December 31, 2014 and 2013, respectively.

(3) The discount rates used to value our office loan portfolio was 15% as of December 31, 2014 and ranged from 6% to 15% as of December 31, 2013. A 100 bp discount rate increase would result in a decrease in fair value of 1.1% and 0.3% as of December 31, 2014 and 2013, respectively.

Equity investments and other receivables: As of December 31, 2014, equity investments and other receivables, which had an aggregate book value of $18.5 million, were generally valued by discounting expected cash flows.

There were no liabilities recorded at fair value as of December 31, 2014 or 2013. Refer to Note 2 for further discussion regarding fair value measurement.

Fair Value of Financial Instruments

As discussed in Note 2, GAAP requires disclosure of fair value information about financial instruments, whether or not reported in the statement of financial position at fair value, for which it is practicable to estimate that value.

The following table details the carrying amount, face amount, and fair value of the financial instruments described in Note 2 that are not reported in the statement of financial position at fair value ($ in thousands):

	December 31, 2014						December 31, 2013
	Carrying Amount		Face Amount		Fair Value		Carrying Amount		Face Amount		Fair Value
Financial assets
Cash and cash equivalents	$	51,810	$	51,810	$	51,810	$	52,342	$	52,342	$	52,342
Restricted cash		11,591		11,591		11,591		10,096		10,096		10,096
Loans receivable, net		4,428,500		4,462,897		4,462,897		2,047,223		2,077,227		2,058,699
Financial liabilities
Revolving repurchase facilities		2,040,783		2,040,783		2,040,783		863,622		863,622		863,622
Asset-specific repurchase agreements		324,553		324,553		324,553		245,731		245,731		245,731
Loan participations sold		499,433		499,433		499,433		90,000		90,000		90,000
Convertible notes, net		161,853		172,500		181,341		159,524		172,500		181,772

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Blackstone Mortgage Trust, Inc.

Notes to Consolidated Financial Statements (continued)

Estimates of fair value for cash, cash equivalents and convertible notes are measured using observable, quoted market prices, or Level 1 inputs. All other significant fair value estimates are measured using unobservable inputs, or Level 3 inputs. The use of different assumptions or methodologies could have a material effect on our estimated fair value amounts. See Note 2 for further discussion regarding fair value measurement of certain of our assets and liabilities.

15. TRANSACTIONS WITH RELATED PARTIES

Transactions Related to Our Manager and its Affiliates

As further described in Note 11, in December 2012 we concluded multiple, related transactions with Blackstone and its affiliates, including: (i) the Investment Management Business Sale; (ii) the sale of 500,000 shares of our class A common stock for $20.00 per share; and (iii) the execution of a new external management agreement with our Manager. In addition, Blackstone received the right to designate two members of our board of directors and exercised that right by designating an employee and one of its senior advisors to replace two former members of our board of directors who resigned effective December 19, 2012. Certain of our former employees are now employed by an affiliate of our Manager.

The initial term of the Management Agreement expires on December 19, 2015 and will be automatically renewed for a one-year term each anniversary thereafter unless earlier terminated.

On March 26, 2013, we amended the Management Agreement with our Manager to, among other things, amend our investment guidelines to permit the investment risk management committee of our board of directors, which consists of only independent directors, to approve any proposed investment by our Manager.

On July 30, 2013, we and our Manager entered into Amendment No. 1 to our amended and restated Management Agreement with our Manager. The amendments consisted of: (i) revisions to clarify that internal audit expenses (including through one or more third parties and/or affiliates of our Manager) are to be paid by us and not our Manager; and (ii) updates to reflect our recent name change and the merger of our CT Legacy REIT Mezz Borrower, Inc. subsidiary with and into CT Legacy Partners, LLC.

On October 23, 2014, we and our Manager entered into a Second Amended and Restated Management Agreement, or the Second Amended and Restated Management Agreement. The Second Amended and Restated Management Agreement amended and restated the existing Management Agreement to, among other things: (i) incorporate the terms of Amendment No. 1 to our amended and restated Management Agreement; (ii) amend our investment guidelines to increase the threshold required for approval by the investment risk management committee of our board of directors from any proposed investment in excess of $150.0 million to any proposed investment in excess of $250.0 million; and (iii) revise the definitions for Incentive Compensation and Management Fee (in each case as defined in the Second Amended and Restated Management Agreement) to remove wording regarding the calculation of payments during 2013 that is no longer relevant.

As of December 31, 2014, our consolidated balance sheet included $6.3 million of accrued management and incentive fees payable to our Manager. During the year ended December 31, 2014, we paid $15.7 million of management and incentive fees to our Manager and reimbursed our Manager for $115,000 of expenses incurred on our behalf. In addition, as of December 31, 2014, our consolidated balance sheet includes $151,000 of preferred distributions payable by CT Legacy Partners to an affiliate of our Manager. During the year ended December 31, 2014, CT Legacy Partners made aggregate preferred distributions of $2.1 million to such affiliate.

On October 23, 2014, we issued 337,941 shares of restricted class A common stock with a fair value of $9.4 million as of the grant date to our Manager under the 2013 Manager Plan. On October 3, 2013, we issued

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Blackstone Mortgage Trust, Inc.

Notes to Consolidated Financial Statements (continued)

339,431 shares of restricted class A common stock with a grant date fair value of $8.5 million to our Manager under the 2013 Manager Plan. The shares of restricted class A common stock vest ratably in quarterly installments over three years from the date of issuance. During the years ended, December 31, 2014 and 2013, we recorded a non-cash expense related to these shares of $3.8 million and $767,000, respectively. Refer to Note 13 for further discussion of our restricted class A common stock.

During the years ended December 31, 2014 and 2013, CT CDO I incurred special servicing fees to our Manager of $522,000 and $847,000 respectively, of which it paid $139,000 and $847,000 respectively.

During the years ended December 31, 2014 and 2013, we paid fees of $26,000 and $9,000, respectively, to a third-party service provider for equity capital markets data services. This service provider was acquired by an affiliate of our Manager on August 6, 2014.

During the year ended December 31, 2014, we incurred $96,000 of fees to a third-party service provider for various administrative services that was owned by an affiliate of our Manager. We did not incur any of these fees during the year ended December 31, 2013.

During the year ended December 31, 2014, we incurred $80,000 of fees to an affiliate of our Manager for various administrative services. We did not incur any of these fees during the year ended December 31, 2013.

There may be conflicts between us and our Manager with respect to certain of the investments in the CT Legacy Partners and CTOPI portfolios where an affiliate of our Manager holds a related investment that is senior, junior, or pari passu to the investments held by these portfolios.

The Management Agreement with our Manager excludes from the management fee calculation our interests in CT Legacy Partners, CTOPI, and CT CDO I, which may result in further conflicts between the economic interests of us and our Manager. Refer to Note 10 for further discussion of the Management Agreement with our Manager.

On May 13, 2013, we entered into a joint venture, 42-16 Partners, with an affiliate of our Manager to originate and warehouse loans prior to the completion of our class A common stock offering on May 29, 2013. 42-16 Partners was owned 16.7% by us and 83.3% by an affiliate of our Manager and originated one senior mortgage loan on May 21, 2013. On May 30, 2013, we ended this relationship with the affiliate of our Manager and purchased 100% of the equity interests in 42-16 Partners held by the affiliate of our Manager using proceeds from the sale of our class A common stock, and, as a result, 42-16 Partners became a 100% owned and consolidated subsidiary. We recorded a $193,000 charge to non-controlling interest as a result of the purchase of these equity interests at their fair value, rather than GAAP book value.

An affiliate of our Manager purchased 1,960,784 shares of our class A common stock as part of our stock offering on May 22, 2013. These shares were purchased for $25.50 each, the same price offered to non-affiliated purchasers. This affiliate owned class A common stock representing 5.4% of outstanding class A common stock and stock units as of February 10, 2015. In addition, an affiliate of our Manager was compensated $1.0 million for its role as co-manager of our offering of class A common stock on May 22, 2013 and $188,000 for its role as co-manager of our offering of convertible notes on November 19, 2013.

On October 2, 2013 we originated a $71.0 million loan, the proceeds of which were used by the borrower to repay an existing loan owned by an affiliate of our Manager.

On October 23, 2013, we purchased a $176.9 million loan from a third party. In conjunction with our acquisition of this loan, we consented to its restructuring, which restructuring resulted in an affiliate of our Manager earning a $2.3 million modification fee. During 2014, we received $119.4 million of proceeds from partial repayments of this loan, resulting in a net book value of $53.8 million as of December 31, 2014.

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Blackstone Mortgage Trust, Inc.

Notes to Consolidated Financial Statements (continued)

On June 20, 2014, CT CDO I, CT Legacy Partners, CTOPI, and other affiliates of our Manager entered into a deed-in-lieu of foreclosure transaction which resulted in a restructuring of the interests held by each entity with respect to certain loans in our CT Legacy Portfolio segment with an aggregate principal balance of $35.0 million and an aggregate book value of $27.0 million.

Other Related-Party Transactions

In conjunction with the Investment Management Business Sale, we entered into a letter agreement with W.R. Berkley Corporation, or WRBC, pursuant to which we agreed not to undertake any offering of our class A common stock, or other equity securities, in an aggregate amount greater than $30.0 million without prior approval of a majority of the independent members of our board of directors. This one-time approval was obtained in conjunction with our May 2013 offering of class A common stock, and we are no longer required to obtain such approval for future offerings. An employee of WRBC was a member of our board of directors until our annual meeting held on June 18, 2014.

16. COMMITMENTS AND CONTINGENCIES

Unfunded Commitments Under Loans Receivable

As of December 31, 2014, we had unfunded commitments of $513.2 million related to 35 loans receivable, which amounts will generally be funded to finance lease-related or capital expenditures by our borrowers. These future commitments will expire over the next five years.

Income Tax Audit of CTIMCO

The Internal Revenue Service, or the IRS, is currently undergoing an examination of the federal income tax returns for the year ended December 31, 2012 of our former subsidiary, CT Investment Management Co., LLC, or CTIMCO. The examination is on-going, and no adjustments have been communicated to us by the IRS. When we sold CTIMCO in December 2012, we provided certain indemnifications related to its operations, and any amounts determined by the IRS to be owed by CTIMCO would ultimately be paid by us.

Litigation

In the normal course of business, we are subject to various legal proceedings and claims, the resolution of which, in our Manager’s opinion, will not have a material adverse effect on our consolidated financial position or results of operations. As of December 31, 2014, there are no reserves recorded for pending litigation.

Board of Director’s Compensation

As of December 31, 2014, of the eight members of our board of directors, five are entitled to annual compensation of $125,000 each. The other three board members, including our chairman and our chief executive officer, serve as directors with no compensation. As of December 31, 2014, the annual compensation for our directors was paid 50% in cash and 50% in the form of deferred stock units. In addition, the member of our board of directors that serves as the chairperson of the audit committee of our board of directors receives additional annual cash compensation of $12,000. Compensation to the board of directors is payable in four equal quarterly installments.

17. SEGMENT REPORTING

We operate our real estate finance business through a Loan Origination segment and a CT Legacy Portfolio segment. The Loan Origination segment includes our activities associated with the origination and acquisition of mortgage loans, the capitalization of our loan portfolio, and the costs associated with operating our business

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Blackstone Mortgage Trust, Inc.

Notes to Consolidated Financial Statements (continued)

generally. The CT Legacy Portfolio segment includes our activities specifically related to CT Legacy Partners and our equity investment in CTOPI. Our Manager identifies, makes operating decisions, and assesses the performance of each of our business segments based on financial and operating data and metrics generated from our internal information systems.

Our Loan Origination segment business commenced during 2013. Accordingly, no comparable segment data exists for 2012, or any other prior period, and we have therefore not retrospectively restated our previously reported 2012 information.

There were no transactions between our operating segments during the years ended December 31, 2014 and 2013. For the year ended December 31, 2014, 11% of our revenues were generated from international sources. Substantially all of our revenues for the year ended December 31, 2013 were generated from domestic sources.

The following table presents our consolidated statement of operations for each segment for the year ended December 31, 2014 ($ in thousands):

	Loan Origination		CT Legacy Portfolio			Total
Income from loans and other investments
Interest and related income	$	180,654	$	4,112		$	184,766
Less: Interest and related expenses		68,098		1,045			69,143
Income from loans and other investments, net		112,556		3,067			115,623
Other expenses
Management and incentive fees		19,491		—			19,491
General and administrative expenses		12,665		15,134			27,799
Total other expenses		32,156		15,134			47,290
Gain on investments at fair value		—		13,258			13,258
Loss on deconsolidation of subsidiaries		—		(8,615	)		(8,615	)
Income from equity investments in unconsolidated subsidiaries		—		28,036			28,036
Income before income taxes		80,400		20,612			101,012
Income tax provision		194		324			518
Net income		80,206		20,288			100,494
Net income attributable to non-controlling interests		—		(10,449	)		(10,449	)
Net income attributable to Blackstone Mortgage Trust, Inc.	$	80,206	$	9,839		$	90,045

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Blackstone Mortgage Trust, Inc.

Notes to Consolidated Financial Statements (continued)

The following table presents our consolidated balance sheet for each segment as of December 31, 2014 ($ in thousands):

	Loan Origination		CT Legacy Portfolio		Total
Assets
Cash and cash equivalents	$	51,810	$	—	$	51,810
Restricted cash		—		11,591		11,591
Loans receivable, net		4,428,500		—		4,428,500
Equity investments in unconsolidated subsidiaries		—		10,604		10,604
Accrued interest receivable, prepaid expenses, and other assets		36,531		49,485		86,016
Total assets	$	4,516,841	$	71,680	$	4,588,521
Liabilities and Equity
Accounts payable, accrued expenses, and other liabilities	$	47,328	$	13,685	$	61,013
Revolving repurchase facilities		2,040,783		—		2,040,783
Asset-specific repurchase agreements		324,553		—		324,553
Loan participations sold		499,433		—		499,433
Convertible notes, net		161,853		—		161,853
Total liabilities		3,073,950		13,685		3,087,635
Equity
Total Blackstone Mortgage Trust, Inc. stockholders’ equity		1,442,891		22,480		1,465,371
Non-controlling interests		—		35,515		35,515
Total equity		1,442,891		57,995		1,500,886
Total liabilities and equity	$	4,516,841	$	71,680	$	4,588,521

The following table presents our consolidated statement of operations for each segment for the year ended December 31, 2013 ($ in thousands):

	Loan Origination			CT Legacy Portfolio			Total
Income from loans and other investments
Interest and related income	$	41,621		$	11,543		$	53,164
Less: Interest and related expenses		13,053			4,964			18,017
Income from loans and other investments, net		28,568			6,579			35,147
Other expenses
Management and incentive fees		5,937			—			5,937
General and administrative expenses		5,149			6,356			11,505
Total other expenses		11,086			6,356			17,442
Valuation allowance on loans held-for-sale		—			1,259			1,259
Gain on investments at fair value		—			7,417			7,417
Gain on extinguishment of debt		—			38			38
Income before income taxes		17,482			8,937			26,419
Income tax benefit		31			964			995
Net income		17,451			7,973			25,424
Net income attributable to non-controlling interests		(193	)		(10,199	)		(10,392	)
Net income (loss) attributable to Blackstone Mortgage Trust, Inc.	$	17,258		$	(2,226	)	$	15,032

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Blackstone Mortgage Trust, Inc.

Notes to Consolidated Financial Statements (continued)

The following table presents our consolidated balance sheet for each segment as of December 31, 2013 ($ in thousands):

	Loan Origination		CT Legacy Portfolio		Total
Assets
Cash and cash equivalents	$	52,342	$	—	$	52,342
Restricted cash		—		10,096		10,096
Loans receivable, net		2,000,223		47,000		2,047,223
Equity investments in unconsolidated subsidiaries		—		22,480		22,480
Accrued interest receivable, prepaid expenses, and other assets		21,020		59,619		80,639
Total assets	$	2,073,585	$	139,195	$	2,212,780
Liabilities and Equity
Accounts payable, accrued expenses, and other liabilities	$	21,104	$	76,049	$	97,153
Revolving repurchase facilities		863,622		—		863,622
Asset-specific repurchase agreements		245,731		—		245,731
Loan participations sold		90,000		—		90,000
Convertible notes, net		159,524		—		159,524
Total liabilities		1,379,981		76,049		1,456,030
Equity
Total Blackstone Mortgage Trust, Inc. stockholders’ equity		693,604		24,305		717,909
Non-controlling interests		—		38,841		38,841
Total equity		693,604		63,146		756,750
Total liabilities and equity	$	2,073,585	$	139,195	$	2,212,780

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Blackstone Mortgage Trust, Inc.

Notes to Consolidated Financial Statements (continued)

18. SUMMARY OF QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

The following is a summary of the unaudited quarterly results of operations for the years ended December 31, 2014, 2013, and 2012 ($ in thousands except per share data):

	March 31			June 30		September 30		December 31
2014
Revenues(1)	$	33,656		$	42,466	$	50,386	$	58,258
Net income	$	13,116		$	38,439	$	23,601	$	25,338
Net income attributable to
Blackstone Mortgage Trust, Inc.	$	13,065		$	33,466	$	22,024	$	21,490
Net income per share of class A common stock:
Basic	$	0.34		$	0.70	$	0.45	$	0.37
Diluted	$	0.34		$	0.70	$	0.45	$	0.37
2013
Revenues(1)	$	1,456		$	6,017	$	18,853	$	26,837
Net (loss) income	$	(1,597	)	$	6,768	$	10,526	$	9,728
Net (loss) income attributable to
Blackstone Mortgage Trust, Inc.	$	(3,115	)	$	2,748	$	8,320	$	7,079
Net (loss) income per share of class A common stock:
Basic	$	(1.03	)	$	0.22	$	0.29	$	0.24
Diluted	$	(1.03	)	$	0.22	$	0.29	$	0.24
2012
Revenues(1)	$	14,716		$	6,763	$	6,944	$	6,517
Net income	$	140,622		$	3,351	$	12,900	$	122,931
Net income attributable to
Blackstone Mortgage Trust, Inc.	$	66,553		$	2,283	$	6,999	$	105,189
Net income per share of class A common stock:
Basic	$	29.14		$	1.00	$	3.02	$	42.21
Diluted	$	27.39		$	0.93	$	2.84	$	40.65

(1) Excludes revenues from discontinued operations.

Basic and diluted earnings per share are computed independently based on the weighted-average shares of common stock and stock units outstanding for each period. Accordingly, the sum of the quarterly earnings per share amounts may not agree to the total for the year. Earnings per share amounts have been adjusted to give retroactive effect to the reverse stock split, which we effected on May 6, 2013. See Note 9 for a further discussion of earnings per share.

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Blackstone Mortgage Trust, Inc.

Schedule IV – Mortgage Loans on Real Estate

As of December 31, 2014

(in thousands)

Type of Loan/Borrower	Description / Location	Interest Payment Rates(2)			Maximum Maturity Date(3)		Periodic Payment Terms(4)		Prior Liens(5)		Face Amount of Loans		Carrying Amount of Loans(6)
Senior Mortgage Loans(1)
Borrower A	Hotel / UK		L + 4.00	%		5/22/2019		I/O	$	—	$	311,240	$	307,084
Borrower B	Condo / Northeast		L + 4.50	%		11/9/2018		I/O		—		181,000		179,839
Borrower C	Office / Diversified		L + 3.80	%		12/9/2019		I/O		—		163,300		161,770
Borrower D	Office / Midwest		L + 3.50	%		8/9/2019		I/O		—		153,879		152,751
Borrower E	Other / Diversified		L + 4.75	%		1/7/2019		I/O		—		151,767		150,618
Borrower F	Hotel / UK		L + 3.40	%		11/20/2019		I/O		—		149,395		147,936
Borrower G	Office / Northeast		L + 4.75	%		1/9/2019		I/O		—		139,809		139,099
Borrower H	Office / Canada		L + 5.50	%		12/9/2019		I/O		—		138,644		137,024
Borrower I	Hotel / Northeast		L + 4.30	%		12/1/2017		I/O		—		133,350		132,987
All other mortgage loans individually less than 3%	Various / Diversified		L + 3.65 % – L + 6.83	%		6/10/2016 – 9/30/2020				—		2,852,148		2,831,478
Total senior mortgage loans										—		4,374,532		4,340,586
Subordinate Loans(7)
Borrower AA	Office / Northwest		L + 5.66	%		4/9/2015		I/O		88,986		54,399		53,833
Borrower BB	Condo / Northeast		L + 12.56	%		12/13/2017		I/O		110,388		33,966		34,081
Total subordinate loans										199,374		88,365		87,914
Total loans									$	199,374	$	4,462,897	$	4,428,500

(1) Includes senior mortgages and similar credit quality loans, including related contiguous subordinate loans, and pari passu participations in senior mortgage loans.

(2) As of December 31, 2014, our floating rate loans and related liabilities were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Therefore the net exposure to each benchmark rate is in direct proportion to our net assets indexed to that rate. In addition to cash coupon, all-in yield includes the amortization of deferred origination fees, loan origination costs, and accrual of both extension and exit fees.

(3) Maximum maturity date assumes all extension options are exercised.

(4) I/O = interest only.

(5) Represents only third party liens.

(6) The tax basis of the loans included above is approximately $3.9 billion as of December 31, 2014.

(7) Includes subordinate interests in mortgages and mezzanine loans.

S-1

Blackstone Mortgage Trust, Inc.

Notes to Schedule IV

As of December 31, 2014

(in thousands)

1. Reconciliation of Mortgage Loans on Real Estate:

The following table reconciles mortgage loans on real estate for the years ended:

	2014			2013			2012
Balance at January 1,	$	2,047,223		$	141,500		$	869,269
Additions during period:
Consolidation (deconsolidation) of subsidiary		—			—			(645,163	)
Loan fundings		3,067,263			2,327,914			26
Amortization of deferred fees and expenses		19,785			5,965			180
Unrealized gain on foreign currency translation		—			796			—
Valuation allowance on loans held-for-sale		—			1,259			—
Recovery of provision for loan losses		—			—			36,147
Deductions during period:
Collections of principal		(564,183	)		(383,647	)		(118,959	)
Unrealized (loss) on foreign currency translation		(52,076	)		—			—
Deferred origination fees and expenses		(35,449	)		(25,402	)		—
Loans sold		(27,063	)		(21,162	)		—
Transfers to other assets		(27,000	)		—			—
Balance at December 31,	$	4,428,500		$	2,047,223		$	141,500

S-2

EX-10.31

Exhibit 10.31

SECOND AMENDMENT TO MASTER REPURCHASE AGREEMENT

THIS SECOND AMENDMENT TO MASTER REPURCHASE AGREEMENT (this “Amendment”), dated as of September 11, 2013 (the “Effective Date”), is made by and among CITIBANK, N.A., having an address at 388 Greenwich Street, 19^th Floor, New York, New York 10013 (together with its successors and/or assigns, “Buyer”), PARLEX 2 FINANCE, LLC, a Delaware limited liability company, having an address c/o Blackstone Mortgage Trust, Inc., 345 Park Avenue, New York, New York 10154 (“Seller”) and, for the purpose of acknowledging and agreeing to the provision set forth in Section 3 hereof, BLACKSTONE MORTGAGE TRUST, INC., a Maryland corporation, having an address at 345 Park Avenue, New York, New York 10154 (“Guarantor”).

W I T N E S S E T H:

WHEREAS, Seller and Buyer have entered into that certain Master Repurchase Agreement, dated as of June 12, 2013, as amended by that certain First Amendment to Master Repurchase Agreement, dated as of July 26, 2013 (as the same may be further amended, supplemented, extended, restated, replaced or otherwise modified from time to time, the “Repurchase Agreement”);

WHEREAS, all capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Repurchase Agreement;

WHEREAS, Seller and Buyer desire to modify certain terms and provisions of the Repurchase Agreement as set forth herein.

NOW, THEREFORE, in consideration of ten dollars ($10) and for other good and valuable consideration, the receipt and legal sufficiency of which are hereby acknowledged, Seller and Buyer covenant and agree as follows as of the Effective Date, and Guarantor acknowledges and agrees as to the provision set forth in Section 3 as of the Effective Date:

1. Modification of Repurchase Agreement. The Repurchase Agreement is hereby modified as of the Effective Date as follows:

(a) The phrase: “5% of Tangible Net Worth (as such term is defined in the Guaranty)” in Section 14(a)(xiv) is hereby deleted in all two places and replaced with the phrase: “the lesser of (i) 5% of Tangible Net Worth (as such term is defined in the Guaranty) and (ii) $25,000,000”.

2. Seller’s Representations. Seller has taken all necessary action to authorize the execution, delivery and performance of this Amendment. This Amendment has been duly executed and delivered by or on behalf of Seller and constitutes the legal, valid and binding obligation of Seller enforceable against Seller in accordance with its terms subject to bankruptcy, insolvency, and other limitations on creditors’ rights generally and to equitable principles. No Event of Default has occurred and is continuing, and no Event of Default will occur as a result of

the execution, delivery and performance by Seller of this Amendment. Any consent, approval, authorization, order, registration or qualification of or with any Governmental Authority required for the execution, delivery and performance by Seller of this Amendment has been obtained and is in full force and effect (other than consents, approvals, authorizations, orders, registrations or qualifications that if not obtained, are not reasonably likely to have a Material Adverse Effect).

3. Reaffirmation of Guaranty. Guarantor has executed this Amendment for the purpose of acknowledging and agreeing that, notwithstanding the execution and delivery of this Amendment and the amendment of the Repurchase Agreement hereunder, all of Guarantor’s obligations under the Guaranty remain in full force and effect and the same are hereby irrevocably and unconditionally ratified and confirmed by Guarantor in all respects.

4. Full Force and Effect. Except as expressly modified hereby, all of the terms, covenants and conditions of the Repurchase Agreement and the other Transaction Documents remain unmodified and in full force and effect and are hereby ratified and confirmed by Seller. Any inconsistency between this Amendment and the Repurchase Agreement (as it existed before this Amendment) shall be resolved in favor of this Amendment, whether or not this Amendment specifically modifies the particular provision(s) in the Repurchase Agreement inconsistent with this Amendment. All references to the “Agreement” in the Repurchase Agreement or to the “Repurchase Agreement” in any of the other Transaction Documents shall mean and refer to the Repurchase Agreement as modified and amended hereby.

5. No Waiver. The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of the Buyer under the Repurchase Agreement, the Guaranty, any of the other Transaction Documents or any other document, instrument or agreement executed and/or delivered in connection therewith.

6. Headings. Each of the captions contained in this Amendment are for the convenience of reference only and shall not define or limit the provisions hereof.

7. Counterparts. This Amendment may be executed in any number of counterparts, and all such counterparts shall together constitute the same agreement. Signatures delivered by email (in PDF format) shall be considered binding with the same force and effect as original signatures

8. Governing Law. This Amendment shall be governed in accordance with the terms and provisions of Section 20 of the Repurchase Agreement.

[No Further Text on this Page; Signature Pages Follow]

2

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their duly authorized representatives as of the day and year first above written and effective as of the Effective Date.

SELLER:
PARLEX 2 FINANCE, LLC, a Delaware limited liability company
By:	/s/ Douglas Armer
	Name:	Douglas Armer
	Title:	Principal, Head of Capital Markets
GUARANTOR:
BLACKSTONE MORTGAGE TRUST, INC., a Maryland corporation
By:	/s/ Douglas Armer
	Name:	Douglas Armer
	Title:	Principal, Head of Capital Markets

[Signatures Continued on Next Page]

BUYER:
CITIBANK, N.A.
By:	/s/ Richard B. Schlenger
	Name:	Richard B. Schlenger
	Title:	Authorized Signatory

EX-10.32

Exhibit 10.32

THIRD AMENDMENT TO MASTER REPURCHASE AGREEMENT

This THIRD AMENDMENT TO MASTER REPURCHASE AGREEMENT (this “Amendment”), dated as of November 20, 2013 (the “Effective Date”), is made by and among CITIBANK, N.A., having an address at 388 Greenwich Street, 19^th Floor, New York, New York 10013 (together with its successors and/or assigns, “Buyer”), PARLEX 2 FINANCE, LLC, a Delaware limited liability company, having an address c/o Blackstone Mortgage Trust, Inc., 345 Park Avenue, New York, New York 10154 (“Seller”) and, for the purpose of acknowledging and agreeing to the provision set forth in Section 3 hereof, BLACKSTONE MORTGAGE TRUST, INC., a Maryland corporation, having an address at 345 Park Avenue, New York, New York 10154 (“Guarantor”).

W I T N E S S E T H:

WHEREAS, Seller and Buyer have entered into that certain Master Repurchase Agreement, dated as of June 12, 2013, as amended by that certain First Amendment to Master Repurchase Agreement, dated as of July 26, 2013 (the “First Amendment to MRA”) and that certain Second Amendment to Master Repurchase Agreement, dated as of September 11, 2013 (as the same may be further amended, supplemented, extended, restated, replaced or otherwise modified from time to time, the “Repurchase Agreement”);

WHEREAS, all capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Repurchase Agreement; and

WHEREAS, Seller and Buyer desire to modify certain terms and provisions of the Repurchase Agreement as set forth herein.

NOW, THEREFORE, in consideration of ten dollars ($10) and for other good and valuable consideration, the receipt and legal sufficiency of which are hereby acknowledged, Seller and Buyer covenant and agree as follows as of the Effective Date, and Guarantor acknowledges and agrees as to the provision set forth in Section 3 as of the Effective Date:

1. Modification of Repurchase Agreement. The Repurchase Agreement is hereby modified as of the Effective Date as follows:

(a) The definition of “Purchased Loan – Class A” in Section 2 of the Repurchase Agreement is hereby deleted in its entirety and replaced with the following:

““Purchased Loan – Class A” shall mean a Purchased Loan or any portion of the Purchase Price relating to such Purchased Loan categorized as a “Class A” Purchased Loan on the related executed Confirmation.”

(b) The definition of “Purchased Loan – Class B” in Section 2 of the Repurchase Agreement is hereby deleted in its entirety and replaced with the following:

““Purchased Loan – Class B” shall mean a Purchased Loan or any portion of the Purchase Price relating to such Purchased Loan categorized as a “Class B” Purchased Loan on the related executed Confirmation.

(c) The item listed as subclause (iii) in Section 3(b) of the Repurchase Agreement (which item was incorporated pursuant to the First Amendment to MRA) as to be set forth in the Confirmation is hereby deleted in its entirety and replaced with the following:

“(iii) either (A) the classification of such Purchased Loan as either a Purchased Loan – Class A or a Purchased Loan – Class B, or (B) in lieu thereof, the classification of a portion of the Purchase Price relating to such Purchased Loan as either (x) a Purchased Loan – Class A and the classification of the remaining portion of such Purchase Price, if any, as a a Purchased Loan – Class B or (y) a Purchased Loan – Class B and the classification of the remaining portion of such Purchase Price, if any, as a Purchased Loan – Class A.”

(d) The last sentence of Section 3(c) of the Repurchase Agreement (which sentence was incorporated pursuant to the First Amendment to MRA) is hereby deleted in its entirety and replaced with the following:

“Notwithstanding anything to the contrary set forth herein, upon classification of a Purchased Loan in its entirety as either a Purchased Loan – Class A or a Purchased Loan – Class B, or classification of any portion of the Purchase Price relating to such Purchased Loan as either a Purchased Loan – Class A or a Purchased Loan – Class B, such Purchased Loan or applicable portion of the Purchase Price relating to a Purchased Loan may be subsequently re-classified by Seller subject to the limitations set forth herein with respect to the Facility Amount – Class A, Facility Amount – Class B, Facility Availability Period – Class A and Facility Availability Period – Class B. Notwithstanding the foregoing, (A) no re-classification of all or a portion of the Purchase Price relating to a Purchased Loan – Class A as a Purchased Loan – Class B shall cause the aggregate outstanding Purchase Prices for all Purchased Loans – Class B to at any time exceed the Facility Amount – Class B, and (B) Seller shall not be permitted to re-classify all or a portion of the Purchase Price relating to a Purchased Loan – Class B as a Purchased Loan – Class A after the Facility Expiration Date – Class A.”

2

(e) The following is hereby added to the end of Section 3(f) of the Repurchase Agreement:

“Reductions of outstanding Purchase Price made in accordance with this Section 3(f) in connection with a Purchased Loan for which a portion of the Purchase Price is classified as a Purchased Loan – Class A and a portion of the Purchase Price is classified as a Purchased Loan – Class B, shall be applied in reduction of the outstanding Purchase Price classified as Purchased Loan – Class A and/or Purchased Loan – Class B as directed by Seller.”

(f) The following is hereby added to the end of Section 5(e) of the Repurchase Agreement:

“Principal Payments applied in accordance with this Section 5(e) toward the reduction of outstanding Purchase Price in respect of a Purchased Loan for which a portion of the Purchase Price is classified as a Purchased Loan – Class A and a portion of the Purchase Price is classified as a Purchased Loan – Class B, shall be applied in reduction of the outstanding Purchase Price classified as Purchased Loan – Class A and/or Purchased Loan – Class B as directed by Seller.”

2. Seller’s Representations. Seller has taken all necessary action to authorize the execution, delivery and performance of this Amendment. This Amendment has been duly executed and delivered by or on behalf of Seller and constitutes the legal, valid and binding obligation of Seller enforceable against Seller in accordance with its terms subject to bankruptcy, insolvency, and other limitations on creditors’ rights generally and to equitable principles. No Event of Default has occurred and is continuing, and no Event of Default will occur as a result of the execution, delivery and performance by Seller of this Amendment. Any consent, approval, authorization, order, registration or qualification of or with any Governmental Authority required for the execution, delivery and performance by Seller of this Amendment has been obtained and is in full force and effect (other than consents, approvals, authorizations, orders, registrations or qualifications that if not obtained, are not reasonably likely to have a Material Adverse Effect).

3. Reaffirmation of Guaranty. Guarantor has executed this Amendment for the purpose of acknowledging and agreeing that, notwithstanding the execution and delivery of this Amendment and the amendment of the Repurchase Agreement hereunder, all of Guarantor’s obligations under the Guaranty remain in full force and effect and the same are hereby irrevocably and unconditionally ratified and confirmed by Guarantor in all respects.

4. Full Force and Effect. Except as expressly modified hereby, all of the terms, covenants and conditions of the Repurchase Agreement and the other Transaction Documents remain unmodified and in full force and effect and are hereby ratified and confirmed by Seller. Any inconsistency between this Amendment and the Repurchase Agreement (as it existed before this Amendment) shall be resolved in favor of this Amendment, whether or not this Amendment specifically modifies the particular provision(s) in the Repurchase Agreement inconsistent with this Amendment. All references to the “Agreement” in the Repurchase Agreement or to the “Repurchase Agreement” in any of the other Transaction Documents shall mean and refer to the Repurchase Agreement as modified and amended by this Amendment.

3

5. No Waiver. The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of the Buyer under the Repurchase Agreement, the Guaranty, any of the other Transaction Documents or any other document, instrument or agreement executed and/or delivered in connection therewith.

6. Headings. Each of the captions contained in this Amendment are for the convenience of reference only and shall not define or limit the provisions hereof.

7. Counterparts. This Amendment may be executed in any number of counterparts, and all such counterparts shall together constitute the same agreement. Signatures delivered by email (in PDF format) shall be considered binding with the same force and effect as original signatures.

8. Governing Law. This Amendment shall be governed in accordance with the terms and provisions of Section 20 of the Repurchase Agreement.

[Remainder of page intentionally left blank; signatures follow on next page.]

4

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their duly authorized representatives as of the day and year first above written and effective as of the Effective Date.

SELLER:
PARLEX 2 FINANCE, LLC, a Delaware limited liability company
By:	/s/ Douglas Armer
	Name:	Douglas Armer
	Title:	Principal, Head of Capital Markets, and Treasurer
GUARANTOR:
BLACKSTONE MORTGAGE TRUST, INC., a Maryland corporation
By:	/s/ Douglas Armer
	Name:	Douglas Armer
	Title:	Principal, Head of Capital Markets, and Treasurer

[Signatures Continued on Next Page]

BUYER:
CITIBANK, N.A.
By:	/s/ Richard B. Schlenger
	Name:	Richard B. Schlenger
	Title:	Authorized Signatory

EX-10.33

Exhibit 10.33

AMENDED AND RESTATED

MASTER REPURCHASE AGREEMENT

Dated as of July 28, 2014

among

PARLEX 2 FINANCE, LLC,

PARLEX 2A FINCO, LLC,

and any other Person when such Person joins as a Seller under

this Agreement from time to time

individually and/or collectively, as the context requires, as Seller,

and

CITIBANK, N.A.,

as Buyer

TABLE OF CONTENTS

		Page
1.	APPLICABILITY		1
2.	DEFINITIONS		1
3.	INITIATION; CONFIRMATION; TERMINATION; FEES		22
4.	MARGIN MAINTENANCE		28
5.	INCOME PAYMENTS AND PRINCIPAL PAYMENTS		32
6.	SECURITY INTEREST		34
7.	PAYMENT, TRANSFER AND CUSTODY		35
8.	SALE, TRANSFER, HYPOTHECATION OR PLEDGE OF PURCHASED LOANS		38
9.	INTENTIONALLY OMITTED		39
10.	REPRESENTATIONS		39
11.	NEGATIVE COVENANTS OF SELLER		44
12.	AFFIRMATIVE COVENANTS OF SELLER		45
13.	SINGLE-PURPOSE ENTITY		48
14.	EVENTS OF DEFAULT; REMEDIES		49
15.	SINGLE AGREEMENT		55
16.	RECORDING OF COMMUNICATIONS		55
17.	NOTICES AND OTHER COMMUNICATIONS		55
18.	ENTIRE AGREEMENT; SEVERABILITY		56
19.	NON-ASSIGNABILITY		56
20.	GOVERNING LAW		57
21.	NO WAIVERS, ETC.		57
22.	USE OF EMPLOYEE PLAN ASSETS		57
23.	INTENT		58
24.	DISCLOSURE RELATING TO CERTAIN FEDERAL PROTECTIONS		60
25.	CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL		60
26.	NO RELIANCE		61
27.	INDEMNITY		61
28.	DUE DILIGENCE		62
29.	SERVICING		63
30.	MISCELLANEOUS		64
31.	TAXES		65
32.	JOINT AND SEVERAL OBLIGATIONS		67

i

ANNEXES AND EXHIBITS

ANNEX I	Names and Addresses for Communications between Parties and Wire Instructions
SCHEDULE I	Prohibited Transferees
EXHIBIT I	Form of Confirmation
EXHIBIT II	Authorized Representatives of Seller
EXHIBIT III	Form of Custodial Delivery
EXHIBIT IV	Eligible Loan Due Diligence Checklist
EXHIBIT V	Form of Power of Attorney
EXHIBIT VI	Representations and Warranties Regarding Each Individual Purchased Loan
EXHIBIT VII	Collateral Tape
EXHIBIT VIII	Form of Transaction Request
EXHIBIT IX	Form of Request for Margin Excess
EXHIBIT X	Form of Irrevocable Direction Letter
EXHIBIT XI	Form of Joinder Agreement
EXHIBIT XII	Form of Facility Asset Chart

ii

AMENDED AND RESTATED MASTER REPURCHASE AGREEMENT, dated as of July 28, 2014, by and among PARLEX 2 FINANCE, LLC, a Delaware limited liability company (“Parlex 2”), PARLEX 2A FINCO, LLC, a Delaware limited liability company (“Parlex 2A”, and together with Parlex 2, and any other Person when such Person joins as a Seller hereunder from time to time, individually and/or collectively as the context may require, “Seller”) and CITIBANK, N.A., a national banking association (“Buyer”).

1. APPLICABILITY

From time to time during the Facility Availability Period, the parties hereto may enter into transactions in which Seller agrees to transfer to Buyer Purchased Loans against the transfer of funds by Buyer, with a simultaneous agreement by Buyer to transfer to Seller such Purchased Loans at a date certain, against the transfer of funds by Seller. Each such transaction shall be referred to herein as a “Transaction” and, unless otherwise agreed in writing, shall be governed by this Agreement, including any supplemental terms or conditions contained in any exhibits identified herein as applicable hereunder.

This Agreement amends, restates and replaces in its entirety that certain Master Repurchase Agreement, dated as of June 12, 2013 by and between Parlex 2 and Buyer, as amended by that certain First Amendment to Master Repurchase Agreement dated as of July 26, 2013, by and between Parlex 2 and Buyer, as further amended by that certain Second Amendment to Master Repurchase Agreement dated as of September 11, 2013, by and between Parlex 2 and Buyer, as further amended by that certain Third Amendment to Master Repurchase Agreement dated as of November 20, 2013, by and between Parlex 2 and Buyer, as further amended by that certain Fourth Amendment to Master Repurchase Agreement dated as of January 31, 2014, by and between Parlex 2 and Buyer, as further amended by that certain Joinder Agreement dated as of January 31, 2014, by and among Parlex 2, Parlex 2A and Buyer, as amended by that certain Letter Agreement dated as of January 31, 2014, by and among Parlex 2, Parlex 2A and Buyer, and as further amended by that certain Fifth Amendment to Master Repurchase Agreement dated as of April 1, 2014, by and among Parlex 2, Parlex 2A and Buyer (collectively, the “Original Agreement”). Seller and Buyer acknowledge and agree that the Original Agreement shall be void and of no force or effect from and after the date hereof.

2. DEFINITIONS

“Accelerated Repurchase Date” shall have the meaning specified in Section 14(b)(i) of this Agreement.

“Acceptable Attorney” means Ropes & Gray LLP or any other attorney-at-law or law firm reasonably acceptable to Buyer.

“Accepted Servicing Practices” shall have the meaning given to such term in the Servicing Agreement (or, if not defined therein, shall mean with respect to any Purchased Loan, those mortgage servicing practices of prudent mortgage lending institutions which service whole mortgage loans (and senior interests in whole mortgage loans) in the jurisdiction where the related Mortgaged Property is located).

“Act of Insolvency” shall mean, with respect to any Person, (a) the filing of a decree or order for relief by a court having jurisdiction over such Person or any substantial part of its assets or property in an involuntary case under any applicable Insolvency Law now or hereafter in effect which (i) results in the entry of an order for relief or (ii) is not dismissed within 90 days, (b) the appointment by a court having jurisdiction over such Person or any substantial part of its assets or property, of a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official for such Person or for any substantial part of its assets or property and such appointment shall remain unstayed and in effect for a period of 90 days, (c) an order by a court having jurisdiction over such Person or any substantial part of its assets or property ordering the winding up or liquidation of such Person’s affairs, and such order shall remain unstayed and in effect for a period of 90 days, (d) the commencement by such Person of a voluntary case under any applicable Insolvency Law now or hereafter in effect, (e) the consent by such Person to the entry of an order for relief in an involuntary case under any Insolvency Law, (f) the consent by such Person to the appointment of or taking possession by a receiver, liquidator, assignee, custodian, trustee, sequestrator or similar official for such Person or for any substantial part of its assets or property, (g) the making by such Person of any general assignment for the benefit of creditors, or (h) the admission in writing in connection with a legal proceeding of the inability of such Person to pay its debts generally as they become due.

“Actual Knowledge” shall mean, as of any date of determination, the then current actual knowledge of Stephen Plavin, Thomas C. Ruffing and Douglas Armer, without duty of further inquiry or investigation; provided, that if any such individual ceases to be an officer of or in the employ of Seller and/or Guarantor after the date of this Agreement in a capacity comparable to the capacity occupied as of the date of this Agreement, then Seller shall designate promptly another individual reasonably acceptable to Buyer for purposes of satisfying this definition.

“Affiliate” shall mean, when used with respect to any specified Person, any other Person directly or indirectly Controlling, Controlled by, or under common Control with, such Person.

“Agreement” shall mean this Amended and Restated Master Repurchase Agreement, dated as of the date first set forth above, by and between Parlex 2, Parlex 2A, and Citibank, N.A., as such agreement may be amended, modified, supplemented, and/or restated and in effect from time to time.

“Alternative Rate” shall have the meaning specified in Section 3(g) of this Agreement.

“Alternative Rate Transaction” shall mean, with respect to any Pricing Rate Period, any Transaction with respect to which the Pricing Rate for such Pricing Rate Period is determined with reference to the Alternative Rate.

“Applicable Spread” shall mean, with respect to each Transaction:

(i) so long as no Event of Default shall have occurred and be continuing, the number of basis points (i.e., 1 basis point equals 0.01%) determined in accordance with the Pricing Matrix, and confirmed in the related Confirmation; or

(ii) after the occurrence and during the continuance of an Event of Default, the applicable incremental per annum rate described in clause (i) of this definition, as applicable, plus 400 basis points (4.00%).

2

It is understood and agreed that no improvement or decline in the LTV (Loan UPB) after the applicable Purchase Date for a Purchased Loan shall result in any adjustment to the Applicable Spread for such Purchased Loan.

“Applicable Standard of Discretion” shall mean (a) at any time the Maximum LTV (Purchase Price) of a Purchased Loan is less than or equal to the LTV (Loan UPB) of such Purchased Loan as of the Purchase Date, Buyer’s commercially reasonable discretion, and (b) at any time the Maximum LTV (Purchase Price) of a Purchased Loan is greater than the LTV (Loan UPB) of such Purchased Loan as of the Purchase Date, Buyer’s sole discretion.

“Appraisal” shall mean a FIRREA compliant appraisal addressed to Buyer, Seller or Guarantor, and the successors and assigns of the addressee (and, if not addressed to Buyer, containing reliance language acceptable to Buyer, which language shall be made available by Seller to and approved by Buyer prior to the applicable Purchase Date) and reasonably satisfactory to Buyer of the related Mortgaged Property from a third party appraiser.

“ARD Loan” shall mean any loan that provides that if the unamortized principal balance thereof is not repaid by a date certain set forth in the related loan documents, such loan will accrue additional interest at the rate specified in the related Mortgage Note and the related Mortgagor is required to apply certain excess monthly cash flow generated by the related Mortgaged Property to the repayment of the outstanding principal balance on such Mortgage Loan.

“Assignment Documents in Blank” shall mean, for each Purchased Loan, the (i) allonge in blank, (ii) omnibus assignment in blank, (iii) Assignment of Mortgage in blank, and (iv) assignment of Assignment of Leases in blank.

“Assignment of Leases” shall mean, with respect to any Mortgage, an assignment of leases thereunder, notice of transfer or equivalent instrument in recordable form, sufficient under the laws of the jurisdiction wherein the Mortgaged Property is located to reflect the assignment of leases, subject to the terms, covenants and provisions of this Agreement.

“Assignment of Mortgage” shall mean, with respect to any Mortgage, an assignment of the mortgage, notice of transfer or equivalent instrument in recordable form, sufficient under the laws of the jurisdiction wherein the related Mortgaged Property is located to reflect the assignment and pledge of the Mortgage, subject to the terms, covenants and provisions of this Agreement.

“Attorney’s Bailee Letter” shall mean a letter from an Acceptable Attorney, in form and substance reasonably acceptable to Buyer, wherein such Acceptable Attorney in possession of a Purchased Loan File (i) acknowledges receipt of such Purchased Loan File, (ii) confirms that such Acceptable Attorney is holding the same as bailee of Buyer under such letter and (iii) agrees that such Acceptable Attorney shall deliver such Purchased Loan File to the Custodian by not later than the third (3^rd) Business Day following the Purchase Date for the related Purchased Loan.

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“Bankruptcy Code” shall mean Title 11 of the United States Code (11 U.S.C. § 101, et seq.), as amended, modified or replaced from time to time.

“Blocked Account Agreement” shall mean, individually or collectively, as the context may require, (i) that certain Deposit Account Control Agreement, dated as of June 12, 2013, among Buyer, Parlex 2, Servicer and the Depository, relating to the Cash Management Account established by Parlex 2, as the same may be amended, modified and/or restated from time to time, (ii) that certain Deposit Account Control Agreement, dated as of January 31, 2014, among Buyer, Parlex 2A, Servicer and the Depository, relating to the Cash Management Account established by Parlex 2A, as the same may be amended, modified and/or restated from time to time, and (iii) each additional Deposit Account Control Agreement entered into among a new Seller admitted to this Agreement pursuant to a Joinder Agreement, Buyer, Servicer and the Depository and relating to a Cash Management Account established pursuant to this Agreement by such new Seller, as the same may be amended, modified and/or restated from time to time.

“Business Day” shall mean a day other than (i) a Saturday or Sunday, (ii) a day on which the New York Stock Exchange or Federal Reserve Bank of New York is authorized or obligated by law or executive order to be closed and (iii) a day on which commercial banks in the State of New York, Pennsylvania, Kansas or Minnesota are authorized or obligated by law or executive order to be closed. When used with respect to a Pricing Rate Determination Date, “Business Day” shall mean any day other than a Saturday, a Sunday or a day on which banks in London, England are closed for interbank or foreign exchange transactions.

“Buyer” shall mean Citibank, N.A., or any successor or assign.

“Capital Lease Obligations” shall mean, for any Person, all obligations of such Person to pay rent or other amounts under a lease of (or other agreement conveying the right to use) Property to the extent such obligations are required to be classified and accounted for as a capital lease on a balance sheet of such Person under GAAP, and, for purposes of this Agreement, the amount of such obligations shall be the capitalized amount thereof, determined in accordance with GAAP.

“Capital Stock” shall mean any and all shares, interests, participations or other equivalents (however designated) of capital stock of a corporation, any and all equivalent equity ownership interests in a Person which is not a corporation, including, without limitation, any and all member or other equivalent interests in any limited liability company, and any and all warrants or options to purchase any of the foregoing.

“Cash Management Account” shall mean, individually or collectively, as the context may require, with respect to each Seller, a segregated interest bearing account, in the name of such Seller for the benefit of Buyer, established at the Depository and subject to a Blocked Account Agreement.

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“Change of Control” shall mean any of the following events shall have occurred without the prior approval of Buyer:

(i) Guarantor shall no longer own, directly or indirectly, 100% of the ownership interest in Seller and Control, directly or indirectly, Seller;

(ii) any merger, reorganization or consolidation of Guarantor where Guarantor is not the surviving entity; or

(iii) any conveyance, transfer, lease or disposal of all or substantially all assets of any Seller or Guarantor to any Person or entity other than an Affiliate of such entity.

“Code” shall mean The Internal Revenue Code of 1986 and the regulations promulgated and rulings issued thereunder, in each case as amended, modified or replaced from time to time.

“Collateral” shall have the meaning specified in Section 6 of this Agreement.

“Collateral Tape” shall mean, with respect to each Eligible Loan, the tape containing the fields of information set forth in Exhibit VII attached hereto.

“Column A” shall have the meaning specified in the definition of Facility Asset Chart.

“Column B” shall have the meaning specified in the definition of Facility Asset Chart.

“Column C” shall have the meaning specified in the definition of Facility Asset Chart.

“Column D” shall have the meaning specified in the definition of Facility Asset Chart.

“Column E” shall have the meaning specified in the definition of Facility Asset Chart.

“Concentration Limit” shall mean, unless otherwise agreed to in writing by Buyer (including, without limitation, in a Confirmation), the test that shall be satisfied at any applicable date of determination, if: (x) the aggregate outstanding Purchase Price with respect to all Purchased Loans which are participation interests shall not exceed 33% of the Facility Amount and (y) the outstanding Purchase Price with respect to any single Purchased Loan shall not exceed 25% of the Facility Amount.

“Confirmation” shall have the meaning specified in Section 3(b) of this Agreement.

“Connection Income Taxes” shall mean Other Connection Taxes that are imposed on or measured by net income (however denominated) or that are franchise Taxes or branch profits Taxes.

“Control” shall mean the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of a Person, whether through the ownership of voting securities or by contract and “Controlling” and “Controlled” shall have meanings correlative thereto.

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“Current Appraisal” shall mean, as of any date of determination, an Appraisal approved by Buyer dated within six (6) months (or such greater number of months as Buyer may approve in its sole discretion) of such date of determination.

“Custodial Agreement” shall mean, individually or collectively, as the context may require, (i) that certain Custodial Agreement, dated as of June 12, 2013, among the Custodian, Parlex 2 and Buyer, as amended by that certain Amendment No. 1 to Custodial Agreement, dated as of January 31, 2014, among Custodian, Parlex 2, Parlex 2A, and Buyer, and as the same may be further amended, modified and/or restated from time to time, and (ii) each additional Custodial Agreement entered into among a new Seller admitted to this Agreement pursuant to a Joinder Agreement, the Custodian and Buyer, as the same may be amended, modified and/or restated from time to time.

“Custodial Delivery” shall mean the form executed by Seller in order to deliver the Purchased Loan Schedule and the Purchased Loan File to Buyer or its designee (including the Custodian) pursuant to Section 7 hereof, a form of which is attached hereto as Exhibit III.

“Custodian” shall mean U.S. Bank, National Association, or any successor Custodian appointed by Buyer with the prior written consent of Seller (which consent shall not be unreasonably withheld or delayed).

“Debt Yield (Loan UPB)” shall mean, with respect to each Purchased Loan, as of any date of determination, the net cash flow debt yield equal to the percentage equivalent of the quotient obtained by dividing (a) the in place underwritten net cash flow of the related Mortgaged Property, as determined by Buyer in its good faith business judgment, by (b) the unpaid principal balance of such Purchased Loan on such date of determination.

“Debt Yield (Purchase Price)” shall mean, with respect to each Purchased Loan, as of any date of determination, the net cash flow debt yield equal to the percentage equivalent of the quotient obtained by dividing (a) the in place underwritten net cash flow of the related Mortgaged Property, as determined by Buyer in its good faith business judgment, by (b) the outstanding Purchase Price of such Purchased Loan on such date of determination.

“Default” shall mean any event which, with the giving of notice, the passage of time, or both, would constitute an Event of Default.

“Defeasance” shall have the meaning specified in Exhibit VI.

“Depository” shall mean PNC Bank, or any successor Depository appointed by Seller with the prior written consent of Buyer (which consent shall not be unreasonably withheld or delayed).

“Due Diligence Package” shall mean (i) the Collateral Tape, (ii) the items on the Eligible Loan Due Diligence Checklist, in each case to the extent applicable and (iii) such other documents or information as Buyer or its counsel shall reasonably deem necessary.

“Early Repurchase Date” shall have the meaning specified in Section 3(d) of this Agreement.

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“Eligible Loan Due Diligence Checklist” shall mean the due diligence materials set forth in Exhibit IV attached hereto.

“Eligible Loans” shall mean fixed or floating rate whole mortgage loans (“Whole Loans”) or senior interests (including “A” notes in an “A/B” note structure) in such Whole Loans (“Senior Interests”) or participation interests in such Whole Loans or Senior Interests which are secured by stabilized or un-stabilized multi-family or commercial properties (including office, retail, industrial and hotel properties), which have been approved by Buyer in its sole discretion as a Purchased Loan and which satisfy all of the following criteria as of the applicable Purchase Date:

(a) the Debt Yield (Loan UPB) is equal to or greater than 6.00%,

(b) the LTV (Loan UPB) is 75.00% or less (or such higher percentage as Buyer may agree to in its sole discretion),

(c) the LTV (Aggregate Loan UPB) is 80.00% or less, and

(d) in the event the maturity date of the subject Whole Loan or Senior Interests (or participation interests therein) shall be later than three (3) years (inclusive of all extension terms) after the expiration of the Facility Availability Period, then the conditions precedent to the exercise of any option that would extend the maturity date of such Whole Loan or Senior Interests (or participation interests therein) beyond such three (3) year period shall include extension conditions satisfactory to Buyer, including but not limited to, enhanced credit metrics relative to those in place at the time of such Purchased Loan’s origination.

Eligible Loans shall also include such other loans and debt instruments (or interests in such loans and debt instruments) as Buyer may approve from time to time in its sole discretion, subject to terms and conditions and document delivery requirements as may be established by Buyer.

“Environmental Law” shall mean, any federal, state, foreign or local statute, law, rule, regulation, ordinance, code and rule of common law now or hereafter in effect and in each case as amended, and any judicial or administrative interpretation thereof, including any judicial or administrative order, consent decree or judgment, relating to the environment, employee health and safety or Hazardous Materials, including, without limitation, CERCLA; RCRA; the Federal Water Pollution Control Act, 33 U.S.C. § 1251 et seq.; the Toxic Substances Control Act, 15 U.S.C. § 2601 et seq.; the Clean Air Act, 42 U.S.C. § 7401 et seq.; the Safe Drinking Water Act, 42 U.S.C. § 3803 et seq.; the Oil Pollution Act of 1990, 33 U.S.C. § 2701 et seq.; the Emergency Planning the Community Right-to-Know Act of 1986, 42 U.S.C. § 11001 et seq.; the Hazardous Material Transportation Act, 49 U.S.C. § 1801 et seq.; and the Occupational Safety and Health Act, 29 U.S.C. § 651 et seq.; and any state and local or foreign counterparts or equivalents, in each case as amended from time to time.

“ERISA” shall mean the Employee Retirement Income Security Act of 1974, as amended from time to time, and the regulations promulgated thereunder. Section references to ERISA are to ERISA, as in effect at the date of this Agreement and, as of the relevant date, any subsequent provisions of ERISA, amendatory thereof, supplemental thereto or substituted therefor.

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“ERISA Affiliate” shall mean any corporation or trade or business that is a member of any group of organizations (i) described in Section 414(b) or (c) of the Code of which Seller is a member and (ii) solely for purposes of potential liability under Section 302 of ERISA and Section 412 of the Code and the lien created under Section 303(k) of ERISA and Section 430(k) of the Code, described in Section 414(m) or (o) of the Code of which Seller is a member.

“ESA” shall have the meaning specified in Exhibit VI.

“Event of Default” shall have the meaning specified in Section 14(a) of this Agreement.

“Excluded Taxes” shall mean, any of the following Taxes imposed on or with respect to payment to Buyer or required to be withheld or deducted from such payment, (a) Taxes imposed on or measured by net income (however denominated), franchise Taxes, Taxes imposed on or measured by net worth (however denominated) and branch profits Taxes, in each case, (i) imposed as a result of Buyer being organized under the laws of, or having its principal office or the office from which it books the Transactions located in, the jurisdiction imposing such Taxes (or any political subdivision thereof) or (ii) that are Other Connection Taxes, (b) U.S. federal withholding Taxes imposed on amounts payable to or for the account of Buyer with respect to an interest in the Transactions pursuant to a law in effect on the date on which such Party (i) acquires such interest in the Transactions or (ii) changes its principal office or the office from which it books the Transactions, except in each case to the extent that, pursuant to Section 31, amounts with respect to such Taxes were payable either to such Buyer’s assignor immediately before such Buyer became a party hereto or to such Buyer immediately before it changed the office from which it books the Transactions, (c) Taxes attributable to Buyer’s failure to comply with Section 31 of this Agreement, (d) Taxes attributable to Buyer’s failure to comply with its obligations under Sections 19(c), 19(d) or 23(i) of this Agreement, (e) any withholding Taxes imposed under FATCA, (f) any U.S. federal backup withholding Taxes imposed under Section 3406 of the Code, and (g) any interest, additions to tax or penalties in respect of the foregoing.

“Exit Fee” shall have the meaning specified in the Fee Agreement.

“Extension Fee” shall have the meaning specified in the Fee Agreement.

“Facility Amount” shall mean $500,000,000.

“Facility Asset Chart” shall mean a chart in the form of Exhibit XII to this Agreement setting forth, as of any date of determination, with respect to each Purchased Loan, (i) the current outstanding Purchase Price (under the heading “Current Outstanding Buyer Purchase Prices” and referred to herein as “Column A”), (ii) the current Margin Excess (Other) (under the heading “Current Margin Excess (Other)” and referred to herein as “Column B”), (iii) the available Margin Excess (Future Funding) (under the heading “Adjusted Margin Excess (Future Fundings)” and referred to herein as “Column C”), (iv) the Maximum Purchase Price (under the heading “Total of A, B, C” and referred to herein as “Column D”), and (v) the potentially available Margin Excess (Future Funding) (under the heading “Potential Margin Excess (Future Fundings)” and referred to herein as “Column E”).

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“Facility Availability Period” shall mean the period commencing on June 12, 2013 and ending on July 28, 2017 (or if such day is not a Business Day, the next succeeding Business Day). Notwithstanding anything herein to the contrary, at any time during the Facility Availability Period, Seller may request an extension of the Facility Availability Period which extension shall be in Buyer’s sole discretion and subject to terms and conditions determined by Buyer in its sole discretion.

“Facility Expiration Date” shall mean the last day of the Facility Availability Period; provided, that the Facility Expiration Date shall be extendible by Seller on an annual basis thereafter (i.e. for consecutive twelve (12) month periods), subject to the following:

(a) Seller delivers to Buyer a written request of the extension of the Facility Expiration Date no earlier than ninety (90) nor later than thirty (30) days before the then current Facility Expiration Date,

(b) no Default or Event of Default has occurred and is continuing on the date the request to extend is delivered or on the then current Facility Expiration Date,

(c) no Margin Deficit exists that has not been satisfied,

(d) the Concentration Limit is satisfied on the date the request to extend is delivered and on the then current Facility Expiration Date (except to the extent waived or otherwise approved by Buyer), and

(e) Seller shall have paid to Buyer the Extension Fee on or before the then current Facility Expiration Date.

“FATCA” shall mean Sections 1471 through 1474 of the Code, as of the date of this Agreement (or any amended or successor version that is substantively comparable and not materially more onerous to comply with), any current or future regulations or official interpretations thereof and, for the avoidance of doubt, any agreements entered into pursuant to any of the foregoing.

“Fee Agreement” shall mean (i) that certain Second Amended and Restated Fee Letter, dated as of April 28, 2014, between Seller and Buyer, as the same may be amended, modified and/or restated from time to time (including through a Joinder Agreement), and (ii) each additional Fee Letter entered into among a new Seller admitted to this Agreement pursuant to a Joinder Agreement, the Custodian and Buyer, as the same may be amended, modified and/or restated from time to time.

“Filings” shall have the meaning specified in Section 6.

“Financing Lease” shall mean any lease of property, real or personal, the obligations of the lessee in respect of which are required in accordance with GAAP to be capitalized on a balance sheet of the lessee.

“FIRREA” shall mean the Financial Institutions, Reform, Recovery and Enforcement Act of 1989.

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“Funding Fee” shall have the meaning specified in the Fee Agreement.

“Future Funding Conditions Precedent” shall have the meaning specified in Section 4(c).

“GAAP” shall mean United States generally accepted accounting principles consistently applied as in effect from time to time.

“Governmental Authority” shall mean any national or federal government, any state, regional, local or other political subdivision thereof with jurisdiction and any Person with jurisdiction exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government.

“Ground Lease” shall have the meaning specified in Exhibit VI.

“Guarantor” shall mean Blackstone Mortgage Trust, Inc., a Maryland corporation (or, following a substitution consummated in accordance with Section 9, Successor Guarantor).

“Guaranty” shall mean the Limited Guaranty, dated as of June 12, 2013, from Guarantor in favor of Buyer, as amended by that certain First Amendment to Limited Guaranty, dated as of November 20, 2013, from Guarantor in favor of Buyer, as further amended by that certain Second Amendment to Limited Guaranty, dated as of February 24, 2014, from Guarantor in favor of Buyer, as the same may be further amended, modified and/or restated from time to time.

“Hedging Transactions” shall mean, with respect to any Purchased Loan that is a fixed rate loan, any short sale of U.S. Treasury Securities or mortgage-related securities, futures contract (including Eurodollar futures) or options contract or any interest rate swap, cap or collar agreement or similar arrangements providing for protection against fluctuations in interest rates or the exchange of nominal interest obligations, either generally or under specific contingencies, entered into by Seller with either (x) Buyer or an Affiliate of Buyer or (y) one or more other counterparties reasonably acceptable to Buyer and, in the case of clause (y) only, assigned by Seller to Buyer as additional collateral for the applicable Transaction.

“Income” shall mean, with respect to any Purchased Loan at any time, the sum of (x) any principal thereof and all interest, dividends or other distributions thereon and (y) all net sale proceeds received by Seller in connection with a sale of such Purchased Loan to a Person other than Buyer.

“Indebtedness” shall mean, for any Person: (a) obligations created, issued or incurred by such Person for borrowed money (whether by loan, the issuance and sale of debt securities or the sale of Property to another Person subject to an understanding or agreement, contingent or otherwise, to repurchase such Property from such Person); (b) obligations of such Person to pay the deferred purchase or acquisition price of Property or services, other than trade accounts payable (other than for borrowed money) arising, and accrued expenses incurred, in the ordinary course of business so long as such trade accounts payable are payable within ninety (90) days of the date the respective goods are delivered or the respective services are rendered; (c) Indebtedness of others secured by a Lien on the Property of such Person, whether or not the respective Indebtedness so secured has been assumed by such Person; (d) obligations (contingent or otherwise) of such Person in respect of letters of credit or similar instruments issued or

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accepted by banks and other financial institutions for account of such Person; contingent or future funding obligations under any Purchased Loan or any obligations senior to, or pari passu with, any Purchased Loan; (e) Capital Lease Obligations of such Person; and (f) obligations of such Person under repurchase agreements or like arrangements; (g) Indebtedness of others guaranteed by such Person to the extent of such guarantee; and (h) all obligations of such Person incurred in connection with the acquisition or carrying of fixed assets by such Person. Notwithstanding the foregoing, nonrecourse Indebtedness owing pursuant to a securitization transaction such as a REMIC securitization, a collateralized loan obligation transaction or other similar securitization shall not be considered Indebtedness for any person.

“Indemnified Amounts” and “Indemnified Parties” shall have the meaning specified in Section 27 of this Agreement.

“Indemnified Taxes” shall mean (a) Taxes, other than Excluded Taxes, imposed on or with respect to any payment made by or on account of any obligation of Seller under any Transaction Document and (b) Other Taxes.

“Independent Director” shall mean a duly appointed manager or member of the board of directors (or managers) of the relevant entity who shall not have been, at the time of such appointment or at any time while serving as a director or manager of the relevant entity and may not have been at any time in the preceding five (5) years, (a) a direct or indirect legal or beneficial owner in such entity or any of its Affiliates, (b) a creditor, supplier, employee, officer, director (other than in its capacity as Independent Director), family member, manager or contractor of such entity or any of its Affiliates, or (c) a Person who controls (directly, indirectly or otherwise) such entity or any of its Affiliates or any creditor, supplier, employee, officer, director, family member, manager or contractor of such Person or any of its Affiliates.

“Insolvency Laws” shall mean the Bankruptcy Code and all other applicable liquidation, conservatorship, bankruptcy, moratorium, rearrangement, receivership, insolvency, reorganization, suspension or payments and similar debtor relief laws from time to time in effect affecting the rights of creditors generally.

“Insurance Rating Requirements” shall have the meaning specified in Exhibit VI.

“Irrevocable Direction Letter” shall have the meaning specified in Section 5(b).

“Joinder Agreement” shall have the meaning specified in the definition of Seller.”

“Junior Interest” shall have the meaning specified in Exhibit VI.

“LIBOR” shall mean, with respect to each Pricing Rate Period, the rate (expressed as a percentage per annum) for deposits in U.S. dollars, for a one month period, that appears on “Page BBAM” of the Bloomberg Financial Markets Services Screen (or the successor thereto) as of 11:00 a.m., London time, on the related Pricing Rate Determination Date. If such rate does not appear on “Page BBAM” of the Bloomberg Financial Markets Services Screen (or the successor thereto) as of 11:00 a.m., London time, on such Pricing Rate Determination Date, Buyer shall request the principal London office of any four major reference banks in the London interbank market selected by Buyer to provide such bank’s offered quotation (expressed as a percentage

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per annum) to prime banks in the London interbank market for deposits in U.S. dollars for a one month period as of 11:00 a.m., London time, on such Pricing Rate Determination Date for amounts of not less than the Repurchase Price of the applicable Transaction. If at least two such offered quotations are so provided, LIBOR shall be the arithmetic mean of such quotations. If fewer than two such quotations are so provided, Buyer shall request any three major banks in New York City selected by Buyer to provide such bank’s rate (expressed as a percentage per annum) for loans in U.S. dollars to leading European banks for a one month period as of approximately 11:00 a.m., New York City time on the applicable Pricing Rate Determination Date for amounts of not less than the Repurchase Price of such Transaction. If at least two such rates are so provided, LIBOR shall be the arithmetic mean of such rates. LIBOR shall be determined by Buyer or its agent, which determination shall be conclusive absent manifest error.

“LIBO Rate” shall mean, with respect to any Pricing Rate Period pertaining to a Transaction, a rate per annum determined for such Pricing Rate Period in accordance with the following formula (rounded upward to the nearest 1/100th of 1%):

LIBOR

1 – Reserve Requirement

“Lien” shall mean any mortgage, lien, encumbrance, charge or other security interest, whether arising under contract, by operation of law, judicial process or otherwise.

“LTV (Aggregate Loan UPB)” shall mean, with respect to any Purchased Loan, the ratio, expressed as a percentage, the numerator of which shall equal the sum of (x) the unpaid principal balance of such Purchased Loan plus (y) the unpaid principal balance of any subordinate or mezzanine debt secured indirectly by the Mortgaged Property and the denominator of which shall equal the “as is” value of such Mortgaged Property securing such Purchased Loan as determined by Buyer as of the Purchase Date in its sole discretion. For purposes of determining the value of a Mortgaged Property in accordance with this definition, (i) the value may be determined by reference to a Current Appraisal, discounted cash flow analysis or other commercially reasonable method and (ii) for the avoidance of doubt, Buyer may reduce value for any actual or potential risks (including risk of delay) posed by any Liens on the related Mortgaged Property.

“LTV (Loan UPB)” shall mean, with respect to any Purchased Loan, the ratio, expressed as a percentage, the numerator of which shall equal the unpaid principal balance of the Purchased Loan and the denominator of which shall equal the “as is” value of the related Mortgaged Property securing such Purchased Loan as determined by Buyer as of the Purchase Date in its sole discretion. For purposes of determining the value of a Mortgaged Property in accordance with this definition, (i) the value may be determined by reference to a Current Appraisal, discounted cash flow analysis or other commercially reasonable method and (ii) for the avoidance of doubt, Buyer may reduce value for any actual or potential risks (including risk of delay) posed by any Liens on the related Mortgaged Property.

“LTV (Purchase Price)” shall mean, with respect to any Purchased Loan, the ratio, expressed as a percentage, the numerator of which shall equal the outstanding Purchase Price of the Purchased Loan and the denominator of which shall equal the “as is” value of the related

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Mortgaged Property securing such Purchased Loan as determined by Buyer as of the Purchase Date in its sole discretion and at all times thereafter in Buyer’s commercially reasonable discretion. For purposes of determining the value of a Mortgaged Property in accordance with this definition, (i) the value may be determined by reference to a Current Appraisal, discounted cash flow analysis or other commercially reasonable method and (ii) for the avoidance of doubt, Buyer may reduce value for any actual or potential risks (including risk of delay) posed by any Liens on the related Mortgaged Property.

“MAI” shall have the meaning specified in Exhibit VI.

“Margin Amount” shall mean, with respect to any Purchased Loan as of any date of determination, an amount equal to the product of the applicable Margin Percentage and the outstanding Purchase Price of such Purchased Loan as of such date.

“Margin Deficit” shall have the meaning specified in Section 4(a).

“Margin Deficit Notice” shall have the meaning specified in Section 4(b).

“Margin Excess” shall mean, as applicable, Margin Excess (Future Funding) or Margin Excess (Other).

“Margin Excess (Future Funding)” shall have the meaning specified in Section 4(c).

“Margin Excess (Other)” shall have the meaning specified in Section 4(e).

“Margin Percentage” shall mean, with respect to any Purchased Loan as of any date of determination, the reciprocal of the applicable Maximum Purchase Price Percentage.

“Market Value” shall mean, with respect to any Purchased Loan, the market value for such Purchased Loan, as determined by Buyer at the Applicable Standard of Discretion on each Business Day in accordance with this definition. For purposes of Section 4(a) and 5(e), as applicable, changes in the Market Value of a Purchased Loan shall be determined solely in relation to material positive or negative changes (relative to Buyer’s initial underwriting or the most recent determination of Market Value in terms of the performance or condition, taken in the aggregate, of (i) the Mortgaged Property securing the Purchased Loan or other collateral securing or related to the Purchased Loan, (ii) the Purchased Loan’s borrower (including obligors, guarantors, participants and sponsors) and the borrower on any underlying property or other collateral securing such Purchased Loan, (iii) the commercial real estate market relevant to the Mortgaged Property and (iv) any actual risks posed by any liens or claims on the related Mortgaged Property or Properties. In addition, the Market Value for any Purchased Loan may be deemed by Buyer to be zero or such greater amount (in the Applicable Standard of Discretion) in the event any of the following occurs with respect to such Purchased Loan: (a) a negative change in Market Value to the extent resulting from a continuing material breach of a representation or warranty set forth on Exhibit VI (but without giving effect to any qualifications for Seller’s Actual Knowledge); or (b) the Repurchase Date with respect to such Purchased Loan occurs without repurchase of such Purchased Loan.

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“Material Adverse Effect” shall mean a material adverse effect on (a) the business, condition (financial or otherwise) or results of operations of Seller and Guarantor, taken as a whole, (b) the ability of Seller or Guarantor to pay and perform its material obligations under any of the Transaction Documents, (c) the legality, validity or enforceability of any of the Transaction Documents, (d) the rights and remedies of Buyer under any of the Transaction Documents, or (e) the perfection or priority of any Lien granted under any Purchased Loan Document.

“Maximum LTV (Purchase Price)” shall mean, with respect to any Purchased Loan, the ratio, expressed as a percentage, the numerator of which shall equal the Maximum Purchase Price of the Purchased Loan and the denominator of which shall equal the “as is” value of the related Mortgaged Property securing such Purchased Loan as determined by Buyer in its commercially reasonable discretion.

“Maximum Purchase Price” shall have the meaning set forth in the Fee Agreement.

“Maximum Purchase Price Percentage” shall have the meaning set forth in the Fee Agreement.

“Mortgage” shall mean a mortgage, deed of trust, deed to secure debt or other instrument, creating a valid and enforceable first lien on or a first priority ownership interest in an estate in fee simple in real property and the improvements thereon, securing a mortgage note or similar evidence of indebtedness.

“Mortgage Note” shall mean a note or other evidence of indebtedness of a Mortgagor secured by a Mortgage in connection with a Purchased Loan.

“Mortgaged Property” shall mean the real property securing repayment of the debt evidenced by a Mortgage Note.

“Mortgagee” shall mean the record holder of a Mortgage Note secured by a Mortgage.

“Mortgagor” shall mean the obligor on a Mortgage Note and the grantor of the related Mortgage.

“MTM Representations” shall mean the representations and warranties set forth as items 11, 12, 14, 25, 35, 36, 37 and 42 on Exhibit VI of this Agreement.

“Multiemployer Plan” shall mean a multiemployer plan defined as such in Section 3(37) of ERISA to which contributions have been, or were required to have been, made by Seller or any ERISA Affiliate during the preceding five plan years and which is subject to Title IV of ERISA.

“OFAC” shall mean the U.S. Department of Treasury, Office of Foreign Assets Control

“OFAC List” shall mean the Specially Designated Nationals list maintained by OFAC.

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“Omnibus Amendment” shall mean that certain Omnibus Amendment to Other Transaction Documents and Reaffirmation of Guaranty dated as of the date hereof, by and among Seller, Guarantor and Buyer.

“Original Agreement” shall have the meaning set forth in Section 1 of this Agreement.

“Other Connection Taxes” shall mean Taxes imposed as a result of a present or former connection between Buyer and the jurisdiction imposing such Taxes (other than a connection arising solely as a result of Buyer having executed, delivered, become a party to, performed its obligations under, received payments under, received or perfected a security interest under or enforced any Transaction Document, or sold or assigned an interest in any Transaction or Transaction Document).

“Other Taxes” shall mean all present or future stamp, court or documentary, intangible, recording, filing or similar Taxes that arise from the execution, delivery, performance, enforcement or registration of, from the receipt or perfection of a security interest under any Transaction Document; provided, however, that Other Taxes shall not include (i) Taxes imposed with respect to an assignment, transfer or sale of participation or other interest in or with respect to the Transaction Documents or (ii) any Excluded Taxes.

“Parlex 2” shall mean Parlex 2 Finance, LLC, a Delaware limited liability company.

“Parlex 2A” shall mean Parlex 2A Finco, LLC, a Delaware limited liability company.

“Participant Register” shall have the meaning specified in Section 19(d).

“Permitted Encumbrances” shall have the meaning specified in Exhibit VI.

“Permitted Liens” shall mean any of the following as to which no enforcement, collection, execution, levy or foreclosure proceeding has been commenced: (a) Liens for Taxes not yet due and payable or which are being contested in good faith and for which adequate reserves have been established in accordance with GAAP, (b) Liens imposed by Requirements of Law, such as materialmen’s, mechanics’, carriers’, workmen’s, repairmen’s and similar Liens, arising in the ordinary course of business securing obligations that are not overdue for more than thirty (30) days, and (c) Liens granted pursuant to or by the Transaction Documents.

“Permitted Purchased Loan Modification” shall mean any modification or amendment of a Purchased Loan which is not a Significant Purchased Loan Modification.

“Person” shall mean an individual, corporation, limited liability company, business trust, partnership, joint tenant or tenant-in-common, trust, unincorporated organization, or other entity, or a federal, state or local government or any agency or political subdivision thereof.

“Plan” shall mean an employee benefit or other plan established or maintained by Seller or any ERISA Affiliate during the five year period ended prior to the date of this Agreement or to which Seller or any ERISA Affiliate makes, is obligated to make or has, within the five year period ended prior to the date of this Agreement, been required to make contributions and that is covered by Title IV of ERISA or Section 302 of ERISA or Section 412 of the Code, other than a Multiemployer Plan.

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“Plan Party” shall have the meaning specified in Section 22(a) of this Agreement.

“Price Differential” shall mean, with respect to any Transaction as of any date, the aggregate amount obtained by daily application of the Pricing Rate for such Transaction to the outstanding Purchase Price for such Transaction on a 360-day-per-year basis for the actual number of days during the period commencing on (and including) the Purchase Date for such Transaction and ending on (but excluding) the date of determination (reduced by any amount of such Price Differential previously paid by Seller to Buyer with respect to such Transaction).

“Pricing Matrix” shall mean the matrix attached to the Fee Agreement which shall be used to determine the Purchase Price Percentage, Maximum Purchase Price Percentage and the Applicable Spread for each Purchased Loan.

“Pricing Rate” shall mean, for any Pricing Rate Period, an annual rate equal to the LIBO Rate for such Pricing Rate Period plus the Applicable Spread for such Transaction and shall be subject to adjustment and/or conversion as provided in Sections 3(g) and 3(h) of this Agreement.

“Pricing Rate Determination Date” shall mean with respect to any Pricing Rate Period with respect to any Transaction, the second (2nd) Business Day preceding the first day of such Pricing Rate Period.

“Pricing Rate Period” shall mean, (a) in the case of the first Pricing Rate Period with respect to any Transaction, the period commencing on and including the Purchase Date for such Transaction and ending on and excluding the following Remittance Date, and (b) in the case of any subsequent Pricing Rate Period, the period commencing on and including such Remittance Date and ending on and excluding the following Remittance Date; provided, however, that in no event shall any Pricing Rate Period end subsequent to the Repurchase Date.

“Prime Rate” shall mean the prime rate of U.S. commercial banks as published in The Wall Street Journal (or, if more than one such rate is published, the average of such rates).

“Principal Payment” shall mean, with respect to any Purchased Loan, any payment or prepayment of principal received by the Depository in respect thereof.

“Prohibited Person” shall mean any (1) person or entity who is on the OFAC List; a “designated national,” “specially designated national,” “specially designated terrorist,” “specially designated global terrorist,” “foreign terrorist organization,” or “blocked person” within the definitions set forth in the Foreign Assets Control Regulations of the United States Treasury Department, 31 C.F.R., Subtitle B, Chapter V, as amended, (2) person acting on behalf of, or an entity owned or controlled by, any government against whom the United States maintains economic sanctions or embargoes under the Regulations of the United States Treasury Department, 31 C.F.R., Subtitle B, Chapter V, as amended, including, but not limited to, the “Government of Sudan,” the “Government of Iran,” and the “Government of Cuba,” and any person or organization determined by the Director of the Office of Foreign Assets Control to be included within 31 C.F.R. Section 575.306 (definition of “Government of Iraq”), (3) person or

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entity who is listed in the Annex to or is otherwise within the scope of Executive Order 13224 – Blocking Property and Prohibiting Transactions with Person who Commit, Threaten to Commit, or Support Terrorism, effective September 24, 2001, or (4) person or entity subject to additional restrictions imposed by the following statutes or Regulations and Executive Orders issued thereunder: the Trading with the Enemy Act, 50 U.S.C. app. §§ 1 et seq., the Iraq Sanctions Act, Pub. L. 101-513, Title V, §§ 586 to 586J, 104 Stat. 2047, the National Emergencies Act, 50 U.S.C. §§ 1601 et seq., the Anti-Terrorism and Effective Death Penalty Act of 1996, Pub. L. 104-132, 110 Stat. 1214-1319, the International Emergency Economic Powers Act, 50 U.S.C. §§ 1701 et seq., the United Nations Participation Act, 22 U.S.C. § 287c, the International Security and Development Cooperation Act, 22 U.S.C. § 2349aa-9, the Nuclear Proliferation Prevention Act of 1994, Pub. L. 103-236, 108 Stat. 507, the Foreign Narcotics Kingpin Designation Act, 21 U.S.C. §§ 1901 et seq., the Iran and Libya Sanctions Act of 1996, Pub. L. 104-172, 110 Stat. 1541, the Cuban Democracy Act, 22 U.S.C. §§ 6001 et seq., the Cuban Liberty and Democratic Solidarity Act, 22 U.S.C. §§ 6201-91, the Foreign Operations, Export Financing and Related Programs Appropriations Act, 1997, Pub. L. 104-208, 110 Stat. 3009-172, the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, Pub. L. 107-56, 115 Stat. 272, or any other law of similar import as to any non-U.S. country, as each such Act or law has been or may be amended, adjusted, modified, or reviewed from time to time.

“Prohibited Transferee” shall mean any of the Persons listed on Schedule I attached to this Agreement.

“Property” shall mean any right or interest in or to property of any kind whatsoever, whether real, personal or mixed and whether tangible or intangible.

“Purchase Date” shall mean any date on which a Purchased Loan is to be transferred by Seller to Buyer.

“Purchase Price” shall mean, with respect to any Purchased Loan, the price at which such Purchased Loan is transferred by Seller to Buyer on the applicable Purchase Date, as adjusted after the Purchase Date, all as set forth below and not to exceed the Maximum Purchase Price. The Purchase Price as of the Purchase Date for any Purchased Loan shall be the amount set forth on the applicable Confirmation (expressed in dollars) equal to the lesser of (a) the product obtained by multiplying (i) the lesser of the Market Value of such Purchased Loan and the par amount of such Purchased Loan by (ii) the applicable Purchase Price Percentage and (b) the amount that causes the LTV (Purchase Price) to equal 60.00%. The Purchase Price of any Purchased Loan shall thereafter only be modified to be (a) increased by any Margin Excess transferred by Buyer to Seller pursuant to Section 4(c) or 4(e) of this Agreement, not to exceed the Maximum Purchase Price, and (b) reduced by any amount applied to reduce the Purchase Price pursuant to Section 3(f), 4(a) or 5 of this Agreement.

“Purchase Price Percentage” shall mean, with respect to each Purchased Loan, the amount, expressed as a percentage, determined by dividing (i) the outstanding Purchase Price of such Purchased Loan as of any date of determination hereunder by (ii) the Market Value of such Purchased Loan as of such date, not to exceed the Maximum Purchase Price Percentage.

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“Purchased Loan Documents” shall mean, with respect to a Purchased Loan, the documents comprising the Purchased Loan File for such Purchased Loan.

“Purchased Loan File” shall mean the documents specified as the “Purchased Loan File” in Section 7(b), together with any additional documents and information required to be delivered to Buyer or its designee (including the Custodian) pursuant to this Agreement.

“Purchased Loans” shall mean (i) with respect to any Transaction, the Eligible Loan sold by Seller to Buyer in such Transaction and (ii) with respect to the Transactions in general, all Eligible Loans sold by Seller to Buyer.

“Purchased Loan Schedule” shall mean a schedule of Purchased Loans attached to each Trust Receipt and Custodial Delivery, which may but is not required to, contain information substantially similar to the Collateral Tape.

“Register” shall have the meaning specified in Section 19(c).

“REMIC” shall mean a real estate mortgage investment conduit, within the meaning of Section 860D(a) of the Code.

“Remittance Date” shall mean the seventeenth (17th) calendar day of each month, or the next succeeding Business Day, if such calendar day shall not be a Business Day, or such other day as is mutually agreed to by Seller and Buyer.

“Repurchase Date” shall mean, with respect to each Purchased Loan, the earliest of: (x) the Facility Expiration Date or (y) the maturity date of such Purchased Loan (subject to extension, if applicable, in accordance with its Purchased Loan Documents) or (z) the related Early Repurchase Date.

“Repurchase Obligations” shall mean all obligations of Seller to pay the Repurchase Price on the Repurchase Date and all other obligations and liabilities of Seller to Buyer arising under or in connection with the Transaction Documents, whether now existing or hereafter arising.

“Repurchase Price” shall mean, with respect to any Purchased Loan as of any date, the price at which such Purchased Loan is to be transferred from Buyer to Seller upon termination of the related Transaction; such price will be determined in each case as the sum of (a) the outstanding Purchase Price of such Purchased Loan, (b) the accrued but unpaid Price Differential thereon with respect to such Purchased Loan as of such date, (c) all other amounts due and payable as of such date by Seller to Buyer under this Agreement or any Transaction Document with respect to such Purchased Loan (including, but not limited to, accrued and unpaid fees, expenses and indemnity amounts) and (d) any costs incurred in connection with terminating any related Hedging Transactions entered into with Buyer or an Affiliate of Buyer.

“Request for Margin Excess” shall mean a request for Margin Excess, in the form of Exhibit IX attached hereto.

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“Requirement of Law” shall mean any law, treaty, rule, regulation, code, directive, policy, order or requirement or determination of an arbitrator or a court or other Governmental Authority whether now or hereafter enacted or in effect.

“Reserve Requirement” shall mean, with respect to any Pricing Rate Period, the aggregate (without duplication) of the rates (expressed as a decimal fraction) of reserve requirements in effect during such Pricing Rate Period (including, without limitation, basic, supplemental, marginal and emergency reserves under any regulations of the Board of Governors of the Federal Reserve System or other Governmental Authority having jurisdiction with respect thereto) dealing with reserve requirements prescribed for eurocurrency funding (currently referred to as “Eurocurrency Liabilities” in Regulation D of such Board of Governors) maintained by Buyer.

“SEC” shall have the meaning specified in Exhibit VI.

“Seller” shall mean, collectively, Parlex 2, Parlex 2A, and each other Person as and when same may be approved by Buyer in its sole discretion from time to time and admitted to this Agreement as a Seller by a joinder agreement executed and delivered by Buyer, Seller and such approved other Seller in the form of Exhibit XI to this Agreement (a “Joinder Agreement”).

“Senior Interests” shall have the meaning given to such term in the definition of “Eligible Loans”.

“Servicer” shall mean (x) Midland Loan Services, a division of PNC Bank, National Association or (y) any other third party servicer selected by Seller and approved by Buyer in its sole discretion; provided, that notwithstanding the foregoing, such other third party servicer selected by Seller shall be approved by Buyer in its reasonable discretion, so long as such Person’s primary servicer rating shall be at least “above average” by Standard & Poor’s Ratings Service.

“Servicing Agreement” shall mean, individually or collectively, as the context may require, (x) that certain Servicing Agreement, dated as of June 12, 2013, among Parlex 2, Buyer and Servicer, as the same may be amended, modified and/or restated from time to time, (y) that certain Servicing Agreement, dated as of January 31, 2014, among Parlex 2A, Buyer, and Servicer, as the same may be amended, modified and/or restated from time to time, and (z) any other servicing agreement entered into by a Seller, Buyer and any Servicer approved by Buyer for the servicing of Purchased Loans, as the same may be amended, modified and/or restated from time to time.

“Servicing Records” shall have the meaning specified in Section 29(b).

“Servicing Rights” shall mean Seller’s right, title and interest in and to any and all of the following: (a) any and all rights to service the related Purchased Loan; (b) any payments to or monies received by such Seller or any other Person as a fee for servicing such Purchased Loan; (c) any late fees, penalties or similar payments with respect to such Purchased Loan; (d) all agreements or documents creating, defining or evidencing any such servicing rights to the extent they relate to such servicing rights and all rights of such Seller or any other Person thereunder; (e) escrow payments or other similar payments with respect to such Purchased Loan and any

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amounts actually collected by such Seller or any other Person with respect thereto; (f) the right, if any, to appoint a special servicer or liquidator of such Purchased Loan; and (g) all accounts and other rights to payment related to the servicing of such Purchased Loan.

“Significant Purchased Loan Modification” means any modification or amendment of a Purchased Loan which

(i) reduces the principal amount of the Purchased Loan in question other than (1) with respect to a dollar-for-dollar principal payment or (2) reductions of principal to the extent of deferred, accrued or capitalized interest added to principal which additional amount subsequently reduced was not taken into account by Buyer in determining the related Purchase Price,

(ii) increases the principal amount of a Purchased Loan other than (a) increases which are derived from accrual or capitalization of deferred interest which is added to principal or protective advances or (b) increases resulting from future fundings made pursuant to the Purchased Loan Documents,

(iii) modifies the amount or timing of any regularly scheduled payments of principal and non-contingent interest of the Purchased Loan in question, provided, however, that Seller may, without the consent of Buyer change the scheduled payment date of a Purchased Loan within any given calendar month,

(iv) changes the frequency of scheduled payments of principal and interest in respect of a Purchased Loan,

(v) subordinates the lien priority of the Purchased Loan in question or the payment priority of the Purchased Loan in question other than subordinations required under the then existing terms and conditions of the Purchased Loan in question (provided, however, the foregoing shall not preclude the execution and delivery of subordination, nondisturbance and attornment agreements with tenants, subordination to tenant leases, easements, plats of subdivision and condominium declarations, conditions, covenants and restrictions and similar instruments which in the commercially reasonable judgment of Seller do not materially adversely affect the rights and interest of the holder of the Purchased Loan in question),

(vi) releases any collateral for the Purchased Loan in question other than releases required under the then existing Purchased Loan documents or releases in connection with eminent domain or under threat of eminent domain,

(vii) waives, amends or modifies any cash management or reserve account requirements of the Purchased Loan other than changes required under the then existing Purchased Loan documentation,

(viii) waives any due-on-sale or due-on-encumbrance provisions of the Purchased Loan in question other than waivers required to be given under the then existing Purchased Loan documents, or

(ix) waives, amends or modifies the underlying insurance requirements of the Purchased Loan.

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“Single Purpose Entity” shall have the meaning specified in Exhibit VI.

“Solvent” shall mean with respect to any Person at any time, having a state of affairs such that all of the following conditions are met at such time: (a) the fair value of the assets and property of such Person is greater than the amount of such Person’s liabilities (including disputed, contingent and unliquidated liabilities) as such value is established and liabilities evaluated for purposes of Section 101(32) of the Bankruptcy Code, (b) the present fair salable value of the assets and property of such Person in an orderly liquidation of such Person is not less than the amount that will be required to pay the probable liability of such Person on its debts as they become absolute and matured, (c) such Person does not intend to, and does not believe that it will, incur debts or liabilities beyond such Person’s ability to pay as such debts and liabilities mature, and (d) such Person is not engaged in a business or a transaction, and is not about to engage in a business or a transaction, for which such Person’s assets and property would constitute unreasonably small capital.

“Special Purpose Entity” shall mean a Person, other than an individual, which is formed or organized solely for the purpose of holding, directly and subject to this Agreement, the Purchased Loans and otherwise complies with the requirements of Section 13.

“Standard Qualifications” shall have the meaning specified in Exhibit VI.

“Supplemental Funding Fee” shall have the meaning specified in the Fee Agreement.

“Survey” shall mean a certified ALTA/ACSM (or applicable state standards for the state in which the Collateral is located) survey of a Mortgaged Property prepared by a registered independent surveyor or engineer and in form and content satisfactory to Buyer in its commercially reasonable discretion and the company issuing the Title Policy for such Mortgaged Property.

“Taxes” shall mean all present or future Taxes, levies, imposts, duties, deductions, withholdings (including backup withholding), assessments, fees or other charges imposed by any Governmental Authority, including any interest, additions to tax or penalties applicable thereto.

“Terrorism Cap Amount” shall have the meaning specified in Exhibit VI.

“Title Policy” shall have the meaning specified in Exhibit VI.

“Transaction” shall have the meaning set forth in Section 1.

“Transaction Conditions Precedent” shall have the meaning specified in Section 3(b) of this Agreement.

“Transaction Documents” shall mean, collectively, this Agreement, any applicable Annexes to this Agreement, the Guaranty, any Custodial Agreement, any Blocked Account Agreement, any Servicing Agreement, any Joinder Agreement, the Omnibus Amendment, all

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Confirmations executed pursuant to this Agreement or the Original Agreement in connection with specific Transactions, any other documents or instruments relating to any such documents executed by Seller or Guarantor, and any written modifications, extensions, renewals, restatements, or replacements of any of the foregoing.

“Transaction Request” shall mean a request to enter into a Transaction, in the form of Exhibit VIII attached hereto.

“Treasury Regulations” shall have the meaning specified in Section 19(d) of this Agreement.

“TRIA” shall have the meaning specified in Exhibit VI.

“Trust Receipt” shall mean a trust receipt issued by Custodian to Buyer confirming the Custodian’s possession of certain Purchased Loan Files which are the property of and held by Custodian for the benefit of Buyer (or any other holder of such trust receipt) or a bailment arrangement with an Acceptable Attorney.

“UCC” shall have the meaning specified in Section 6 of this Agreement.

“U.S. Person” shall mean a “United States person” as defined in Section 7701(a)(30) of the Code.

“Whole Loans” shall have the meaning given to such term in the definition of “Eligible Loans”.

“Zoning Regulations” shall have the meaning specified in Exhibit VI.

3. INITIATION; CONFIRMATION; TERMINATION; FEES

(a) Subject to the terms and conditions set forth in this Agreement (including, without limitation, the “Transaction Conditions Precedent” specified in Section 3(b) of this Agreement), an agreement to enter into a Transaction shall be made, from time to time, in writing at the initiation of Seller as provided below; provided, however, that (i) the aggregate outstanding Purchase Price at any time for all Transactions shall not exceed the Facility Amount and (ii) Buyer shall not have any obligation to enter into new Transactions with Seller after the occurrence and during the continuance of a monetary or material non-monetary Default or an Event of Default or after the Facility Availability Period. Seller may, from time to time, submit to Buyer a Transaction Request, in the form of Exhibit VIII attached hereto, for Buyer’s review and approval in order to enter into a Transaction with respect to any Eligible Loan that Seller proposes to be included as Collateral under this Agreement. Upon Buyer’s receipt of a complete Due Diligence Package, Buyer shall have the right to request, in Buyer’s good faith business judgment and in a manner consistent with Buyer’s other master repurchase facilities for comparable assets, additional diligence materials and deliveries with respect to the applicable Eligible Loan, to the extent necessary for Buyer’s underwriting of such Eligible Loan. Upon Buyer’s receipt of the Transaction Request, Due Diligence Package and additional diligence materials, Buyer shall use commercially reasonable efforts to within five (5) Business Days and following receipt of internal credit approval, either (i) notify Seller of the Purchase Price and the

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Market Value for the Eligible Loan or (ii) deny Seller’s request for a Transaction. Buyer’s failure to respond to Seller within five (5) Business Days shall be deemed to be a denial of Seller’s request for a Transaction, unless Buyer and Seller have agreed otherwise in writing. Buyer shall have the right to review all Eligible Loans proposed to be sold to Buyer in any Transaction and to conduct its own due diligence investigation of such Eligible Loans as Buyer reasonably determines. Buyer shall be entitled to make a determination, in its sole discretion, that it shall or shall not purchase any or all of the Eligible Loans proposed to be sold to Buyer by Seller. On the Purchase Date for the Transaction which shall be on a date mutually agreed upon by Buyer and Seller following the approval of an Eligible Loan by Buyer, the Purchased Loan shall be transferred to Buyer against the transfer of the Purchase Price to an account of Seller or as directed by Seller in writing.

(b) Upon agreeing to enter into a Transaction hereunder, provided each of the Transaction Conditions Precedent shall have been satisfied (or waived by Buyer), Buyer shall promptly deliver to Seller a written confirmation in the form of Exhibit I attached hereto of each Transaction (a “Confirmation”). Such Confirmation shall describe the Purchased Loan, shall identify Buyer and Seller, and shall set forth:

(i) the Purchase Date,

(ii) the Purchase Price Percentage, Maximum Purchase Price Percentage, the initial Purchase Price and the Maximum Purchase Price for such Purchased Loan,

(iii) the Repurchase Date,

(iv) the Pricing Rate (including the Applicable Spread),

(v) the Margin Percentage,

(vi) the LTV (Purchase Price) and Maximum LTV (Purchase Price),

(vii) the LTV (Loan UPB) and LTV (Aggregate Loan UPB) (if applicable),

(viii) the Funding Fee, any additional conditions precedent to the availability of Margin Excess (Future Funding) and the type of funding (i.e. table funded/non-table funded), and

(ix) any additional reasonable terms or conditions not inconsistent with this Agreement and mutually agreed upon by Buyer and Seller.

With respect to any Transaction, the Pricing Rate shall be determined initially on the Pricing Rate Determination Date applicable to the first Pricing Rate Period for such Transaction, and shall be reset on each subsequent Pricing Rate Determination Date for the next succeeding Pricing Rate Period for such Transaction. Buyer or its agent shall determine in accordance with the terms of this Agreement the Pricing Rate on each Pricing Rate Determination Date for the related Pricing Rate Period and notify Seller of such rate for such period on such subsequent Pricing Rate Determination Date. For purposes of this Section 3(b), the “Transaction Conditions Precedent” shall be deemed to have been satisfied with respect to any proposed Transaction if:

(A) no monetary or material non-monetary Default or Event of Default under this Agreement shall have occurred and be continuing as of the Purchase Date for such proposed Transaction;

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(B) subject to any exceptions reasonably approved by Buyer, the representations and warranties made by Seller in any of the Transaction Documents shall be true and correct in all material respects as of the Purchase Date for such Transaction, before and after giving effect to such Transaction, as though made on such Purchase Date (except to the extent such representations and warranties are made as of a particular date);

(C) Buyer shall have received from Seller all corporate and governmental approvals, legal opinions of counsel to Seller and Guarantor (including, without limitation, as to authority, enforceability, perfection, bankruptcy safe harbor and the Investment Company Act of 1940) and closing documentation as Buyer may reasonably request pursuant to this Agreement,

(D) Seller shall have paid to Buyer (x) the Funding Fee then due and payable with respect to such Transaction pursuant to the Fee Agreement and (y) Buyer’s out-of-pocket costs and expenses pursuant to Section 30(d) of this Agreement (which amounts referred to in the preceding sub-clauses (D)(x) and (D)(y) may be paid through a holdback to the Purchase Price);

(E) Buyer shall have (A) determined, in accordance with the applicable provisions of Section 3(a) of this Agreement, that the Assets proposed to be sold to Buyer by Seller in such Transaction are Eligible Loans and (B) obtained internal credit approval for the inclusion of such Eligible Loan as a Purchased Loan in a Transaction; and

(F) Buyer shall have determined that no event has occurred which is reasonably likely to result in a Material Adverse Effect; and

(G) as of the applicable Purchase Date, each of the Concentration Limits is satisfied (unless waived by Buyer).

(c) Each Confirmation, together with this Agreement, shall be conclusive evidence of the terms of the Transaction(s) covered thereby unless specific objection is made in writing no less than three (3) Business Days after the date thereof. In the event of any conflict between the terms of such Confirmation and the terms of this Agreement, the Confirmation shall prevail. An objection sent by Seller with respect to any Confirmation must state specifically that the writing is an objection, must specify the provision(s) of such Confirmation being objected to by Seller,

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must set forth such provision(s) in the manner that Seller believes such provisions should be stated, and must be sent by Seller no more than five (5) Business Days after such Confirmation is received by Seller. It is understood and agreed that once a Confirmation has been executed by Buyer and Seller, such Confirmation shall be binding on the parties hereto (absent manifest error) and shall constitute evidence of Buyer’s approval of the applicable Purchased Loan and the terms of the applicable Transaction.

(d) No Transaction shall be terminable on demand by Buyer (other than upon the occurrence and during the continuance of an Event of Default). Seller shall be entitled to terminate a Transaction on demand, in whole only, and repurchase the Purchased Loan subject to a Transaction on any Business Day prior to the Repurchase Date (an “Early Repurchase Date”); provided, however, that:

(i) Seller notifies Buyer in writing of its intent to terminate such Transaction and repurchase such Purchased Loan no later than three (3) Business Days prior to such Early Repurchase Date,

(ii) on such Early Repurchase Date Seller pays to Buyer an amount equal to the sum of (x) the Repurchase Price for such Transaction, (y) the Exit Fee, if any, then due and payable with respect to such Transaction pursuant to the Fee Agreement and (z) any other amounts payable under this Agreement (including, without limitation, Section 3(i) of this Agreement) with respect to such Transaction, in connection with the transfer to Seller or its agent of such Purchased Loan,

(iii) on such Early Repurchase Date, following the payment of the amounts set forth in subclause (ii) above, no unpaid Margin Deficit exists, and

(iv) no Default or Event of Default shall have occurred and be continuing as of such Early Repurchase Date.

Such notice shall set forth the Early Repurchase Date and shall identify with particularity the Purchased Loans to be repurchased on such Early Repurchase Date.

(e) On the Repurchase Date or any Early Repurchase Date (including, without limitation, in order to cure a Margin Deficit), termination of the applicable Transaction will be effected by transfer to Seller or its agent of the applicable Purchased Loan and any Income in respect thereof received by Buyer (and not previously credited or transferred to, or applied to the obligations of, Seller pursuant to Section 5 of this Agreement) against the simultaneous transfer to an account of Buyer of the Repurchase Price, the amount, if any, payable by Seller in the event any Hedging Transaction related to such Purchased Loan is being terminated as of such date and any other amounts payable under this Agreement with respect to such Transaction.

(f) On any Remittance Date before the Repurchase Date (or any Business Day before the Repurchase Date upon two (2) Business Days prior notice to Buyer, with respect to a reduction in outstanding Purchase Price of greater than $2,000,000), Seller shall have the right, from time to time, to transfer cash to Buyer for the purpose of reducing the outstanding Purchase Price of, but not terminating, a Transaction and without the release of any Collateral or the

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payment of any Exit Fee or other prepayment fee or penalty; provided, that any such reduction in outstanding Purchase Price occurring on a date other than a Remittance Date shall be required to be accompanied by payment of all unpaid accrued Price Differential on the amount of such reduction. Upon any reduction in outstanding Purchase Price in accordance with this Section 3(f), either Seller or Buyer can request an amended and restated Confirmation which shall reflect the decrease in the outstanding Purchase Price (it being acknowledged that the failure by any party to request or deliver such amended and restated Confirmation shall not be a Default).

(g) If prior to any Pricing Rate Period with respect to any Transaction, Buyer shall have determined in the exercise of its reasonable business judgment (which determination shall be conclusive and binding upon Seller) that, by reason of circumstances affecting the relevant market, adequate and reasonable means do not exist for ascertaining the LIBO Rate for such Pricing Rate Period, Buyer shall give prompt written notice thereof to Seller. If such notice is given, the Pricing Rate with respect to such Transaction for such Pricing Rate Period, and for any subsequent Pricing Rate Periods until such notice has been withdrawn by Buyer shall be a per annum rate equal to the Prime Rate plus 100 basis points (1.00%) (the “Alternative Rate”).

(h) Notwithstanding any other provision herein, if the adoption of or any change in any Requirement of Law or in the interpretation or application thereof shall make it unlawful for Buyer to effect or continue Transactions as contemplated by the Transaction Documents, (a) the commitment of Buyer hereunder to enter into new Transactions shall forthwith be canceled, and (b) the Transactions then outstanding shall be converted automatically to Alternative Rate Transactions on the last day of the then current Pricing Rate Period or within such earlier period as may be required by law. If any such conversion of a Transaction occurs on a day which is not the last day of the then current Pricing Rate Period with respect to such Transaction, Seller shall pay to Buyer such amounts, if any, as may be required pursuant to Section 3(i) of this Agreement.

(i) Upon written demand by Buyer, Seller shall indemnify Buyer and hold Buyer harmless from any net actual, out-of-pocket loss or expense (not to include any lost profit or opportunity or other consequential costs, loss or damages) (including, without limitation, reasonable actual attorneys’ fees and disbursements of outside counsel) which Buyer sustains or incurs as a consequence of (i) default by Seller in terminating any Transaction after Seller has given a notice in accordance with Section 3(d) hereof of a termination of a Transaction, (ii) any payment of the Repurchase Price on any day other than a Remittance Date or the Repurchase Date (including, without limitation, any such actual, out-of-pocket loss or expense arising from the reemployment of funds obtained by Buyer to maintain Transactions hereunder or from customary and reasonable fees payable to terminate the deposits from which such funds were obtained) or (iii) a default by Seller in selling Eligible Loans after Seller has delivered to Buyer an executed Confirmation in connection with a proposed Transaction and Buyer has agreed to purchase such Eligible Loans in accordance with the provisions of this Agreement as evidenced by a countersigned Confirmation executed by Buyer and delivered to Seller. A certificate as to such actual costs, losses, damages and expenses, setting forth the calculations therefor shall be submitted promptly by Buyer to Seller.

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(j) If the adoption of or any change in any Requirement of Law or in the interpretation or application thereof by any Governmental Authority or compliance by Buyer with any request or directive from any central bank or other Governmental Authority having jurisdiction over Buyer made subsequent to the date hereof:

(i) shall subject Buyer to any tax of any kind whatsoever with respect to the Transaction Documents, any Purchased Loan or any Transaction, or change the basis of taxation of payments to Buyer in respect thereof (except for (i) Indemnified Taxes (with Other Taxes applying for this purpose without the proviso in the definition thereof), (ii) Taxes described in clauses (b) through (g) of the definition of Excluded Taxes and (iii) Connection Income Taxes); or

(ii) shall impose, modify or hold applicable any reserve, special deposit, compulsory loan or similar requirement against assets held by, deposits or other liabilities in or for the account of, advances, loans or other extensions of credit by, or any other acquisition of funds by, any office of Buyer which is not otherwise included in the determination of the LIBO Rate hereunder;

and the result of any of the foregoing is to increase the cost to Buyer, by an amount which Buyer deems, in the exercise of its reasonable business judgment, to be material, of entering into, continuing or maintaining Transactions or to reduce in a material manner any amount receivable under the Transaction Documents in respect thereof; then, in any such case, and provided Buyer imposes such additional costs generally on all of its similarly situated customers, Seller shall pay to Buyer within ten (10) Business Days any additional amounts necessary to compensate Buyer for such increased cost or reduced amount receivable. If Buyer becomes entitled to claim any additional amounts pursuant to this Section 3(j), it shall notify Seller in writing of the event by reason of which it has become so entitled. Such notification as to the calculation of any additional amounts payable pursuant to this subsection shall be submitted by Buyer to Seller.

(k) If Buyer shall have determined that the adoption of or any change in any Requirement of Law regarding capital adequacy or in the interpretation or application thereof or compliance by Buyer or any corporation controlling Buyer with any request or directive regarding capital adequacy (whether or not having the force of law) from any Governmental Authority made subsequent to the date hereof has the effect of reducing the rate of return on Buyer’s or such corporation’s capital as a consequence of its obligations hereunder to a level below that which Buyer or such corporation could have achieved but for such adoption, change or compliance (taking into consideration Buyer’s or such corporation’s policies with respect to capital adequacy) by an amount deemed by Buyer, in the exercise of its reasonable business judgment, to be material, then from time to time, after submission by Buyer to Seller of a written request therefor, and provided Buyer imposes such additional costs generally on all of its similarly situated customers, Seller shall pay to Buyer within ten (10) Business Days such additional amount or amounts as will compensate Buyer for such reduction. Such notification as to the calculation of any additional amounts payable pursuant to this subsection shall be submitted by Buyer to Seller.

(l) Notwithstanding the foregoing or anything herein or in the Fee Agreement to the contrary, (x) if any Transaction is converted to an Alternative Rate Transaction, then Seller may

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consummate an early repurchase of the related Purchased Loan at any time while the Alternative Rate is in effect without payment of the Exit Fee, (y) if Buyer notifies Seller of its entitlement to additional amounts pursuant to Section 3(j) or 3(k), then provided Seller pays such additional amounts pursuant to Section 3(j) or 3(k), Seller may consummate an early repurchase of all of the Purchased Loans and terminate this Agreement and the other Transaction Documents without payment of the Exit Fee and (z) no Exit Fee shall be due and payable in connection with any reduction in outstanding Purchase Price or consummation of an early repurchase of a Purchased Loan in accordance with Section 4(a).

4. MARGIN MAINTENANCE

(a) If, at any time, the aggregate Market Value of the Purchased Loans shall be less than the sum of the Margin Amounts calculated individually with respect to each Purchased Loan (a “Margin Deficit”), then Buyer may by notice to Seller in writing (including therein a description of the Market Value calculation for each Purchased Loan) require Seller to cure such Margin Deficit by any of the following methods selected by Seller:

(i) transferring to Buyer additional cash collateral in an amount at least equal to the sum of the amounts, calculated individually for each Purchased Loan, equal to the product of (x) the difference between the Margin Amount with respect to such Purchased Loan and the Market Value of such Purchased Loan multiplied by (y) the applicable Maximum Purchase Price Percentage, which cash collateral shall be held by Buyer as additional Collateral with respect to the applicable Purchased Loan(s);

(ii) reducing the outstanding Purchase Price of any Purchased Loan, as applicable, such that the aggregate Market Value of the Purchased Loans is at least equal to or is greater than the sum of the Margin Amounts of the Purchased Loans; or

(iii) doing an early repurchase on an Early Repurchase Date of any of the Purchased Loans pursuant to Section 3(d) of this Agreement and paying the related Repurchase Price which early repurchase results in a cure of such Margin Deficit.

Any cash transferred to Buyer pursuant to clause (ii) of this Section 4(a) of this Agreement with respect to any Purchased Loan shall be applied to reduce the outstanding Purchase Price for each Purchased Loan on a dollar-for-dollar basis for which there was a Margin Deficit. Notwithstanding the foregoing or anything herein to the contrary, a Margin Deficit shall not exist or be deemed to exist with respect to any Purchased Loan at any time the outstanding Purchase Price with respect to such Purchased Loan is less than 60% of the related Market Value.

(b) If any notice is given by Buyer under Section 4(a) of this Agreement on any Business Day (such notice, a “Margin Deficit Notice”) and Seller elects to transfer cash pursuant to Section 4(a)(i) or (ii), Seller shall transfer cash in the full amount required in Section 4(a)(i) or (ii), if the Margin Deficit Notice is given before 1:00 p.m. EST, by no later than the close of business on the Business Day following the Business Day on which such Margin Deficit Notice is given, and if the Margin Deficit Notice is given on or after 1:00 p.m. EST, by no later than the

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close of business on the second (2^nd) Business Day following the Business Day on which such Margin Deficit Notice is given. The failure of Buyer, on any one or more occasions, to exercise its rights under Section 4(a) of this Agreement shall not change or alter the terms and conditions to which this Agreement is subject or limit the right of Buyer to do so at a later date. Buyer and Seller agree that any failure or delay by Buyer to exercise its rights under Section 4(a) of this Agreement shall not limit such party’s rights under this Agreement or otherwise existing by law or in any way create additional rights for such party.

(c) At any time prior to the Facility Expiration Date, in the event a future funding is contractually required to be made available to the related Mortgagor under a Purchased Loan, Seller may submit to Buyer a Request for Margin Excess, in the form of Exhibit IX attached hereto, which requests that Buyer transfer to Seller cash in an amount equal to the product of a percentage, not to exceed the applicable Maximum Purchase Price Percentage for such Purchased Loan, multiplied by the amount of such future funding (such product, “Margin Excess (Future Funding)”), which cash shall be applied to increase the outstanding Purchase Price with respect to the Transaction for such Purchased Loan and to satisfy such future funding obligation in part; provided, that, Buyer shall not have any obligation to transfer such Margin Excess (Future Funding) to Seller unless Buyer shall have determined that all of the following conditions precedent (such conditions, the “Future Funding Conditions Precedent”) are satisfied:

(i) If in connection with the entry into the initial Transaction relating to the Purchased Loan that is the subject of a future funding obligation, Buyer and Seller agreed upon additional conditions precedent which are required to be satisfied (e.g. maintenance of or improvement in Debt Yield (Purchase Price) and/or Debt Yield (Loan UPB)) with respect to such Purchased Loan and which are specified in the Confirmation, taking into account the increase in the outstanding Purchase Price attributable to such Margin Excess (Future Funding), then such additional conditions precedent are satisfied;

(ii) taking into account the increase in the outstanding Purchase Price attributable to such Margin Excess (Future Funding), the LTV (Purchase Price) shall not exceed sixty percent (60%);

(iii) no Default or Event of Default has occurred and is continuing;

(iv) the increase in the outstanding Purchase Price with respect to such Purchased Loan attributable to such Margin Excess (Future Funding) shall be equal to or greater than $250,000;

(v) Seller shall have demonstrated to Buyer’s reasonable satisfaction that all conditions precedent to the future funding obligation under the Purchased Loan documentation shall have been satisfied in all material respects; and

(vi) following such increase in the outstanding Purchase Price attributable to such Margin Excess (Future Funding), no Margin Deficit shall exist.

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In addition to and in no way limiting Seller’s right to submit to Buyer a Request for Margin Excess in accordance with this Section 4(c), concurrent with or following a future funding made by Seller to a Mortgagor under a Purchased Loan, Seller may submit to Buyer a written request that Buyer, after applying all of the Future Funding Conditions Precedent referred to above, provide Seller with an indication of the amount of availability created with respect to such Purchased Loan by Seller making such future funding.

(d) If any notice is given by Seller under Section 4(c) of this Agreement on any Business Day, Buyer shall transfer cash as provided in Section 4(c) by no later than the close of business on the second (2^nd) Business Day following the Business Day on which Buyer reasonably determines that the Future Funding Conditions Precedent have been satisfied (or, in Buyer’s sole discretion, waived). The failure of Seller, on any one or more occasions, to exercise its rights under Section 4(c) of this Agreement shall not change or alter the terms and conditions to which this Agreement is subject or limit the right of Seller to do so at a later date. Buyer and Seller agree that any failure or delay by Seller to exercise its rights under Section 4(c) of this Agreement shall not limit such party’s rights under this Agreement or otherwise existing by law or in any way create additional rights for such party.

(e) At any time prior to the Facility Expiration Date, in the event,

(x) (a) Seller elects to transfer cash to Buyer pursuant to Section 4(a)(i) or (ii) to satisfy a Margin Deficit and (b) on any date subsequent to such transfer of cash, the Market Value of a Purchased Loan increases such that the outstanding Purchase Price (or if cash collateral was transferred in accordance with Section 4(a)(i), the outstanding Purchase Price less such cash collateral so transferred) with respect to such Purchased Loan is less than the Maximum Purchase Price with respect to such Purchased Loan, or

(y) (a) Seller elects to transfer cash to Buyer pursuant to Section 3(f) or elects as described in the definition of Pricing Matrix to receive on the applicable Purchase Date a Purchase Price lower than the Maximum Purchase Price of such Purchased Loan and (b) on any date subsequent to such transfer of cash, Seller desires to receive a re-advance of such cash so transferred or an additional advance of cash in an amount up to the Maximum Purchase Price of such Purchased Loan (the difference between the actual outstanding Purchase Price (or outstanding Purchase Price less cash collateral transferred, as the case may be), and the Maximum Purchase Price, the “Margin Excess (Other)”), then Seller may submit to Buyer a Request for Margin Excess, in the form of Exhibit IX attached hereto, which requests that Buyer transfer to Seller an amount up to such Margin Excess (Other), by wire transfer to an account designated by Seller; provided, that, Buyer shall not have any obligation to transfer such Margin Excess (Other) to Seller unless Buyer shall have determined that all of the following conditions precedent are satisfied:

(i) no Default or Event of Default has occurred and is continuing;

(ii) with respect to any Purchased Loan, the amount of cash transferred by Buyer pursuant to clause (x) or (y) above shall not cause the Purchase Price to exceed the Maximum Purchase Price for such Purchased Loan;

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(iii) the increase in the outstanding Purchase Price with respect to such Purchased Loan attributable to such Margin Excess (Other) shall be equal to or greater than $250,000; and

(iv) following such increase in the outstanding Purchase Price attributable to such Margin Excess (Other), no Margin Deficit shall exist.

(f) If any Request for Margin Excess is given by Seller on any Business Day under (x) Section 4(e)(x) of this Agreement, Buyer shall transfer cash as provided in Section 4(e)(x) by no later than the close of business on the next succeeding Business Day following the Business Day on which Buyer has completed its calculation of Market Value, or (y) Section 4(e)(y) of this Agreement, Buyer shall transfer cash as provided in Section 4(e)(y) by no later than the close of business on the next succeeding Business Day following the Business Day on which such Request for Margin Excess is submitted. The failure of Seller, on any one or more occasions, to exercise its rights under Section 4(e) of this Agreement shall not change or alter the terms and conditions to which this Agreement is subject or limit the right of Seller to do so at a later date. Buyer and Seller agree that any failure or delay by Seller to exercise its rights under Section 4(e) of this Agreement shall not limit such party’s rights under this Agreement or otherwise existing by law or in any way create additional rights for such party.

(g) Promptly following the transfer of Margin Excess by Buyer to Seller, or any increase to the Market Value of a Purchased Loan, in each case pursuant to Section 4(c) and 4(d) or 4(e) and 4(f), as applicable, Buyer and Seller shall revise the Confirmation to reflect the revised outstanding Purchase Price, Maximum Purchase Price, Purchase Price Percentage, and Maximum Purchase Price Percentage for such Purchased Loan, as applicable, and any other necessary modifications to the terms set forth on the existing Confirmation.

(h) In the event Seller requests to enter into a Transaction with Buyer with respect to any Eligible Loan which includes Margin Excess (Future Funding) obligations approved by Buyer, or Seller requests a Margin Excess (Future Funding) with respect to any Purchased Loan, and the result of such Transaction with respect to such Eligible Loan or the funding of such Margin Excess (Future Funding) with respect to such Purchased Loan would be that, the sum of Column A plus Column B plus Column C calculated with respect to all Purchased Loans collectively (including for this purpose, such Eligible Loan) would exceed the Facility Amount, then Seller may notify Buyer in writing that Seller elects to reallocate downward, in its sole discretion, the amount referenced in Column C with respect to any Purchased Loan by an amount necessary for the sum of Column A plus Column B plus Column C calculated with respect to all Purchased Loans collectively (including for this purpose, such Eligible Loan) not to exceed, with respect to all Purchased Loans collectively (including for this purpose, such Eligible Loan), the Facility Amount. Notwithstanding the foregoing, Seller shall be permitted, at any time and from time to time, upon written notice to Buyer, to reallocate upward or downward the amount referenced in Column C with respect to any Purchased Loan so long as (a) the sum of Column A plus Column B plus Column C calculated with respect to all Purchased Loans collectively, does not exceed the Facility Amount and (b) any upward reallocation of the amount referenced in Column C for any Purchased Loan does not exceed the amount referenced in Column E with respect to such Purchased Loan. Upon making any such reallocations, Seller shall promptly deliver to Buyer (by e-mail) a Facility Asset Chart, which then-current Facility Asset Chart shall

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represent the definitive allocation of Buyer’s Margin Excess (Future Funding) obligations with respect to all Purchased Loans. Notwithstanding anything to the contrary set forth in this Agreement or any other Transaction Document, Buyer and Seller hereby acknowledge and agree that, as of any date of determination, (i) the amount referenced in Column C of the then-current version of the Facility Asset Chart with respect to any Purchased Loan shall be the maximum amount of Margin Excess (Future Funding) that Buyer would be obligated to transfer to Seller with respect to such Purchased Loan upon satisfaction of the Future Funding Conditions Precedent, in accordance with Sections 4(c) and (d) of this Agreement, and (ii) the sum of Column A plus Column B plus Column C calculated with respect to each Purchased Loan individually, as reflected in Column D, shall not exceed, with respect to all Purchased Loans collectively, the Facility Amount.

5. INCOME PAYMENTS AND PRINCIPAL PAYMENTS

(a) Each Cash Management Account shall be established at the Depository, which (i) in the case of the Cash Management Account established by Parlex 2, shall have been established on June 12, 2013, (ii) in the case of the Cash Management Account established by Parlex 2A, shall have been established on January 31, 2014, and (iii) in the case of any Cash Management Account established by any Person that joins as a Seller under this Agreement from time to time, shall be established concurrently with the execution and delivery of the Joinder Agreement by which such Person joins as a Seller under this Agreement. Buyer shall have sole dominion and control over each Cash Management Account. All Income in respect of the Purchased Loans and any payments in respect of associated Hedging Transactions, as well as any interest received from the reinvestment of such Income, shall be deposited directly into the applicable Cash Management Account and shall be remitted by the Depository in accordance with the applicable provisions of Sections 5(d), 5(e), 5(f) and 14(b)(iii) of this Agreement.

(b) With respect to each Purchased Loan, Seller shall deliver to each Mortgagor, issuer of a participation or borrower under a Purchased Loan an irrevocable direction letter (the “Irrevocable Direction Letter”) in the form attached as Exhibit X to this Agreement, with a simultaneous copy to Servicer, instructing the Mortgagor and Servicer to pay all amounts payable under the related Purchased Loan to the applicable Cash Management Account and shall provide to Buyer proof of such delivery. If a Mortgagor or Servicer forwards any Income with respect to a Purchased Loan to Seller rather than directly to the applicable Cash Management Account, Seller shall (i) deliver an additional Irrevocable Direction Letter to the applicable Mortgagor, with a simultaneous copy to Servicer, and make other commercially reasonable efforts to cause such Mortgagor or Servicer to forward such amounts directly to the applicable Cash Management Account and (ii) deposit in the applicable Cash Management Account any such amounts within one Business Day of Seller’s receipt thereof.

(c) On each Remittance Date, Seller shall pay to Buyer an amount equal to the Price Differential which has accrued during the related Pricing Rate Period for each Transaction to the extent not previously paid to Buyer.

(d) So long as no Event of Default shall have occurred and be continuing, during the Facility Availability Period, all Income received by the Depository in respect of the Purchased Loans and the associated Hedging Transactions (other than Principal Payments and net sale

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proceeds) may be remitted by the Depository on the next Business Day to the account of Seller specified in the applicable Blocked Account Agreement (or in accordance with such other direction and instruction of Seller which is reasonably approved by Buyer).

(e) So long as no Event of Default shall have occurred and be continuing, during the Facility Availability Period, all Principal Payments in respect of each Purchased Loan (whether scheduled or unscheduled) received by the Depository shall be paid, pursuant to the withdrawal instructions of Seller that have been approved by Buyer after Buyer and Seller have reconciled the amount of any partial Principal Payment, to Buyer on the next Remittance Date and, in each instance, applied as follows: (i) first, toward the reduction of the outstanding Purchase Price of such Purchased Loan to the extent necessary to cause the outstanding Purchase Price with respect to such Purchased Loan to equal the product of the related Market Value and the applicable Purchase Price Percentage (or with respect to any Principal Payment in full, in the amount necessary to reduce the outstanding Purchase Price of such Purchased Loan to zero) and (ii) second, to the extent necessary to cause the outstanding Purchase Price with respect to each other Purchased Loan to equal the product of the related Market Value and the applicable Purchase Price Percentage. Any Principal Payments received by the Depository and not paid to Buyer pursuant to the preceding sentence on each Remittance Date during the Facility Availability Period shall be remitted promptly to Seller.

(f) Following the end of the Facility Availability Period (so long as no Event of Default shall have occurred and be continuing), all Income received by the Depository in respect of the Purchased Loans and the associated Hedging Transactions shall be applied, pursuant to the withdrawal instructions of Seller that have been approved by Buyer, by the Depository on each Remittance Date as follows (subject to the following sentence):

(i) first, to the Depository and Custodian an amount equal to the depository and custodial fees due and payable;

(ii) second, to Buyer an amount equal to its out-of-pocket costs and expenses and any other amounts due and payable under this Agreement;

(iii) third, to Buyer an amount equal to the Price Differential which has accrued and is outstanding in respect of all of the Purchased Loans as of such Business Day;

(iv) fourth, to make a payment to Buyer in reduction of the outstanding Purchase Price of the Purchased Loans, such payment to be allocated amongst the Purchased Loans on a pro rata basis based upon outstanding Purchase Price of each Purchased Loan;

(v) fifth, to pay, the amount, if any, payable by Seller in the event any Hedging Transaction is being terminated as of such date; and

(vi) sixth, the surplus, if any, to Seller.

Notwithstanding anything in Section 5(f) of this Agreement to the contrary, prior to the application of funds pursuant to such Section, Seller shall be entitled upon written request to

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Buyer to receive the amount of funds, if any, as may be required by applicable law to be distributed for Guarantor to maintain its status as a “real estate investment trust” for tax purposes and to avoid other adverse tax consequences to Guarantor and/or its shareholders related to the status of Guarantor as a “real estate investment trust” for tax purposes; provided, that such distribution shall be subject to the condition precedent (which Seller shall be required to demonstrate to the satisfaction of Buyer in its sole discretion) that Guarantor has exhausted all other sources of cash flow and income, whether in the form of equity or debt, prior to such request being made to Buyer.

(g) If an Event of Default shall have occurred and be continuing, all Income received by the Depository in respect of the Purchased Loans and the associated Hedging Transactions shall be applied, upon the direction and instruction of Buyer, by the Depository on the Business Day next following the Business Day on which such funds are deposited in the applicable Cash Management Account as follows:

(i) first, to the Depository and Custodian an amount equal to the depository and custodial fees due and payable;

(ii) second, to Buyer an amount equal to its out-of-pocket costs and expenses and any other amounts due and payable under this Agreement;

(iii) third, to Buyer an amount equal to the Price Differential which has accrued and is outstanding in respect of all of the Purchased Loans as of such Business Day;

(iv) fourth, to make a payment to Buyer in reduction of the outstanding Purchase Price of the Purchased Loans, such payment to be allocated amongst the Purchased Loans as determined by Buyer in its sole discretion, until the outstanding Purchase Price for all of the Purchased Loans has been reduced to zero;

(v) fifth, to pay, the amount, if any, payable by Seller in the event any Hedging Transaction related to such Purchased Loan is being terminated as of such date; and

(vi) sixth, the surplus, if any, to whoever may be lawfully entitled to receive such surplus.

6. SECURITY INTEREST

Buyer and Seller intend that all Transactions hereunder be sales to Buyer of the Purchased Loans and not loans from Buyer to Seller secured by the Purchased Loans (other than for tax purposes). However, in the event any such Transaction is deemed to be a loan, Seller hereby pledges all of its right, title, and interest in, to and under and grants a first priority lien on, and security interest in, all of Seller’s interest in the following property, whether now owned or hereafter acquired, now existing or hereafter created and wherever located (collectively, the “Collateral”) to Buyer to secure the payment and performance of all other amounts or obligations owing to Buyer pursuant to this Agreement and the related documents described herein:

(a) the Purchased Loans, the Servicing Rights, Servicing Agreements, Servicing Records, insurance relating to the Purchased Loans, and collection and escrow accounts relating to the Purchased Loans;

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(b) the Hedging Transactions, if any, entered into pursuant to this Agreement;

(c) each Cash Management Account and all financial assets (including, without limitation, all security entitlements with respect to all financial assets) from time to time on deposit in each Cash Management Account;

(d) all “general intangibles”, “accounts” and “chattel paper” as defined in the UCC relating to or constituting any and all of the foregoing; and

(e) all replacements, substitutions or distributions on or proceeds, payments, Income and profits of, and records (but excluding any financial models or other proprietary information) and files relating to any and all of any of the foregoing.

Buyer’s security interest in the Collateral shall terminate only upon termination of Seller’s obligations under this Agreement and the documents delivered in connection herewith and therewith. Upon such termination, Buyer shall promptly deliver to Seller such UCC termination statements and other release documents as may be commercially reasonable and to return the Purchased Loans to Seller. For purposes of the grant of the security interest pursuant to this Section 6, this Agreement shall be deemed to constitute a security agreement under the New York Uniform Commercial Code (the “UCC”). Buyer shall have all of the rights and may exercise all of the remedies of a secured creditor under the UCC and the other laws of the State of New York. In furtherance of the foregoing, (a) Buyer, at Seller’s sole cost and expense, shall cause to be filed in such locations as may be reasonably necessary to perfect and maintain perfection and priority of the security interest granted hereby, UCC financing statements and continuation statements (collectively, the “Filings”), and shall forward copies of such Filings to Seller upon completion thereof, and (b) Seller shall from time to time take such further actions as may be reasonably requested by Buyer to maintain and continue the perfection and priority of the security interest granted hereby (including marking its records and files to evidence the interests granted to Buyer hereunder).

7. PAYMENT, TRANSFER AND CUSTODY

(a) On the Purchase Date for each Transaction, ownership of the Purchased Loans shall be transferred to Buyer or its designee (including the Custodian) against the simultaneous transfer of the Purchase Price to an account of Seller specified in writing by Seller relating to such Transaction.

(b) On or before each Purchase Date, Seller shall deliver or cause to be delivered to Buyer or its designee the Custodial Delivery in the form attached hereto as Exhibit III; provided, that notwithstanding the foregoing, upon request of Seller, Buyer in its sole discretion may elect to permit Seller to make such delivery by not later than the third (3^rd) Business Day after the related Purchase Date, so long as Seller causes an Acceptable Attorney to deliver to Buyer and the Custodian an Attorney’s Bailee Letter on or prior to such Purchase Date. In connection with each sale, transfer, conveyance and assignment of a Purchased Loan, on or prior to the Purchase

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Date with respect to such Purchased Loan, Seller shall deliver or cause to be delivered and released the following documents (collectively, the “Purchased Loan File”) pertaining to such Purchased Loan to the Custodian on or prior to the Purchase Date (unless otherwise waived by Buyer) with respect to such Purchased Loan (or, pursuant to the proviso in the immediately preceding sentence, by not later than the third (3^rd) Business Day after the related Purchase Date):

With respect to each Purchased Loan that is a Whole Loan or Senior Interest, to the extent applicable:

(i) The original Mortgage Note (or senior Mortgage Note in an “A/B” structure) bearing all intervening endorsements.

(ii) An original or copy of any loan agreement and any guarantee executed in connection with the Mortgage Note.

(iii) An original or copy of the Mortgage with evidence of recordation, or submission for recordation, from the appropriate governmental recording office of the jurisdiction where the Mortgaged Property is located.

(iv) Originals or copies of all assumption, modification, consolidation or extension agreements with evidence of recordation, or submission for recordation, from the appropriate governmental recording office of the jurisdiction where the Mortgaged Property is located.

(v) An original of the Assignment Documents in Blank.

(vi) Originals or copies of all intervening assignments of mortgage with evidence of recordation, or submission for recordation, from the appropriate governmental recording office of the jurisdiction where the Mortgaged Property is located.

(vii) An original or copy of the attorney’s opinion of title and abstract of title or a copy of the mortgagee title insurance policy, as applicable, or if the mortgagee title insurance policy has not been issued, a copy of the irrevocable marked commitment to issue the same (or irrevocable signed proforma policy).

(viii) An original or copy of any security agreement, chattel mortgage or equivalent document executed in connection with the Purchased Loan.

(ix) An original or copy of the assignment of leases and rents, if any, with evidence of recordation, or submission for recordation, from the appropriate governmental recording office of the jurisdiction where the Mortgaged Property is located.

(x) Originals or copies of all intervening assignments of assignment of leases and rents, if any, or copies thereof, with evidence of recordation, or submission for recordation, from the appropriate governmental recording office of the jurisdiction where the Mortgaged Property is located.

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(xi) A copy of the UCC financing statements and all necessary UCC continuation statements with evidence of filing or submission for filing thereon, and UCC assignments prepared by Seller in blank, which UCC assignments shall be in form and substance acceptable for filing.

(xii) An environmental indemnity agreement (if any).

(xiii) Mortgagor’s certificate or title affidavit (if any).

(xiv) A survey of the Mortgaged Property (if any) as accepted by the title company for issuance of the Title Policy.

(xv) A copy of the Mortgagor’s opinion of counsel.

(xvi) An assignment of permits, contracts and agreements (if any).

With respect to each Purchased Loan which is a participation interest in a Whole Loan or Senior Interest:

(i) the original or a copy of all of the documents described above with respect to a Purchased Loan which is a whole mortgage loan;

(ii) if applicable, an original participation certificate bearing all intervening endorsements, endorsed “Pay to the order of                      without recourse” and signed in the name of the Last Endorsee by an authorized Person;

(iii) an original or copy of any participation agreement and an original or copy of any intercreditor agreement, co–lender agreement and/or servicing agreement executed in connection with the Purchased Loan; and

(iv) the omnibus assignment of Purchased Loan sufficient to transfer to Buyer all of Seller’s rights, title and interest in and to the Purchased Loan.

From time to time, Seller shall forward to the Custodian additional original documents or additional documents evidencing any assumption, modification, consolidation or extension of a Purchased Loan approved in accordance with the terms of this Agreement, and upon receipt of any such other documents, the Custodian shall hold such other documents as Buyer shall request from time to time. With respect to any documents which have been delivered or are being delivered to recording offices for recording and have not been returned to Seller in time to permit their delivery hereunder at the time required, in lieu of delivering such original documents, Seller shall deliver to Buyer a true copy thereof with an officer’s certificate certifying that such copy is a true, correct and complete copy of the original, which has been transmitted for recordation. Seller shall deliver such original documents to the Custodian promptly when they are received. With respect to all of the Purchased Loans delivered by Seller to Buyer or its designee (including the Custodian), Seller shall execute an omnibus power of attorney substantially in the form of

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Exhibit V attached hereto irrevocably appointing Buyer its attorney-in-fact with full power during the occurrence and continuance of an Event of Default and, subject to the following sentence, during the occurrence and continuance of a monetary Default or material non-monetary Default, to (i) complete and record the Assignment of Mortgage, (ii) complete the endorsement of the Mortgage Note and (iii) take such other steps as may be reasonably necessary or desirable to enforce Buyer’s rights against such Purchased Loans and the related Purchased Loan Files and the Servicing Records. If a monetary Default or a material non-monetary Default has occurred and is continuing and Buyer has requested in writing that Seller take or cause to be taken any action that Buyer deems reasonably necessary to preserve Buyer’s ability to enforce upon the Purchased Loans as and when permitted pursuant to Section 14(b) hereof (which writing shall include a statement that Buyer will exercise its power of attorney if Seller fails to take or cause to be taken such action requested by Buyer), and Seller has not complied with any such request promptly following receipt thereof, then Buyer may exercise its power of attorney during the existence and continuation of any such monetary Default or material non-monetary Default, as the case may be, as Buyer deems reasonably necessary to preserve Buyer’s ability to enforce upon the Purchased Loans as and when permitted pursuant to Section 14(b) hereof. Buyer shall deposit the Purchased Loan Files representing the Purchased Loans, or direct that the Purchased Loan Files be deposited directly, with the Custodian. The Purchased Loan Files shall be maintained in accordance with the applicable Custodial Agreement. Any Purchased Loan Files not delivered to Buyer or its designee (including the Custodian) are and shall be held in trust by Seller or its designee for the benefit of Buyer as the owner thereof. Seller or its designee shall maintain a copy of the Purchased Loan File and the originals of the Purchased Loan File not delivered to Buyer or its designee. The possession of the Purchased Loan File by Seller or its designee is at the will of Buyer for the sole purpose of servicing the related Purchased Loan, and such retention and possession by Seller or its designee is in a custodial capacity only. The books and records (including, without limitation, any computer records or tapes) of Seller or its designee shall be marked appropriately to reflect clearly the sale of the related Purchased Loan to Buyer. Seller or its designee (including the Custodian) shall release its custody of the Purchased Loan File only in accordance with written instructions from Buyer, unless such release is required as incidental to the servicing of the Purchased Loans, is in connection with a repurchase of any Purchased Loan by Seller or as otherwise required by law.

(c) Unless an Event of Default shall have occurred and be continuing, Buyer shall exercise all voting and corporate rights with respect to the Purchased Loans in accordance with Seller’s written instructions; provided, however, that Buyer shall not be required to follow Seller’s instructions concerning any vote or corporate right if doing so would, in Buyer’s Applicable Standard of Discretion and in a manner consistent with Buyer’s other master repurchase facilities for comparable assets, be inconsistent with or result in any violation of any provision of the Transaction Documents or any Requirement of Law. Upon the occurrence and during the continuation of an Event of Default, Buyer shall be entitled to exercise all voting and corporate rights with respect to the Purchased Loans without regard to Seller’s instructions.

8. SALE, TRANSFER, HYPOTHECATION OR PLEDGE OF PURCHASED LOANS

(a) Title to all Purchased Loans shall pass to Buyer on the applicable Purchase Date, and Buyer shall have free and unrestricted use of all Purchased Loans, subject however, to the terms of this Agreement. Nothing in this Agreement or any other Transaction Document shall

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preclude Buyer from engaging in repurchase transactions with the Purchased Loans or otherwise selling, transferring, pledging, repledging, hypothecating, or rehypothecating the Purchased Loans, but no such transaction shall relieve Buyer of its obligations to transfer the Purchased Loans to Seller pursuant to Section 3 of this Agreement, of Buyer’s obligation to credit or pay Income to, or apply Income to the obligations of, Seller pursuant to Section 5 hereof or of Buyer’s obligations pursuant to Section 19(b).

(b) Nothing contained in this Agreement or any other Transaction Document shall obligate Buyer to segregate any Purchased Loans delivered to Buyer by Seller. Notwithstanding anything to the contrary in this Agreement or any other Transaction Document, no Purchased Loan shall remain in the custody of Seller or an Affiliate of Seller.

9. INTENTIONALLY OMITTED

10. REPRESENTATIONS

(a) Each of Buyer and Seller represents and warrants to the other that (i) it is duly authorized to execute and deliver this Agreement, to enter into Transactions contemplated hereunder and to perform its obligations hereunder and has taken all necessary action to authorize such execution, delivery and performance, (ii) it will engage in such Transactions as principal (or, if agreed in writing, in the form of an annex hereto or otherwise, in advance of any Transaction by the other party hereto, as agent for a disclosed principal), (iii) the person signing this Agreement on its behalf is duly authorized to do so on its behalf (or on behalf of any such disclosed principal), (iv) it has obtained all authorizations of any governmental body required in connection with this Agreement and the Transactions hereunder and such authorizations are in full force and effect and (v) the execution, delivery and performance of this Agreement and the Transactions hereunder will not violate any law, ordinance or rule applicable to it or its organizational documents or any agreement by which it is bound or by which any of its assets are affected.

(b) In addition to the representations and warranties in subsection (a) above, Seller represents and warrants to Buyer that as of the date of this Agreement, as of the Purchase Date for the purchase of any Purchased Loans by Buyer from Seller and any Transaction thereunder, as of any Business Day on which Margin Excess is made available by Buyer to Seller, and at all times while this Agreement and any Transaction thereunder is in full force and effect:

(i) Organization. Seller is duly formed, validly existing and in good standing under the laws and regulations of the state of Seller’s formation and is duly licensed, qualified, and in good standing in every state where such licensing or qualification is necessary for the transaction of Seller’s business. Seller has the power to own and hold the assets it purports to own and hold, and to carry on its business as now being conducted and proposed to be conducted, and has the power to execute, deliver, and perform its obligations under this Agreement and the other Transaction Documents.

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(ii) Due Execution; Enforceability. The Transaction Documents have been or will be duly executed and delivered by Seller. The Transaction Documents constitute the legal, valid and binding obligations of Seller, enforceable against Seller in accordance with their respective terms subject to bankruptcy, insolvency, and other limitations on creditors’ rights generally and to equitable principles.

(iii) Non-Contravention. Neither the execution and delivery of the Transaction Documents, nor consummation by Seller of the transactions contemplated by the Transaction Documents (or any of them), nor compliance by Seller with the terms, conditions and provisions of the Transaction Documents (or any of them) will conflict with or result in a breach of any of the terms or provisions of (i) the organizational documents of Seller, (ii) any contractual obligation to which Seller is now a party or the rights under which have been assigned to Seller or the obligations under which have been assumed by Seller or to which the assets of Seller are subject or constitute a default thereunder, or result thereunder in the creation or imposition of any lien upon any of the assets of Seller, other than pursuant to the Transaction Documents, (iii) any judgment or order, writ, injunction, decree or demand of any court applicable to Seller, or (iv) any applicable Requirement of Law, in the case of clauses (ii)-(iv) above, to the extent that such conflict or breach would have a Material Adverse Effect. Seller has all necessary licenses, permits and other consents from Governmental Authorities necessary to acquire, own and sell the Purchased Loans and for the performance of its obligations under the Transaction Documents, except to the extent failure to have such licenses, permits and consents is not reasonably likely to have a Material Adverse Effect.

(iv) Litigation; Requirements of Law. Except as disclosed in writing to Buyer, there is no action, suit, proceeding, investigation, or arbitration pending or, to Seller’s Actual Knowledge, threatened in writing against Seller or any of its assets, which is reasonably likely to have a Material Adverse Effect. Seller is in compliance in all material respects with all Requirements of Law. Seller is not in default in any material respect with respect to any judgment, order, writ, injunction, decree, rule or regulation of any arbitrator or Governmental Authority.

(v) No Broker. Seller has not dealt with any broker, investment banker, agent, or other Person (other than Buyer or an Affiliate of Buyer) who may be entitled to any commission or compensation in connection with the sale of Purchased Loans pursuant to any of the Transaction Documents.

(vi) Good Title to Purchased Loans. Immediately prior to the purchase of any Purchased Loans by Buyer from Seller, such Purchased Loans are free and clear of any lien, encumbrance or impediment to transfer (including any “adverse claim” as defined in Section 8-102(a)(1) of the UCC), and Seller

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is the record and beneficial owner of and has good and marketable title to and the right to sell and transfer such Purchased Loans to Buyer and, upon transfer of such Purchased Loans to Buyer, Buyer shall be the owner of such Purchased Loans free of any adverse claim, subject to the rights of Seller and other obligations of Buyer pursuant to the terms of this Agreement. In the event the related Transaction is recharacterized as a secured financing of the Purchased Loans, the provisions of this Agreement are effective to create in favor of Buyer a valid security interest in all rights, title and interest of Seller in, to and under the Collateral and Buyer shall have a valid, perfected first priority security interest in the Purchased Loans.

(vii) No Default. As of the date of this Agreement and each Purchase Date, no Default or Event of Default has occurred and is continuing under or with respect to the Transaction Documents. At all times while this Agreement and any Transaction thereunder is in effect, no monetary Default, material non-monetary Default or Event of Default to Seller’s Actual Knowledge has occurred and is continuing under or with respect to the Transaction Documents.

(viii) Representations and Warranties Regarding Purchased Loans; Delivery of Purchased Loan File. Seller represents and warrants to Buyer that each Purchased Loan sold in a Transaction hereunder, as of the related Purchase Date for such Transaction and as of any Business Day on which Margin Excess is made available by Buyer to Seller which increases the outstanding Purchase Price of such Purchased Loan, conforms to the applicable representations and warranties set forth in Exhibit VI attached hereto in all material respects, except as disclosed to Buyer in writing. With respect to each Purchased Loan, the Mortgage Note, the Mortgage, the Assignment of Mortgage and any other documents required to be delivered under this Agreement and the applicable Custodial Agreement for such Purchased Loan have been delivered to Buyer or the Custodian on its behalf (or shall be delivered in accordance with the time periods set forth herein).

(ix) Adequate Capitalization; No Fraudulent Transfer. Seller is generally able to pay, and as of the date hereof is paying, its debts as they come due. Seller has not become, and is not presently, financially insolvent nor will Seller be made insolvent by virtue of Seller’s execution of or performance under any of the Transaction Documents within the meaning of the bankruptcy laws or the insolvency laws of any jurisdiction. Seller has not entered into any Transaction Document or any Transaction pursuant thereto in contemplation of insolvency or with intent to hinder, delay or defraud any creditor. Seller has not received any written notice that any payment or other transfer made to or on account of Seller from or on account of any Mortgagor or any other person obligated under any Purchased Loan Documents is or may be void or voidable as an actual or constructive fraudulent transfer or as a preferential transfer.

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(x) Consents. No consent, approval or other action of, or filing by Seller with, any Governmental Authority or any other Person is required to authorize, or is otherwise required in connection with, the execution, delivery and performance of any of the Transaction Documents (other than consents, approvals and filings that have been obtained or made, as applicable, or that, if not obtained or made, are not reasonably likely to have a Material Adverse Effect).

(xi) Members. Seller is a wholly owned subsidiary of Guarantor.

(xii) Organizational Documents. Seller has delivered to Buyer certified copies of its organizational documents, together with all amendments thereto, if any.

(xiii) No Encumbrances. Except to the extent expressly set forth in this Agreement, there are (i) no outstanding rights, options, warrants or agreements on the part of Seller for a purchase, sale or issuance, in connection with the Purchased Loans, (ii) no agreements on the part of Seller to issue, sell or distribute the Purchased Loans, and (iii) no obligations on the part of Seller (contingent or otherwise) to purchase, redeem or otherwise acquire any securities or any interest therein or to pay any dividend or make any distribution in respect of the Purchased Loans.

(xiv) Federal Regulations. Seller is not (A) required to register as an “investment company,” or a company “controlled by an investment company,” within the meaning of the Investment Company Act of 1940, as amended, or (B) a “holding company,” or a “subsidiary company of a holding company,” or an “affiliate” of either a “holding company” or a “subsidiary company of a holding company,” as such terms are defined in the Public Utility Holding Company Act of 1935, as amended.

(xv) Taxes. Seller and Guarantor have filed or caused to be filed all U.S. federal and other material tax returns which are required to be filed with respect to Seller and have paid all U.S. federal and other material taxes imposed on or with respect to Seller except for any such taxes as are being appropriately contested in good faith by appropriate proceedings diligently conducted and with respect to which adequate reserves have been provided in accordance with GAAP; no tax liens have been filed against Seller or its assets (except for Permitted Liens).

(xvi) ERISA. Neither Seller nor any ERISA Affiliate maintains any Plans and neither Seller nor any ERISA Affiliate and makes any contributions to any Plans or any Multiemployer Plans.

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(xvii) Judgments/Bankruptcy. Except as disclosed in writing to Buyer, there are no judgments against Seller unsatisfied of record or docketed in any court located in the United States of America. No Act of Insolvency has ever occurred with respect to Seller.

(xviii) Full and Accurate Disclosure. No information contained in the Transaction Documents or in any written statement prepared and delivered by Seller or Guarantor pursuant to the terms of the Transaction Documents contains any untrue statement of a material fact or omits to state a material fact necessary to make the statements contained herein or therein not misleading in light of the circumstances under which they were made when such statements and omissions are considered in the totality of the circumstances in question.

(xix) Financial Information. All financial data concerning Seller and Guarantor that has been delivered by Seller to Buyer is true, complete and correct in all material respects and has been prepared in accordance with GAAP. To Seller’s Actual Knowledge, all financial data concerning the Purchased Loans that has been delivered by or on behalf of Seller to Buyer is true, complete and correct in all material respects. Since the delivery of such data, except as otherwise disclosed in writing to Buyer, there has been no change in the financial position of Seller and Guarantor or in the operations of Seller and Guarantor or, to Seller’s Actual Knowledge, the financial position of the Purchased Loans, which change is reasonably likely to have in a Material Adverse Effect.

(xx) Notice Address; Jurisdiction of Organization. On the date of this Agreement, Seller’s address for notices is as set forth in Annex I. Seller’s jurisdiction of organization is Delaware. The location where Seller keeps its books and records, including all computer tapes and records relating to the Collateral, is its notice address.

(xxi) Prohibited Person. None of Seller, Guarantor or any of their respective Affiliates is a Prohibited Person and each of Seller and Guarantor is in full compliance with all applicable orders, rules, regulations and recommendations of OFAC. None of Seller or Guarantor or any of their respective members, directors, executive officers, parents or Subsidiaries, as applicable: (A) are subject to U.S. or multilateral economic or trade sanctions currently in force; (B) are owned or controlled by, or act on behalf of, any governments, corporations, entities or individuals that are subject to U.S. or multilateral economic or trade sanctions currently in force; or (C) is a Prohibited Person or is otherwise named, identified or described on any blocked persons list, designated nationals list, denied persons list, entity list, debarred party list, unverified list, sanctions list or other list of individuals or entities with whom U.S. persons may not conduct business, including but not limited to lists published or maintained by OFAC, lists published or maintained by the U.S.

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Department of Commerce, and lists published or maintained by the U.S. Department of State. Each of Seller and Guarantor has established an anti-money laundering compliance program as required by all applicable anti-money laundering laws and regulations, including without limitation the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (Public Law 107-56).

11. NEGATIVE COVENANTS OF SELLER

On and as of the date hereof and until this Agreement is no longer in force with respect to any Transaction, Seller shall not without the prior written consent of Buyer:

(a) subject to Seller’s right to repurchase any Purchased Loan, take any action which would directly or indirectly impair or adversely affect Buyer’s title to the Purchased Loans;

(b) transfer, assign, convey, grant, bargain, sell, set over, deliver or otherwise dispose of, or pledge or hypothecate, directly or indirectly, any interest in the Purchased Loans (or any of them) to any Person other than Buyer, or engage in repurchase transactions or similar transactions with respect to the Purchased Loans (or any of them) with any Person other than Buyer, unless and until such Purchased Loans are repurchased by Seller in accordance with this Agreement;

(c) create, incur or permit to exist any Lien in or on the Purchased Loans, except as described in Section 6 of this Agreement;

(d) create, incur or permit to exist any lien, encumbrance or security interest in or on any of the other Collateral subject to the security interest granted by Seller pursuant to Section 6 of this Agreement;

(e) modify or terminate any of the organizational documents of Seller (except Buyer shall not unreasonably withhold or delay any request for a consent to such modification to the organizational documents (excluding the special purpose entity provisions));

(f) consent to any amendment or supplement to, or termination of any note, loan agreement, mortgage or guaranty relating to the Purchased Loans or other material agreement or instrument relating to the Purchased Loans (other than Permitted Purchased Loan Modifications), unless and until such Purchased Loans are repurchased by Seller in accordance with this Agreement; provided, that notwithstanding the foregoing, to the extent Buyer’s prior approval is required for any such amendment or termination set forth in this Section 11(f) and Seller delivers a written request for approval to Buyer which is not responded to within five (5) Business Days, then Buyer shall be deemed to have granted its approval to such amendment or termination if Seller proceeds to deliver to Buyer a second written request for approval which is not responded to within five (5) Business Days, so long as such second request is marked in bold lettering with the following language: “BUYER’S RESPONSE IS REQUIRED WITHIN FIVE (5) BUSINESS DAYS OF RECEIPT OF THIS NOTICE PURSUANT TO THE TERMS OF A REPURCHASE AGREEMENT BETWEEN THE UNDERSIGNED AND BUYER” and the envelope containing the request must be marked “PRIORITY”;

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(g) admit any additional members in Seller, or permit the sole member of Seller to assign or transfer all or any portion of its membership interest in Seller;

(h) enter into any Hedging Transactions (it being understood and agreed Seller shall not have any obligation to enter into Hedging Transactions with respect to individual Purchased Loans or pursue hedging strategies at the level of Seller with respect to the Purchased Loans);

(i) after the occurrence and during the continuation of an Event of Default, make any distribution, payment on account of, or set apart assets for, a sinking or other analogous fund for the purchase, redemption, defeasance, retirement or other acquisition of any Capital Stock of Seller, whether now or hereafter outstanding, or make any other distribution in respect thereof, either directly or indirectly, whether in cash or property or in obligations of Seller.

12. AFFIRMATIVE COVENANTS OF SELLER

(a) Seller shall use commercially reasonable efforts to promptly notify Buyer of any change in its business operations and/or financial condition that would be reasonably likely to have a Material Adverse Effect; provided, however, the failure to deliver such notice in accordance with this Section 12(a) shall not give rise to an Event of Default; provided, further, that nothing in this Section 12 shall relieve Seller of its obligations under this Agreement.

(b) Seller shall provide Buyer with copies of such documents as Buyer may reasonably request and which are in Seller’s possession or control evidencing the truthfulness of the representations set forth in Section 10.

(c) Seller (1) shall defend the right, title and interest of Buyer in and to the Collateral against, and take such other action as is necessary to remove, the Liens of all Persons (other than security interests by or through Buyer and Permitted Liens) and (2) shall, at Buyer’s reasonable request, take all action necessary to ensure that Buyer will have a first priority security interest in the Purchased Loans subject to any of the Transactions in the event such Transactions are recharacterized as secured financings.

(d) Seller shall notify Buyer and the Depository of the occurrence of any Default or Event of Default of which Seller has written notice or Actual Knowledge and which has not otherwise been disclosed pursuant to the reports delivered in accordance with Section 12(i).

(e) With respect to each fixed rate Purchased Loan, Seller shall enter into Hedging Transactions designed to mitigate interest rate risk (i.e. not credit risk) pursuant to a hedging strategy reasonably acceptable to Buyer and pledge such Hedging Transactions to Buyer as Collateral (including, without limitation, to the extent such Hedging Transactions are entered into with a party other than Buyer, delivering a collateral assignment of such Hedging Transactions in form and substance acceptable to Buyer). Seller acknowledges Buyer will mark to market such Hedging Transactions from time to time in accordance with and subject to the terms of this Agreement.

(f) Seller shall promptly (and in any event not later than three (3) Business Days following receipt) deliver to Buyer (i) any written notice of the occurrence of an event of default received by Seller pursuant to the Purchased Loan Documents and (ii) any other information with respect to the Purchased Loans within Seller’s possession or control as may be reasonably requested by Buyer from time to time.

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(g) Seller will permit Buyer or its designated representative to inspect at Buyer’s sole cost and expense (so long as an Event of Default has not occurred and is not continuing) Seller’s records which are not privileged or confidential (but excluding for this purpose all information received from Mortgagors or other obligors on the Purchased Loans) and the conduct and operation of its business related thereto upon reasonable prior written notice from Buyer or its designated representative, at such reasonable times and with reasonable frequency (not to exceed twice per calendar year, so long as an Event of Default has not occurred and is not continuing), subject to the terms of any confidentiality agreement between Buyer and Seller and applicable law, and if no such confidentiality agreement then exists between Buyer and Seller, Buyer and Seller shall act in accordance with customary market standards regarding confidentiality and applicable law. Buyer shall act in a commercially reasonable manner in requesting and conducting any inspection relating to the conduct and operation of Seller’s business.

(h) At any time from time to time upon the reasonable request of Buyer, at the sole expense of Seller, Seller will promptly and duly execute and deliver such further instruments and documents and take such further actions as Buyer may reasonably request for the purposes of obtaining or preserving the full benefits of this Agreement including the first priority security interest granted hereunder and of the rights and powers herein granted (including, among other things, filing such UCC financing statements as Buyer may reasonably request). If any amount payable under or in connection with any of the Collateral shall be or become evidenced by any promissory note, other instrument or chattel paper, such note, instrument or chattel paper shall be immediately delivered to Buyer, duly endorsed in a manner reasonably satisfactory to Buyer, to be held as Collateral pursuant to this Agreement, and the documents delivered in connection herewith.

(i) Seller shall provide Buyer with the following financial and reporting information:

(i) Within 45 days after the last day of each of the first three fiscal quarters in any fiscal year, Guarantor’s and (to the extent prepared separately from Guarantor) Seller’s unaudited consolidated balance sheets as of the end of such quarter, in each case certified as being true and correct by an officer’s certificate;

(ii) Within 90 days after the last day of its fiscal year, Guarantor’s audited and (to the extent prepared separately from Guarantor) Seller’s unaudited (or, if generated by Seller, Seller’s audited) consolidated statements of income and statements of changes in cash flow for such year and balance sheets as of the end of such year, in each case presented fairly in accordance with GAAP, and accompanied, in the case of Guarantor, by an unqualified report of a nationally recognized independent certified public accounting firm, Deloitte & Touche LLP or any other accounting firm consented to by Buyer in its reasonable discretion;

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(iii) Within 30 days after the last day of each calendar month, any and all property level financial information (including, without limitation, operating and financial statements) with respect to the Purchased Loans that was received during the preceding calendar month and is in the possession of Seller or an Affiliate, including, without limitation, rent rolls and income statements;

(iv) Within 30 days after the last day of each calendar quarter in any fiscal year, an officer’s certificate from Seller addressed to Buyer certifying that, as of such calendar month, (x) Seller and Guarantor are in compliance in all material respects with all of the terms and requirements of this Agreement, (y) Guarantor is in compliance with the financial covenants set forth in the Guaranty (including therein detailed calculations demonstrating such compliance) and (z) no Event of Default has occurred and is continuing; and

(v) With respect to the Purchased Loans and related Mortgaged Properties: (x) within 30 days after the last day of each calendar month, Seller’s monthly operations report covering occupancy, collections, delinquencies, losses, recoveries, cash flows and such other property level information as may reasonably be requested by Buyer and (y) within 30 days after the last day of each calendar quarter in any fiscal year, an asset management report prepared by Seller or Guarantor.

(j) Seller shall at all times comply with all laws, ordinances, rules and regulations of any federal, state, municipal or other public authority having jurisdiction over Seller or any of its assets, except to the extent any failure thereof is not reasonably likely to result in a Material Adverse Effect. Seller shall do or cause to be done all things reasonably necessary to preserve and maintain in full force and effect its legal existence, and all licenses material to its business.

(k) Seller shall at all times keep proper books of records and accounts in which full, true and correct entries shall be made of its transactions in accordance with GAAP and set aside on its books from its earnings for each fiscal year all such proper reserves in accordance with GAAP.

(l) Seller shall observe, perform and satisfy all the terms, provisions and covenants required to be observed, performed or satisfied by it, and shall pay when due all costs, fees and expenses required to be paid by it, under the Transaction Documents. Seller shall pay and discharge all Taxes, levies, liens and other charges on its assets and on the Collateral that, in each case, in any manner would create any Lien upon the Collateral, except for Permitted Liens or similar charges.

(m) Seller will maintain records with respect to the Collateral and the conduct and operation of its business with no less a degree of prudence than if the Collateral were held by Seller for its own account.

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(n) In the event that Guarantor terminates BXMT Advisors L.L.C. as Guarantor’s external manager pursuant to the Amended and Restated Management Agreement, dated as of March 26, 2013, between Guarantor and BXMT Advisors L.L.C., any replacement external manager or switch to internal management shall be subject to Buyer’s prior written approval, not to be unreasonably withheld, conditioned or delayed.

13. SINGLE-PURPOSE ENTITY

Seller hereby represents and warrants to Buyer, and covenants with Buyer, that as of the date hereof and so long as any of the Transaction Documents shall remain in effect:

(a) It is and intends to remain Solvent and it has paid and will pay its debts and liabilities (including employment and overhead expenses) from and solely to the extent of its own assets as the same shall become due.

(b) It has complied and will comply with the provisions of its organizational documents (i.e. certificate of formation and operating agreement) in all material respects.

(c) It has done or caused to be done and will, to the extent under its control, do all things necessary to observe corporate formalities and to preserve its existence.

(d) It has maintained and will maintain all of its books, records, financial statements and bank accounts separate from those of its Affiliates, its members and any other Person (except, in each case, to the extent consolidation is permitted under GAAP or as a matter of law), and, to the extent required by law, it will file its own tax returns, if any (except, for the avoidance of doubt, if the Seller is included as part of a consolidated, unitary, combined or similar tax return, or if the Seller is disregarded as a separate entity for applicable tax purposes).

(e) It has been, is and will be, and at all times will hold itself out to the public as, a legal entity separate and distinct from any other entity (including any Affiliate), shall correct any misunderstanding of which it has Actual Knowledge regarding its status as a separate entity, shall conduct business in its own name, shall not identify itself or any of its Affiliates as a division or part of the other, shall maintain and utilize separate stationery, invoices and checks, and allocate fairly and reasonably any overhead for shared office space and for services performed by an employee of an Affiliate.

(f) It has not owned and will not own any property or any other assets other than Purchased Loans, cash and its interest under any associated Hedging Transactions.

(g) It has not engaged and will not engage in any business other than the acquisition, origination, ownership, servicing, enforcement, financing and disposition of Purchased Loans in accordance with the applicable provisions of the Transaction Documents and its organizational documents.

(h) It has not entered into, and will not enter into, any contract or agreement with any of its Affiliates, except upon terms and conditions that are substantially similar to those that would be available on an arm’s-length basis with Persons other than such Affiliate.

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(i) It has not incurred and will not incur any Indebtedness or other obligation, secured or unsecured, direct or indirect, absolute or contingent (including guaranteeing any obligation), other than (A) with respect to the Purchased Loan Documents, and (B) trade payables in the ordinary course of its business which are either (x) no more than ninety (90) days past due and do not exceed $500,000.00 in the aggregate or (y) more than ninety (90) days past due and do not exceed $250,000.00 in the aggregate, and are being contested in good faith and for which adequate reserves are maintained, and (C) as otherwise expressly permitted under this Agreement.

(j) It has not made and will not make any loans or advances to any other Person, except as permitted under this Agreement, and shall not acquire obligations or securities of any member or any Affiliate of any member or any other Person.

(k) It will maintain adequate capital derived from income from its business operations for the normal obligations reasonably foreseeable in a business of its size and character and in light of its contemplated business operations.

(l) It shall not seek its dissolution, liquidation or winding up, in whole or in part, or suffer any Change of Control or consolidation or merger with respect to Seller.

(m) It will not commingle its funds and other assets with those of any of its Affiliates or any other Person.

(n) It has maintained and will maintain its assets in such a manner that it will not be costly or difficult to segregate, ascertain or identify its individual assets from those of any of its Affiliates or any other Person.

(o) Except as expressly permitted under this Agreement, it has not held and will not hold itself out to be responsible for the debts or obligations of any other Person.

(p) Seller shall not take any Act of Insolvency without the affirmative vote of the Independent Director.

(q) It shall at all times maintain at least one Independent Director. For so long as the Repurchase Obligations remain outstanding, Seller shall not take any of the actions contemplated by Section 13(p) above (including, to the extent, applicable without the affirmative vote of such Independent Director).

(r) It shall not pledge its assets to secure the obligations of any other Person.

14. EVENTS OF DEFAULT; REMEDIES

(a) After the occurrence and during the continuance of an Event of Default, Seller hereby appoints Buyer as attorney-in-fact of Seller in accordance with Section 7(b) for the purpose of carrying out the provisions of this Agreement and taking any action and executing or endorsing any instruments that Buyer may deem necessary or advisable to accomplish the purposes hereof, which appointment as attorney-in-fact is irrevocable and coupled with an interest. With respect to each Transaction, each of the following clauses (i) through (xv) shall be an Event of Default under this Agreement:

(i) Seller fails to repurchase the Purchased Loans upon the applicable Repurchase Date;

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(ii) Seller fails to cure a Margin Deficit in accordance with Section 4 hereof;

(iii) an Act of Insolvency occurs with respect to Seller or Guarantor;

(iv) Guarantor fails to qualify as a REIT (after giving effect to any cure or corrective periods or allowances pursuant to the Code);

(v) either (A) the Transaction Documents shall for any reason not cause, or shall cease to cause, Buyer to be the owner free of any adverse claim of any of the Purchased Loans, or (B) if a Transaction is recharacterized as a secured financing, the Transaction Documents with respect to any Transaction shall for any reason cease to create a valid first priority security interest in favor of Buyer in any of the Purchased Loans;

(vi) if an event occurs which would constitute (a) an “event of default” under any Hedging Transaction or (b) a “termination event” or an “additional termination event” under any Hedging Transaction (and, in either case, Seller has failed to cure the “event of default” within the applicable cure period or to meet its obligation to pay the Early Termination Amount, if any, pursuant to the terms of such Hedging Transaction);

(vii) failure of Buyer to receive within one (1) Business Day after any Remittance Date the accreted value of the Price Differential (less any amount of such Price Differential previously paid by Seller to Buyer);

(viii) failure of Seller to make any other payment owing to Buyer which has become due, whether by acceleration or otherwise under the terms of this Agreement (other than due to any act or failure to act of Depository to the extent available funds are on deposit in the applicable Cash Management Account), which failure is not remedied within three (3) Business Days after written notice thereof to Seller from Buyer;

(ix) any Governmental Authority takes any action to (i) condemn, seize or appropriate, or assume custody or control of, all or any substantial part of the property of Seller, (ii) displace the management of Seller or curtail its authority in the conduct of the business of Seller, or (iii) terminate the activities of Seller as contemplated by the Transaction Documents;

(x) a Change of Control shall have occurred;

(xi) any representation (other than a MTM Representation) made by Seller or Guarantor in any Transaction Document shall have been incorrect or

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untrue in any material respect when made or repeated or deemed to have been made or repeated and such incorrect or untrue representation exists and continues unremedied for ten (10) Business Days after the earlier of receipt of written notice thereof from Buyer or the Seller’s acquiring Actual Knowledge of such incorrect or untrue representation (other than the representations and warranties set forth in Section 10(b)(viii) of this Agreement made by Seller, which shall not be considered an Event of Default if incorrect or untrue in any material respect, provided Seller repurchases the related Purchased Loan on an Early Repurchase Date no later than three (3) Business Days after receiving notice of such incorrect or untrue representation and terminates the related Transaction; provided further Seller shall not have made any such representation with actual knowledge that it was materially incorrect or untrue at the time made);

(xii) (i) Guarantor breaches any of the payment obligations set forth in the Guaranty or (ii) Guarantor shall fail to observe any of the financial covenants set forth in the Guaranty or (iii) shall have defaulted or failed to perform any of the other obligations under the Guaranty in any material respect and such default or failure referred to in this clause (iii) remains uncured for a period of seven (7) Business Days after the earlier of receipt of notice thereof from Buyer or the Seller’s acquiring Actual Knowledge of such default or failure by Guarantor;

(xiii) a final non-appealable judgment by any competent court in the United States of America for the payment of money in an amount greater than $100,000 (in the case of Seller) or $5,000,000 (in the case of the Guarantor) shall have been rendered against Seller or Guarantor, and remains undischarged or unpaid for a period of forty-five (45) days, during which period execution of such judgment is stayed by the posting of cash or a bond or other collateral acceptable to Buyer in the amount of the judgment;

Seller or Guarantor shall have (x) defaulted under any note, indenture, loan agreement, guaranty or other Indebtedness to which it is a party, which default (A) involves the failure to pay a matured obligation in excess of $100,000 (in the case of Seller) or the greater of (a) $5,000,000 or (b) the lesser of (i) 5% of Tangible Net Worth (as such term is defined in the Guaranty) and (ii) $25,000,000 (in the case of Guarantor), or (B) results in the acceleration of the maturity of such Indebtedness in excess of a principal amount of $100,000 (in the case of Seller) or the greater of (a) $5,000,000 or (b) the lesser of (i) 5% of Tangible Net Worth (as such term is defined in the Guaranty) and (ii) $25,000,000 (in the case of Guarantor) by any other party to or beneficiary of such note, indenture, loan agreement, guaranty or other Indebtedness or (y) failed to perform any other material non-payment obligation under such note, indenture, loan agreement, guaranty or other Indebtedness with an asserted actual out-of-pocket damages claim in excess of the limits referenced in clause

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(x) with respect to Seller or Guarantor, as applicable and acceleration occurs under such Indebtedness as a result thereof; provided, however, that any such default, failure to perform or breach shall not constitute an Event of Default if Seller or Guarantor cures such default or failure to perform, as the case may be, within the grace notice and/or cure period, if any, provided under the applicable agreement; or

(xiv) if Seller or Guarantor shall breach or fail to perform any of the terms, agreements, conditions, covenants or obligations applicable to such Person under this Agreement, any other Transaction Document or any Purchased Loan Document to which such Person is a party, other than as specifically otherwise referred to in this definition of “Event of Default” (including, without limitation, the failure by Seller to deliver any report required pursuant to Section 12(i)), and such breach or failure to perform is not remedied within fifteen (15) Business Days after written notice thereof to Seller from the applicable party or its successors or assigns; (each of (i) through (xv), an “Event of Default”).

(b) If an Event of Default shall occur and be continuing, the following rights and remedies shall be available to Buyer:

(i) At the option of Buyer, exercised by written notice to Seller (which option shall be deemed to have been exercised, even if no notice is given, immediately upon the occurrence of an Act of Insolvency), the Repurchase Date for each Transaction hereunder shall, if it has not already occurred, be deemed immediately to occur (the date on which such option is exercised or deemed to have been exercised being referred to hereinafter as the “Accelerated Repurchase Date”).

(ii) If Buyer exercises or is deemed to have exercised the option referred to in Section 14(b)(i) of this Agreement:

(A) Seller’s obligations hereunder to repurchase all Purchased Loans shall become immediately due and payable on and as of the Accelerated Repurchase Date; and

(B) to the extent permitted by applicable law, the Repurchase Price with respect to each Transaction (determined as of the Accelerated Repurchase Date) shall be increased by the aggregate amount obtained by daily application of, on a 360 day per year basis for the actual number of days during the period from and including the Accelerated Repurchase Date to but excluding the date of payment of the Repurchase Price (as so increased), (x) the Pricing Rate for such Transaction multiplied by (y) the outstanding Purchase Price for such Transaction (decreased by (I) any amounts actually remitted to Buyer by the Depository or Seller from time to time pursuant to Sections 4 or 5 of this Agreement and applied to such Repurchase Price, and (II) any amounts applied to the Repurchase Price pursuant to Section 14(b)(iii) of this Agreement); and

(C) the Custodian shall, upon the request of Buyer, deliver to Buyer all instruments, certificates and other documents then held by the Custodian relating to the Purchased Loans.

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(iii) Upon the occurrence and during the continuance of an Event of Default with respect to Seller, Buyer may (A) immediately sell, at a public or private sale in a commercially reasonable manner in accordance with Requirements of Law, and with prior written notice to Seller, at such price or prices as Buyer may reasonably deem satisfactory any or all of the Purchased Loans or (B) in its sole discretion elect, in lieu of selling all or a portion of such Purchased Loans, to give Seller credit for such Purchased Loans in an amount equal to the market value of such Purchased Loans as determined by Buyer in its sole discretion against the aggregate unpaid Repurchase Price for such Purchased Loans and any other amounts owing by Seller under the Transaction Documents. The proceeds of any disposition of Purchased Loans effected pursuant to this Section 14(b)(iii) shall be applied in accordance with Section 5(g).

(iv) The parties recognize that it may not be possible to purchase or sell all of the Purchased Loans on a particular Business Day, or in a transaction with the same purchaser, or in the same manner because the market for such Purchased Loans may not be liquid. In view of the nature of the Purchased Loans, the parties agree that liquidation of a Transaction or the Purchased Loans does not require a public purchase or sale and that a good faith private purchase or sale shall be deemed to have been made in a commercially reasonable manner. Accordingly, Buyer may elect, in its sole discretion in accordance with Requirements of Law, the time and manner of liquidating any Purchased Loans, and nothing contained herein shall (A) obligate Buyer to liquidate any Purchased Loans on the occurrence and during the continuance of an Event of Default or to liquidate all of the Purchased Loans in the same manner or on the same Business Day or (B) constitute a waiver of any right or remedy of Buyer.

(v) Seller shall be liable to Buyer for (A) the amount of all actual out-of-pocket expenses, including reasonable legal fees and expenses, actually incurred by Buyer in connection with or as a consequence of an Event of Default with respect to Seller, (B) all actual costs incurred in connection with the termination of Hedging Transactions, and (C) any other actual out-of-pocket loss, damage, cost or expense directly arising or resulting from the occurrence and continuance of an Event of Default with respect to Seller.

(vi) Buyer shall have, in addition to its rights and remedies under the Transaction Documents, all of the rights and remedies provided by

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applicable federal, state, foreign, and local laws (including, without limitation, if the Transactions are recharacterized as secured financings, the rights and remedies of a secured party under the UCC of the State of New York, to the extent that the UCC is applicable, and the right to offset any mutual debt and claim), in equity, and under any other agreement between Buyer and Seller. Without limiting the generality of the foregoing, Buyer shall be entitled to set off the proceeds of the liquidation of the Purchased Loans against all of Seller’s obligations to Buyer pursuant to this Agreement, whether or not such obligations are then due, without prejudice to Buyer’s right to recover any deficiency.

(vii) Subject to the notice and grace periods set forth herein, Buyer may exercise any or all of the remedies available to Buyer immediately upon the occurrence and continuance of an Event of Default (other than with respect to Buyer) and at any time during the continuance thereof. All rights and remedies arising under the Transaction Documents, as amended from time to time, are cumulative and not exclusive of any other rights or remedies which Buyer may have.

(viii) Buyer may enforce its rights and remedies hereunder without prior judicial process or hearing, and Seller hereby expressly waives any defenses Seller might otherwise have to require Buyer to enforce its rights by judicial process. Seller also waives any defense Seller might otherwise have arising from the use of nonjudicial process, disposition of any or all of the Purchased Loans, or from any other election of remedies. Seller recognizes that nonjudicial remedies are consistent with the usages of the trade, are responsive to commercial necessity and are the result of a bargain at arm’s length.

(ix) Upon the designation of any Accelerated Repurchase Date, Buyer may, without prior notice to Seller, set off any sum or obligation (whether or not arising under this Agreement, whether matured or unmatured, whether or not contingent and irrespective of the currency, place of payment or booking office of the sum or obligation) owed by Seller to Buyer or any Affiliate of Buyer against any sum or obligation (whether or not arising under this Agreement, whether matured or unmatured, whether or not contingent and irrespective of the currency, place of payment or booking office of the sum or obligation) owed by Buyer or any Affiliate of Buyer to Seller. Buyer will give written notice to the other party of any set off effected under this Section 14(b)(ix). If a sum or obligation is unascertained, Buyer may in good faith estimate that obligation and set-off in respect of the estimate, subject to the relevant party accounting to the other when the obligation is ascertained. Nothing in this Section 14(b)(ix) shall be effective to create a charge or other security interest. This Section 14(b)(ix) shall be without prejudice and in addition to any right of set-off, combination of accounts, lien or other rights to which any party is at any time otherwise entitled (whether by operation of law, contract or otherwise).

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15. SINGLE AGREEMENT

Buyer and Seller acknowledge that, and have entered hereinto and will enter into each Transaction hereunder in consideration of and in reliance upon the fact that, all Transactions hereunder constitute a single business and contractual relationship and have been made in consideration of each other. Accordingly, each of Buyer and Seller agrees (i) to perform all of its obligations in respect of each Transaction hereunder, and that a default in the performance of any such obligations shall constitute a default by it in respect of all Transactions hereunder, (ii) that each of them shall be entitled to set off claims and apply property held by them in respect of any Transaction against obligations owing to them in respect of any other Transactions hereunder and (iii) that payments, deliveries and other transfers made by either of them in respect of any Transaction shall be deemed to have been made in consideration of payments, deliveries and other transfers in respect of any other Transactions hereunder, and the obligations to make any such payments, deliveries and other transfers may be applied against each other and netted.

16. RECORDING OF COMMUNICATIONS

EACH OF BUYER AND SELLER SHALL HAVE THE RIGHT (BUT NOT THE OBLIGATION) FROM TIME TO TIME TO MAKE OR CAUSE TO BE MADE TAPE RECORDINGS OF COMMUNICATIONS BETWEEN ITS EMPLOYEES, IF ANY, AND THOSE OF THE OTHER PARTY WITH RESPECT TO TRANSACTIONS; PROVIDED, HOWEVER, THAT SUCH RIGHT TO RECORD COMMUNICATIONS SHALL BE LIMITED TO COMMUNICATIONS OF EMPLOYEES TAKING PLACE ON THE TRADING FLOOR OF THE APPLICABLE PARTY.

17. NOTICES AND OTHER COMMUNICATIONS

Unless otherwise provided in this Agreement, all notices, consents, approvals and requests required or permitted hereunder shall be given in writing and shall be effective for all purposes if hand delivered or sent by (a) hand delivery, with proof of delivery, (b) certified or registered United States mail, postage prepaid, (c) expedited prepaid delivery service, either commercial or United States Postal Service, with proof of delivery, or (d) by email with proof of delivery to the address specified in Annex I hereto or at such other address and person as shall be designated from time to time by any party hereto, as the case may be, in a written notice to the other parties hereto in the manner provided for in this Section. A notice shall be deemed to have been given: (a) in the case of hand delivery, at the time of delivery, (b) in the case of registered or certified mail, when delivered or the first attempted delivery on a Business Day, (c) in the case of expedited prepaid delivery upon the first attempted delivery on a Business Day, or (d) in the case of email, upon receipt of confirmation of transmission and delivery, respectively, provided that such notice sent by email was also delivered as required in this Section. A party receiving a notice which does not comply with the technical requirements for notice under this Section may elect to waive any deficiencies and treat the notice as having been properly given. Notwithstanding the foregoing, in the event that Seller directs Buyer to transfer funds pursuant to a Transaction or otherwise in accordance with Section 3 or 4 to an account or recipient other than Seller’s wiring instructions specified on Annex I, such direction shall be in writing (including in a Confirmation) and signed by two (2) authorized officers of Seller.

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18. ENTIRE AGREEMENT; SEVERABILITY

This Agreement shall supersede any existing agreements between the parties containing general terms and conditions for repurchase transactions. Each provision and agreement herein shall be treated as separate and independent from any other provision or agreement herein and shall be enforceable notwithstanding the unenforceability of any such other provision or agreement.

19. NON-ASSIGNABILITY

(a) The rights and obligations of Seller under the Transaction Documents and under any Transaction shall not be assigned by Seller without the prior written consent of Buyer.

(b) Upon prior written notice to Seller, Buyer shall be entitled to assign an interest in its rights and obligations under the Transaction Documents and/or under any Transaction to any other Person or issue one or more participation interests with respect to any or all of the Transactions and, in connection therewith, may bifurcate or allocate (i.e. senior/subordinate) amounts due to Buyer; provided, however, in all such instances, so long as no Event of Default has occurred and is continuing, (i) Buyer may not assign an interest in its rights and obligations under the Transaction Documents and/or under any Transaction or issue one or more participation interests with respect to any or all of the Transactions to any Prohibited Transferee, (ii) Buyer shall retain control and authority over its rights and obligations under the Transaction Documents and/or under any Transaction, (iii) Seller shall not be obligated to deal directly or indirectly with any party other than Buyer, and (iv) Seller shall not be charged for, incur or be required to pay or reimburse Buyer or any assignee, transferee, participant or other third party for any costs that would not have been incurred but for the assignment, participation, bifurcation or allocation by Buyer in accordance with this Section 19(b). In furtherance of and without limitation to the foregoing, in no event shall Buyer confer on or grant any rights in any Person other than Buyer any right to determine the Market Value of any Purchased Loan, to declare a Margin Deficit, to determine whether a Default or Event of Default has occurred or is continuing, to approve a Purchased Loan, to make available to Seller Margin Excess, or to enforce any provision of any Transaction Documents against Seller or Guarantor, it being understood and agreed that nothing herein shall restrict or limit Buyer’s right to consult with and consider the views and opinions of any assignee, transferee or participant under this Agreement.

(c) Buyer, acting solely for this purpose as a non-fiduciary agent of Seller, shall maintain a register for the recordation of each assignment pursuant to Section 19(b) above and the name and address of any assignee, and the Repurchase Price and Price Differential owing to such assignee (the “Register”). The entries in the Register shall be conclusive absent manifest error. Buyer and Seller shall treat each Person whose name is recorded in the Register pursuant to the terms hereof as the owner of the applicable rights and obligations and no transfer or assignment shall be effective unless duly noted in the Register. The Register shall be available for inspection by the Seller at any reasonable time and from time to time upon reasonable request.

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(d) The Buyer and each assignee, if any that sells a participation shall, acting solely for this purpose as a non-fiduciary agent of Seller, maintain a register on which it records such sale, the name and address of the applicable participant and, with respect to each such participant, the participated Repurchase Price and Price Differential (the “Participant Register”). Neither the Buyer nor any such assignee shall have any obligation to disclose the identity of any participant or any information relating to a participant’s interest in any obligations under any Transaction Document to any Person except (i) to the extent that the Internal Revenue Service requests such disclosure (from Seller, Guarantor, Buyer, such assignee or otherwise) or such disclosure is otherwise reasonably determined to be required to establish that such obligation is in registered form under Section 5f.103-1I of the United States Treasury Regulations (the “Treasury Regulations”), and (ii) the portion of the Participant Register relating to any such participant requesting (directly or through Buyer or an assignee) payment from Seller under the Transaction Documents shall be made available to Seller upon reasonable request. The entries in the Participant Register shall be conclusive absent manifest error. The applicable Buyer shall treat each Person whose name is recorded in the Participant Register as the owner of the applicable participation for all purposes of this Agreement and no sale of a participation shall be effective unless duly noted in the Participant Register.

(e) Subject to the foregoing, the Transaction Documents and any Transactions shall be binding upon and shall inure to the benefit of the parties and their respective successors and assigns. Nothing in the Transaction Documents, express or implied, shall give to any Person, other than the parties to the Transaction Documents and their respective successors, any benefit or any legal or equitable right, power, remedy or claim under the Transaction Documents.

20. GOVERNING LAW

This Agreement shall be governed by the laws of the State of New York without giving effect to the conflict of law principles thereof.

21. NO WAIVERS, ETC.

No express or implied waiver of any Event of Default by either party shall constitute a waiver of any other Event of Default and no exercise of any remedy hereunder by any party shall constitute a waiver of its right to exercise any other remedy hereunder. No modification or waiver of any provision of this Agreement and no consent by any party to a departure herefrom shall be effective unless and until such shall be in writing and duly executed by both of the parties hereto. Without limitation on any of the foregoing, the failure to give a notice pursuant to Section 4(a) or 4(b) hereof will not constitute a waiver of any right to do so at a later date.

22. USE OF EMPLOYEE PLAN ASSETS

(a) If assets of an employee benefit plan subject to any provision of the Employee Retirement Income Security Act of 1974 (“ERISA”) are intended to be used by either party hereto (the “Plan Party”) in a Transaction, the Plan Party shall so notify the other party prior to the Transaction. The Plan Party shall represent in writing to the other party that the Transaction does not constitute a prohibited transaction under ERISA, and the other party may proceed in reliance thereon but shall not be required so to proceed.

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(b) Subject to the last sentence of subparagraph (a) of this Section, any such Transaction shall proceed only if Seller furnishes or has furnished to Buyer its most recent available unaudited statement of its financial condition.

(c) By entering into a Transaction pursuant to this Section, Seller shall be deemed (i) to represent to Buyer that since the date of Seller’s latest such financial statements, there has been no material adverse change in Seller’s financial condition which Seller has not disclosed to Buyer, and (ii) to agree to provide Buyer with future audited and unaudited statements of its financial condition as they are issued, so long as it is a Seller in any outstanding Transaction involving a Plan Party.

23. INTENT

(a) The parties recognize and agree that: (i) each Transaction is a “repurchase agreement” as that term is defined in Section 101(47) of the Bankruptcy Code and a “securities contract” as that term is defined in Section 741(7) of the Bankruptcy Code, (ii) payments under this Agreement are deemed “margin payments” or “settlement payments,” as defined in Section 741 of the Bankruptcy Code, and (iii) the grant of a security interest set forth in Sections 6 and 29(b) hereof and the Guaranty, each of which secures the rights of Buyer hereunder also constitutes a “repurchase agreement” as contemplated by Section 101(47)(A)(v) of the Bankruptcy Code and a “securities contract” as contemplated by Section 741(7)(A)(xi) of the Bankruptcy Code. It is further understood that this Agreement constitutes a “master netting agreement” as defined in Section 101(38A) of the Bankruptcy Code, as amended, with respect to the Transaction so constituting a “repurchase agreement” or “securities contract”.

(b) The parties recognize and agree that each of Buyer and Seller is a “repo participant” as that term is defined in Section 101(46) of the Bankruptcy Code.

(c) The parties recognize and agree that each party (for so long as each is either a “financial institution,” “financial participant,” repo participant, or “master netting participant” or other entity listed in Section 555, 559, 561, 362(b)(6), or 362(b)(7) of the Bankruptcy Code) shall be entitled to the “safe harbor” benefits and protections afforded under the Bankruptcy Code with respect to a “repurchase agreement” and a “securities contract” and a “master netting agreement,” including (x) the rights set forth in Sections 3 and 14 and in Section 555, 559, and 561 of the Bankruptcy Code to liquidate the Purchased Loans and/or accelerate or terminate this Agreement, and (y) the right to offset or net out termination payments, payment amounts or other transfer obligations and otherwise exercise contractual rights as set forth in Sections 362(b)(6), 362(b)(7), 362(b)(27), 362(o), and 546 of the Bankruptcy Code.

(d) Each party hereto hereby further agrees that it shall not challenge the characterization of (i) this Agreement as a “repurchase agreement”, “securities contract” and/or “master netting agreement”, or (ii) each party as a “repo participant” within the meaning of the Bankruptcy Code except insofar as, in the case of a “repurchase agreement”, the term of the Transactions, would render such definition inapplicable.

(e) It is understood that either party’s right to accelerate or terminate this Agreement or to liquidate assets delivered to it in connection with the Transactions hereunder or to exercise

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any other remedies pursuant to Section 14 or 29 hereof is a contractual right to accelerate, terminate or liquidate this Agreement or the Transactions as described in Sections 555 and 559 of the Bankruptcy Code. It is further understood and agreed that either party’s right to cause the termination, liquidation, or acceleration of, or to offset net termination values, payment amounts or other transfer obligations arising under or in connection with, this Agreement or the Transactions hereunder is a contractual right to cause the termination, liquidation, or acceleration of, or to offset net termination values, payment amounts or other transfer obligations arising under or in connection with, this Agreement as described in Section 561 of the Bankruptcy Code.

(f) The parties agree and acknowledge that if a party hereto is an “insured depository institution,” as such term is defined in the Federal Deposit Insurance Act, as amended (“FDIA”), then each of the Transactions hereunder is a “qualified financial contract,” as that term is defined in FDIA and any rules, orders or policy statements thereunder (except insofar as the type of assets subject to the Transactions would render such definition inapplicable).

(g) The parties agree and acknowledge that this Agreement constitutes a “netting contract” as defined in and subject to Title IV of the Federal Deposit Insurance Corporation Improvement Act of 1991 (“FDICIA”) and each payment entitlement and payment obligation under the Transactions hereunder shall constitute a “covered contractual payment entitlement” or “covered contractual payment obligation”, respectively, as defined in and subject to FDICIA (except insofar as one or both of the parties is not a “financial institution” as that term is defined in FDICIA).

(h) In light of the intent set forth above in this Section 23, each Party agrees that, from time to time upon the written request of the other Party (the “Requesting Party”), each Party will execute and deliver any supplements, modifications, addendums or other documents as may be necessary or desirable, in the Requesting Party’s good faith discretion, in order to cause this Agreement and the Transactions contemplated hereby to qualify for, comply with the provisions of, or otherwise satisfy, maintain or preserve the criteria for safe harbor treatment under the Bankruptcy Code for “repurchase agreements”, “securities contracts” and “master netting agreements”; provided, however, that either Party’s failure to request, or either Party’s failure to execute, such supplements, modifications, addendums or other documents does not in any way alter or otherwise change the intention of the parties hereto that this Agreement and the Transactions hereunder constitute “repurchase agreements”, “securities contracts” and/or a “master netting agreement” as such terms are defined in the Bankruptcy Code.

(i) Notwithstanding anything to the contrary in this Agreement, it is the intention of the parties that, for U.S. Federal, state and local income and franchise tax purposes, the Transactions constitute a loan from Buyer to Seller, and that Seller is and, so long as no Event of Default shall have occurred and be continuing, will continue to be, treated as the owner of the Purchased Loans for such purposes. Unless prohibited by applicable law, Seller and Buyer (and its assignees and participants, if any) shall treat the Transactions as described in the preceding sentence for all U.S. Federal, state and local income and franchise tax purposes (including, without limitations, on any and all filings with any U.S. Federal, state or local taxing authority).

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24. DISCLOSURE RELATING TO CERTAIN FEDERAL PROTECTIONS

The parties acknowledge that they have been advised that:

(a) in the case of Transactions in which one of the parties is a broker or dealer registered with the Securities and Exchange Commission (“SEC”) under Section 15 of the Securities Exchange Act of 1934 (“1934 Act”), the Securities Investor Protection Corporation has taken the position that the provisions of the Securities Investor Protection Act of 1970 (“SIPA”) do not protect the other party with respect to any Transaction hereunder;

(b) in the case of Transactions in which one of the parties is a government securities broker or a government securities dealer registered with the SEC under Section 15C of the 1934 Act, SIPA will not provide protection to the other party with respect to any Transaction hereunder; and

(c) in the case of Transactions in which one of the parties is a financial institution, funds held by the financial institution pursuant to a Transaction hereunder are not a deposit and therefore are not insured by the Federal Deposit Insurance Corporation or the National Credit Union Share Insurance Fund, as applicable.

25. CONSENT TO JURISDICTION; WAIVER OF JURY TRIAL

(a) Each party irrevocably and unconditionally (i) submits to the exclusive jurisdiction of any United States Federal or New York State court sitting in Manhattan, and any appellate court from any such court, solely for the purpose of any suit, action or proceeding brought to enforce its obligations under this Agreement or relating in any way to this Agreement or any Transaction under this Agreement and (ii) waives, to the fullest extent it may effectively do so, any defense of an inconvenient forum to the maintenance of such action or proceeding in any such court and any right of jurisdiction on account of its place of residence or domicile.

(b) To the extent that either party has or hereafter may acquire any immunity (sovereign or otherwise) from any legal action, suit or proceeding, from jurisdiction of any court or from set off or any legal process (whether service or notice, attachment prior to judgment, attachment in aid of execution of judgment, execution of judgment or otherwise) with respect to itself or any of its property, such party hereby irrevocably waives and agrees not to plead or claim such immunity in respect of any action brought to enforce its obligations under this Agreement or relating in any way to this Agreement or any Transaction under this Agreement.

(c) The parties hereby irrevocably waive, to the fullest extent it may effectively do so, the defense of an inconvenient forum to the maintenance of such action or proceeding and irrevocably consent to the service of any summons and complaint and any other process by the mailing of copies of such process to them at their respective address specified herein. The parties hereby agree that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Section 25 shall affect the right of Buyer or Seller to serve legal process in any other manner permitted by law or affect the right of Buyer or Seller to bring any action or proceeding against the other party or its property in the courts of other jurisdictions.

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(d) EACH OF THE PARTIES HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT, ANY OTHER TRANSACTION DOCUMENT OR ANY INSTRUMENT OR DOCUMENT DELIVERED HEREUNDER OR THEREUNDER.

26. NO RELIANCE

Each of Buyer and Seller hereby acknowledges, represents and warrants to the other that, in connection with the negotiation of, the entering into, and the performance under, the Transaction Documents and each Transaction thereunder:

(a) It is not relying (for purposes of making any investment decision or otherwise) upon any advice, counsel or representations (whether written or oral) of the other party to the Transaction Documents, other than the representations expressly set forth in the Transaction Documents;

(b) It has consulted with its own legal, regulatory, tax, business, investment, financial and accounting advisors to the extent that it has deemed necessary, and it has made its own investment, hedging and trading decisions (including decisions regarding the suitability of any Transaction) based upon its own judgment and upon any advice from such advisors as it has deemed necessary and not upon any view expressed by the other party;

(c) It is a sophisticated and informed Person that has a full understanding of all the terms, conditions and risks (economic and otherwise) of the Transaction Documents and each Transaction thereunder and is capable of assuming and willing to assume (financially and otherwise) those risks;

(d) It is entering into the Transaction Documents and each Transaction thereunder for the purposes of managing its borrowings or investments or hedging its underlying assets or liabilities and not for purposes of speculation; and

(e) It is not acting as a fiduciary or financial, investment or commodity trading advisor for the other party and has not given the other party (directly or indirectly through any other Person) any assurance, guaranty or representation whatsoever as to the merits (either legal, regulatory, tax, business, investment, financial accounting or otherwise) of the Transaction Documents or any Transaction thereunder.

27. INDEMNITY

Seller hereby agrees to indemnify Buyer and each of its officers, directors, employees and agents (“Indemnified Parties”) from and against any and all actual out-of-pocket liabilities, obligations, losses, damages, penalties, actions, judgments, suits, fees, costs, expenses (including reasonable attorneys fees and disbursements of outside counsel) or disbursements (all of the foregoing, collectively “Indemnified Amounts”) which may at any time (including, without limitation, such time as this Agreement shall no longer be in effect and the Transactions shall have been repaid in full) be imposed on or asserted against any Indemnified Party in any way whatsoever arising out of or in connection with, or relating to, this Agreement or any

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Transactions thereunder or any action taken or omitted to be taken by any Indemnified Party under or in connection with any of the foregoing; provided, that Seller shall not be liable for Indemnified Amounts resulting from the gross negligence or willful misconduct of any Indemnified Party. Without limiting the generality of the foregoing, Seller agrees to hold Buyer harmless from and indemnify Buyer against all Indemnified Amounts with respect to all Purchased Loans relating to or arising out of any violation or alleged violation of any Environmental Law, rule or regulation or any consumer credit laws, including without limitation ERISA, the Truth in Lending Act and/or the Real Estate Settlement Procedures Act, that, in each case, results from anything other than Buyer’s gross negligence or willful misconduct. In any suit, proceeding or action brought by Buyer in connection with any Purchased Loan for any sum owing thereunder, or to enforce any provisions of any Purchased Loan, Seller will save, indemnify and hold Buyer harmless from and against all actual out-of-pocket expense (including reasonable attorneys’ fees of outside counsel), actual out-of-pocket loss or damage suffered by reason of any defense, set-off, counterclaim, recoupment or reduction or liability whatsoever of the account debtor or obligor thereunder, arising out of a breach by Seller of any obligation thereunder or arising out of any other agreement, indebtedness or liability at any time owing to or in favor of such account debtor or obligor or its successors from Seller.

28. DUE DILIGENCE

Seller acknowledges that, at reasonable times and upon reasonable notice to Seller, Buyer has the right to perform continuing due diligence reviews with respect to the Purchased Loans, for purposes of verifying compliance with the representations, warranties and specifications made hereunder, or otherwise, and Seller agrees that upon reasonable prior written notice to Seller, Buyer or its authorized representatives will be permitted during normal business hours to examine, inspect, and make copies and extracts of, the Purchased Loan Files, Servicing Records and any and all documents, records, agreements, instruments or information relating to such Purchased Loans in the possession or under the control of Seller, any other servicer or subservicer of Seller and/or the Custodian. Seller also shall make available to Buyer upon reasonable advance written notice a knowledgeable financial or accounting officer for the purpose of answering financial or accounting questions respecting the Purchased Loan Files and the Purchased Loans. Without limiting the generality of the foregoing, Seller acknowledges that Buyer may enter into Transactions with Seller based solely upon the information provided by Seller to Buyer and the representations, warranties and covenants contained herein, and that Buyer, at its option, has the right at any time to conduct a partial or complete due diligence review on some or all of the Purchased Loans. Buyer may underwrite such Purchased Loans itself or engage a third party underwriter to perform such underwriting. Seller agrees to reasonably cooperate with Buyer and any third party underwriter reasonably acceptable to Seller in connection with such underwriting, including, but not limited to, providing Buyer and any third party underwriter with access to any and all documents, records, agreements, instruments or information relating to such Purchased Loans in the possession, or under the control, of Seller. Seller further agrees that Seller shall reimburse Buyer for any and all actual costs and expenses reasonably incurred by Buyer in connection with Buyer’s activities pursuant to this Section 28 and for Buyer’s actual costs and out-of-pocket expenses incurred in connection with due diligence reviews with respect to Eligible Loans which Seller proposes to make the subject of a Transaction under this Agreement. Notwithstanding the foregoing, (x) Seller’s obligation to reimburse Buyer for Buyer’s out-of-pocket costs and expenses (including legal expenses)

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incurred in connection with Eligible Loans which Seller proposes to make the subject of a Transaction shall not exceed $15,000 with respect to any individual Eligible Loan without Seller’s prior consent and (y) so long as an Event of Default has not occurred and is not continuing, with respect to any due diligence Buyer proposes to perform with respect to any Purchased Loan after the related Purchase Date which would create a reimbursement obligation on the part of Seller, Buyer shall provide to Seller prior written notice of such due diligence activities (including an estimate of the cost) and a reasonable opportunity for Seller to demonstrate to Buyer that such due diligence need not be performed, provided the final determination to perform or not perform such due diligence shall be made by Buyer.

29. SERVICING

(a) Seller and Buyer agree that all Servicing Rights with respect to the Purchased Loans are being transferred hereunder to Buyer on the applicable Purchase Date and such Servicing Rights shall be transferred by Buyer to Seller upon Seller’s payment of the Repurchase Price for such applicable Purchased Loan. Notwithstanding the purchase and sale of the Purchased Loans and Servicing Rights hereby, Seller or, upon request by Seller, Servicer shall be granted a revocable license to exercise the Servicing Rights with respect to the Purchased Loans for the benefit of Buyer and, if Buyer shall exercise its rights to pledge or hypothecate a Purchased Loan prior to the Repurchase Date pursuant to Section 8, Buyer’s assigns (which license shall be deemed automatically revoked upon the occurrence and during the continuance of an Event of Default); provided, however, that the obligations of Seller or Servicer to service the Purchased Loans shall cease, at Seller’s option, upon the payment by Seller to Buyer of the Repurchase Price therefor. Seller shall cause Servicer to service the Purchased Loans pursuant to the Servicing Agreement, in each case, in accordance with Accepted Servicing Practices. Seller shall obtain the written consent of Buyer prior to appointing any third party Servicer for a Purchased Loan or entering into any Servicing Agreement with a Servicer (other than the initial Servicing Agreement with Midland Loan Services as initial Servicer).

(b) Seller agrees that Buyer is the owner of all servicing records, files, documents, records, data bases, computer tapes, copies of computer tapes, proof of insurance coverage, insurance policies, appraisals, other closing documentation, payment history records, and any other records relating to or evidencing the servicing of Purchased Loans (collectively, the “Servicing Records”) so long as the Purchased Loans are subject to this Agreement. Seller grants Buyer a security interest in all servicing fees and rights relating to the Purchased Loans and all Servicing Records to secure the obligation of the Seller or Servicer to service in conformity with this Section and any other obligation of Seller to Buyer. Seller covenants to safeguard such Servicing Records which are in Seller’s possession and to deliver them promptly to Buyer or its designee (including the Custodian) at Buyer’s request.

(c) Upon the occurrence and during the continuance of an Event of Default, Buyer may, in its sole discretion, (i) sell its right to the Purchased Loans on a servicing released basis or (ii) terminate any Seller or Servicer of the Purchased Loans with or without cause, in each case without payment of any termination fee to the extent provided in the Servicing Agreement.

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(d) Seller shall not employ or permit Servicer to employ sub-servicers to service the Purchased Loans without the prior written approval of Buyer in its sole discretion except to the extent permitted in the Servicing Agreement.

(e) The payment of servicing fees under any Servicing Agreement shall be solely the obligation of Seller.

30. MISCELLANEOUS

(a) All rights, remedies and powers of Buyer hereunder and in connection herewith are irrevocable and cumulative, and not alternative or exclusive, and shall be in addition to all other rights, remedies and powers of Buyer whether under law, equity or agreement. In addition to the rights and remedies granted to it in this Agreement, to the extent this Agreement is determined to create a security interest, Buyer shall have all rights and remedies of a secured party under the UCC.

(b) The Transaction Documents may be executed in counterparts, each of which so executed shall be deemed to be an original, but all of such counterparts shall together constitute but one and the same instrument. Signatures delivered by email (in PDF format) shall be considered binding with the same force and effect as original signatures.

(c) The headings in the Transaction Documents are for convenience of reference only and shall not affect the interpretation or construction of the Transaction Documents.

(d) Without limiting the rights and remedies of Buyer under the Transaction Documents, Seller shall pay Buyer’s reasonable actual out-of-pocket costs and expenses, including reasonable fees and expenses of outside accountants, attorneys and advisors, incurred in connection with the preparation, negotiation, execution and consummation of, and any amendment, supplement or modification to, the Transaction Documents and the Transactions thereunder. Seller agrees to pay Buyer promptly all costs and expenses (including reasonable expenses for legal services of every kind) of any subsequent enforcement of any of the provisions hereof, or of the performance by Buyer of any obligations of Seller in respect of the Purchased Loans, or any actual or attempted sale, or any exchange, enforcement, collection, compromise or settlement in respect of any of the Collateral and for the custody, care or preservation of the Collateral (including insurance costs) and defending or asserting rights and claims of Buyer in respect thereof, by litigation or otherwise. In addition, Seller agrees to pay Buyer promptly all reasonable actual out-of-pocket costs and expenses (including reasonable expenses for legal services of outside counsel) reasonably incurred in connection with the maintenance of each Cash Management Account and registering the Collateral in the name of Buyer or its nominee. All such expenses shall be recourse obligations of Seller to Buyer under this Agreement.

(e) Each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement shall be prohibited by or be invalid under such law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement.

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(f) This Agreement contains a final and complete integration of all prior expressions by the parties with respect to the subject matter hereof and thereof and shall constitute the entire agreement among the parties with respect to such subject matter, superseding all prior oral or written understandings.

(g) The parties understand that this Agreement is a legally binding agreement that may affect such party’s rights. Each party represents to the other that it has received legal advice from counsel of its choice regarding the meaning and legal significance of this Agreement and that it is satisfied with its legal counsel and the advice received from it.

(h) Should any provision of this Agreement require judicial interpretation, it is agreed that a court interpreting or construing the same shall not apply a presumption that the terms hereof shall be more strictly construed against any Person by reason of the rule of construction that a document is to be construed more strictly against the Person who itself or through its agent prepared the same, it being agreed that all parties have participated in the preparation of this Agreement.

(i) The parties recognize that each Transaction is a “securities contract” as that term is defined in Section 741 of Title 11 of the United States Code, as amended.

31. TAXES

(a) Any and all payments by or on account of any obligation of Seller under any Transaction Document shall be made without deduction or withholding for any Taxes, except as required by applicable law. If any applicable law requires the deduction or withholding of any Tax from any such payment, then Seller shall make (or cause to be made) such deduction or withholding and shall timely pay (or cause to be timely paid) the full amount deducted or withheld to the relevant Governmental Authority in accordance with applicable law and, if such Tax is an Indemnified Tax, then the sum payable shall be increased by Seller as necessary so that after such deduction or withholding has been made (including such deductions and withholdings applicable to additional sums payable under this Section 31) Buyer receives an amount equal to the sum it would have received had no such deduction or withholding been made.

(b) Seller shall timely pay any Other Taxes of which it is aware to the relevant Governmental Authority in accordance with applicable law.

(c) Seller shall indemnify Buyer, within ten (10) Business Days after demand therefor, for the full amount of any Indemnified Taxes (including Indemnified Taxes imposed or asserted on or attributable to amounts payable under this Section 31) payable or paid by Buyer or required to be withheld or deducted from a payment to Buyer, and any reasonable expenses arising therefrom or with respect thereto, whether or not such Indemnified Taxes were correctly or legally imposed or asserted by the relevant Governmental Authority. A certificate setting forth in reasonable detail calculation of the amount of such payment or liability (together with a certified copy of the return reporting such payment, if applicable or other evidence of such payment reasonably satisfactory to the Seller) delivered to Seller by Buyer shall be conclusive absent manifest error.

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(d) Buyer shall deliver to Seller such documentation as prescribed by applicable law or as reasonably requested by Seller as will enable Seller to determine whether or not payments hereunder or under any other Transaction Document to or for the benefit of Buyer (or any assignee or participant thereof) is subject to tax withholding, backup withholding or information reporting requirements. Without limiting the generality of the foregoing, if Buyer (or an assignee or participant thereof) is entitled to an exemption from or reduction of withholding tax with respect to payments made under any Transaction Document, Buyer shall deliver to Seller, at the time or times prescribed by applicable law and otherwise as reasonably requested by Seller, such properly completed and executed documentation as prescribed by applicable law or as reasonably requested by Seller as will permit such payments to be made without withholding or at a reduced rate of withholding. Without limiting the generality of the foregoing:

(i) On or prior to the date on which the Buyer becomes a Buyer under this Agreement and prior to the entry in the Register of any assignment to a U.S. Person (and from time to time thereafter as required by applicable law or upon the reasonable request of Seller) the Buyer shall deliver to the Seller two (2) executed originals of IRS Form W-9 (or successor forms) certifying that Buyer (and/or such assignee) is exempt from U.S. federal backup withholding tax.

(ii) On or prior to entry in the Register of an assignment to an assignee that is not a U.S. Person (and from time to time thereafter as required by applicable law or upon the reasonable request of Seller) the Buyer shall deliver to the Seller two (2) executed originals of IRS Forms W-8ECI, W-8BEN, W-8IMY (or any successor forms thereof, as applicable) or other applicable form, certificate or document prescribed by the United States Internal Revenue Service certifying as to such person’s entitlement to exemption from, or reduction in the rate of, withholding Taxes.

(e) If a payment made to the Buyer (or any assignee or participant thereof) under any Transaction Document would be subject to U.S. federal withholding Tax imposed by FATCA if such person were to fail to comply with the applicable reporting requirements of FATCA (including those contained in Section 1471(b) or 1472(b) of the Code, as applicable), such person shall deliver to Seller at the time or times prescribed by law and at such time or times reasonably requested by Seller such documentation prescribed by applicable law (including as prescribed by Section 1471(b)(3)(C)(i) of the Code) and such additional documentation reasonably requested by Seller as may be necessary for Seller to comply with its obligations under FATCA and to determine that such person has complied with it’s obligations under FATCA or to determine the amount to deduct and withhold from such payment. Solely for purposes of this clause (c), “FATCA” shall include any amendments made to FATCA after the date of this Agreement

(f) Buyer may not effect an assignment (and may not reflect such assignment in the Register) to an assignee that is not a U.S. Person, unless such assignee delivers a valid U.S. branch withholding certificate on IRS Form W-8IMY (or any successor thereto) evidencing its agreement with the Buyer and the Seller to be treated as a U.S. Person for U.S. federal withholding purposes.

(g) Buyer (and each applicable assignee and participant) agrees that if any form or certification it previously delivered (on behalf of itself or any assignee or any participant thereof)

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expires or becomes obsolete or inaccurate in any respect, it shall update (in the case of an assignee or participant, by obtaining such updated form for such person) such form or certification or promptly notify Seller in writing of its legal inability to do so.

(h) If any party determines, in its sole discretion exercised in good faith, that it has received a refund of any Taxes as to which it has been indemnified pursuant to this Section 31 (including by the payment of additional amounts pursuant to this Section 31), it shall pay to the indemnifying party an amount equal to such refund (but only to the extent of indemnity payments made under this Section 31 with respect to the Taxes giving rise to such refund), net of all out-of-pocket expenses (including Taxes) of such indemnified party and without interest (other than any interest paid by the relevant Governmental Authority with respect to such refund). Such indemnifying party, upon the request of such indemnified party, shall repay to such indemnified party the amount paid over pursuant to this Section 31(h) (plus any penalties, interest or other charges imposed by the relevant Governmental Authority) in the event that such indemnified party is required to repay such refund to such Governmental Authority. Notwithstanding anything to the contrary in this Section 31(h), in no event will the indemnified party be required to pay any amount to an indemnifying party pursuant to this Section 31(h) the payment of which would place the indemnified party in a less favorable net after-Tax position than the indemnified party would have been in if the indemnification payments or additional amounts giving rise to such refund had never been paid. This Section 31(h) shall not be construed to require any indemnified party to make available its Tax returns (or any other information relating to its Taxes that it deems confidential) to the indemnifying party or any other Person.

(i) Each party’s obligations under this Section 31 shall survive any assignment of rights by, or the replacement of, Buyer, the termination of the Transactions and the repayment, satisfaction or discharge of all obligations under any Transaction Document.

32. JOINT AND SEVERAL OBLIGATIONS

(a) Each Seller hereby acknowledges and agrees that (i) each Seller shall be jointly and severally liable to Buyer to the maximum extent permitted by Requirement of Law for all Repurchase Obligations, (ii) the liability of each Seller with respect to the Repurchase Obligations (A) shall be absolute and unconditional to the extent set forth in this Agreement and the other Transaction Documents and shall remain in full force and effect (or be reinstated) until all Repurchase Obligations shall have been paid, performed and/or satisfied, as applicable, in full, and (B) until such payment, performance and/or satisfaction, as applicable, has occurred, shall not be discharged, affected, modified or impaired on the occurrence from time to time of any event, including any of the following, whether or not with notice to or the consent of each Seller, (1) the waiver, compromise, settlement, release, termination or amendment (including any extension or postponement of the time for payment, performance, satisfaction, renewal or refinancing) of any of the Repurchase Obligations (other than a waiver, compromise, settlement, release or termination in full of the Repurchase Obligations), (2) the failure to give notice to each Seller of the occurrence of an Event of Default, (3) the release, substitution or exchange by Buyer of any Purchased Loan (whether with or without consideration) or the acceptance by

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Buyer of any additional collateral or the availability or claimed availability of any other collateral or source of repayment or any non-perfection or other impairment of collateral, (4) the release of any Person primarily or secondarily liable for all or any part of the Repurchase Obligations, whether by Buyer or in connection with any Act of Insolvency affecting any Seller or any other Person who, or any of whose property, shall at the time in question be obligated in respect of the Repurchase Obligations or any part thereof, or (5) to the extent permitted by Requirement of Law, any other event, occurrence, action or circumstance that would, in the absence of this Section 32, result in the release or discharge of any or all Sellers from the performance or observance of any Repurchase Obligation, (iii) Buyer shall not be required first to initiate any suit or to exhaust its remedies against any Seller or any other Person to become liable, or against any of the Purchased Loans, in order to enforce the Transaction Documents and each Seller expressly agrees that, notwithstanding the occurrence of any of the foregoing, each Seller shall be and remain directly and primarily liable for all sums due under any of the Transaction Documents, (iv) when making any demand hereunder against any Seller, Buyer may, but shall be under no obligation to, make a similar demand on any other Seller, and any failure by Buyer to make any such demand or to collect any payments from any other Seller, or any release of any such other Seller shall not relieve any Seller in a respect of which a demand or collection is not made or Sellers not so released of their obligations or liabilities hereunder, and shall not impair or affect the rights and remedies, express or implied, or as a matter of law, of Buyer against Sellers, and (v) on disposition by Buyer of any property encumbered by any Purchased Loans, each Seller shall be and shall remain jointly and severally liable for any deficiency to the extent set forth in this Agreement and the other Transaction Documents.

(b) Buyer hereby acknowledges and agrees that the provisions of this Section 32 and the obligation of each Seller to be jointly and severally liable for the Repurchase Obligations do not and shall not violate any of the provisions of Section 13 of this Agreement or otherwise cause any Seller to no longer be a Special Purpose Entity.

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IN WITNESS WHEREOF, the parties have executed this Agreement as of the day first written above.

BUYER:
CITIBANK, N.A.
By:	/s/ Richard B. Schlenger
Name:	Richard B. Schlenger
Title:	Authorized Signatory

[SIGNATURES CONTINUE ON NEXT PAGE]

Signature Page to Amended and Restated Master Repurchase Agreement

SELLER:
PARLEX 2 FINANCE, LLC,
a Delaware limited liability company
By:	/s/ Douglas Armer
Name:	Douglas Armer
Title:	Managing Director, Head of Capital Markets and Treasurer
PARLEX 2A FINCO, LLC,
a Delaware limited liability company
By:	/s/ Douglas Armer
Name:	Douglas Armer
Title:	Managing Director, Head of Capital Markets and Treasurer

Signature Page to Amended and Restated Master Repurchase Agreement

ANNEXES AND EXHIBITS

ANNEX I	Names and Addresses for Communications between Parties and Wire Instructions
SCHEDULE I	Prohibited Transferees
EXHIBIT I	Form of Confirmation
EXHIBIT II	Authorized Representatives of Seller
EXHIBIT III	Form of Custodial Delivery
EXHIBIT IV	Eligible Loan Due Diligence Checklist
EXHIBIT V	Form of Power of Attorney
EXHIBIT VI	Representations and Warranties Regarding Each Individual Purchased Loan
EXHIBIT VII	Collateral Tape
EXHIBIT VIII	Form of Transaction Request
EXHIBIT IX	Form of Request for Margin Excess
EXHIBIT X EXHIBIT XI EXHIBIT XII	Form of Irrevocable Direction Letter Form of Joinder Agreement Form of Facility Asset Chart

ANNEX I

Names and Addresses for Communications Between Parties and Wire Instructions

Buyer:

Citibank, N.A.

388 Greenwich Street

New York, New York 10013

Attention: Richard Schlenger

Tel: (212) 816-7806

Email: Richard.Schlenger@Citi.com

and

Sidley Austin LLP

787 Seventh Avenue

New York, New York 10019

Attention: Brian Krisberg, Esq.

Tel: (212) 839-8735

Email: Brian.Krisberg@Sidley.com

Seller:

Parlex 2 Finance, LLC

c/o Blackstone Mortgage Trust, Inc.

345 Park Avenue

New York, NY 10154

Attention: Douglas Armer

Tel: (212) 583-5000

Email: BXMTCitiRepo@blackstone.com

Parlex 2A Finco, LLC

c/o Blackstone Mortgage Trust, Inc.

345 Park Avenue

New York, NY 10154

Attention: Douglas Armer

Tel: (212) 583-5000

Email: BXMTCitiRepo@blackstone.com

With copies to:

Ropes & Gray LLP

1211 Avenue of the Americas

New York, New York 10036

Attention: David C. Djaha

Tel: (212) 841-0489

Email: david.djaha@ropesgray.com

Payments to Buyer: Payments to Buyer under this Agreement shall be made by transfer, via wire transfer, to the following account of Buyer: Citibank, New York, ABA #: 021000089, Account #: 36855692, Account Name: Citi, NA, Ref: Loan No. BXMT, Credit to: Mortgage Ops.

Payments to Seller: Payments to Seller under this Agreement shall be made by transfer, via wire transfer, to the following account of Seller: Bank of America, ABA #: 026009593, Account #: 483024227101, Account Name: “Blackstone Mortgage Trust, Inc.”.

SCHEDULE I

Prohibited Transferees

All Affiliates, successors and assigns of the entities listed on this Schedule I and such other Persons indicated by Seller from time to time and approved by Buyer, such approval not to be unreasonably withheld, shall be Prohibited Transferees, as defined and used in the Agreement.

Angelo, Gordon & Co., L.P.	LoanCore Capital, LLC
Annaly Capital Management, Inc.	Lone Star U.S. Acquisitions, LLC
Apollo Commercial Real Estate Finance, Inc.	Macquarie Group Limited
Arbor Realty Trust Inc.	Mesa West Capital, LLC
Ares Commercial Real Estate Corporation	NCH Capital Inc.
Brookfield Investment Management Inc.	Newcastle Investment Corp.
Cantor Fitzgerald & Co.	NorthStar Realty Finance Corp.
CapitalSource Inc.	OZ Management LP
Children’s Investment Fund LP	RAIT Financial Trust
Colony Financial, Inc.	Redwood Trust Inc.
CreXus Investment Corp.	Rialto Capital Management, LLC
Fortress Credit Corp.	SL Green Realty Corp.
Guggenheim Partners, LLC	Square Mile Capital Management, LLC
H/2 Credit Manager LP	Starwood Capital Group
iStar Financial Inc.	Starwood Property Trust, Inc.
KKR & Co. L.P.	TPG Capital Management, L.P.
Ladder Capital Securities LLC	Winthrop Capital Management, LLC

EXHIBIT I

CONFIRMATION STATEMENT

Ladies and Gentlemen:

Citibank, N.A., is pleased to deliver our written CONFIRMATION of our agreement to enter into the Transaction pursuant to which Citibank, N.A. shall purchase from you, [                    ], LLC (“Seller”), the Purchased Loans identified in the Amended and Restated Master Repurchase Agreement, dated as of [                    ], 2014 (the “Agreement”), between Citibank, N.A. (“Buyer”) and Parlex 2 Finance, LLC, Parlex 2A Finco, LLC and any Person that joins as a Seller (as such term is defined in the Agreement) under the Agreement from time to time, as follows below and on the attached Schedule 1. Capitalized terms used herein without definition have the meanings given in the Agreement.

Purchased Loan:	As identified on attached Schedule 1
Aggregate Principal Amount of Purchased Loan:	As identified on attached Schedule 1
Governing Agreements:	As identified on attached Schedule 1
Purchase Date:	, 20
Repurchase Date:	The earlier of (x) the Facility Expiration Date and (y) the maturity date of the Purchased Loan, not extended (i.e. [            , 20    ])
Purchase Price Percentage:	[    %]
Maximum Purchase Price Percentage:	[    %]
Pricing Rate:	one month LIBOR plus [    %]
Margin Percentage:	[    %]
LTV (Purchase Price):	[    %]
Maximum LTV (Purchase Price):	[    %]
LTV (Aggregate Loan UPB):	[    %]
LTV (Loan UPB):	[    %]
Purchase Price:	[$        ]
Maximum Purchase Price as of Purchase Date:	[$        ]
Funding Fee:	[$        ]
Future Funding Conditions Precedent:	[                    ]
Type of Funding:	[Table Funding/Non-Table Funding]

I-1

[Wiring Instructions]1	[ABA No:
	Credit:
	Acct. No:
	Reference:                     ]

¹  If different than the standard wiring instructions on Annex I to the Master Repurchase Agreement. In such instance, Confirmation requires signature of two officers of Seller.

I-2

Name and address for communications:	Buyer:	Citibank, N.A. 388 Greenwich Street New York, New York 10013 Attention: Richard Schlenger Tel: (212) 816-7806 Email: Richard.Schlenger@Citi.com
	Seller:	[                                         ], LLC c/o Blackstone Mortgage Trust, Inc. 345 Park Avenue New York, NY 10154 Attention: Douglas Armer Tel: (212) 583-5000 Email: BXMTCitiRepo@blackstone.com

I-3

CITIBANK, N.A.

By:

Name:

Title:

By:

Name:

Title:

AGREED AND ACKNOWLEDGED:

[                                         ], LLC,

a Delaware limited liability company

By:

Name:

Title:

[By:

Name:

Title:]²

²  Second signature of Seller is only needed if Seller is directing Buyer to fund to an account other than Seller’s account specified in Annex I to the Master Repurchase Agreement.

I-4

Schedule 1 to Confirmation Statement

Purchased Loan:

Aggregate Principal Amount:

Governing Agreements:

I-5

EXHIBIT II

AUTHORIZED REPRESENTATIVES OF SELLER

Name	Specimen Signature
Douglas N. Armer
Randall S. Rothschild
Thomas C. Ruffing
Michael B. Nash
Stephen D. Plavin

II-1

EXHIBIT III

FORM OF CUSTODIAL DELIVERY

On this      day of             , 20    , [                                        ], LLC (“Seller”), pursuant to (i) that certain Custodial Agreement, dated as of                  , 201[    ] (as amended, modified or supplemented from time to time, the “Custodial Agreement”), among Seller, U.S. Bank National Association, as Custodian, and Citibank, N.A. (“Buyer”) and (ii) that certain Amended and Restated Master Repurchase Agreement, dated as of [            ], 2014 (as amended, modified or supplemented from time to time, the “Repurchase Agreement”), between Seller, [Parlex 2 Finance, LLC,] [Parlex 2A Finco, LLC], and any Person that joins as a Seller (as such term is defined in the Agreement) under the Repurchase Agreement from time to time, and Buyer, does hereby deliver the documents comprising the Purchased Loan File(s) (and listed on Exhibit B hereto with respect to the Purchased Loan(s) identified in Exhibit A hereto) to (a) the Bailee, for Bailee to hold and deliver to Custodian as set forth therein, and (b) the Custodian (through the Bailee aforesaid pursuant to Section 7(b) of the Repurchase Agreement and that certain Attorney’s Bailee Letter between Bailee and Seller dated as of June 12, 2013 the “Attorney’s Bailee Letter”). Seller hereby instructs Bailee to comply with the terms of the Attorney’s Bailee Letter, and hereby instructs Custodian to comply with the Custodial Agreement, in each case, holding the Purchased Loan File(s) for the benefit of Buyer.

With respect to the Purchased Loan File(s) delivered herewith, for purposes of issuing its Trust Receipt, Custodian shall review the Purchased Loan File to confirm receipt of each of the documents identified on Exhibit B hereto.

Capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Custodial Agreement.

[Remainder of this page intentionally left blank.]

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IN WITNESS WHEREOF, Seller has caused this Custodial Delivery Certificate to be executed and delivered by its duly authorized officer as of the day and year first above written.

[                                         ], LLC,

a Delaware limited liability company

By:

Name:

Title:

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EXHIBIT IV

ELIGIBLE LOAN DUE DILIGENCE CHECKLIST

General Information

Asset Summary Report

Site Inspection Report

Maps and Photos

Borrower/Sponsor Information

Credit Reports

Financial Statements & Tax Returns

Borrower Structure or Org Chart

Bankruptcy and Foreclosure History

Property Information

Historical Operating Statements

Rent Rolls

Budget

Insurance Review

Retail Sales Figures

Market Survey

Leasing Information

Stacking Plan

Major Leases

Tenant Estoppels

Standard Lease Forms

SNDA’s

Third Party Reports

Appraisals

Environmental Site Assessments

Engineering Reports

Seismic Reports

Other Information

Hotel Franchise Compliance Reports

Hotel Franchise Agreement

Hotel Franchise Comfort Letters

Ground Lease

Management Contract

Documentation

Purchase and Sale Agreement

Closing Statement

Legal Binder

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EXHIBIT V

FORM OF POWER OF ATTORNEY

Know All Men by These Presents, that [                                        ], LLC (“Seller”), does hereby appoint Citibank, N.A. (“Buyer”), its attorney-in-fact to act in Seller’s name, place and stead in any way which Seller could do during the occurrence and continuance of an Event of Default and, subject to the following sentence, during the occurrence and continuance of a monetary Default or material non-monetary Default, with respect to (i) the completion of the endorsements of the Mortgage Notes and the Assignments of Mortgages, (ii) the recordation of the Assignments of Mortgages, and (iii) the enforcement of Seller’s rights under the Purchased Loans purchased by Buyer pursuant to the Amended and Restated Master Repurchase Agreement dated as of [            ], 2014 (the “Repurchase Agreement”), between Buyer, Seller, [Parlex 2 Finance, LLC,] [Parlex 2A Finco, LLC], and any Person that joins as a Seller under the Repurchase Agreement from time to time, and to take such other steps as may be necessary or desirable to enforce Buyer’s rights against such Purchased Loans, the related Purchased Loan Files and the Servicing Records to the extent that Seller is permitted by law to act through an agent. If a monetary Default or a material non-monetary Default has occurred and is continuing and Buyer has requested in writing that Seller take or cause to be taken any action that Buyer deems reasonably necessary to preserve Buyer’s ability to enforce upon the Purchased Loans as and when permitted pursuant to Section 14(b) of the Repurchase Agreement (which writing shall include a statement that Buyer will exercise its power of attorney if Seller fails to take or cause to be taken such action requested by Buyer), and Seller has not complied with any such request promptly following receipt thereof, then Buyer may exercise its power of attorney during the existence and continuation of any such monetary Default or material non-monetary Default, as the case may be, as Buyer deems reasonably necessary to preserve Buyer’s ability to enforce upon the Purchased Loans as and when permitted pursuant to Section 14(b) of the Repurchase Agreement.

Capitalized terms used herein and not otherwise defined shall have the meanings set forth in the Repurchase Agreement.

TO INDUCE ANY THIRD PARTY TO ACT HEREUNDER, SELLER HEREBY AGREES THAT ANY THIRD PARTY RECEIVING A DULY EXECUTED COPY OF FACSIMILE OF THIS INSTRUMENT MAY ACT HEREUNDER, AND THAT REVOCATION OR TERMINATION HEREOF SHALL BE INEFFECTIVE AS TO SUCH THIRD PARTY UNLESS AND UNTIL ACTUAL NOTICE OR KNOWLEDGE OR SUCH REVOCATION OR TERMINATION SHALL HAVE BEEN RECEIVED BY SUCH THIRD PARTY, AND SELLER ON ITS OWN BEHALF AND ON BEHALF OF SELLER’S ASSIGNS, HEREBY AGREES TO HOLD HARMLESS ANY SUCH THIRD PARTY FROM AND AGAINST ANY AND ALL CLAIMS THAT MAY ARISE AGAINST SUCH THIRD PARTY BY REASON OF SUCH THIRD PARTY HAVING RELIED ON THE PROVISIONS OF THIS INSTRUMENT.

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IN WITNESS WHEREOF Seller has caused this Power of Attorney to be executed as a deed this      day of             , 2013.

[                                         ],

a Delaware limited liability company

By:

Name:

Title:

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EXHIBIT VI

REPRESENTATIONS AND WARRANTIES

REGARDING EACH INDIVIDUAL PURCHASED LOAN

(1) Whole Loan; Ownership of Purchased Loans. Except with respect to a Purchased Loan that is part of a Whole Loan, each Purchased Loan is a whole loan and not a participation interest in a Purchased Loan. Each Purchased Loan that is part of a Whole Loan is a senior portion of a whole mortgage loan evidenced by a senior note. At the time of the sale, transfer and assignment to Buyer, no Mortgage Note or Mortgage was subject to any assignment, participation or pledge, and the Seller had good title to, and was the sole owner of, each Purchased Loan free and clear of any and all liens, charges, pledges, encumbrances, participations, any other ownership interests on, in or to such Purchased Loan other than any servicing rights appointment or similar agreement and rights of the holder of a related “B note” in an “A/B” structure in a commercial real estate loan (a “Junior Interest”). Seller has full right and authority to sell, assign and transfer each Purchased Loan, and the assignment to Buyer constitutes a legal, valid and binding assignment of such Purchased Loan free and clear of any and all liens, pledges, charges or security interests of any nature encumbering such Purchased Loan other than the rights of the holder of a related Junior Interest.

(2) Loan Document Status. Each related Mortgage Note, Mortgage, Assignment of Leases (if a separate instrument), guaranty and other agreement executed by or on behalf of the related Mortgagor, guarantor or other obligor in connection with such Purchased Loan is the legal, valid and binding obligation of the related Mortgagor, guarantor or other obligor (subject to any non-recourse provisions contained in any of the foregoing agreements and any applicable state anti-deficiency or market value limit deficiency legislation), as applicable, and is enforceable in accordance with its terms, except (i) as such enforcement may be limited by (a) bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or other similar laws affecting the enforcement of creditors’ rights generally and (b) general principles of equity (regardless of whether such enforcement is considered in a proceeding in equity or at law) and (ii) that certain provisions in such Purchased Loan Documents (including, without limitation, provisions requiring the payment of default interest, late fees or prepayment/yield maintenance fees, charges and/or premiums) are, or may be, further limited or rendered unenforceable by or under applicable law, but (subject to the limitations set forth in clause (i) above) such limitations or unenforceability will not render such Purchased Loan Documents invalid as a whole or materially interfere with the Mortgagee’s realization of the principal benefits and/or security provided thereby (clauses (i) and (ii) collectively, the “Standard Qualifications”).

Except as set forth in the immediately preceding sentence, there is no valid offset, defense, counterclaim or right of rescission available to the related Mortgagor with respect to any of the related Mortgage Notes, Mortgages or other Purchased Loan Documents, including, without limitation, any such valid offset, defense, counterclaim or right based on intentional fraud by Seller in connection with the origination of the Purchased Loan, that would deny the Mortgagee the principal benefits intended to be provided by the Mortgage Note, Mortgage or other Purchased Loan Documents.

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(3) Mortgage Provisions. The Purchased Loan Documents for each Purchased Loan contain provisions that render the rights and remedies of the holder thereof adequate for the practical realization against the Mortgaged Property of the principal benefits of the security intended to be provided thereby, including realization by judicial or, if applicable, nonjudicial foreclosure subject to the limitations set forth in the Standard Qualifications.

(4) Mortgage Status; Waivers and Modifications. Since origination and except by written instruments set forth in the related Purchased Loan File (a) the material terms of such Mortgage, Mortgage Note, Purchased Loan guaranty, and related Purchased Loan Documents have not been waived, impaired, modified, altered, satisfied, canceled, subordinated or rescinded in any respect which materially interferes with the security intended to be provided by such Mortgage; (b) no related Mortgaged Property or any portion thereof has been released from the lien of the related Mortgage in any manner which materially interferes with the security intended to be provided by such Mortgage or the use or operation of the remaining portion of such Mortgaged Property; and (c) neither the related Mortgagor nor the related guarantor has been released from its material obligations under the Purchased Loan.

(5) Lien; Valid Assignment. Subject to the Standard Qualifications, each assignment of Mortgage and assignment of Assignment of Leases to the Mortgagee constitutes a legal, valid and binding assignment to the Mortgagee. Each related Mortgage and Assignment of Leases is freely assignable without the consent of the related Mortgagor. Each related Mortgage is a legal, valid and enforceable first lien on the related Mortgagor’s fee (or if identified in the Due Diligence Package, leasehold) interest in the Mortgaged Property in the principal amount of such Purchased Loan or allocated loan amount (subject only to Permitted Encumbrances (as defined below) and the exceptions to paragraph 6 (“Permitted Liens; Title Insurance”) of this Exhibit VI set forth in the related report delivered by Seller to Buyer of any exceptions to the representations and warranties set forth in this Exhibit VI (each such exception, a “Title Exception”)), except as the enforcement thereof may be limited by the Standard Qualifications. Except as otherwise set forth in the Title Policy (as hereinafter defined) relating to the Purchased Loan, such Mortgaged Property (subject to and excepting Permitted Encumbrances and Title Exceptions) as of origination was, and currently is, free and clear of any recorded mechanics’ liens, recorded materialmen’s liens and other recorded encumbrances which are prior to or equal with the lien of the related Mortgage, except those which are bonded over, escrowed for or insured against by a lender’s title insurance policy (as described below), and, subject to the rights of tenants (as tenants only) (subject to and excepting Permitted Encumbrances), no rights exist which under law could give rise to any such lien or encumbrance that would be prior to or equal with the lien of the related Mortgage, except those which are bonded over, escrowed for or insured against by a lender’s title insurance policy (as described below). Notwithstanding anything herein to the contrary, no representation is made as to the perfection of any security interest in rents or other personal property to the extent that possession or control of such items or actions other than the filing of Uniform Commercial Code financing statements is required in order to effect such perfection.

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(6) Permitted Liens; Title Insurance. Each Mortgaged Property securing a Purchased Loan is covered by an American Land Title Association loan title insurance policy or a comparable form of loan title insurance policy approved for use in the applicable jurisdiction (or, if such policy is yet to be issued, by a pro forma policy, a preliminary title policy with escrow instructions or a “marked up” commitment, in each case binding on the title insurer) (the “Title Policy”) in the original principal amount of such Purchased Loan (or with respect to a Purchased Loan secured by multiple properties, an amount equal to at least the allocated loan amount with respect to the Title Policy for each such property) after all advances of principal (including any advances held in escrow or reserves), that insures for the benefit of the owner of the indebtedness secured by the Mortgage, the first priority lien of the Mortgage, which lien is subject only to (a) the lien of current real property taxes, water charges, sewer rents and assessments due and payable but not yet delinquent; (b) covenants, conditions and restrictions, rights of way, easements and other matters of public record; (c) the exceptions (general and specific) and exclusions set forth in such Title Policy; (d) other matters to which like properties are commonly subject; (e) the rights of tenants (as tenants only) under leases (including subleases) pertaining to the related Mortgaged Property and condominium declarations; (f) if the related Purchased Loan is part of a Whole Loan, the rights of the holder of the related Junior Interest; and (g) if the related Purchased Loan is cross-collateralized and cross-defaulted with one or more mortgage loans, the lien of the Mortgage for another mortgage loan contained in the same cross-collateralized and cross-defaulted group of mortgage loans; provided that none of which items (a) through (f), individually or in the aggregate, materially and adversely interferes with the value or current use of the Mortgaged Property or the security intended to be provided by such Mortgage or the Mortgagor’s ability to pay its obligations when they become due (collectively, the “Permitted Encumbrances”). Except as contemplated by clause (g) of the preceding sentence, none of the Permitted Encumbrances are mortgage liens that are senior to or coordinate and co-equal with the lien of the related Mortgage. Such Title Policy (or, if it has yet to be issued, the coverage to be provided thereby) is in full force and effect, all premiums thereon have been paid and no claims have been made by the Seller thereunder and no claims have been paid thereunder. Neither the Seller, nor to the Seller’s Actual Knowledge, any other holder of the Purchased Loan, has done, by act or omission, anything that would materially impair the coverage under such Title Policy.

(7) Junior Liens. It being understood that B notes secured by the same Mortgage as a Purchased Loan are not subordinate mortgages or junior liens, except for any Junior Interests and Purchased Loan that is cross-collateralized and cross-defaulted with another Purchased Loan, there are, as of origination, and to Seller’s Actual Knowledge, no subordinate mortgages or junior liens securing the payment of money encumbering the related Mortgaged Property (other than Permitted Encumbrances and the Title Exceptions, taxes and assessments, mechanics and materialmens liens (which are the subject of the representation in paragraph (5) above), and equipment and other personal property financing). Except as set forth in the Due Diligence Package, the Seller has no Actual Knowledge of any mezzanine debt secured directly by interests in the related Mortgagor.

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(8) Assignment of Leases and Rents. There exists as part of the related Purchased Loan File an Assignment of Leases (either as a separate instrument or incorporated into the related Mortgage). Subject to the Permitted Encumbrances and the Title Exceptions, each related Assignment of Leases creates a valid first-priority collateral assignment of, or a valid first-priority lien or security interest in, rents and certain rights under the related lease or leases, subject only to a license granted to the related Mortgagor to exercise certain rights and to perform certain obligations of the lessor under such lease or leases, including the right to operate the related leased property, except as the enforcement thereof may be limited by the Standard Qualifications. The related Mortgage or related Assignment of Leases, subject to applicable law and the Standard Qualifications, provides that, upon an event of default under the Purchased Loan, a receiver is permitted to be appointed for the collection of rents or for the related Mortgagee to enter into possession to collect the rents or for rents to be paid directly to the Mortgagee.

(9) UCC Filings. If the related Mortgaged Property is operated as a hospitality property, the Seller has filed and/or recorded or caused to be filed and/or recorded (or, if not filed and/or recorded, have been submitted in proper form for filing and/or recording), UCC financing statements in the appropriate public filing and/or recording offices necessary at the time of the origination of the Purchased Loan to perfect a valid security interest in all items of physical personal property reasonably necessary to operate such Mortgaged Property owned by such Mortgagor and located on the related Mortgaged Property (other than any non-material personal property, any personal property subject to a purchase money security interest, a sale and leaseback financing arrangement as permitted under the terms of the related Purchased Loan Documents or any other personal property leases applicable to such personal property), to the extent perfection may be effected pursuant to applicable law by recording or filing, as the case may be. Subject to the Standard Qualifications, each related Mortgage (or equivalent document) creates a valid and enforceable lien and security interest on the items of personalty described above. No representation is made as to the perfection of any security interest in rents or other personal property to the extent that possession or control of such items or actions other than the filing of UCC financing statements are required in order to effect such perfection.

(10) Condition of Property. Seller or the originator of the Purchased Loan inspected or caused to be inspected each related Mortgaged Property within six months of origination of the Purchased Loan and within thirteen months of the Purchase Date.

An engineering report or property condition assessment was prepared in connection with the origination of each Purchased Loan no more than thirteen months prior to the Purchase Date. To the Seller’s Actual Knowledge, based solely upon due diligence customarily performed in connection with the origination of comparable mortgage loans, and except as disclosed on any engineering report or property condition assessment delivered to Buyer, as of the Purchase Date, each related Mortgaged Property was free and clear of any material damage (other than (i) deferred maintenance for which escrows

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were established at origination and (ii) any damage fully covered by insurance) that would affect materially and adversely the use or value of such Mortgaged Property as security for the Purchased Loan.

(11) Taxes and Assessments. All taxes, governmental assessments and other outstanding governmental charges (including, without limitation, water and sewage charges), or installments thereof, which could be a lien on the related Mortgaged Property that would be of equal or superior priority to the lien of the Mortgage and that prior to the Purchase Date have become delinquent in respect of each related Mortgaged Property, to Seller’s Actual Knowledge, have been paid, or an escrow of funds has been established in an amount sufficient to cover such payments and reasonably estimated interest and penalties, if any, thereon. For purposes of this representation and warranty, real estate taxes and governmental assessments and other outstanding governmental charges and installments thereof shall not be considered delinquent until the earlier of (a) the date on which interest and/or penalties would first be payable thereon and (b) the date on which enforcement action is entitled to be taken by the related taxing authority.

(12) Condemnation. To the Seller’s Actual Knowledge, as of the Purchase Date, Seller has not received written notice from any government agency or body of any proceeding pending or threatened, for the total or partial condemnation of such Mortgaged Property that would have a material adverse effect on the value, use or operation of the Mortgaged Property.

(13) Actions Concerning Purchased Loan. To the Seller’s Actual Knowledge as of the Purchase Date, there was no pending or filed action, suit or proceeding, arbitration or governmental investigation involving any Mortgagor, guarantor, or Mortgagor’s interest in the Mortgaged Property, an adverse outcome of which would reasonably be expected to materially and adversely affect (a) such Mortgagor’s title to the Mortgaged Property, (b) the validity or enforceability of the Mortgage, (c) such Mortgagor’s ability to perform under the related Purchased Loan, (d) such guarantor’s ability to perform under the related guaranty, (e) the principal benefit of the security intended to be provided by the Purchased Loan Documents or (f) the current principal use of the Mortgaged Property.

(14) Escrow Deposits. All escrow deposits and payments required to be escrowed with Mortgagee pursuant to each Purchased Loan are in the possession, or under the control, of the Seller or its servicer, and there are no deficiencies (subject to any applicable grace or cure periods) in connection therewith, and all such escrows and deposits (or the right thereto) that are required to be escrowed with Mortgagee under the related Purchased Loan Documents are being conveyed by the Seller to Buyer or its servicer.

(15) No Holdbacks. Except as for Purchased Loans identified to Buyer in connection with the subject transaction as having future advances, the principal amount of the Purchased Loan stated in the Due Diligence Package has been fully disbursed as of the Purchase Date and there is no requirement for future advances thereunder (except in those cases where the full amount of the Purchased Loan has been disbursed but a portion thereof is being held in escrow or reserve accounts pending the satisfaction of certain conditions relating to leasing, repairs or other matters with respect to the related Mortgaged Property, the Mortgagor or other considerations determined by Seller to merit such holdback).

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(16) Insurance. Each related Mortgaged Property is, and is required pursuant to the related Mortgage to be, insured by a property insurance policy providing coverage for loss in accordance with coverage found under a “special cause of loss form” or “all risk form” that includes replacement cost valuation issued by an insurer meeting the requirements of the related Purchased Loan Documents and having a claims-paying or financial strength rating of at least “A-:VIII” from A.M. Best Company or “A3” (or the equivalent) from Moody’s Investors Service, Inc. or “A-” from Standard & Poor’s Ratings Service (collectively, the “Insurance Rating Requirements”), in an amount (subject to a customary deductible) not less than the lesser of (1) the outstanding principal balance of the Purchased Loan and (2) the full insurable value on a replacement cost basis of the improvements, furniture, furnishings, fixtures and equipment owned by the Mortgagor and included in the Mortgaged Property (with no deduction for physical depreciation), but, in any event, not less than the amount necessary or containing such endorsements as are necessary to avoid the operation of any coinsurance provisions with respect to the related Mortgaged Property.

Each related Mortgaged Property is also covered, and required to be covered pursuant to the related Purchased Loan Documents, by business interruption or rental loss insurance which (subject to a customary deductible) covers a period of not less than 12 months (or with respect to each Purchased Loan on a single asset with a principal balance of $50 million or more, 18 months).

If any material part of the improvements, exclusive of a parking lot, located on a Mortgaged Property is in an area identified in the Federal Register by the Federal Emergency Management Agency as “a Special Flood Hazard Area”, the related Mortgagor is required to maintain insurance in the maximum amount available under the National Flood Insurance Program.

If the Mortgaged Property is located within 25 miles of the coast of the Gulf of Mexico or the Atlantic coast of Florida, Georgia, South Carolina or North Carolina, the related Mortgagor is required to maintain coverage for windstorm and/or windstorm related perils and/or “named storms” issued by an insurer meeting the Insurance Rating Requirements or endorsement covering damage from windstorm and/or windstorm related perils and/or named storms.

The Mortgaged Property is covered, and required to be covered pursuant to the related Purchased Loan Documents, by a commercial general liability insurance policy issued by an insurer meeting the Insurance Rating Requirements including coverage for property damage, contractual damage and personal injury (including bodily injury and death) in amounts as are generally required by prudent institutional commercial mortgage lenders, and in any event not less than $1 million per occurrence and $2 million in the aggregate.

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An architectural or engineering consultant has performed an analysis of each of the Mortgaged Properties located in seismic zones 3 or 4 in order to evaluate the structural and seismic condition of such property, for the sole purpose of assessing the scenario expected limit (“SEL”) for the Mortgaged Property in the event of an earthquake. In such instance, the SEL was based on a 475-year return period, an exposure period of 50 years and a 10% probability of exceedance. If the resulting report concluded that the SEL would exceed 20% of the amount of the replacement costs of the improvements, earthquake insurance on such Mortgaged Property was obtained by an insurer rated at least “A:VIII” by A.M. Best Company or “A3” (or the equivalent) from Moody’s Investors Service, Inc. or “A-” by Standard & Poor’s Ratings Service in an amount not less than 100% of the SEL.

The related Purchased Loan Documents require insurance proceeds in respect of a property loss to be applied either (a) to the repair or restoration of all or part of the related Mortgaged Property, with respect to all property losses in excess of 5% of the then outstanding principal amount of the related Purchased Loan, the Mortgagee (or a trustee appointed by it) having the right to hold and disburse such proceeds as the repair or restoration progresses, or (b) to the payment of the outstanding principal balance of such Purchased Loan together with any accrued interest thereon.

All premiums on all insurance policies referred to in this section due and payable as of the Purchase Date have been paid, and such insurance policies name the Mortgagee under the Purchased Loan and its successors and assigns as a loss payee under a mortgagee endorsement clause or, in the case of the general liability insurance policy, as named or additional insured. Such insurance policies will inure to the benefit of the Buyer. Each related Purchased Loan obligates the related Mortgagor to maintain or cause to be maintained all such insurance and, at such Mortgagor’s failure to do so, authorizes the Mortgagee to maintain such insurance at the Mortgagor’s reasonable cost and expense and to charge such Mortgagor for related premiums. All such insurance policies (other than commercial liability policies) require prior notice as provided in the Mortgage Loan Documents to the lender of termination or cancellation (or such lesser period, as may be required by applicable law) arising for any reason other than non-payment of a premium and no such notice has been received by Seller.

(17) Access; Utilities; Separate Tax Lots. To the Seller’s Actual Knowledge, based solely upon Seller’s review of the related Title Policy and current surveys obtained in connection with origination, each Mortgaged Property (a) is located on or adjacent to a public road and has direct legal access to such road, or has access via an irrevocable easement or irrevocable right of way permitting ingress and egress to/from a public road, (b) is served by or has uninhibited access rights to public or private water and sewer (or well and septic) and all required utilities, all of which are appropriate for the current use of the Mortgaged Property, and (c) constitutes one or more separate tax parcels which do not include any property which is not part of the Mortgaged Property or is subject to an endorsement under the related Title Policy insuring the Mortgaged Property, or in certain cases, an application has been, or will be, made to the applicable governing authority for creation of separate tax lots, in which case the Purchased Loan requires the Mortgagor to escrow an amount sufficient to pay taxes for the existing tax parcel of which the Mortgaged Property is a part until the separate tax lots are created.

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(18) No Encroachments. To Seller’s Actual Knowledge based solely on current surveys obtained in connection with origination and the Mortgagee’s Title Policy (or, if such policy is not yet issued, a pro forma title policy, a preliminary title policy with escrow instructions or a “marked up” commitment) obtained in connection with the origination of each Purchased Loan, (a) all material improvements that were included for the purpose of determining the appraised value of the related Mortgaged Property at the time of the origination of such Purchased Loan are within the boundaries of the related Mortgaged Property, except encroachments that do not materially and adversely affect the value or current use of such Mortgaged Property or for which insurance or endorsements were obtained under the Title Policy, (b) no improvements on adjoining parcels encroach onto the related Mortgaged Property except for encroachments that do not materially and adversely affect the value or current use of such Mortgaged Property or for which insurance or endorsements were obtained under the Title Policy and (c) no improvements encroach upon any easements except for encroachments the removal of which would not materially and adversely affect the value or current use of such Mortgaged Property or for which insurance or endorsements obtained with respect to the Title Policy.

(19) No Contingent Interest or Equity Participation. No Purchased Loan has a shared appreciation feature, any other contingent interest feature or a negative amortization feature (except that an ARD Loan may provide for the accrual of the portion of interest in excess of the rate in effect prior to the anticipated repayment date) or an equity participation by Seller (excluding any equity interest held or pledged in connection with a Mezzanine Loan or preferred equity interest).

(20) REMIC. To the extent such Purchased Loan is identified as being REMIC eligible, the Purchased Loan is a “qualified mortgage” within the meaning of Section 860G(a)(3) of the Code (but determined without regard to the rule in the Treasury Regulations Section 1.860G-2(f)(2) that treats certain defective mortgage loans as qualified mortgages), and, accordingly, (A) the issue price of the Purchased Loan to the related Mortgagor at origination did not exceed the non-contingent principal amount of the Purchased Loan and (B) either: (a) such Purchased Loan is secured by an interest in real property (including buildings and structural components thereof, but excluding personal property) having a fair market value (i) at the date the Purchased Loan was originated at least equal to 80% of the adjusted issue price of the Purchased Loan on such date or (ii) at the Purchase Date at least equal to 80% of the adjusted issue price of the Purchased Loan on such date, provided that for purposes hereof, the fair market value of the real property interest must first be reduced by (A) the amount of any lien on the real property interest that is senior to the Purchased Loan and (B) a proportionate amount of any lien that is in parity with the Purchased Loan; or (b) substantially all of the proceeds of such Purchased Loan were used to acquire, improve or protect the real property which served as the only security for such Purchased Loan (other than a recourse feature or other third-party credit enhancement within the meaning of Treasury Regulations Section 1.860G-2(a)(1)(ii)). If the Purchased Loan was “significantly modified” prior to the Purchase Date so as to result in a taxable exchange under Section 1001 of the Code, it either (x) was modified as

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a result of the default or reasonably foreseeable default of such Purchased Loan or (y) satisfies the provisions of either sub-clause (B)(a)(i) above (substituting the date of the last such modification for the date the Purchased Loan was originated) or sub-clause (B)(a)(ii), including the proviso thereto. Any prepayment premium and yield maintenance charges applicable to the Purchased Loan constitute “customary prepayment penalties” within the meaning of Treasury Regulations Section 1.860G-1(b)(2). All terms used in this paragraph shall have the same meanings as set forth in the related Treasury Regulations.

(21) Compliance with Usury Laws. To Seller’s Actual Knowledge, in reliance solely upon legal opinions delivered in connection with a Purchased Loan, the interest rate (exclusive of any default interest, late charges, yield maintenance charge, or prepayment premiums) of such Purchased Loan complied as of the date of origination with, or was exempt from, applicable state or federal laws, regulations and other requirements pertaining to usury.

(22) Authorized to do Business. To the extent required under applicable law, as of the Purchase Date or as of the date that such entity held the Mortgage Note, each holder of the Mortgage Note was authorized to transact and do business in the jurisdiction in which each related Mortgaged Property is located, or the failure to be so authorized does not materially and adversely affect the enforceability of such Purchased Loan by Buyer.

(23) Trustee under Deed of Trust. With respect to each Mortgage which is a deed of trust, as of the date of origination and, to the Seller’s Actual Knowledge, as of the Purchase Date, a trustee, duly qualified under applicable law to serve as such, currently so serves and is named in the deed of trust or has been substituted in accordance with the Mortgage and applicable law or may be substituted in accordance with the Mortgage and applicable law by the related Mortgagee.

(24) Local Law Compliance. To the Seller’s Actual Knowledge, based solely upon any of a letter from any governmental authorities, a legal opinion, an architect’s letter, a zoning consultant’s report, an endorsement to the related Title Policy, or other affirmative investigation of local law compliance consistent with the investigation conducted by the Seller for similar commercial and multifamily mortgage loans intended for securitization, the improvements located on or forming part of each Mortgaged Property securing a Purchased Loan as of the date of origination of such Purchased Loan (or related Whole Loan, as applicable) and as of the Purchase Date, there are no material violations of applicable zoning ordinances, building codes and land laws (collectively “Zoning Regulations”) other than those which (i) are insured by the Title Policy or a law and ordinance insurance policy, (ii) are adequately reserved for in accordance with the Mortgage Loan Documents, or (iii) would not have a material adverse effect on the value, operation or net operating income of the Mortgaged Property. The terms of the Purchased Loan Documents require the Mortgagor to comply in all material respects with all applicable governmental regulations, zoning and building laws.

(25) Licenses and Permits. Each Mortgagor covenants in the Purchased Loan Documents that it shall keep all material licenses, permits and applicable governmental authorizations necessary for its operation of the Mortgaged Property in full force and effect, and to the

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Seller’s Actual Knowledge based upon any of a letter from any government authorities or other affirmative investigation of local law compliance consistent with the investigation conducted by the Seller for similar commercial and multifamily mortgage loans intended for securitization, all such material licenses, permits and applicable governmental authorizations are in effect. The Purchased Loan requires the related Mortgagor to be qualified to do business in the jurisdiction in which the related Mortgaged Property is located.

(26) Recourse Obligations. The Purchased Loan Documents for each Purchased Loan provide that such Purchased Loan (a) becomes full recourse to the Mortgagor or guarantor (which is a natural person or persons, or an entity distinct from the Mortgagor (but may be affiliated with the Mortgagor) that has assets other than equity in the related Mortgaged Property that are not de minimis) in any of the following events: (i) if any voluntary petition for bankruptcy, insolvency, dissolution or liquidation pursuant to federal bankruptcy law, or any similar federal or state law, shall be filed by the Mortgagor; (ii) Mortgagor or guarantor shall have colluded with (or, alternatively, solicited or caused to be solicited) other creditors to cause an involuntary bankruptcy filing with respect to the Mortgagor or (iii) voluntary transfers of either the Mortgaged Property or equity interests in Mortgagor made in violation of the Purchased Loan Documents; and (b) contains provisions providing for recourse against the Mortgagor or guarantor (which is a natural person or persons, or an entity distinct from the Mortgagor (but may be affiliated with the Mortgagor) that has assets other than equity in the related Mortgaged Property that are not de minimis), for losses and damages sustained by reason of Mortgagor’s (i) misappropriation of rents after the occurrence of an event of default under the Purchased Loan, (ii) misappropriation of (A) insurance proceeds or condemnation awards or (B) security deposits or, alternatively, the failure of any security deposits to be delivered to Mortgagee upon foreclosure or action in lieu thereof (except to the extent applied in accordance with leases prior to a Purchased Loan event of default); (iii) fraud or intentional material misrepresentation; (iv) breaches of the environmental covenants in the Purchased Loan Documents; or (v) commission of intentional material physical waste at the Mortgaged Property.

(27) Mortgage Releases. The terms of the related Mortgage or related Purchased Loan Documents do not provide for release of any material portion of the Mortgaged Property from the lien of the Mortgage except (a) a partial release, accompanied by principal repayment, or partial Defeasance (as defined in paragraph (32)), of not less than a specified percentage, which, in the case of a Purchased Loan identified as REMIC eligible, at least equal to the lesser of (i) 110% of the related allocated loan amount of such portion of the Mortgaged Property and (ii) the outstanding principal balance of the Purchased Loan, (b) upon payment in full of such Purchased Loan, (c) upon a Defeasance defined in paragraph (32) below, (d) releases of out-parcels that are unimproved or other portions of the Mortgaged Property which will not have a material adverse effect on the underwritten value of the Mortgaged Property and which were not afforded any material value in the appraisal obtained at the origination of the Purchased Loan and are not necessary for physical access to the Mortgaged Property or compliance with zoning requirements, or (e) as required pursuant to an order of condemnation or taking by a State

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or any political subdivision or authority thereof. With respect to any Purchased Loan identified as REMIC eligible, with respect to any partial release under the preceding clauses (a) or (d), either: (x) such release of collateral (i) would not constitute a “significant modification” of such Purchased Loan within the meaning of Section 1.860G-2(b)(2) of the Treasury Regulations and (ii) would not cause such Purchased Loan to fail to be a “qualified mortgage” within the meaning of Section 860G(a)(3)(A) of the Code; or (y) the Mortgagee or Servicer can, in accordance with the related Purchased Loan Documents, condition such release of collateral on the related Mortgagor’s delivery of an opinion of tax counsel to the effect specified in the immediately preceding clause (x). For purposes of the preceding clause (x), if the fair market value of the real property constituting such Mortgaged Property after the release is not equal to at least 80% of the principal balance of such Purchased Loan outstanding after the release, the Mortgagor is required to make a payment of principal in an amount not less than the amount required by the REMIC provisions.

(28) Financial Reporting and Rent Rolls. Each Mortgage requires the Mortgagor to provide the owner or holder of the Mortgage with quarterly (other than for single-tenant properties) and annual operating statements, and quarterly (other than for single-tenant properties) rent rolls for properties that have leases contributing more than 5% of the in-place base rent and annual financial statements, which annual financial statements with respect to each Purchased Loan with more than one Mortgagor are in the form of an annual combined balance sheet of the Mortgagor entities (and no other entities), together with the related combined statements of operations, members’ capital and cash flows, including a combining balance sheet and statement of income for the Mortgaged Properties on a combined basis.

(29) Acts of Terrorism Exclusion. With respect to each Purchased Loan over $20 million, the related special-form all-risk insurance policy and business interruption policy (issued by an insurer meeting the Insurance Rating Requirements) do not specifically exclude Acts of Terrorism, as defined in the Terrorism Risk Insurance Act of 2002, as amended by the Terrorism Risk Insurance Program Reauthorization Act of 2007 (collectively referred to as “TRIA”), from coverage, or if such coverage is excluded, it is covered by a separate terrorism insurance policy. With respect to each other Purchased Loan, the related special all-risk insurance policy and business interruption policy (issued by an insurer meeting the Insurance Rating Requirements) did not, as of the date of origination of the Purchased Loan, and, to Seller’s Actual Knowledge, do not, as of the Purchase Date, specifically exclude Acts of Terrorism, as defined in TRIA, from coverage, or if such coverage is excluded, it is covered by a separate terrorism insurance policy. With respect to each Purchased Loan, the related Purchased Loan Documents do not expressly waive or prohibit the Mortgagee from requiring coverage for Acts of Terrorism, as defined in TRIA, or damages related thereto except to the extent that any right to require such coverage may be limited by commercial availability on commercially reasonable terms, or as otherwise indicated in the related report delivered by Seller to Buyer of any exceptions to the representations and warranties set forth in this Exhibit VI; provided, that if TRIA or a similar or subsequent statute is not in effect, then, provided that terrorism insurance is commercially available, the Mortgagor under each Purchased Loan is required to carry terrorism insurance, but in such event the Mortgagor shall not be

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required to spend more than the Terrorism Cap Amount on terrorism insurance coverage, and if the cost of terrorism insurance exceeds the Terrorism Cap Amount, the Mortgagor is required to purchase the maximum amount of terrorism insurance available with funds equal to the Terrorism Cap Amount. The “Terrorism Cap Amount” is the specified percentage (which is at least equal to 200%) of the amount of the insurance premium that is payable at such time in respect of the property and business interruption/rental loss insurance required under the related Purchased Loan Documents (without giving effect to the cost of terrorism and earthquake components of such casualty and business interruption/rental loss insurance).

(30) Due on Sale or Encumbrance. Except as otherwise disclosed in the Due Diligence Package, subject to specific exceptions set forth below, each Purchased Loan contains a “due on sale” or other such provision for the acceleration of the payment of the unpaid principal balance of such Purchased Loan if, without the consent of the holder of the Mortgage (which consent, in some cases, may not be unreasonably withheld) and/or complying with the requirements of the related Purchased Loan Documents (which provide for transfers without the consent of the Mortgagee which are customarily acceptable to Seller lending on the security of property comparable to the related Mortgaged Property, including, without limitation, transfers of worn-out or obsolete furnishings, fixtures, or equipment promptly replaced with property of equivalent value and functionality and transfers by leases entered into in accordance with the Purchased Loan Documents), (a) the related Mortgaged Property, or any equity interest of greater than 50% in the related Mortgagor, is directly or indirectly pledged, transferred or sold, other than as related to (i) family and estate planning transfers or transfers upon death or legal incapacity, (ii) transfers to certain affiliates as defined in the related Purchased Loan Documents, (iii) transfers of less than, or other than, a controlling interest in the related Mortgagor, (iv) transfers to another holder of direct or indirect equity in the Mortgagor, a specific Person designated in the related Purchased Loan Documents or a Person satisfying specific criteria identified in the related Purchased Loan Documents, such as a qualified equityholder, (v) transfers of stock or similar equity units in publicly traded companies or (vi) a substitution or release of collateral within the parameters of paragraphs (27) and (32) herein, or (vii) by reason of any mezzanine debt that existed at the origination of the related Purchased Loan, or future permitted mezzanine debt as set forth in the Due Diligence Package or (b) the related Mortgaged Property is encumbered with a subordinate lien or security interest against the related Mortgaged Property, other than (i) any Junior Interest of any Purchased Loan or any subordinate debt that existed at origination and is permitted under the related Purchased Loan Documents, (ii) purchase money security interests (iii) any Purchased Loan that is cross-collateralized and cross-defaulted with another Purchased Loan, as set forth in the Due Diligence Package or (iv) Permitted Encumbrances. The related Mortgage or other Purchased Loan Documents provide that to the extent any rating agency fees are incurred in connection with the review of and consent to any transfer or encumbrance, the Mortgagor is responsible for such payment along with all other reasonable out-of-pocket fees and expenses incurred by the Mortgagee relative to such transfer or encumbrance.

(31) Single-Purpose Entity. Except as otherwise disclosed in the Due Diligence Package, each Purchased Loan requires the Mortgagor to be a Single-Purpose Entity for at least as long

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as the Purchased Loan is outstanding. Both the Purchased Loan Documents and the organizational documents of the Mortgagor with respect to each Purchased Loan with an unpaid principal balance as of the Purchase Date in excess of $5 million provide that the Mortgagor is a Single-Purpose Entity, and each Purchased Loan with an unpaid principal balance as of the Purchase Date of $50 million or more has a counsel’s opinion regarding non-consolidation of the Mortgagor. For this purpose, a “Single-Purpose Entity” shall mean an entity, other than an individual, whose organizational documents (or if the Purchased Loan has an unpaid principal balance as of the Purchase Date equal to $5 million or less, its organizational documents or the related Purchased Loan Documents) provide substantially to the effect that it was formed or organized solely for the purpose of owning and operating one or more of the Mortgaged Properties securing the Purchased Loans and prohibit it from engaging in any business unrelated to such Mortgaged Property or commercial or multi-family properties, and whose organizational documents further provide, or which entity represented in the related Purchased Loan Documents, substantially to the effect that it does not have any assets other than those related to its interest in and operation of such Mortgaged Property or commercial or multi-family properties, or any indebtedness other than as permitted by the related Mortgage(s) or the other related Purchased Loan Documents, that it has its own books and records and accounts separate and apart from those of any other person (other than a Mortgagor for a Purchased Loan that is cross-collateralized and cross-defaulted with the related Purchased Loan), and that it holds itself out as a legal entity, separate and apart from any other person or entity.

(32) Defeasance. With respect to any Purchased Loan that, pursuant to the Purchased Loan Documents, can be defeased (a “Defeasance”), (i) the Purchased Loan Documents provide for defeasance as a unilateral right of the Mortgagor, subject to satisfaction of conditions specified in the Purchased Loan Documents; (ii) the Purchased Loan cannot be defeased within two years after the date of origination of such Purchased Loan; (iii) the Mortgagor is permitted to pledge only United States “government securities” within the meaning of Treasury Regulations Section 1.860G-2(a)(8)(ii), the revenues from which will, in the case of a full Defeasance, be sufficient to make all scheduled payments under the Purchased Loan when due, including the entire remaining principal balance on the maturity date (or on or after the first date on which payment may be made without payment of a yield maintenance charge or prepayment penalty) or, if the Senior Loan is an ARD Loan, the entire principal balance outstanding on the anticipated repayment date, and if the Purchased Loan permits partial releases of real property in connection with partial defeasance, the revenues from the collateral will be sufficient to pay all such scheduled payments calculated on a principal amount equal to a specified percentage at least equal to the lesser of (a) 110% of the allocated loan amount for the real property to be released and (b) the outstanding principal balance of the Purchased Loan; (iv) the Mortgagor is required to provide a certification from an independent certified public accountant that the collateral is sufficient to make all scheduled payments under the Mortgage Note as set forth in (iii) above, (v) if the Mortgagor would continue to own assets in addition to the defeasance collateral, the portion of the Purchased Loan secured by defeasance collateral is required to be assumed (or the Mortgagee may require such assumption) by a Single-Purpose Entity; (vi) the Mortgagor is required to provide an

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opinion of counsel that the Mortgagee has a perfected security interest in such collateral prior to any other claim or interest; and (vii) the Mortgagor is required to pay all rating agency fees associated with Defeasance (if rating confirmation is a specific condition precedent thereto) and all other reasonable out-of-pocket expenses associated with Defeasance, including, but not limited to, accountant’s fees and opinions of counsel.

(33) Ground Leases. For purposes of this Exhibit VI, a “Ground Lease” shall mean a lease creating a leasehold estate in real property where the fee owner as the ground lessor conveys for a term or terms of years its entire interest in the land and buildings and other improvements, if any, comprising the premises demised under such lease to the ground lessee (who may, in certain circumstances, own the building and improvements on the land), subject to the reversionary interest of the ground lessor as fee owner and does not include industrial development agency (IDA) or similar leases for purposes of conferring a tax abatement or other benefit.

With respect to any Purchased Loan where the Purchased Loan is secured by a leasehold estate under a Ground Lease in whole or in part, and the related Mortgage does not also encumber the related lessor’s fee interest in such Mortgaged Property, based upon the terms of the Ground Lease and any estoppel or other agreement received from the ground lessor in favor of Seller, its successors and assigns, Seller represents and warrants that:

(a) The Ground Lease or a memorandum regarding such Ground Lease has been duly recorded or submitted for recordation in a form that is acceptable for recording in the applicable jurisdiction. The Ground Lease or an estoppel or other agreement received from the ground lessor permits the interest of the lessee to be encumbered by the related Mortgage and does not restrict the use of the related Mortgaged Property by such lessee, its successors or assigns in a manner that would materially adversely affect the security provided by the related Mortgage;

(b) The lessor under such Ground Lease has agreed in a writing included in the related Purchased Loan File (or in such Ground Lease) that the Ground Lease may not be amended or modified, or canceled or terminated by agreement of lessor and lessee, without the prior written consent of the Mortgagee;

(c) The Ground Lease has an original term (or an original term plus one or more optional renewal terms, which, under all circumstances, may be exercised, and will be enforceable, by either Mortgagor or the Mortgagee) that extends not less than 20 years beyond the stated maturity of the related Purchased Loan, or 10 years past the stated maturity if such Purchased Loan fully amortizes by the stated maturity (or with respect to a Purchased Loan that accrues on an actual 360 basis, substantially amortizes);

(d) The Ground Lease either (i) is not subject to any liens or encumbrances superior to, or of equal priority with, the Mortgage, except for the related fee interest of the ground lessor and the Permitted Encumbrances, or (ii) is subject to a subordination, non-disturbance and attornment agreement to which the Mortgagee on the lessor’s fee interest in the Mortgaged Property is subject;

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(e) The Ground Lease does not place, in Seller’s reasonable judgment and to Seller’s Actual Knowledge, commercially unreasonably restrictions on the identity of the Mortgagee and, upon foreclosing on the Mortgage, the Ground Lease is assignable to the holder of the Purchased Loan and its successors and assigns without the consent of the lessor thereunder (provided that proper notice is delivered to the extent required in accordance with such Ground Lease), and in the event it is so assigned, it is further assignable by the holder of the Purchased Loan and its successors and assigns without the consent of the lessor;

(f) The Seller has not received any written notice of material default under or notice of termination of such Ground Lease. To the Seller’s Actual Knowledge, there is no material default under such Ground Lease and no condition that, but for the passage of time or giving of notice, would result in a material default under the terms of such Ground Lease and to the Seller’s Actual Knowledge, such Ground Lease is in full force and effect as of the Purchase Date;

(g) The Ground Lease or ancillary agreement between the lessor and the lessee requires the lessor to give to the Mortgagee written notice of any default, and provides that no notice of default or termination is effective against the Mortgagee unless such notice is given to the Mortgagee;

(h) The Mortgagee is permitted a reasonable opportunity (including, where necessary, sufficient time to gain possession of the interest of the lessee under the Ground Lease through legal proceedings) to cure any default under the Ground Lease which is curable after the Mortgagee’s receipt of notice of any default before the lessor may terminate the Ground Lease;

(i) The Ground Lease does not impose any restrictions on subletting that would be viewed, in Seller’s reasonable judgment, as commercially unreasonable by a Seller in connection with loans originated for securitization;

(j) Under the terms of the Ground Lease, an estoppel or other agreement received from the ground lessor and the related Mortgage (taken together), any related insurance proceeds or the portion of the condemnation award allocable to the ground lessee’s interest (other than (i) de minimis amounts for minor casualties or (ii) in respect of a total or substantially total loss or taking as addressed in subpart (k)) will be applied either to the repair or to restoration of all or part of the related Mortgaged Property with (so long as such proceeds are in excess of the threshold amount specified in the related Purchased Loan Documents) the Mortgagee or a trustee appointed by it having the right to hold and disburse such proceeds as repair or restoration progresses, or to the payment of the outstanding principal balance of the Purchased Loan, together with any accrued interest;

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(k) In the case of a total or substantially total taking or loss, under the terms of the Ground Lease, an estoppel or other agreement and the related Mortgage (taken together), any related insurance proceeds, or portion of the condemnation award allocable to ground lessee’s interest in respect of a total or substantially total loss or taking of the related Mortgaged Property to the extent not applied to restoration, will be applied first to the payment of the outstanding principal balance of the Purchased Loan, together with any accrued interest; and

(l) Provided that the Mortgagee cures any defaults which are susceptible to being cured, the ground lessor has agreed to enter into a new lease with Mortgagee upon termination of the Ground Lease for any reason, including rejection of the Ground Lease in an Act of Insolvency.

(35) Servicing. The servicing and collection practices used by the Seller with respect to the Purchased Loan have been, in all respects, legal and have met customary industry standards for servicing of commercial loans.

(36) Origination and Underwriting. The origination practices of the Seller (or to Seller’s Actual Knowledge the related originator if the Seller was not the originator) with respect to each Purchased Loan have been, in all material respects, in material compliance with applicable law and as of the date of its origination, such Purchased Loan (or the related Whole Loan, as applicable) and to the extent originated by Seller or its Affiliates or, if originated by another Person, to Seller’s Actual Knowledge, the origination thereof complied in all material respects with, or was exempt from, all requirements of federal, state or local law relating to the origination of such Purchased Loan; provided that such representation and warranty does not address or otherwise cover any matters with respect to federal, state or local law otherwise covered in this Exhibit VI.

(37) No Material Default; Payment Record. As of the Purchase Date and the date of the transfer of any Margin Excess to Seller, no Purchased Loan has been more than 30 days delinquent, without giving effect to any grace or cure period, in making required debt service payments since origination, and no Purchased Loan is more than 30 days delinquent (beyond any applicable grace or cure period) in making required payments. As of the Purchase Date and the date of the transfer of any Margin Excess to Seller, to the Seller’s Actual Knowledge, there is (a) no material default, breach, violation or event of acceleration existing under the related Purchased Loan, or (b) no event (other than payments due but not yet delinquent) which, with the passage of time or with notice and the expiration of any grace or cure period, would constitute a material default, breach, violation or event of acceleration, which default, breach, violation or event of acceleration, in the case of either (a) or (b), materially and adversely affects the value of the Purchased Loan or the value, use or operation of the related Mortgaged Property, provided, however, that this representation and warranty does not cover any default, breach, violation or event of acceleration that specifically pertains to or arises out of an exception scheduled to any other representation and warranty made by the Seller in this Exhibit VI (including, but not limited to, the prior sentence). Solely with respect to a Whole Loan, no person other than the holder of such Purchased Loan may declare any event of default under the Purchased Loan or accelerate any indebtedness under the Purchased Loan Documents.

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(38) Bankruptcy. To the Seller’s Actual Knowledge as of the Purchase Date and the date of the transfer of any Margin Excess to Seller, neither the Mortgaged Property (other than any tenants of such Mortgaged Property), nor any portion thereof, is the subject of, and no Mortgagor, guarantor or tenant occupying a single-tenant property is a debtor in a state or federal Act of Insolvency.

(39) Organization of Mortgagor. With respect to each Purchased Loan, based solely upon Seller’s reliance on certified copies of the organizational documents of the Mortgagor delivered by the Mortgagor in connection with the origination of such Purchased Loan (or related Whole Loan, as applicable), the Mortgagor is an entity organized under the laws of a state of the United States of America, the District of Columbia or the Commonwealth of Puerto Rico. Except with respect to any Purchased Loan that is cross-collateralized and cross defaulted with another Purchased Loan, to Seller’s Actual Knowledge, no Purchased Loan has a Mortgagor that is an affiliate of another Mortgagor. An “Affiliate” for purposes of this Paragraph 39 means, a mortgagor that is under direct or indirect common ownership and control with another mortgagor.

(40) Environmental Conditions. There is no material and adverse environmental condition or circumstance affecting the related Mortgaged Property; there is no material violation of any applicable Environmental Law with respect to the related Mortgaged Property. Neither Seller nor the underlying obligor on such Senior Loan has taken any actions which would cause the related Mortgaged Property not to be in material compliance with all applicable Environmental Laws. The related Purchased Loan Documents require the borrower to materially comply with all Environmental Laws. Each mortgagor has agreed to either indemnify the mortgagee for any losses resulting from any material, adverse environmental condition (to the extent such condition is not caused by Seller, or from any failure of the mortgagor to abide by such Environmental Laws) or has provided environmental insurance.

(41) Appraisal. The Purchased Loan File contains an appraisal of the related Mortgaged Property with an appraisal date within 6 months of the Purchased Loan origination date, and within 12 months of the Purchase Date. The appraisal is signed by an appraiser who is a Member of the Appraisal Institute (“MAI”) and, to the Seller’s Actual Knowledge, had no interest, direct or indirect, in the Mortgaged Property or the Mortgagor or in any loan made on the security thereof, and whose compensation is not affected by the approval or disapproval of the Purchased Loan. Each appraiser has represented in such appraisal or in a supplemental letter that the appraisal satisfies the requirements of the “Uniform Standards of Professional Appraisal Practice” as adopted by the Appraisal Standards Board of the Appraisal Foundation.

(42) Due Diligence Package. To Seller’s Actual Knowledge, the information pertaining to each Purchased Loan which is set forth in the Due Diligence Package is true and correct in all material respects as of the Purchase Date.

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(43) [Intentionally Omitted]

(44) Advance of Funds by the Seller. After origination, no advance of funds has been made by Seller to the related Mortgagor other than in accordance with the Purchased Loan Documents, and, to Seller’s Actual Knowledge, no funds have been received from any person other than the related Mortgagor or an affiliate for, or on account of, payments due on the Purchased Loan (other than as contemplated by the Purchased Loan Documents, such as, by way of example and not in limitation of the foregoing, amounts paid by the tenant(s) into a Mortgagee-controlled lockbox if required or contemplated under the related lease or Purchased Loan Documents). Neither Seller nor any affiliate thereof has any obligation to make any capital contribution to any Mortgagor under a Purchased Loan, other than contributions made on or prior to the date hereof.

(45) Compliance with Anti-Money Laundering Laws. Seller has complied in all material respects with all applicable anti-money laundering laws and regulations, including without limitation the USA PATRIOT Act of 2001 with respect to the origination of the Purchased Loan, the failure to comply with which would have a material adverse effect on the Purchased Loan.

For purposes of these representations and warranties, “Mortgagee” shall mean the mortgagee, grantee or beneficiary under any Mortgage, any holder of legal title to any portion of any Purchased Loan or, if applicable, any agent or servicer on behalf of such party.

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EXHIBIT VII

COLLATERAL TAPE

VII-1

VII-2

VII-3

VII-4

VII-5

VII-6

VII-7

EXHIBIT VIII

FORM OF TRANSACTION REQUEST

Ladies and Gentlemen:

Pursuant to Section 3(a) of that certain Amended and Restated Master Repurchase Agreement, dated as of [            ], 2014 (the “Agreement”), between Citibank, N.A. (“Buyer”) and Parlex 2 Finance, LLC, Parlex 2A Finco, LLC and any Person that joins as a Seller (as such term is defined in the Agreement) under the Agreement from time to time, [                                        ], LLC (“Seller”) hereby requests that Buyer enter into a Transaction with respect to the Eligible Loans set forth on Schedule 1 attached hereto, upon the proposed terms set forth below. Capitalized terms used herein without definition have the meanings given in the Agreement.

Proposed Eligible Loan:		[	]
Aggregate Principal Amount of Proposed Eligible Loan:	[$		]
Amount of Purchase Price Requested by Seller:	[$		]

VIII-1

Name and address for communications:	Buyer:
		Citibank, N.A.
		388 Greenwich Street
		New York, New York 10013
		Attention:	Richard Schlenger
		Telephone:	(212) 816-7806
		Email: Richard.Schlenger@Citi.com
	Seller:
		[                                         ], LLC
		c/o Blackstone Mortgage Trust, Inc.
		345 Park Avenue
		New York, NY 10154
		Attention: Douglas Armer
		Tel: (212) 583-5000 Email: BXMTCitiRepo@blackstone.com

VIII-2

SELLER:

[                                         ], LLC,

a Delaware limited liability company

By:

Name:

Title:

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Schedule 1 to Transaction Request

(Attachments: Collateral Tape and Eligible Loan Due Diligence Checklist)

Eligible Loan:

Aggregate Principal Amount of Eligible Loan: $[        ]

VIII-4

Schedule 2 to Transaction Request

Exceptions to Representations and Warranties Set

Forth on Exhibit VI

VIII-5

EXHIBIT IX

FORM OF REQUEST FOR MARGIN EXCESS

Ladies and Gentlemen:

Pursuant to Section [4(c)][4(e)] of that certain Amended and Restated Master Repurchase Agreement, dated as of [            ], 2014 (the “Agreement”), between Citibank, N.A. (“Buyer”) and Parlex 2 Finance, LLC, Parlex 2A Finco, LLC and any Person that joins as a Seller (as such term is defined in the Agreement) under the Agreement from time to time, [                                        ], LLC (“Seller”) hereby requests that Buyer transfer cash to Seller with respect to the Purchased Loan described below in the amount set forth below. Capitalized terms used herein without definition have the meanings given in the Agreement.

Purchased Loan:	[                    ]
Amount of Increase in outstanding Purchase Price Requested by Seller:	[$        ] [Describe how Amount Calculated]
Type of Margin Excess:	[Margin Excess (Future Funding)] [Margin Excess (Other) – [DESCRIBE REASON: Margin Deficit, Prior Paydown without Release of Collateral, Original Purchase Price less than Maximum Purchase Price]]

IX-1

Name and address for communications:	Buyer:
		Citibank, N.A.
		388 Greenwich Street
		New York, New York 10013
		Attention:	Richard Schlenger
		Telephone:	(212) 816-7806
		Email: Richard.Schlenger@Citi.com
	Seller:
		[                                         ], LLC
		c/o Blackstone Mortgage Trust, Inc.
		345 Park Avenue
		New York, NY 10154
		Attention: Douglas Armer
		Tel: (212) 583-5000 Email: BXMTCitiRepo@blackstone.com

IX-2

SELLER:

[                                         ], LLC,

a Delaware limited liability company

By:

Name:

Title:

IX-3

EXHIBIT X

FORM OF IRREVOCABLE DIRECTION LETTER

[SELLER]

[LETTERHEAD]

IRREVOCABLE DIRECTION LETTER

AS OF [            ], 20[    ]

Ladies and Gentlemen:

Please refer to: (a) that certain [Loan Agreement], dated [            ], 20[    ], by and among [                                    ] (the “Borrower”), as borrower, and [                                    ] (the “Lender”), as lender; and (b) all documents securing or relating to that certain $[        ] loan made by the Lender to the Borrower on [            ], 20[    ] (the “Loan”).

You are advised as follows, effective as of the date of this letter.

Assignment of the Loan. The Lender has entered into an Amended and Restated Master Repurchase Agreement, dated as [            ], 2014 (as the same may be amended and/or restated from time to time, the “Repo Agreement”), with Citibank, N.A. (“Citi”), 388 Greenwich Street, New York, New York 10013, [Parlex 2 Finance, LLC,] [Parlex 2A Finco, LLC], and any other Person that joins as a Seller under the Repo Agreement from time to time, and has assigned its rights and interests in the Loan (and all of its rights and remedies in respect of the Loan) to Citi. This assignment shall remain in effect unless and until Citi has notified Borrower otherwise in writing.

Direction of Funds. In connection with Lender’s obligations under the Repo Agreement, Lender hereby directs Borrower to disburse, by wire transfer, any and all payments to be made under or in respect of the Loan to the following account at [                                ] for the benefit of Citi:

Account:

Attn:

This direction shall remain in effect unless and until Citi has notified Borrower otherwise in writing.

Modifications, Waivers, Etc. No modification or waiver of any party’s obligations in respect of this letter shall be effective without the prior written consent of Citi.

XI-1

Please acknowledge your acceptance of the terms and directions contained in this correspondence by executing a counterpart of this correspondence and returning it to the undersigned.

[Signature Page Follows]

XI-2

Very truly yours,
	[                                         ], a Delaware limited liability company
	By:
	Name:
	Title:
		Date:	[            ], 20[    ]

Agreed and accepted this [    ] day of
[            ], 20[    ]

[                                         ]

By:

Name:

Title:

XI-3

EXHIBIT XI

FORM OF JOINDER AGREEMENT

This JOINDER AGREEMENT (this “Joinder Agreement”) dated as of [—], is made by and among Parlex 2 Finance, LLC, Parlex 2A Finco, LLC, [ADD OTHER PREVIOUSLY ADDED SELLERS], each a Delaware limited liability company (collectively, the “Existing Sellers”), [—], a Delaware limited liability company] (the “Joining Seller”) and Citibank, N.A. (“Buyer”).

W I T N E S S E T H:

WHEREAS, Existing Sellers and Buyer, entered into that certain Amended and Restated Master Repurchase Agreement, dated as of [            ], 2014 (as the same may be amended, supplemented, extended, restated, replaced or otherwise modified from time to time, the “Repurchase Agreement”), pursuant to which Existing Sellers agreed to sell to Buyer certain Eligible Loans upon the terms and subject to the conditions set forth therein (each such transaction, a “Transaction”);

WHEREAS, all capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Repurchase Agreement; and

WHEREAS, Existing Sellers and Buyer desire to modify certain terms and provisions of the Repurchase Agreement and the other Transaction Documents to admit Joining Seller to the Repurchase Agreement and the other Transaction Documents as a Seller in accordance with this Joinder Agreement.

NOW, THEREFORE, in order to induce Buyer to enter into a Transaction with Joining Seller, and in consideration of the substantial benefit Joining Seller will derive from Buyer entering into such Transaction, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, Joining Seller hereby agrees as follows:

1. In consideration of Joining Seller becoming a Seller entitled to enter into Transactions with Buyer under and subject to the terms and conditions of the Repurchase Agreement, Joining Seller hereby agrees that, effective as of the date hereof, Joining Seller is, and shall be deemed to be, a “Seller” under the Repurchase Agreement and each of the other Transaction Documents to which the Seller is a party (including, without limitation, the Fee Agreement), and agrees that from the date hereof and so long as the Repurchase Obligations remain outstanding, Joining Seller hereby assumes the obligations of a “Seller” under, and Joining Seller shall perform, comply with and be subject to and bound by each of the terms, covenants and conditions of the Repurchase Agreement and each of the other Transaction Documents which are stated to apply to or are made by a Seller (including, without limitation, the Fee Agreement). Without limiting the generality of the foregoing, Joining Seller hereby represents and warrants that (i) each of the representations and warranties set forth in Section 10 of the Repurchase Agreement are true and correct as to Joining Seller and its related Purchased Loan on and as of the date hereof and (ii) Joining Seller has heretofore received true and correct copies of the Repurchase Agreement and each of the other Transaction Documents as in effect on the date hereof.

XI-1

2. Without limiting the foregoing, Joining Seller agrees that it is and shall be obligated to pay the Repurchase Price applicable to its Purchased Loan on the Repurchase Date therefor and perform and pay all of the other Repurchase Obligations applicable to Joining Seller and such Purchased Loan as if it were an original party to the Repurchase Agreement (including, without limitation, all obligations arising under the Fee Agreement) and agrees to execute and deliver such documents, agreements and other instruments as Buyer may reasonably request in connection with such Joining Seller’s obligations hereunder and under the Repurchase Agreement and the other Transaction Documents.

3. In furtherance of the foregoing, Joining Seller shall execute and deliver or cause to be executed and delivered, at any time and from time to time, such further instruments and documents, and shall do or cause to be done such further acts, as may be reasonably necessary or proper in the opinion of Buyer to carry out more effectively the provisions and purposes of this Joinder Agreement and the Repurchase Agreement.

4. The Existing Sellers and Joining Seller each acknowledge and agree that, except as modified by this Joinder Agreement, the Repurchase Agreement and each of the other Transaction Documents remains unmodified and in full force and effect and all of the terms, covenants and conditions thereof are hereby ratified and confirmed in all respects.

5. Notwithstanding any provision, covenant, agreement or requirement to the contrary contained in this Joinder Agreement, the Repurchase Agreement or any other Transaction Document, the Sellers shall make commercially reasonable efforts to amend, restate, or otherwise modify the Custodial Agreement in order to join the Joining Seller thereto, and for the Joining Seller to enter into a new (a) servicing agreement with Servicer in substantially the same form as the Servicing Agreement and (b) blocked account agreement with Servicer and Depository in substantially the same form as the Blocked Account Agreements establishing Cash Management Accounts with Depository in the manner required pursuant to Section 5(a) of the Repurchase Agreement.

6. Notice information for Joining Seller for purposes of Section 17 and Annex I of the Repurchase Agreement and each other applicable Transaction Document shall be as specified in the signature pages hereto for Joining Seller, or at such other address and person as shall be designated from time to time in a written notice to the other parties hereto in the manner provided for in Section 17 of the Repurchase Agreement.

7. THIS JOINDER AGREEMENT SHALL BE GOVERNED BY THE LAWS OF THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE CONFLICT OF LAWS PRINCIPLES THEREOF.

8. This Joinder Agreement may be executed in any number of counterparts, and all such counterparts shall together constitute the same agreement. Signatures delivered by email (in PDF format) shall be considered binding with the same force and effect as original signatures.

XI-2

[Remainder of page intentionally left blank; signatures follow on next page.]

XI-3

IN WITNESS WHEREOF, each of Joining Seller, Exiting Sellers and Buyer has duly executed and delivered this Joinder Agreement as of the date and year first above written.

JOINING SELLER:
[—]
By:
	Name:
	Title:
Address for notices to Joining Seller:
[Joining Seller]
c/o Blackstone Mortgage Trust, Inc.
345 Park Avenue
New York, NY 10154
Attention: Douglas Armer
Tel: (212) 583-5000
Email: BXMTCitiRepo@blackstone.com
With a copy to:
Ropes & Gray LLP
1211 Avenue of the Americas
New York, New York 10036
Attention: David C. Djaha
Tel: (212) 841-0489
Email: david.djaha@ropesgray.com

XI-4

EXISTING SELLERS:
PARLEX 2 FINANCE, LLC
By:
	Name:
	Title:
PARLEX 2A FINCO, LLC
By:
	Name:
	Title:

XI-5

BUYER:
CITIBANK, N.A.
By:
	Name:
	Title:

XI-1

EXHIBIT XII

FORM OF FACILITY ASSET CHART

XII-1

EX-10.36

Exhibit 10.36

FIRST AMENDMENT TO LIMITED GUARANTY

THIS FIRST AMENDMENT TO LIMITED GUARANTY (this “Amendment”), dated as of November 20, 2013 (the “Effective Date”), is made by and among CITIBANK, N.A., having an address at 388 Greenwich Street, 19^th Floor, New York, New York 10013 (together with its successors and/or assigns, “Buyer”) and BLACKSTONE MORTGAGE TRUST, INC., a Maryland corporation, having an address at 345 Park Avenue, New York, New York 10154 (“Guarantor”).

W I T N E S S E T H:

WHEREAS, Buyer and Parlex 2 Finance, LLC, a Delaware limited liability company (“Seller”) have entered into that certain Master Repurchase Agreement, dated as of June 12, 2013 (the “Original Repurchase Agreement”), as amended by that certain First Amendment to Master Repurchase Agreement, dated as of July 26, 2013, that certain Second Amendment to Master Repurchase Agreement, dated as of September 11, 2013, and that certain Third Amendment to Master Repurchase Agreement, dated as of November 20, 2013 (collectively, and as the same may be further amended, supplemented, extended, restated, replaced or otherwise modified from time to time, the “Repurchase Agreement”);

WHEREAS, in connection with the Original Repurchase Agreement, Guarantor entered into that certain Limited Guaranty dated as of June 12, 2013 (as the same may be amended, supplemented or otherwise modified from time to time, the “Guaranty”), in favor of Buyer, guaranteeing certain obligations of Seller;

WHEREAS, all capitalized terms used herein and not otherwise defined shall have the respective meanings set forth in the Guaranty or the Repurchase Agreement, as applicable; and

WHEREAS, Buyer and Guarantor desire to modify certain terms and provisions of the Guaranty as set forth herein.

NOW, THEREFORE, in consideration of ten dollars ($10) and for other good and valuable consideration, the receipt and legal sufficiency of which are hereby acknowledged, Buyer and Guarantor covenant and agree as follows as of the Effective Date:

1. Modification of Guaranty. The Guaranty is hereby modified as of the Effective Date as follows:

(a) The following defined terms are hereby added, in alphabetical order, to Section 1 of the Guaranty, as follows:

“Westminster Loan” shall mean that certain Purchased Loan consisting of (i) a mortgage loan in the initial original principal amount of $135,000,000 to be made by Seller, as lender, to 165 E 66 Retail, LLC, a Delaware limited liability company, 165 E 66 Condo, LLC, a Delaware limited liability company and 165 E 66 Parking, LLC, a Delaware limited liability company, collectively as borrower, and (ii) a mezzanine loan in the initial original principal amount of $46,000,000 to be made by Seller, as lender, to 165 E 66, LLC, a Delaware limited liability company, as borrower.”

“Westminster Loan Repurchase Price” shall mean, as of any date of determination, the then current Repurchase Price with respect to the Westminster Loan.

(b) Section 2(b) of the Guaranty is hereby deleted in its entirety and replaced with the following:

“Notwithstanding anything in this Guaranty or in any other Transaction Document to the contrary, but subject to clauses (c) and (d) below, the maximum liability of Guarantor hereunder and under the other Transaction Documents shall in no event exceed (A) during such time that the Westminster Loan is a Purchased Loan, an amount equal to the sum of (i) twenty-five percent (25%) of the Guaranteed Obligations (exclusive of the Westminster Loan Repurchase Price) plus (ii) the Westminster Loan Repurchase Price, and (B) upon and at all times following the irrevocable payment in full by Seller to Buyer of the Westminster Loan Repurchase Price, twenty-five percent (25%) of the Guaranteed Obligations.”

2. Guarantor’s Representations. Guarantor has taken all necessary action to authorize the execution, delivery and performance of this Amendment. This Amendment has been duly executed and delivered by or on behalf of Guarantor and constitutes the legal, valid and binding obligation of Guarantor enforceable against Guarantor in accordance with its terms subject to bankruptcy, insolvency, and other limitations on creditors’ rights generally and to equitable principles. No Event of Default has occurred and is continuing, and no Event of Default will occur as a result of the execution, delivery and performance by Guarantor of this Amendment. Any consent, approval, authorization, order, registration or qualification of or with any Governmental Authority required for the execution, delivery and performance by Guarantor of this Amendment has been obtained and is in full force and effect (other than consents, approvals, authorizations, orders, registrations or qualifications that if not obtained, are not reasonably likely to have a Material Adverse Effect).

3. Reaffirmation of Guaranty. Except as expressly modified hereby, all of the terms, covenants and conditions of the Guaranty and all of Guarantor’s obligations thereunder remain unmodified and in full force and effect and are hereby unconditionally ratified and confirmed by Guarantor in all respects. Any inconsistency between this Amendment and the Guaranty (as it existed before this Amendment) shall be resolved in favor of this Amendment,

2

whether or not this Amendment specifically modifies the particular provision(s) in the Guaranty inconsistent with this Amendment. All references to the “Guaranty” in the Guaranty or in any of the other Transaction Documents shall mean and refer to the Guaranty as modified and amended by this Amendment.

4. No Waiver. The execution, delivery and effectiveness of this Amendment shall not operate as a waiver of any right, power or remedy of Buyer under the Guaranty, any of the other Transaction Documents, or any other document, instrument or agreement executed and/or delivered in connection therewith.

5. Headings. Each of the captions contained in this Amendment are for the convenience of reference only and shall not define or limit the provisions hereof.

6. Counterparts. This Amendment may be executed in any number of counterparts, and all such counterparts shall together constitute the same agreement. Signatures delivered by email (in PDF format) shall be considered binding with the same force and effect as original signatures.

7. Governing Law. This Amendment shall be governed in accordance with the terms and provisions of Section 27(c) of the Guaranty.

[No Further Text on this Page; Signature Pages Follow]

3

IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed by their duly authorized representatives as of the day and year first above written and effective as of the Effective Date.

GUARANTOR:
BLACKSTONE MORTGAGE TRUST, INC., a Maryland corporation
By:	/s/ Douglas Armer
	Name:	Douglas Armer
	Title:	Principal, Head of Capital Markets and Treasurer

[Signatures Continued on Next Page]

BUYER:
CITIBANK, N.A.
By:	/s/ Richard B. Schlenger
	Name:	Richard B. Schlenger
	Title:	Authorized Signatory

EX-21.1

Exhibit 21.1

Entity	Jurisdiction of Incorporation	D/B/A Jurisdiction
42-16 Partners, LLC	Delaware
345-30 Partners, LLC	Delaware
345-40 Partners, LLC	Delaware
345-50 Partners, LLC	Delaware
345-Lux Partners, S.a.r.l.	Luxembourg
643 Single Family Finco 2014, LLC	Delaware
Ambassador GBP Holdings, LLC	Delaware
Ambassador CAD Holdings, LLC	Delaware
Ambassador EUR Holdings, LLC	Delaware
Bellevue C2 Holding, LLC	Delaware
Bellevue Office Finco 2015, LLC	Delaware
Canada Office Portfolio Finco 2014, LLC	Delaware
Capital Trust RE CDO 2004-1 Corp.	Delaware
Capital Trust RE CDO 2004-1 Ltd.	Cayman Islands
Capital Trust RE CDO Depositor	Delaware
CNL Hotel JV, LLC	Delaware
CT CDO III Corp.	Delaware
CT CDO III Ltd.	Cayman Islands
CT Legacy Asset, LLC	Delaware
CT Legacy Cayman, Ltd.	Cayman Islands
CT Legacy Holdings, LLC	Delaware
CT Legacy JPM SPV, LLC	Delaware
CT Legacy Manager, LLC	Delaware
CT Legacy REIT Holdings, LLC	Delaware
CT Legacy Series 1 Note Issuer, LLC	Delaware
CT Legacy Series 2 Note Issuer, LLC	Delaware
CT Legacy LXR Holdings, LLC	Delaware
CT OPI GP, LLC	Delaware
CT Public Preferred Trust I	Maryland
CT Public Preferred Trust II	Maryland
CT Public Preferred Trust III	Maryland
CT RE CDO 2004-1 Sub, LLC	Delaware
CT XLC Holding, LLC	Delaware
CTOPI Carried Interest Holdings, LLC	Delaware
CTOPI Carried Interest CT Sub 1, LLC	Delaware
CTOPI Carried Interest CT Sub 2, LLC	Delaware
CTOPI Carried Interest CT Sub 3, LLC	Delaware
CTOPI Carried Interest CT Sub 4, LLC	Delaware
De Vere Resorts Finco 2014, LLC	Delaware
Husky Finco, LLC	Delaware
Husky CAD Finco, LLC	Delaware
Husky EUR Finco, LLC	Delaware
Husky UK Finco, LLC	Delaware
Parlex 1 Finance, LLC	Delaware
Parlex 2 Finance, LLC	Delaware
Parlex 2A Finco, LLC	Delaware
Parlex 3 Finance, LLC	Delaware
Parlex 4 Finance, LLC	Delaware

S-1

Blackstone Mortgage Trust, Inc.

Notes to Schedule IV

As of December 31, 2013

(in thousands)

Parlex 4 UK Finco, LLC	Delaware
Parlex 5 Finco, LLC	Delaware
Parlex 6 EUR Finco, LLC	Delaware
Parlex 6 Lux Finco, S.a.r.l.	Luxembourg
Parlex 6 UK Finco, LLC	Delaware
Parlex 7 Finco, LLC	Delaware
Parlex 8 UK Finco, LLC	Delaware
Parlex 9 Finco, LLC	Delaware
Q Hotels Finco 2014, LLC	Delaware
Tysons Corner Finance 2013, LLC	Delaware
Victor Holdings I, LLC	Delaware

S-2

EX-23.1

Exhibit 23.1

CONSENT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

We consent to the incorporation by reference in the Registration Statement on Form S-3 (File No. 333-190191) and on Form S-8 (File Nos. 333-39743, 333-144929, 333-179668 and 333-189806) pertaining to: (i) the Amended and Restated 1997 Long Term Incentive Stock Plan and Amended and Restated 1997 Non-Employee Director Stock Plan; (ii) 2007 Long-Term Incentive Plan; (iii) the 2011 Long-Term Incentive Plan; and (iv) the 2013 Stock Incentive Plan of our report dated February 17, 2015, relating to the 2014 and 2013 consolidated financial statements and the retrospective adjustments to the 2012 consolidated financial statements of Blackstone Mortgage Trust, Inc. and subsidiaries (the “Company”) (which report expresses an unqualified opinion and includes an explanatory paragraph regarding the one-for-ten reverse stock split, as discussed in Note 9 to the consolidated financial statements), and 2014 and 2013 information in the financial statement schedule of the Company, and the effectiveness of the Company’s internal control over financial reporting as of December 31, 2014, appearing in this Annual Report on Form 10-K of Blackstone Mortgage Trust, Inc. for the year ended December 31, 2014.

/s/ Deloitte & Touche LLP

New York, NY

February 17, 2015

EX-23.2

Exhibit 23.2

Consent of Independent Registered Public Accounting Firm

We consent to the incorporation by reference in the Registration Statement on Form S-3 (File No. 333-190191) of Blackstone Mortgage Trust, Inc. (formerly known as Capital Trust, Inc.) and in the related Prospectuses and on Form S-8 (File Nos. 333-39743, 333-144929, 333-179668 and 333-189806) pertaining to: (i) the Amended and Restated 1997 Long-Term Incentive Stock Plan and the Amended and Restated 1997 Non-Employee Director Stock Plan; (ii) the 2007 Long-Term Incentive Plan; (iii) the 2011 Long-Term Incentive Plan; and (iv) the 2013 Stock Incentive Plan of our report dated March 26, 2013, with respect to the consolidated statements of operations, comprehensive income, changes in (deficit) equity, and cash flows and schedule of Capital Trust, Inc. and Subsidiaries, included in this Annual Report (Form 10-K) for the year ended December 31, 2014.

/s/ Ernst & Young LLP

New York, New York

February 17, 2015

EX-31.1

Exhibit 31.1

CERTIFICATION

PURSUANT TO 17 CFR 240.13a-14

PROMULGATED UNDER

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Stephen D. Plavin, certify that:

1. I have reviewed this annual report on Form 10-K of Blackstone Mortgage Trust, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: February 17, 2015

/s/ Stephen D. Plavin

Stephen D. Plavin

Chief Executive Officer

EX-31.2

Exhibit 31.2

CERTIFICATION

PURSUANT TO 17 CFR 240.13a-14

PROMULGATED UNDER

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

I, Paul D. Quinlan, certify that:

1. I have reviewed this annual report on Form 10-K of Blackstone Mortgage Trust, Inc.;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: February 17, 2015

/s/ Paul D. Quinlan

Paul D. Quinlan

Chief Financial Officer

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Blackstone Mortgage Trust, Inc. (the “Company”) on Form 10-K for the period ended December 31, 2014 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Stephen D. Plavin, Chief Executive Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Stephen D. Plavin

Stephen D. Plavin

Chief Executive Officer

February 17, 2015

This certification accompanies each Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

A signed original of this written statement required by Section 906 has been provided by the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

In connection with the Annual Report of Blackstone Mortgage Trust, Inc. (the “Company”) on Form 10-K for the period ended December 31, 2014 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Paul D. Quinlan, Chief Financial Officer of the Company, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Paul D. Quinlan

Paul D. Quinlan

Chief Financial Officer

February 17, 2015

This certification accompanies each Report pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 and shall not, except to the extent required by the Sarbanes-Oxley Act of 2002, be deemed filed by the Company for purposes of Section 18 of the Securities Exchange Act of 1934, as amended.

A signed original of this written statement required by Section 906 has been provided by the Company and will be retained by the Company and furnished to the Securities and Exchange Commission or its staff upon request.

EX-99.1

Exhibit 99.1

SECTION 13(r) DISCLOSURE

The disclosures reproduced below were initially included in periodic reports filed with the Securities and Exchange Commission (the “SEC”) by The Blackstone Group L.P. (“Blackstone”), Travelport Limited and Travelport Worldwide Limited, as applicable, with respect to the fiscal quarters ended March 31, 2014, June 30, 2014 and September 30, 2014, in accordance with Section 13(r) of the Securities Exchange Act of 1934, as amended. As of the date Blackstone Mortgage Trust, Inc. (“BXMT”) filed its Form 10-K for the fiscal year ended December 31, 2014 with the SEC, neither Blackstone nor Travelport Worldwide Limited had filed its Form 10-K for such period. Therefore, the disclosures reproduced below do not include information for the fiscal quarter ended December 31, 2014. Travelport Limited and Travelport Worldwide Limited may be considered affiliates of Blackstone, and therefore affiliates of BXMT. BXMT did not independently verify or participate in the preparation of any of these disclosures.

Travelport Limited included the following disclosure in its Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2014:

Trade Sanctions Disclosure

The following activities are disclosed as required by Section 13(r)(1)(D)(iii) of the Exchange Act.

As part of our global business in the travel industry, we provide certain passenger travel-related GDS and Technology Services to Iran Air. We also provide certain Technology Services to Iran Air Tours. All of these services are either exempt from applicable sanctions prohibitions pursuant to a statutory exemption permitting transactions ordinarily incident to travel or, to the extent not otherwise exempt, specifically licensed by the U.S. Office of Foreign Assets Control. Subject to any changes in the exempt/licensed status of such activities, we intend to continue these business activities, which are directly related to and promote the arrangement of travel for individuals.

The gross revenue and net profit attributable to these activities in the quarter ended March 31, 2014 were approximately $181,000 and $125,000, respectively.

Blackstone included the following disclosure in its Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2014:

Travelport Limited, which may be considered our affiliate, included the disclosure reproduced below in its Form 10-Q for the fiscal quarter ended June 30, 2014. We have not independently verified or participated in the preparation of this disclosure.

“As part of our global business in the travel industry, we provide certain passenger travel-related GDS and Technology Services to Iran Air. We also provide certain airline Technology Services to Iran Air Tours. All of these services are either exempt from applicable sanctions prohibitions pursuant to a statutory exemption permitting transactions ordinarily incident to travel or, to the extent not otherwise exempt, specifically licensed by the U.S. Office of Foreign Assets Control. Subject to any changes in the exempt/licensed status of such activities, we intend to continue these business activities, which are directly related to and promote the arrangement of travel for individuals.

The gross revenue and net profit attributable to these activities in the quarter ended June 30, 2014 were approximately $161,000 and $117,000, respectively.”

Travelport Worldwide Limited included the following disclosure in its Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2014:

Trade Sanctions Disclosure

The following activities are disclosed as required by Section 13(r)(1)(D)(iii) of the Exchange Act.

As part of our global business in the travel industry, we provide certain passenger travel-related Travel Commerce Platform and Technology Services to Iran Air. We also provide certain Technology Services to Iran Air Tours. All of these services are either exempt from applicable sanctions prohibitions pursuant to a statutory exemption permitting transactions ordinarily incident to travel or, to the extent not otherwise exempt, specifically licensed by the U.S. Office of Foreign Assets Control. Subject to any changes in the exempt/licensed status of such activities, we intend to continue these business activities, which are directly related to and promote the arrangement of travel for individuals.

The gross revenue and net profit attributable to these activities in the quarter ended September 30, 2014 were approximately $171,000 and $124,000, respectively.

2

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Organization - Additional Information (Detail)	12 Months Ended
	Dec. 31, 2014 Segment
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of operating segments	2

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Secured Financings - Summary of Key Terms of Revolving Repurchase Facilities (Detail)	12 Months Ended
	Dec. 31, 2014
MetLife [Member]
Line of Credit Facility [Line Items]
LIBOR basis spread on debt obligation	L+1.81 %
Rate	1.81%
Guarantee	50.00%
Advance Rate	77.27%
Margin Call	Collateral marks only
Term/Maturity	June 29, 2020
Wells Fargo [Member]
Line of Credit Facility [Line Items]
LIBOR basis spread on debt obligation	L+1.82 %
Rate	1.82%
Guarantee	25.00%
Advance Rate	78.82%
Margin Call	Collateral marks only
Term/Maturity	Term matched
Citibank [Member]
Line of Credit Facility [Line Items]
LIBOR basis spread on debt obligation	L+1.93 %
Rate	1.93%
Guarantee	25.00%
Advance Rate	76.68%
Margin Call	Collateral marks only
Term/Maturity	Term matched
Bank of America [Member]
Line of Credit Facility [Line Items]
LIBOR basis spread on debt obligation	L+1.77 %
Rate	1.77%
Guarantee	50.00%
Advance Rate	79.59%
Margin Call	Collateral marks only
Term/Maturity	May 21, 2019
JP Morgan [Member]
Line of Credit Facility [Line Items]
LIBOR basis spread on debt obligation	L+1.94 %
Rate	1.94%
Guarantee	25.00%
Advance Rate	77.92%
Margin Call	Collateral marks only
Term/Maturity	Term matched
Morgan Stanley [Member]
Line of Credit Facility [Line Items]
LIBOR basis spread on debt obligation	L+2.32 %
Rate	2.32%
Guarantee	25.00%
Advance Rate	78.71%
Margin Call	Collateral marks only
Term/Maturity	March 3, 2017

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Loans Held-for-Sale - Additional Information (Detail) (USD $)	12 Months Ended		3 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Mar. 31, 2013
Accounts, Notes, Loans and Financing Receivable [Line Items]
Recovery of valuation allowance on loans held-for-sale	$ 1,300,000	$ 1,259,000
Loans held-for-sale	0	0
Loans Held-for-Sale, Net [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Amount reclassified on subordinate mortgage loan			4,600,000
Recovery of valuation allowance on loans held-for-sale		(1,259,000)
Subordinate Loans [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Amount reclassified on subordinate mortgage loan			$ 6,600,000

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Equity - Schedule of Basic and Diluted Earnings Per Share, or EPS, Based on Weighted-Average of Both Restricted and Unrestricted Class A Common Stock Outstanding (Parenthetical) (Detail) (Class A Common Stock [Member])	12 Months Ended
	Dec. 31, 2014
Class A Common Stock [Member]
Reverse stock split ratio	0.1

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Secured Financings - Summary of Key Terms of Revolving Repurchase Facilities (Parenthetical) (Detail)	12 Months Ended
	Dec. 31, 2014
Line of Credit Facility [Line Items]
Facility mature date	Dec. 30, 2016
MetLife [Member]
Line of Credit Facility [Line Items]
Maturity period	Includes five one-year extension options which may be exercised at our sole discretion.
Bank of America [Member]
Line of Credit Facility [Line Items]
Maturity period	Includes two one-year extension options which may be exercised at our sole discretion.

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Stock-Based Incentive Plans - Additional Information (Detail)	12 Months Ended
	Dec. 31, 2014 Plans	Dec. 31, 2013	Dec. 31, 2012
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of benefit plans	5
Issuance of restricted class A common stock, net	490,381	700,000	36,493
Restricted Class A Common Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Issuance of restricted class A common stock, net	490,381	700,000
Restricted shares, vesting period	3 years
Number of shares of restricted class A common stock outstanding	919,719	700,000
Vest in 2015 [Member] | Restricted Class A Common Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares of restricted class A common stock outstanding	398,751
Vest in 2016 [Member] | Restricted Class A Common Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares of restricted class A common stock outstanding	357,511
Vesting Period Two Thousand Seventeen [Member] | Restricted Class A Common Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Number of shares of restricted class A common stock outstanding	163,457
2013 Plan [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Maximum number of shares available under plan	939,319
2013 Manager Plan [Member] | Maximum [Member] | Class A Common Stock [Member]
Share-based Compensation Arrangement by Share-based Payment Award [Line Items]
Maximum number of shares available under plan	2,160,106

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Loans Receivable - Principal Balance and Net Book Value of Loans Receivable Based on Internal Risk Ratings (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014 SecurityLoan	Dec. 31, 2013 SecurityLoan
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	$ 4,428,500	$ 2,047,223
Loans Receivable [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Number of Loans	60	31
Principal balance	4,462,897	2,077,227
Net book value	4,428,500	2,047,223
Loans Receivable [Member] | Risk Rating 1-3 [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	4,428,500	2,020,223
Loans Receivable [Member] | Risk Rating 4-5 [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value		27,000
Subordinate Loans [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Number of Loans	2	5
Principal balance	88,365	264,898
Net book value	87,914	246,894
Subordinate Loans [Member] | Risk Rating 1-3 [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Number of Loans	2	3
Principal balance	88,365	227,350
Net book value	87,914	219,894
Subordinate Loans [Member] | Risk Rating 4-5 [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Number of Loans		2
Principal balance		37,548
Net book value		27,000
Senior Loans [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Number of Loans	58	26
Principal balance	4,374,532	1,811,513
Net book value	4,340,586	1,800,329
Senior Loans [Member] | Risk Rating 1-3 [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Number of Loans	58	26
Principal balance	4,374,532	1,811,513
Net book value	$ 4,340,586	$ 1,800,329

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Other Expenses (Tables)

12 Months Ended

Dec. 31, 2014

Other Income and Expenses [Abstract]

Schedule of General and Administrative Expenses

General and administrative expenses consisted of the following ($ in thousands):

	Year Ended December 31, 2014
	2014		2013		2012
Professional services	$	2,627	$	2,441	$	895
Operating and other costs		2,009		1,797		1,732
Transaction costs – investment management sale		—		—		3,870
		4,636		4,238		6,497
Non-cash and CT Legacy Portfolio compensation expenses
Management incentive awards plan – CTOPI(1)		12,898		—		—
Management incentive awards plan – CT Legacy Partners(2)		1,374		5,089		2,232
Restricted class A common stock earned		7,988		1,064		1,353
Director stock-based compensation		375		263		223
		22,635		6,416		3,808
Expenses of consolidated securitization vehicles		528		851		64
	$	27,799	$	11,505	$	10,369

(1) Represents the portion of CTOPI carried interest revenue paid under compensation awards. See Note 5 for further discussion.

(2) Represents the accrual of amounts payable under the CT Legacy Partners management incentive awards during the period. See below for discussion of the CT Legacy Partners management incentive awards plan.

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Stock-Based Incentive Plans - Movement in Outstanding Shares of Restricted Class A Common Stock and Weighted-Average Grant Date Fair Value Per Share (Detail) (Restricted Class A Common Stock [Member], USD $)	12 Months Ended
	Dec. 31, 2014
Restricted Class A Common Stock [Member]
Schedule Of Share Based Compensation Restricted Stock Units Award Activity [Line Items]
Restricted Class A Common Stock, Beginning Balance	700,000
Restricted Class A Common Stock, Granted	490,381
Restricted Class A Common Stock, Vested	(270,662)
Restricted Class A Common Stock, Ending Balance	919,719
Weighted-Average Grant Date Fair Value Per Share, Beginning Balance	$ 25.69
Weighted-Average Grant Date Fair Value Per Share, Granted	$ 27.82
Weighted-Average Grant Date Fair Value Per Share, Vested	$ 25.57
Weighted-Average Grant Date Fair Value Per Share, Ending Balance	$ 26.86

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Other Expenses - Additional Information (Detail) (USD $)	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Management fee - percent of average outstanding Equity balance	1.50%
Incentive fee computation-percent of the product per agreement	20.00%
Incentive fee computation-percent of average outstanding Equity per annum	7.00%
Management fees description	Manager is entitled to an incentive fee in an amount equal to the product of (i) 20% and (ii) the excess of (a) our Core Earnings (as defined in the management agreement) for the previous 12-month period over (b) an amount equal to 7.00% per annum multiplied by our average outstanding Equity, provided that our Core Earnings over the prior three-year period (or the period since May 29, 2013, the date of the first offering of our class A common stock following December 19, 2012, whichever is shorter) is greater than zero. Core Earnings is generally equal to our net income (loss) prepared in accordance with GAAP, excluding (i) certain non-cash items and (ii) the net income (loss) related to our CT Legacy Portfolio segment.
Management fees	$ 19,491,000	$ 5,937,000
Manager [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Management fees	17,800,000	5,900,000	0
Incentive fees payable	1,700,000	0	0
Incentive Awards Plan [Member]
Employee Service Share-based Compensation, Allocation of Recognized Period Costs [Line Items]
Percentage of the dividends paid to common equity holders created employee pool	6.75%
Percentage of granted incentive compensation to employees	94.00%
Percentage of grants vesting schedule	53.00%
Description of incentive management fee grants to employees vesting schedule	(i) 25% on the date of grant; (ii) 25% in March 2013; (iii) 25% in March 2014; and (iv) the remainder is contingent on continued employment with an affiliate of our Manager and our receipt of distributions from CT Legacy Partners. Of the remaining 47% of these grants, 29% are fully vested as a result of an acceleration event, and 18% vest only upon our receipt of distributions from CT Legacy Partners.
Percentage of grants vesting upon receipt of dividends	18.00%
Percentage of remaining grants after vesting schedule	47.00%
Percentage of fully vested grants	29.00%
Accrued payables, awards	$ 2,800,000	$ 2,800,000

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Segment Reporting - Consolidated Statement of Operations for Each Segment (Detail) (USD $)	3 Months Ended												12 Months Ended
	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Income from loans and other investments
Interest and related income													$ 184,766,000	$ 53,164,000	$ 34,939,000
Less: Interest and related expenses													69,143,000	18,017,000	38,138,000
Income from loans and other investments, net													115,623,000	35,147,000	(3,199,000)
Other expenses
Management and incentive fees													19,491,000	5,937,000
General and administrative expenses													27,799,000	11,505,000	10,369,000
Total other expenses													47,290,000	17,442,000	10,369,000
Valuation allowance on loans held-for-sale													1,300,000	1,259,000
Gain on investments at fair value													13,258,000	7,417,000	51,904,000
Loss on deconsolidation of subsidiaries													(8,615,000)		200,283,000
Gain on extinguishment of debt														38,000
Income from equity investments in unconsolidated subsidiaries													28,036,000		1,781,000
Income before income taxes													101,012,000	26,419,000	282,387,000
Income tax provision													518,000	995,000	174,000
Net income	25,338,000	23,601,000	38,439,000	13,116,000	9,728,000	10,526,000	6,768,000	(1,597,000)	122,931,000	12,900,000	3,351,000	140,622,000	100,494,000	25,424,000	279,804,000
Net income attributable to non-controlling interests													(10,449,000)	(10,392,000)	(98,780,000)
Net income (loss) attributable to Blackstone Mortgage Trust, Inc.	21,490,000	22,024,000	33,466,000	13,065,000	7,079,000	8,320,000	2,748,000	(3,115,000)	105,189,000	6,999,000	2,283,000	66,553,000	90,045,000	15,032,000	181,024,000
Loan Origination [Member]
Income from loans and other investments
Interest and related income													180,654,000	41,621,000
Less: Interest and related expenses													68,098,000	13,053,000
Income from loans and other investments, net													112,556,000	28,568,000
Other expenses
Management and incentive fees													19,491,000	5,937,000
General and administrative expenses													12,665,000	5,149,000
Total other expenses													32,156,000	11,086,000
Income before income taxes													80,400,000	17,482,000
Income tax provision													194,000	31,000
Net income													80,206,000	17,451,000
Net income attributable to non-controlling interests														(193,000)
Net income (loss) attributable to Blackstone Mortgage Trust, Inc.													80,206,000	17,258,000
CT Legacy Portfolio [Member]
Income from loans and other investments
Interest and related income													4,112,000	11,543,000
Less: Interest and related expenses													1,045,000	4,964,000
Income from loans and other investments, net													3,067,000	6,579,000
Other expenses
General and administrative expenses													15,134,000	6,356,000
Total other expenses													15,134,000	6,356,000
Valuation allowance on loans held-for-sale														1,259,000
Gain on investments at fair value													13,258,000	7,417,000
Loss on deconsolidation of subsidiaries													(8,615,000)
Gain on extinguishment of debt														38,000
Income from equity investments in unconsolidated subsidiaries													28,036,000
Income before income taxes													20,612,000	8,937,000
Income tax provision													324,000	964,000
Net income													20,288,000	7,973,000
Net income attributable to non-controlling interests													(10,449,000)	(10,199,000)
Net income (loss) attributable to Blackstone Mortgage Trust, Inc.													$ 9,839,000	$ (2,226,000)

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Secured Financings - Summary of Statistics for Asset-Specific Repurchase Agreements (Parenthetical) (Detail) (Assets Sold Under Agreements To Repurchase Carrying Amounts [Member])	12 Months Ended
	Dec. 31, 2014
Assets Sold Under Agreements To Repurchase Carrying Amounts [Member]
Participating Mortgage Loans [Line Items]
LIBOR basis spread on debt obligation	As of December 31, 2014, our floating rate loans and related liabilities were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Therefore the net exposure to each benchmark rate is in direct proportion to our net assets indexed to that rate. In addition to cash coupon, all-in yield / cost includes the amortization of deferred origination fees / financing costs.

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Discontinued Operations - Schedule of the Components of Discontinued Operations (Detail) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended												12 Months Ended
	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Total revenues	$ 58,258	$ 50,386	$ 42,466	$ 33,656	$ 26,837	$ 18,853	$ 6,017	$ 1,456	$ 6,517	$ 6,944	$ 6,763	$ 14,716
General and administrative expenses													27,799	11,505	10,369
Loss from discontinued operations															(2,138)
Loss on sale of discontinued operations															(271)
Loss from discontinued operations per share common stock:
Basic															$ (1.03)
Diluted															$ (1.03)
Discontinued Operations [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Servicing fees															9,686
Management fees from affiliates															6,312
Total revenues															15,998
General and administrative expenses															12,938
Income from discontinued operations before income taxes															3,060
Income tax provision															(5,198)
Loss from discontinued operations															(2,138)
Loss on sale of discontinued operations															$ (271)
Loss from discontinued operations per share common stock:
Basic															$ (1.03)
Diluted															$ (1.03)

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Transactions with Related Parties - Additional Information (Detail) (USD $)	0 Months Ended			1 Months Ended	12 Months Ended			1 Months Ended			0 Months Ended
	Oct. 23, 2013	Oct. 02, 2013	May 13, 2013	Dec. 31, 2014	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012	Sep. 30, 2014	Apr. 30, 2014	Jan. 31, 2014	Oct. 23, 2014	Oct. 03, 2013	Dec. 20, 2012	May 30, 2013	May 31, 2013	Jun. 20, 2014	Nov. 19, 2013	May 22, 2013	Feb. 10, 2015
Related Party Transaction [Line Items]
Class A common shares acquired by Holdings III, shares				100,000	28,275,006	25,875,000	669,047
Management Agreement expiration date					Dec. 19, 2015
Management Agreement renewal term, description					The initial term of the Management Agreement expires on December 19, 2015 and will be automatically renewed for a one-year term each anniversary thereafter unless earlier terminated.
Issuance of restricted class A common stock					490,381	700,000	36,493
Common stock value				$ 583,000	$ 583,000	$ 295,000
Joint venture agreement date					May 13, 2013
Percentage of equity interest purchased			100.00%											100.00%
Joint venture agreement end date					May 30, 2013
Charge to non-controlling interest from purchase of equity interests at fair value			193,000
Common stock, shares issued				58,269,889	58,269,889	29,501,651
Common stock, par value				$ 0.01	$ 0.01	$ 0.01
Convertible notes				161,853,000	161,853,000	159,524,000
Amount of loan originated		71,000,000
Purchased loan from third party	176,900,000
Proceeds from partial repayments of loans					119,400,000
Net Book Value Of Loans					53,800,000
Minimum [Member]
Related Party Transaction [Line Items]
Investment threshold amount				150,000,000	150,000,000
Second Amended and Restated Management Agreement [Member] | Minimum [Member]
Related Party Transaction [Line Items]
Investment threshold amount				250,000,000	250,000,000
Class A Common Stock [Member]
Related Party Transaction [Line Items]
Class A common shares acquired by Holdings III, shares				100,000	28,275,000			9,200,000	9,200,000	9,775,000
Common stock, shares issued															25,875,000
CT Legacy Portfolio [Member]
Related Party Transaction [Line Items]
Aggregate principal balance of loans																35,000,000
Aggregate book value of loans																27,000,000
Manager [Member]
Related Party Transaction [Line Items]
Issuance of restricted class A common stock											337,941	339,431
Common stock value											9,400,000	8,500,000
Vesting period of restricted class A common stock												3 years
Non-cash expense					3,800	767,000,000
Affiliate of Manager [Member]
Related Party Transaction [Line Items]
Accrued management fees payable				6,300,000	6,300,000
Management fees paid to Manager					15,700,000
Percentage of equity interest purchased			83.30%
Convertible notes																	188,000
Modification fee	2,300,000
Affiliate of Manager [Member] | Class A Common Stock [Member]
Related Party Transaction [Line Items]
Common stock value																		1,000,000
Common stock, shares issued																		1,960,784
Common stock, par value																		$ 25.50
Affiliate of Manager [Member] | Subsequent Events [Member] | Class A Common Stock [Member]
Related Party Transaction [Line Items]
Common stock, shares outstanding percentage																			5.40%
Affiliate of our Manager [Member]
Related Party Transaction [Line Items]
Preferred distributions payable to affiliate of our Manager					115,000
Payments of preferred distributions to affiliate of our Manager					2,100,000
Preferred distributions payable to affiliate of our Manager				151,000	151,000
Administrative services fees incurred					80,000	0
Affiliate of our Manager [Member] | Third-Party Service Provider [Member]
Related Party Transaction [Line Items]
Acquired service provider, date					Aug. 06, 2014
Administrative services fees incurred					96,000	0
Affiliate of our Manager [Member] | CT CDO I [Member]
Related Party Transaction [Line Items]
Special servicing fees					139,000	847,000
Special servicing fees payable				522,000	522,000	847,000
Affiliate of our Manager [Member] | Equity Capital Markets Data Services [Member]
Related Party Transaction [Line Items]
Service fees paid to third-party service provider					26,000	9,000
Blackstone [Member]
Related Party Transaction [Line Items]
Percentage of equity interest purchased			16.70%
W.R. Berkley Corporation [Member]
Related Party Transaction [Line Items]
Aggregate amount of offering as stated in letter agreement, threshold				$ 30,000,000	$ 30,000,000
Sale to Holdings III [Member]
Related Party Transaction [Line Items]
Class A common shares acquired by Holdings III, price per share													$ 20.00
Class A common shares acquired by Holdings III, shares													500,000

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Fair Values - Reconciliation of Beginning and Ending Balances of Assets Measured at Fair Value on Recurring Basis Using Level 3 Inputs (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013
Adjustments to fair value included in earnings
Valuation allowance on loans held-for-sale	$ (1,300)	$ (1,259)
Other Assets [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Balance, beginning	54,461
Consolidation of CT Legacy Partners		164,780
Proceeds from investments	(20,231)	(118,635)
Adjustments to fair value included in earnings
Gain on investments at fair value	13,277	7,332
Deferred interest		984
Balance, ending	47,507	54,461
Loans Held-for-Sale, Net [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Transfer from loans receivable, at fair value		2,000
Proceeds from investments		(3,259)
Adjustments to fair value included in earnings
Valuation allowance on loans held-for-sale		1,259
Investment in CT Legacy Assets [Member]
Fair Value, Assets Measured on Recurring Basis, Unobservable Input Reconciliation [Line Items]
Balance, beginning		132,000
Consolidation of CT Legacy Partners		$ (132,000)

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Commitments and Contingencies - Additional Information (Detail) (USD $)	12 Months Ended
	Dec. 31, 2014 Directors Loans
Commitments And Contingencies [Line Items]
Unfunded commitments	$ 513,200,000
Commitments expiration period	5 years
Number of loans receivable	35
Number of board of directors	8
Number of directors entitled to annual compensation	5
Pending Litigation [Member]
Commitments And Contingencies [Line Items]
Reserves recorded for pending litigation	0
Five Board of Directors [Member]
Commitments And Contingencies [Line Items]
Annual cash compensation	125,000
Three Board of Directors [Member]
Commitments And Contingencies [Line Items]
Annual cash compensation	0
Four Directors [Member]
Commitments And Contingencies [Line Items]
Percentage of compensation paid in cash	50.00%
Percentage of compensation in the form of deferred stock units	50.00%
Chairperson of Audit Committee [Member]
Commitments And Contingencies [Line Items]
Annual cash compensation	$ 12,000

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Income Taxes - Additional Information (Detail) (USD $)	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012	May 31, 2013
Tax Credit Carryforward [Line Items]
Annual distribution of net taxable income for U.S. federal income tax not to apply to our earnings that we distribute (percent)	90.00%
Net taxable income subject to distribution (percent)	100.00%
Excise tax rate	4.00%
Income tax provision	$ 518,000	$ 995,000	$ 174,000
Deferred tax assets	0	0
Deferred tax liabilities	0	0
Common stock, shares issued	58,269,889	29,501,651
Net operating losses carried forward		159,000,000
Net capital losses carried forward		32,000,000
NOLs expiration date	Expire in 2029
Capital Loss Carryforwards Expiring 2015 [Member]
Tax Credit Carryforward [Line Items]
Net capital losses carried forward		31,400,000
Capital Loss Carryforwards Expiring 2017 [Member]
Tax Credit Carryforward [Line Items]
Net capital losses carried forward		602,000
Internal Revenue Service [Member]
Tax Credit Carryforward [Line Items]
Net operating losses and net capital losses	$ 2,000,000
Class A Common Stock [Member]
Tax Credit Carryforward [Line Items]
Common stock, shares issued				25,875,000
Earliest Tax Year [Member]
Tax Credit Carryforward [Line Items]
Open tax year	2011
Latest Tax Year [Member]
Tax Credit Carryforward [Line Items]
Open tax year	2014

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Equity - Schedule of Basic and Diluted Earnings Per Share, Continuing Operations (Detail) (USD $) In Thousands, except Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Earnings Per Share [Abstract]
Income from continuing operations	$ 100,494	$ 25,424	$ 282,213
Net income attributable to non-controlling interests	(10,449)	(10,392)	(98,780)
Income from continuing operations attributable to Blackstone Mortgage Trust, Inc.	$ 90,045	$ 15,032	$ 183,433
Weighted-average shares outstanding	48,394,478	18,520,052	2,345,943
Warrants and options outstanding for the purchase of class A common stock			129,351
Weighted-average shares outstanding, diluted	48,394,478	18,520,052	2,475,294
Per share amount, basic	$ 1.86	$ 0.81	$ 78.19
Per share amount, diluted	$ 1.86	$ 0.81	$ 74.16

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Summary of Quarterly Results of Operations

12 Months Ended

Dec. 31, 2014

Quarterly Financial Information Disclosure [Abstract]

Summary of Quarterly Results of Operations

18. SUMMARY OF QUARTERLY RESULTS OF OPERATIONS (UNAUDITED)

The following is a summary of the unaudited quarterly results of operations for the years ended December 31, 2014, 2013, and 2012 ($ in thousands except per share data):

	March 31			June 30		September 30		December 31
2014
Revenues(1)	$	33,656		$	42,466	$	50,386	$	58,258
Net income	$	13,116		$	38,439	$	23,601	$	25,338
Net income attributable to
Blackstone Mortgage Trust, Inc.	$	13,065		$	33,466	$	22,024	$	21,490
Net income per share of class A common stock:
Basic	$	0.34		$	0.70	$	0.45	$	0.37
Diluted	$	0.34		$	0.70	$	0.45	$	0.37
2013
Revenues(1)	$	1,456		$	6,017	$	18,853	$	26,837
Net (loss) income	$	(1,597	)	$	6,768	$	10,526	$	9,728
Net (loss) income attributable to
Blackstone Mortgage Trust, Inc.	$	(3,115	)	$	2,748	$	8,320	$	7,079
Net (loss) income per share of class A common stock:
Basic	$	(1.03	)	$	0.22	$	0.29	$	0.24
Diluted	$	(1.03	)	$	0.22	$	0.29	$	0.24
2012
Revenues(1)	$	14,716		$	6,763	$	6,944	$	6,517
Net income	$	140,622		$	3,351	$	12,900	$	122,931
Net income attributable to
Blackstone Mortgage Trust, Inc.	$	66,553		$	2,283	$	6,999	$	105,189
Net income per share of class A common stock:
Basic	$	29.14		$	1.00	$	3.02	$	42.21
Diluted	$	27.39		$	0.93	$	2.84	$	40.65

(1) Excludes revenues from discontinued operations.

Basic and diluted earnings per share are computed independently based on the weighted-average shares of common stock and stock units outstanding for each period. Accordingly, the sum of the quarterly earnings per share amounts may not agree to the total for the year. Earnings per share amounts have been adjusted to give retroactive effect to the reverse stock split, which we effected on May 6, 2013. See Note 9 for a further discussion of earnings per share.

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Equity Investments in Unconsolidated Subsidiaries - Additional Information (Detail) (USD $)	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2012	Jan. 31, 2011
Schedule of Equity Method Investments [Line Items]
Distributions		$ 1,006,000
Income from equity investments in unconsolidated subsidiaries	28,036,000	1,781,000
CT Opportunity Partners I, LP [Member]
Schedule of Equity Method Investments [Line Items]
Carried interest revenue, percentage of fund's profit	17.70%
Preferred return	9.00%
Return of capital to partners	100.00%
Carried interest revenue	10,600,000
Distributions	17,900,000
Advance distribution of carried interest revenue	10,200,000
Income from equity investments in unconsolidated subsidiaries	28,000,000
Percentage of carried interest distributions pool for employees			45.00%
Percentage of granted carried interest distributions to employees	96.00%
Percentage of grants vesting schedule	65.00%
Percentage of grants vesting upon receipt of dividends	35.00%
Description of incentive management fee grants to employees vesting schedule	(i) one-third on the date of grant; (ii) one-third on September 13, 2012; and (iii) the remainder is contingent on continued employment with an affiliate of our Manager and upon our receipt of carried interest distributions from CTOPI. Of the remaining 35% of these grants, 31% are fully vested as a result of an acceleration event, and 4% vest solely upon our receipt of carried interest distributions from CTOPI or the disposition of certain investments owned by CTOPI.
Payment under equity method investment	$ 12,900,000
CT Opportunity Partners I, LP [Member] | Acceleration Event [Member]
Schedule of Equity Method Investments [Line Items]
Percentage of grants vesting upon receipt of dividends	31.00%
CT Opportunity Partners I, LP [Member] | Incentive Management Fees [Member]
Schedule of Equity Method Investments [Line Items]
Percentage of grants vesting upon receipt of dividends	4.00%

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Loans Receivable - Overall Statistics for Loans Receivable Portfolio (Parenthetical) (Detail)	12 Months Ended
	Dec. 31, 2014
Accounts, Notes, Loans and Financing Receivable [Line Items]
Commitments expiration period	5 years
Percentage of loans subject to yield maintenance, lock-out provisions, or other prepayment restrictions	85.00%
Percentage of loans open to repayment by borrower	15.00%
LIBOR [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Percentage of loans receivable by type	14.00%
Average floor rate	0.31%
Unfunded Commitments [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Commitments expiration period	4 years

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Discontinued Operations - Additional Information (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended	0 Months Ended
	Dec. 31, 2012	Dec. 19, 2012
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Purchase agreement, purchase price	$ 21,424
CT Legacy REIT [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Sale of outstanding class A preferred stock		100.00%
Sale to Holdings III [Member]
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items]
Purchase agreement, purchase price		21,400

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Segment Reporting (Tables)

12 Months Ended

Dec. 31, 2014

Segment Reporting [Abstract]

Consolidated Statement of Operations for Each Segment

The following table presents our consolidated statement of operations for each segment for the year ended December 31, 2014 ($ in thousands):

	Loan Origination		CT Legacy Portfolio			Total
Income from loans and other investments
Interest and related income	$	180,654	$	4,112		$	184,766
Less: Interest and related expenses		68,098		1,045			69,143
Income from loans and other investments, net		112,556		3,067			115,623
Other expenses
Management and incentive fees		19,491		—			19,491
General and administrative expenses		12,665		15,134			27,799
Total other expenses		32,156		15,134			47,290
Gain on investments at fair value		—		13,258			13,258
Loss on deconsolidation of subsidiaries		—		(8,615	)		(8,615	)
Income from equity investments in unconsolidated subsidiaries		—		28,036			28,036
Income before income taxes		80,400		20,612			101,012
Income tax provision		194		324			518
Net income		80,206		20,288			100,494
Net income attributable to non-controlling interests		—		(10,449	)		(10,449	)
Net income attributable to Blackstone Mortgage Trust, Inc.	$	80,206	$	9,839		$	90,045

The following table presents our consolidated balance sheet for each segment as of December 31, 2014 ($ in thousands):

	Loan Origination		CT Legacy Portfolio		Total
Assets
Cash and cash equivalents	$	51,810	$	—	$	51,810
Restricted cash		—		11,591		11,591
Loans receivable, net		4,428,500		—		4,428,500
Equity investments in unconsolidated subsidiaries		—		10,604		10,604
Accrued interest receivable, prepaid expenses, and other assets		36,531		49,485		86,016
Total assets	$	4,516,841	$	71,680	$	4,588,521
Liabilities and Equity
Accounts payable, accrued expenses, and other liabilities	$	47,328	$	13,685	$	61,013
Revolving repurchase facilities		2,040,783		—		2,040,783
Asset-specific repurchase agreements		324,553		—		324,553
Loan participations sold		499,433		—		499,433
Convertible notes, net		161,853		—		161,853
Total liabilities		3,073,950		13,685		3,087,635
Equity
Total Blackstone Mortgage Trust, Inc. stockholders’ equity		1,442,891		22,480		1,465,371
Non-controlling interests		—		35,515		35,515
Total equity		1,442,891		57,995		1,500,886
Total liabilities and equity	$	4,516,841	$	71,680	$	4,588,521

The following table presents our consolidated statement of operations for each segment for the year ended December 31, 2013 ($ in thousands):

	Loan Origination			CT Legacy Portfolio			Total
Income from loans and other investments
Interest and related income	$	41,621		$	11,543		$	53,164
Less: Interest and related expenses		13,053			4,964			18,017
Income from loans and other investments, net		28,568			6,579			35,147
Other expenses
Management and incentive fees		5,937			—			5,937
General and administrative expenses		5,149			6,356			11,505
Total other expenses		11,086			6,356			17,442
Valuation allowance on loans held-for-sale		—			1,259			1,259
Gain on investments at fair value		—			7,417			7,417
Gain on extinguishment of debt		—			38			38
Income before income taxes		17,482			8,937			26,419
Income tax benefit		31			964			995
Net income		17,451			7,973			25,424
Net income attributable to non-controlling interests		(193	)		(10,199	)		(10,392	)
Net income (loss) attributable to Blackstone Mortgage Trust, Inc.	$	17,258		$	(2,226	)	$	15,032

Consolidated Balance Sheet for Each Segment

The following table presents our consolidated balance sheet for each segment as of December 31, 2014 ($ in thousands):

	Loan Origination		CT Legacy Portfolio		Total
Assets
Cash and cash equivalents	$	51,810	$	—	$	51,810
Restricted cash		—		11,591		11,591
Loans receivable, net		4,428,500		—		4,428,500
Equity investments in unconsolidated subsidiaries		—		10,604		10,604
Accrued interest receivable, prepaid expenses, and other assets		36,531		49,485		86,016
Total assets	$	4,516,841	$	71,680	$	4,588,521
Liabilities and Equity
Accounts payable, accrued expenses, and other liabilities	$	47,328	$	13,685	$	61,013
Revolving repurchase facilities		2,040,783		—		2,040,783
Asset-specific repurchase agreements		324,553		—		324,553
Loan participations sold		499,433		—		499,433
Convertible notes, net		161,853		—		161,853
Total liabilities		3,073,950		13,685		3,087,635
Equity
Total Blackstone Mortgage Trust, Inc. stockholders’ equity		1,442,891		22,480		1,465,371
Non-controlling interests		—		35,515		35,515
Total equity		1,442,891		57,995		1,500,886
Total liabilities and equity	$	4,516,841	$	71,680	$	4,588,521

The following table presents our consolidated balance sheet for each segment as of December 31, 2013 ($ in thousands):

	Loan Origination		CT Legacy Portfolio		Total
Assets
Cash and cash equivalents	$	52,342	$	—	$	52,342
Restricted cash		—		10,096		10,096
Loans receivable, net		2,000,223		47,000		2,047,223
Equity investments in unconsolidated subsidiaries		—		22,480		22,480
Accrued interest receivable, prepaid expenses, and other assets		21,020		59,619		80,639
Total assets	$	2,073,585	$	139,195	$	2,212,780
Liabilities and Equity
Accounts payable, accrued expenses, and other liabilities	$	21,104	$	76,049	$	97,153
Revolving repurchase facilities		863,622		—		863,622
Asset-specific repurchase agreements		245,731		—		245,731
Loan participations sold		90,000		—		90,000
Convertible notes, net		159,524		—		159,524
Total liabilities		1,379,981		76,049		1,456,030
Equity
Total Blackstone Mortgage Trust, Inc. stockholders’ equity		693,604		24,305		717,909
Non-controlling interests		—		38,841		38,841
Total equity		693,604		63,146		756,750
Total liabilities and equity	$	2,073,585	$	139,195	$	2,212,780

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Secured Financings - Revolving Repurchase Facilities Outstanding (Detail) (USD $)	Dec. 31, 2014	Dec. 31, 2013
Line of Credit Facility [Line Items]
Maximum Facility Size	$ 3,377,205,000
Collateral Assets	3,121,541,000
Potential	2,425,350,000
Repurchase Borrowings Outstanding	2,040,783,000	863,622,000
Available	384,567,000
Wells Fargo [Member]
Line of Credit Facility [Line Items]
Maximum Facility Size	1,000,000,000
Collateral Assets	747,256,000
Potential	585,737,000
Repurchase Borrowings Outstanding	484,365,000
Available	101,372,000
Citibank [Member]
Line of Credit Facility [Line Items]
Maximum Facility Size	500,000,000
Collateral Assets	621,025,000
Potential	472,080,000
Repurchase Borrowings Outstanding	392,455,000	334,692,000
Available	79,625,000
Bank of America [Member]
Line of Credit Facility [Line Items]
Maximum Facility Size	500,000,000
Collateral Assets	557,810,000
Potential	441,201,000
Repurchase Borrowings Outstanding	389,347,000	271,320,000
Available	51,854,000
JP Morgan [Member]
Line of Credit Facility [Line Items]
Maximum Facility Size	488,155,000
Collateral Assets	544,654,000
Potential	422,249,000
Repurchase Borrowings Outstanding	341,487,000	257,610,000
Available	80,762,000
MetLife [Member]
Line of Credit Facility [Line Items]
Maximum Facility Size	500,000,000
Collateral Assets	476,499,000
Potential	366,902,000
Repurchase Borrowings Outstanding	305,889,000
Available	61,013,000
Morgan Stanley [Member]
Line of Credit Facility [Line Items]
Maximum Facility Size	389,050,000
Collateral Assets	174,297,000
Potential	137,181,000
Repurchase Borrowings Outstanding	127,240,000
Available	$ 9,941,000

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Equity - Schedule of Movement in Outstanding Shares of Class A Common Stock, Restricted Class A Common Stock and Deferred Stock Units (Detail)	1 Months Ended	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Equity [Abstract]
Beginning balance		29,602,884	3,016,407	2,277,344
Issuance of class A common stock	100,000	28,275,006	25,875,000	669,047
Issuance of restricted class A common stock, net		490,381	700,000	36,493
Issuance of deferred stock units		20,537	11,477	33,523
Ending balance	58,388,808	58,388,808	29,602,884	3,016,407

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Derivative Financial Instruments - Summary of Notional and Fair Value Amounts of Derivative Financial Instruments (Detail) (USD $)	Dec. 31, 2014
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Notional Amount	$ 42,525,000
Fair Value	1,138,000
Foreign Currency Contracts [Member]
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Notional Amount	42,525,000
Fair Value	$ 1,138,000

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Loans Receivable - Additional Information (Detail) (USD $)	0 Months Ended	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2014 SecurityLoan	Dec. 31, 2013 SecurityLoan
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value of loans in maturity default			27,000,000
Number of loans in maturity default			1
Reserve for loan losses		0	0
Mortgage Loan [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loan loss reserve	0
Nonaccrual loans in loan portfolio	0	0
Material interest receivable	0	0	0
Subordinate Loans [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loan impairments or loans in maturity	0
Loss reserves on loans			100.00%
Number of Loans		2	5
Subordinate Loans [Member] | Mortgage Loan [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Number of Loans			1
Subordinate Loans [Member] | Delinquent [Member] | Contractual Payments [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Gross book value			10,500,000

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Summary of Significant Accounting Policies

12 Months Ended

Dec. 31, 2014

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP, and include, on a consolidated basis, our accounts, the accounts of our wholly-owned subsidiaries, majority-owned subsidiaries, and variable interest entities, or VIEs, of which we are the primary beneficiary. All intercompany balances and transactions have been eliminated in consolidation. Certain of the assets and credit of our consolidated subsidiaries are not available to satisfy the debt or other obligations of us, our affiliates, or other entities.

One of our subsidiaries, CT Legacy Partners, LLC, or CT Legacy Partners, accounts for its operations in accordance with industry-specific GAAP accounting guidance for investment companies, pursuant to which it reports its investments at fair value. We have retained this accounting treatment in consolidation and, accordingly, report the loans and other investments of CT Legacy Partners at fair value on our consolidated balance sheets.

Certain reclassifications have been made in the presentation of the prior period consolidated financial statements to conform to the current presentation including reclassifying (i) loans receivable, at fair value, into accrued interest receivable, prepaid expenses, and other assets, (ii) securitized debt obligations into accounts payable, accrued expenses, and other liabilities, and (iii) restricted class A common stock into class A common stock.

Principles of Consolidation

We consolidate all entities that we control through either majority ownership or voting rights. In addition, we consolidate all VIEs of which we are considered the primarily beneficiary. VIEs are defined as entities in which equity investors (i) do not have the characteristics of a controlling financial interest and/or (ii) do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. The entity that consolidates a VIE is known as its primary beneficiary and is generally the entity with (i) the power to direct the activities that most significantly affect the VIE’s economic performance and (ii) the right to receive benefits from the VIE or the obligation to absorb losses of the VIE that could be significant to the VIE.

Assets of consolidated VIEs can only be used to satisfy the obligations of those VIEs. The liabilities of consolidated VIEs are non-recourse to us. As of December 31, 2013, our consolidated balance sheet included $49.8 million of other assets and $40.2 million of other liabilities that were attributable to CT CDO I, a consolidated VIE which was part of our CT Legacy Portfolio segment. During 2014, we recorded a 100% impairment of our residual interests in CT CDO I. As a result of this impairment, we no longer have a variable interest in CT CDO I, and therefore ceased to be its primary beneficiary. This resulted in the recognition of an $8.6 million loss on the deconsolidation of CT CDO I on our consolidated statement of operations. As of December 31, 2014, we no longer had any assets or liabilities on our consolidated balance sheet attributable to a consolidated VIE.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results may ultimately differ from those estimates.

Revenue Recognition

Interest income from our loans receivable is recognized over the life of each investment using the effective interest method and is recorded on the accrual basis. Recognition of fees, premiums, discounts, and direct costs associated with these investments is deferred until the loan is advanced and is then recorded over the term of the loan as an adjustment to yield. Income accrual is generally suspended for loans at the earlier of the date at which payments become 90 days past due or when, in the opinion of our Manager, recovery of income and principal becomes doubtful. Income is then recorded on the basis of cash received until accrual is resumed when the loan becomes contractually current and performance is demonstrated to be resumed.

Cash and Cash Equivalents

Cash and cash equivalents represent cash held in banks, cash on hand, and liquid investments with original maturities of three months or less. We may have bank balances in excess of federally insured amounts; however, we deposit our cash and cash equivalents with high credit-quality institutions to minimize credit risk exposure. We have not experienced, and do not expect, any losses on our cash or cash equivalents.

Restricted Cash

We classify the cash balances held by CT Legacy Partners as restricted because, while these cash balances are available for use by CT Legacy Partners for its operations, they cannot be used by us until our allocable share is distributed from CT Legacy Partners and cannot be commingled with any of our unrestricted cash balances.

Loans Receivable and Provision for Loan Losses

We originate and purchase commercial real estate debt and related instruments generally to be held as long-term investments at amortized cost. We are required to periodically evaluate each of these loans for possible impairment. Impairment is indicated when it is deemed probable that we will not be able to collect all amounts due to us pursuant to the contractual terms of the loan. If a loan is determined to be impaired, we write down the loan through a charge to the provision for loan losses. Impairment of these loans, which are collateral dependent, is measured by comparing the estimated fair value of the underlying collateral to the book value of the respective loan. These valuations require significant judgments, which include assumptions regarding capitalization rates, leasing, creditworthiness of major tenants, occupancy rates, availability of financing, exit plan, loan sponsorship, actions of other lenders, and other factors deemed necessary by our Manager. Actual losses, if any, could ultimately differ from these estimates.

Our Manager performs a quarterly review of our portfolio of loans. In conjunction with this review, our Manager assesses the risk factors of each loan, and assigns a risk rating based on a variety of factors, including, without limitation, loan-to-value ratio, debt yield, property type, geographic and local market dynamics, physical condition, cash flow volatility, leasing and tenant profile, loan structure and exit plan, and project sponsorship. Based on a 5-point scale, our loans are rated “1” through “5,” from less risk to greater risk, which ratings are defined as follows:

1  – Very Low Risk

2  – Low Risk

3  – Medium Risk

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

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

Previously, our Manager assigned risk ratings between “1” and “8,” from less risk to greater risk.

Loans Held-for-Sale and Related Allowance

In certain cases, we may classify loans as held-for-sale based upon the specific facts and circumstances of particular loans, including known or expected transactions. Loans held-for-sale are carried at the lower of their amortized cost basis or fair value, less costs to sell. A reduction in the fair value of loans held-for-sale is recorded as a charge to our consolidated statements of operations as a valuation allowance on loans held-for-sale.

Equity Investments in Unconsolidated Subsidiaries

Our carried interest in CT Opportunity Partners I, LP, or CTOPI, is accounted for using the equity method. CTOPI’s assets and liabilities are not consolidated into our financial statements due to our determination that (i) it is not a VIE and (ii) the other investors in CTOPI have sufficient rights to preclude consolidation by us. As such, we report our allocable percentage of the net assets of CTOPI on our consolidated balance sheets. The recognition of income from CTOPI is generally deferred until cash is collected or appropriate contingencies have been eliminated.

Derivative Financial Instruments

We classify all derivative financial instruments as other assets or other liabilities on our consolidated balance sheets at fair value.

On the date we enter into a derivative contract, we designate each contract as (i) a hedge of a net investment in a foreign operation, or net investment hedge, (ii) a hedge of a forecasted transaction or of the variability of cash flows to be received or paid related to a recognized asset or liability, or cash flow hedge, (iii) a hedge of a recognized asset or liability, or fair value hedge, or (iv) a derivative instrument not to be designated as a hedging derivative, or freestanding derivative. For all derivatives other than those designated as freestanding derivatives, we formally document our hedge relationships and designation at inception. This documentation includes the identification of the hedging instruments and the hedged items, its risk management objectives, strategy for undertaking the hedge transaction and our evaluation of the effectiveness of its hedged transaction.

On a quarterly basis, we also formally assess whether the derivative we designated in each hedging relationship is expected to be, and has been, highly effective in offsetting changes in the value or cash flows of the hedged items. If it is determined that a derivative is not highly effective at hedging the designated exposure, hedge accounting is discontinued. Changes in the fair value of the effective portion of our hedges are reflected in accumulated other comprehensive income (loss) on our consolidated financial statements. Changes in the fair value of the ineffective portion of our hedges are included in net income (loss). Amounts are reclassified out of accumulated other comprehensive income (loss) and into net income (loss) when the hedged item is either sold or substantially liquidated. To the extent a derivative does not qualify for hedge accounting and is deemed a freestanding derivative, the changes in its value are included in net income (loss).

Repurchase Agreements

We record investments financed with repurchase agreements as separate assets and the related borrowings under any repurchase agreements are recorded as separate liabilities on our consolidated balance sheets. Interest income earned on the investments and interest expense incurred on the repurchase agreements are reported separately on our consolidated statements of operations.

Loan Participations Sold

Loan participations sold represent senior interests in certain loans that we sold, however we present such loan participations sold as liabilities because these arrangements do not qualify as sales under GAAP. These participations are non-recourse and remain on our consolidated balance sheet until the loan is repaid. The gross presentation of loan participations sold does not impact stockholders’ equity or net income.

Convertible Notes

The “Debt with Conversion and Other Options” Topic of the Financial Accounting Standards Board, or FASB, Accounting Standards Codification, or Codification, requires the liability and equity components of convertible debt instruments that may be settled in cash upon conversion, including partial cash settlement, to be separately accounted for in a manner that reflects the issuer’s nonconvertible debt borrowing rate. The initial proceeds from the sale of convertible notes are allocated between a liability component and an equity component in a manner that reflects interest expense at the rate of similar nonconvertible debt that could have been issued at such time. The equity component represents the excess initial proceeds received over the fair value of the liability component of the notes as of the date of issuance. We measured the estimated fair value of the debt component of our convertible notes as of the issuance date based on our nonconvertible debt borrowing rate. The equity component of the convertible notes is reflected within additional paid-in capital on our consolidated balance sheet, and the resulting debt discount is amortized over the period during which the convertible notes are expected to be outstanding (through the maturity date) as additional non-cash interest expense. The additional non-cash interest expense attributable to the convertible notes will increase in subsequent periods through the maturity date as the notes accrete to their par value over the same period.

Deferred Financing Costs

The deferred financing costs that are included in accrued interest receivable, prepaid expenses, and other assets on our consolidated balance sheets include issuance and other costs related to our debt obligations. These costs are amortized as interest expense using the effective interest method over the life of the related obligations.

Fair Value of Financial Instruments

The Codification defines fair value, establishes a framework for measuring fair value, and requires certain disclosures about fair value measurements under GAAP. Specifically, this guidance defines fair value based on exit price, or the price that would be received upon the sale of an asset or the transfer of a liability in an orderly transaction between market participants at the measurement date.

The “Fair Value Measurement and Disclosures” Topic of the Codification also establishes a fair value hierarchy that prioritizes and ranks the level of market price observability used in measuring financial instruments. Market price observability is affected by a number of factors, including the type of financial instrument, the characteristics specific to the financial instrument, and the state of the marketplace, including the existence and transparency of transactions between market participants. Financial instruments with readily available quoted prices in active markets generally will have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value.

Financial instruments measured and reported at fair value are classified and disclosed based on the observability of inputs used in the determination, as follows:

• Level 1: Generally includes only unadjusted quoted prices that are available in active markets for identical financial instruments as of the reporting date.

• Level 2: Pricing inputs include quoted prices in active markets for similar instruments, quoted prices in less active or inactive markets for identical or similar instruments where multiple price quotes can be obtained, and other observable inputs, such as interest rates, yield curves, credit risks, and default rates.

• Level 3: Pricing inputs are unobservable for the financial instruments and include situations where there is little, if any, market activity for the financial instrument. These inputs require significant judgment or estimation by management of third parties when determining fair value and generally represent anything that does not meet the criteria of Levels 1 and 2.

The estimated value of each asset reported at fair value using Level 3 inputs is determined by an internal committee composed of members of senior management of our Manager, including our Chief Executive Officer, Chief Financial Officer, and other senior officers.

Certain of our other assets are reported at fair value either (i) on a recurring basis, as of each quarter-end, or (ii) on a nonrecurring basis, as a result of impairment or other events. Our assets that are recorded at fair value are discussed further in Note 14. We generally value our assets recorded at fair value by either (i) discounting expected cash flows based on assumptions regarding the collection of principal and interest and estimated market rates, or (ii) obtaining assessments from third-party dealers. For collateral-dependent loans that are identified as impaired, we measure impairment by comparing our Manager’s estimation of fair value of the underlying collateral, less costs to sell, to the book value of the respective loan. These valuations may require significant judgments, which include assumptions regarding capitalization rates, leasing, creditworthiness of major tenants, occupancy rates, availability of financing, exit plan, loan sponsorship, actions of other lenders, and other factors deemed necessary by our Manager.

We are also required by GAAP to disclose fair value information about financial instruments, that are not otherwise reported at fair value in our consolidated balance sheet, to the extent it is practicable to estimate a fair value for those instruments. These disclosure requirements exclude certain financial instruments and all non-financial instruments.

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

• Cash and cash equivalents: The carrying amount of cash on deposit and in money market funds approximates fair value.

• Restricted cash: The carrying amount of restricted cash approximates fair value.

• Loans receivable, net: The fair values for these loans were estimated by our Manager taking into consideration factors, including capitalization rates, leasing, occupancy rates, availability and cost of financing, exit plan, sponsorship, actions of other lenders, and indications of market value from other market participants. In the case of impaired loans receivable, fair value was determined based on the lower of amortized cost and the value of the underlying real estate collateral.

• Derivative financial instruments: The fair value of our foreign currency contracts was valued using advice from a third party derivative specialist, based on contractual cash flows and observable inputs comprising foreign currency rates and credit spreads.

• Repurchase obligations: The fair values for these instruments were estimated based on the rate at which a similar credit facility would have currently priced.

• Convertible notes, net: The convertible notes are actively traded and their fair values were obtained using quoted market prices based on recent transactions.

• Participations sold: The fair value of these instruments were estimated based on the value of the related loan receivable asset.

Income Taxes

Our financial results generally do not reflect provisions for current or deferred income taxes on our REIT taxable income. We believe that we operate in a manner that will continue to allow us to be taxed as a REIT and, as a result, we generally do not expect to pay substantial corporate level taxes other than those payable by our taxable REIT subsidiaries. If we were to fail to meet these requirements, we may be subject to federal, state, and local income tax on current and past income, and penalties. Refer to Note 12 for additional information.

Stock-Based Compensation

Our stock-based compensation consists of awards issued to our Manager and certain of its employees that vest over the life of the awards as well as deferred stock units issued to certain members of our Board of Directors. Stock-based compensation expense is recognized for these awards in net income on a variable basis over the applicable vesting period of the awards, based on the value of our class A common stock. Refer to Note 13 for additional information.

Earnings per Share

Basic earnings per share, or Basic EPS, is computed in accordance with the two-class method and is based on the net earnings allocable to our class A common stock, including restricted class A common stock and deferred stock units, divided by the weighted-average number of shares of class A common stock, including restricted class A common stock and deferred stock units outstanding during the period. Our restricted class A common stock is considered a participating security, as defined by GAAP, and has been included in our Basic EPS under the two-class method as these restricted shares have the same rights as our other shares of class A common stock, including participating in any gains or losses.

Diluted earnings per share, or Diluted EPS, is determined using the treasury stock method, and is based on the net earnings allocable to our class A common stock, including restricted class A common stock and deferred stock units, divided by the weighted-average number of shares of class A common stock, including restricted class A common stock and deferred stock units. Refer to Note 9 for additional discussion of earnings per share.

Foreign Currency

In the normal course of business, we enter into transactions not denominated in United States, or U.S., dollars. Foreign exchange gains and losses arising on such transactions are recorded as a gain or loss in our consolidated statements of operations. In addition, we consolidate entities that have a non-U.S. dollar functional currency. Non-U.S. dollar denominated assets and liabilities are translated to U.S. dollars at the exchange rate prevailing at the reporting date and income, expenses, gains, and losses are translated at the prevailing exchange rate on the dates that they were recorded. Cumulative translation adjustments arising from the translation of non-U.S. dollar denominated subsidiaries are recorded in other comprehensive income.

Underwriting Commissions and Offering Costs

Underwriting commissions and offering costs incurred in connection with common stock offerings are reflected as a reduction of additional paid-in capital. Costs incurred that are not directly associated with the completion of a common stock offering are expensed when incurred.

Segment Reporting

We operate our real estate finance business through a Loan Origination segment and a CT Legacy Portfolio segment. The Loan Origination segment includes our activities associated with loan origination and acquisition, the capitalization of our loan portfolio, and the costs associated with operating our business generally. The CT Legacy Portfolio segment includes our activities specifically related to CT Legacy Partners and our equity investment in CTOPI. Our Manager makes operating decisions and assesses the performance of each of our business segments based on financial and operating data and metrics generated from our internal information systems.

Recent Accounting Pronouncements

In January 2013, the FASB issued ASU 2013-01, “Balance Sheet (Topic 210): Clarifying the Scope of Disclosures About Offsetting Assets and Liabilities,” or ASU 2013-01. ASU 2013-01 was developed to clarify which instruments and transactions are subject to the offsetting disclosure requirements set forth by ASU 2011-11 “Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities.” ASU 2013-01 was effective for the first interim or annual period beginning on or after January 1, 2013, and was applied retrospectively for all comparative periods presented. The adoption of ASU 2013-01 did not have a material impact on our consolidated financial statements.

In February 2013, the FASB issued ASU 2013-02, “Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income,” or ASU 2013-02. ASU 2013-02 implements the previously deferred requirement to disclose reclassification adjustments into and out of accumulated other comprehensive income in either a note or on the face of the financial statements. ASU 2013-02 was effective for the first interim or annual period beginning after December 15, 2012, and was applied prospectively. As we have not reclassified any balances into or out of accumulated other comprehensive income, the adoption of ASU 2013-02 did not have a material impact on our consolidated financial statements.

In June 2013, the FASB issued ASU 2013-08, “Financial Services-Investment Companies (Topic 946): Amendments to the Scope, Measurement, and Disclosure Requirements,” or ASU 2013-08. ASU 2013-08 amends the criteria for qualification as an investment company under Topic 946 of the FASB Accounting Standards Codification, or Topic 946, and requires additional disclosure by investment companies. ASU 2013-08 is effective for the first interim or annual period beginning after December 15, 2013, and is to be applied prospectively. We currently consolidate CT Legacy Partners, which accounts for its operations as an investment company under Topic 946. We do not expect the adoption of ASU 2013-08 to impact CT Legacy Partners’ status as an investment company. Further, because ASU 2013-08 specifically excludes REITs from its scope, it will not otherwise impact our consolidated financial statements.

In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606),” or ASU 2014-09. ASU 2014-09 broadly amends the accounting guidance for revenue recognition. ASU 2014-09 is effective for the first interim or annual period beginning after December 15, 2016, and is to be applied prospectively. We do not anticipate that the adoption of ASU 2014-09 will have a material impact on our consolidated financial statements.

In June 2014, the FASB issued ASU 2014-11, “Transfers and Servicing (Topic 860): Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosures,” or ASU 2014-11. ASU 2014-11 amends the accounting guidance for repurchase-to-maturity transactions and repurchase agreements executed as repurchase financings, and requires additional disclosure about certain transactions by the transferor. ASU 2014-11 is effective for certain transactions that qualify for sales treatment for the first interim or annual period beginning after December 15, 2014. The new disclosure requirements for repurchase agreements, securities lending transactions, and repurchase-to-maturity transactions that qualify for secured borrowing treatment is effective for annual periods beginning after December 15, 2014, and for interim periods beginning after March 15, 2015. We currently record our repurchase arrangements as secured borrowings and do not anticipate that ASU 2014-11 will have a material impact on our consolidated financial statements.

In August 2014, the FASB issued ASU 2014-15, “Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” or ASU 2014-15. ASU 2014-15 introduces an explicit requirement for management to assess and provide certain disclosures if there is substantial doubt about an entity’s ability to continue as a going concern. ASU 2014-15 is effective for the annual period ending after December 15, 2016. We do not anticipate that the adoption of ASU 2014-15 will have a material impact on our consolidated financial statements.

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Derivative Financial Instruments - Summary of Impact of Derivative Financial Instruments to Consolidated Statement of Operations and Consolidated Statement of Comprehensive Income (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Net Investment Hedges [Member] | Foreign Currency Contracts [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Gain recognized in other comprehensive income	$ 1,138
Gain reclassified from AOCI into net income	0	0	0
Freestanding Derivatives [Member] | Interest Rate Contracts [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Loss recognized in other comprehensive income			(10,449)
Loss reclassified from AOCI into net income			(15,066)
Gain recognized in net income		$ 136

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Loans Receivable - Activity Relating to Loans Receivable (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loan fundings	$ 3,067,263	$ 2,327,914	$ 26
Unrealized loss on foreign currency translation	15,822	(798)
Deferred origination fees and expenses	(35,449)	(25,402)
Amortization of deferred fees and expenses	(19,785)	(6,290)	(566)
Reclassification to other assets	(27,000)
Net Book Value [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
December 31, 2013	2,047,223
Loan fundings	3,067,263
Loan repayments and sales	(591,246)
Unrealized loss on foreign currency translation	(52,076)
Deferred origination fees and expenses	(35,449)
Amortization of deferred fees and expenses	19,785
Reclassification to other assets	(27,000)
December 31, 2014	4,428,500
Deferred Fees and Other Items [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
December 31, 2013	(30,004)
Unrealized loss on foreign currency translation	725
Deferred origination fees and expenses	(35,449)
Amortization of deferred fees and expenses	19,785
Realized loan losses	10,546
December 31, 2014	(34,397)
Principal Balance [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
December 31, 2013	2,077,227
Loan fundings	3,067,263
Loan repayments and sales	(591,246)
Unrealized loss on foreign currency translation	(52,801)
Realized loan losses	(10,546)
Reclassification to other assets	(27,000)
December 31, 2014	$ 4,462,897

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Equity Investments in Unconsolidated Subsidiaries (Tables)

12 Months Ended

Dec. 31, 2014

Equity Method Investments and Joint Ventures [Abstract]

Activity Relating to Our Equity Investments in Unconsolidated Subsidiaries

Activity relating to our equity investments in unconsolidated subsidiaries was ($ in thousands):

	CTOPI Carried Interest
Total as of December 31, 2013	$	22,480
Distributions		(17,867	)
Deferred income allocation(1)		5,991
Total as of December 31, 2014	$	10,604

(1) In instances where we have not received cash or all appropriate contingencies have not been eliminated, we have deferred the recognition of revenue allocated to us from CTOPI in respect of our carried interest in CTOPI, and recorded an offsetting liability as a component of accounts payable, accrued expenses, and other liabilities on our consolidated balance sheets.

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Loans Receivable (Tables)

12 Months Ended

Dec. 31, 2014

Receivables [Abstract]

Overall Statistics for Loans Receivable Portfolio

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

	December 31, 2014			December 31, 2013
Number of loans		60			31
Principal balance	$	4,462,897		$	2,077,227
Net book value	$	4,428,500		$	2,047,223
Unfunded loan commitments(1)	$	513,229		$	164,283
Weighted-average cash coupon(2)		L+4.36	%		L+4.64	%
Weighted-average all-in yield(2)		L+4.81	%		L+5.26	%
Weighted-average maximum maturity (years)(3)		3.9			4.1

(1) Unfunded commitments will primarily be funded to finance property improvements or lease-related expenditures by the borrowers. These future commitments will expire over the next four years.

(2) As of December 31, 2014, our floating rate loans and related liabilities were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Therefore the net exposure to each benchmark rate is in direct proportion to our net assets indexed to that rate. In addition, 14% of our loans earned interest based on LIBOR floors, with an average floor of 0.31%, as of December 31, 2014. In addition to cash coupon, all-in yield includes the amortization of deferred origination fees, loan origination costs, and accrual of both extension and exit fees.

(3) Maximum maturity assumes all extension options are exercised by the borrower, however our loans may be repaid prior to such date. As of December 31, 2014, 85% of our loans are subject to yield maintenance, lock-out provisions, or other prepayment restrictions and 15% are open to repayment by the borrower.

Activity Relating to Loans Receivable

Activity relating to our loans receivable was ($ in thousands):

	Principal Balance			Deferred Fees and Other Items			Net Book Value
December 31, 2013	$	2,077,227		$	(30,004	)	$	2,047,223
Loan fundings		3,067,263			—			3,067,263
Loan repayments and sales		(591,246	)		—			(591,246	)
Unrealized loss on foreign currency translation		(52,801	)		725			(52,076	)
Deferred origination fees and expenses		—			(35,449	)		(35,449	)
Amortization of deferred fees and expenses		—			19,785			19,785
Realized loan losses(1)		(10,546	)		10,546			—
Reclassification to other assets		(27,000	)		—			(27,000	)
December 31, 2014	$	4,462,897		$	(34,397	)	$	4,428,500

(1) Includes a loan loss reserve of $10.5 million as of December 31, 2013, related to one loan in the CT Legacy Portfolio segment, owned by CT CDO I, with a principal balance of $10.5 million. This loan was subsequently written off in 2014 resulting in an aggregate loan loss reserve of zero as of December 31, 2014.

Types of Loans in Loan Portfolio, as well as Property Type and Geographic Distribution of Properties Securing these Loans

The tables below detail the types of loans in our loan portfolio, as well as the property type and geographic distribution of the properties securing these loans ($ in thousands):

	December 31, 2014					December 31, 2013
Asset Type	Net Book Value		Percentage			Net Book Value		Percentage
Senior loans(1)	$	4,340,586		98	%	$	1,800,329		88	%
Subordinate loans(2)		87,914		2			246,894		12
	$	4,428,500		100	%	$	2,047,223		100	%

Property Type	Net Book Value		Percentage			Net Book Value		Percentage
Office	$	1,878,605		42	%	$	864,666		42	%
Hotel		1,267,486		29			390,492		19
Multifamily		426,094		10			341,819		17
Condominium		315,686		7			275,645		13
Retail		270,812		6			43,115		2
Other		269,817		6			131,486		7
	$	4,428,500		100	%	$	2,047,223		100	%

Geographic Location	Net Book Value		Percentage			Net Book Value		Percentage
United States
Northeast	$	1,383,258		31	%	$	828,571		40	%
Southeast		657,484		15			243,798		12
West		628,275		14			469,262		23
Southwest		405,741		9			216,429		11
Midwest		335,406		8			85,708		4
Northwest		138,796		3			166,207		8
Subtotal		3,548,960		80			2,009,975		98
International
United Kingdom		622,692		14			37,248		2
Canada		137,024		3			—		—
Spain		86,289		2			—		—
Netherlands		33,535		1			—		—
Subtotal		879,540		20			37,248		2
Total	$	4,428,500		100	%	$	2,047,223		100	%

(1) Includes senior mortgages and similar credit quality loans, including related contiguous subordinate loans, and pari passu participations in senior mortgage loans.

(2) Includes subordinate interests in mortgages and mezzanine loans.

Principal Balance and Net Book Value of Loans Receivable Based on Internal Risk Ratings

The following table allocates the principal balance and net book value of our loans receivable based on our internal risk ratings as of December 31, 2014 ($ in thousands):

	Senior Loans(1)						Subordinate Loans(2)
Risk Rating	Number of Loans		Principal Balance		Net Book Value		Number of Loans		Principal Balance		Net Book Value		Total Net Book Value
1 – 3		58	$	4,374,532	$	4,340,586		2	$	88,365	$	87,914	$	4,428,500
4 – 5		—		—		—		—		—		—		—
		58	$	4,374,532	$	4,340,586		2	$	88,365	$	87,914	$	4,428,500

(1) Includes senior mortgages and similar credit quality loans, including related contiguous subordinate loans, and pari passu participations in senior mortgage loans.

(2) Includes subordinate interests in mortgages and mezzanine loans.

The following table allocates the principal balance and net book value of our loans receivable based on our internal risk ratings as of December 31, 2013 ($ in thousands):

	Senior Loans(1)						Subordinate Loans(2)
Risk Rating	Number of Loans		Principal Balance		Net Book Value		Number of Loans		Principal Balance		Net Book Value		Total Net Book Value
1 – 3		26	$	1,811,513	$	1,800,329		3	$	227,350	$	219,894	$	2,020,223
4 – 5		—		—		—		2		37,548		27,000		27,000
		26	$	1,811,513	$	1,800,329		5	$	264,898	$	246,894	$	2,047,223

(1) Includes senior mortgages and similar credit quality loans, including related contiguous subordinate loans, and pari passu participations in senior mortgage loans.

(2) Includes subordinate interests in mortgages and mezzanine loans.

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Secured Financings - Summary of Statistics for Asset-Specific Repurchase Agreements (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014 Loans	Dec. 31, 2013 Loans
Assets Sold Under Agreements To Repurchase Carrying Amounts [Member]
Participating Mortgage Loans [Line Items]
Number of loans	3	4
Principal balance	$ 324,553	$ 245,731
Weighted-average cash coupon	L+2.68 %	L+2.55 %
Weighted-average all-in yield / cost	L+3.16 %	L+3.03 %
Assets Sold Under Agreements To Repurchase Carrying Amounts [Member] | LIBOR [Member]
Participating Mortgage Loans [Line Items]
Weighted-average cash coupon	2.68%	2.55%
Weighted-average all-in yield / cost	3.16%	3.03%
Collateral Assets [Member]
Participating Mortgage Loans [Line Items]
Number of loans	4	4
Principal balance	$ 429,197	$ 334,857
Weighted-average cash coupon	L+5.07 %	L+4.79 %
Weighted-average all-in yield / cost	L+5.53 %	L+5.38 %
Collateral Assets [Member] | LIBOR [Member]
Participating Mortgage Loans [Line Items]
Weighted-average cash coupon	5.07%	4.79%
Weighted-average all-in yield / cost	5.53%	5.38%

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Loans Receivable - Activity Relating to Loans Receivable (Parenthetical) (Detail) (CT CDO I [Member], USD $) In Millions, unless otherwise specified	12 Months Ended
	Dec. 31, 2014 SecurityLoan	Dec. 31, 2013
CT CDO I [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Loan loss reserve	$ 0	$ 10.5
Aggregate principal balance	$ 10.5
Number of loan	1

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Secured Financings (Tables)

12 Months Ended

Dec. 31, 2014

Revolving Repurchase Facilities Outstanding

The following table details our revolving repurchase facilities outstanding ($ in thousands):

	December 31, 2014										Dec. 31, 2013 Borrowings Outstanding
	Maximum Facility Size(1)		Collateral Assets(2)		Repurchase Borrowings(3)
Lender					Potential		Outstanding		Available
Wells Fargo	$	1,000,000	$	747,256	$	585,737	$	484,365	$	101,372	$	—
Citibank		500,000		621,025		472,080		392,455		79,625		334,692
Bank of America		500,000		557,810		441,201		389,347		51,854		271,320
JP Morgan(4)		488,155		544,654		422,249		341,487		80,762		257,610
MetLife		500,000		476,499		366,902		305,889		61,013		—
Morgan Stanley(5)		389,050		174,297		137,181		127,240		9,941		—
	$	3,377,205	$	3,121,541	$	2,425,350	$	2,040,783	$	384,567	$	863,622

(1) Maximum facility size represents the total amount of borrowings in each repurchase agreement, however these borrowings are only available to us once sufficient collateral assets have been pledged under each facility at the discretion of the lender.

(2) Represents the principal balance of the collateral assets.

(3) Potential borrowings represent the total amount we could draw under each facility based on collateral already approved and pledged. When undrawn, these amounts are immediately available to us at our sole discretion under the terms of each revolving credit facility.

(4) The JP Morgan maximum facility size is composed of a $250.0 million facility and a £153.0 million ($238.2 million) facility.

(5) The Morgan Stanley maximum facility size represents a £250.0 million ($389.1 million) facility.

Summary of Key Terms of Revolving Repurchase Facilities

The following table outlines the key terms of our revolving repurchase facilities:

Lender	Rate(1)(2)			Guarantee(1)(3)			Advance Rate(1)			Margin Call(4)	Term/Maturity
Wells Fargo		L+1.82	%		25	%		78.82	%	Collateral marks only	Term matched(5)
Citibank		L+1.93	%		25	%		76.68	%	Collateral marks only	Term matched(5)
Bank of America		L+1.77	%		50	%		79.59	%	Collateral marks only	May 21, 2019(6)
JP Morgan		L+1.94	%		25	%		77.92	%	Collateral marks only	Term matched(5)(7)
MetLife		L+1.81	%		50	%		77.27	%	Collateral marks only	June 29, 2020(8)
Morgan Stanley		L+2.32	%		25	%		78.71	%	Collateral marks only	March 3, 2017

(1) Represents a weighted-average based on collateral assets pledged and borrowings outstanding as of December 31, 2014.

(2) Represents weighted-average cash coupon on borrowings outstanding as of December 31, 2014. As of December 31, 2014, our floating rate loans and related liabilities were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Therefore the net exposure to each benchmark rate is in direct proportion to our net assets indexed to that rate.

(3) Other than amounts guaranteed based on specific collateral asset types, borrowings under our revolving repurchase facilities are not recourse to us.

(4) Margin call provisions under our revolving repurchase facilities do not permit valuation adjustments based on capital markets activity, and are limited to collateral-specific credit marks.

(5) These revolving repurchase facilities have various availability periods during which new advances can be made and which are generally subject to each lender’s discretion. Maturity dates for advances outstanding are tied to the term of each respective collateral asset.

(6) Includes two one-year extension options which may be exercised at our sole discretion.

(7) Borrowings denominated in British pound sterling under this facility mature on December 30, 2016.

(8) Includes five one-year extension options which may be exercised at our sole discretion.

Summary of Overall Statistics for our Asset-Specific Repurchase Agreements and Loan Participations Sold

The following table details statistics for our loan participations sold ($ in thousands):

	December 31, 2014						December 31, 2013
	Participations Sold			Underlying Loans			Participations Sold			Underlying Loans
Number of loans		4			4			1			1
Principal balance	$	499,433		$	635,701		$	90,000		$	173,837
Weighted-average cash coupon(1)		L+2.51	%		L+4.10	%		L+5.12	%		L+5.66	%
Weighted-average all-in yield / cost(1)		L+2.71	%		L+4.71	%		L+5.26	%		L+9.25	%

(1) As of December 31, 2014, our floating rate loans and related liabilities were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Therefore the net exposure to each benchmark rate is in direct proportion to our net assets indexed to that rate. In addition to cash coupon, all-in yield / cost includes the amortization of deferred origination fees / financing costs.

Asset-Specific Repurchase Agreements [Member]

Summary of Overall Statistics for our Asset-Specific Repurchase Agreements and Loan Participations Sold

Asset-Specific Repurchase Agreements

The following table details statistics for our asset-specific repurchase agreements ($ in thousands):

	December 31, 2014						December 31, 2013
	Repurchase Agreements			Collateral Assets			Repurchase Agreements			Collateral Assets
Number of loans		3			4			4			4
Principal balance	$	324,553		$	429,197		$	245,731		$	334,857
Weighted-average cash coupon(1)		L+2.68	%		L+5.07	%		L+2.55	%		L+4.79	%
Weighted-average all-in yield / cost(1)		L+3.16	%		L+5.53	%		L+3.03	%		L+5.38	%

(1) As of December 31, 2014, our floating rate loans and related liabilities were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Therefore the net exposure to each benchmark rate is in direct proportion to our net assets indexed to that rate. In addition to cash coupon, all-in yield / cost includes the amortization of deferred origination fees / financing costs.

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Derivative Financial Instruments (Tables)

12 Months Ended

Dec. 31, 2014

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Summary of Notional and Fair Value Amounts of Derivative Financial Instruments

The following table summarizes the notional and fair value amounts of our derivative financial instruments as of December 31, 2014 and 2013 ($ in thousands):

	December 31, 2014				December 31, 2013
	Notional Amount		Fair Value		Notional Amount		Fair Value
Foreign Currency Contracts	$	42,525	$	1,138	$	—	$	—
	$	42,525	$	1,138	$	—	$	—

Summary of Impact of Derivative Financial Instruments to Consolidated Statement of Operations and Consolidated Statement of Comprehensive Income

The following table summarizes the impact of our derivative financial instruments to our consolidated statement of operations and consolidated statement of comprehensive income for the year ended December 31, 2014, 2013, and 2012 ($ in thousands):

	For the year ended December 31,
	2014		2013		2012
Net investment hedges – Foreign currency contracts
Gain recognized in other comprehensive income	$	1,138	$	—	$	—
Gain reclassified from AOCI into net income	$	—	$	—	$	—
Gain recognized in net income	$	—	$	—	$	—
Freestanding derivatives – Interest rate contracts(1)
Loss recognized in other comprehensive income	$	—	$	—	$	(10,449	)
Loss reclassified from AOCI into net income	$	—	$	—	$	(15,066	)
Gain recognized in net income	$	—	$	136	$	—

(1) The interest rate derivatives represent five interest rate swaps that our consolidated subsidiary, CT Legacy Partners was party to during 2013. In June 2013, CT Legacy Partners terminated these interest rate swaps and recorded a gain of $136,000 which was included as a component of interest expense on our consolidated statements of operations for the year ended December 31, 2013. CT Legacy Partners is no longer party to any derivative financial instruments as of December 31, 2014.

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Organization

12 Months Ended

Dec. 31, 2014

Accounting Policies [Abstract]

Organization

1. ORGANIZATION

References herein to “Blackstone Mortgage Trust,” “Company,” “we,” “us” or “our” refer to Blackstone Mortgage Trust, Inc. and its subsidiaries unless the context specifically requires otherwise.

Blackstone Mortgage Trust is a real estate finance company that originates and purchases senior loans collateralized by properties in North America and Europe. We are externally managed by BXMT Advisors L.L.C., or our Manager, a subsidiary of The Blackstone Group L.P., or Blackstone, and are a real estate investment trust, or REIT, traded on the New York Stock Exchange, or NYSE, under the symbol “BXMT.” We are headquartered in New York City.

We conduct our operations as a REIT for U.S. federal income tax purposes. We generally will not be subject to U.S. federal income taxes on our taxable income to the extent that we annually distribute all of our net taxable income to stockholders and maintain our qualification as a REIT. We also operate our business in a manner that permits us to maintain an exclusion from registration under the Investment Company Act of 1940, as amended. We are organized as a holding company and conduct our business primarily through our various subsidiaries. Our business is organized into two operating segments: the Loan Origination segment and the CT Legacy Portfolio segment.

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Equity (Tables)

12 Months Ended

Dec. 31, 2014

Equity [Abstract]

Summary of Class A Common Stock Issuances

The following table details our issuances of class A common stock during the year ended December 31, 2014 ($ in thousands, except share and per share data):

	Class A Common Stock Offerings								2014 Total / Wtd.-Avg.
	January 2014		April 2014		September 2014		December 2014(3)
Shares Issued		9,775,000		9,200,000		9,200,000		100,000		28,275,000
Issue Price(1)	$	26.25	$	27.72	$	27.49	$	27.58	$	27.14
Net Proceeds(2)	$	256,092	$	254,758	$	252,530	$	2,758	$	766,138

(1) Represents price per share paid to the underwriters.

(2) Net proceeds represents proceeds received from the underwriters less applicable transaction costs.

(3) Issuance represents 100,000 shares issued over a five-day period in December, with a weighted average issue price of $27.58, and generating net proceeds of $2.8 million.

Schedule of Movement in Outstanding Shares of Class A Common Stock, Restricted Class A Common Stock and Deferred Stock Units

The following table details the movement in our outstanding shares of class A common stock, including restricted class A common stock and deferred stock units:

	Year Ended December 31,
Common Stock Outstanding(1)(2)	2014		2013		2012
Beginning balance		29,602,884		3,016,407		2,277,344
Issuance of class A common stock		28,275,006		25,875,000		669,047
Issuance of restricted class A common stock, net		490,381		700,000		36,493
Issuance of deferred stock units		20,537		11,477		33,523
Ending balance		58,388,808		29,602,884		3,016,407

(1) Deferred stock units held by members of our board of directors totalled 118,919, 101,233, and 89,754 as of December 31, 2014, 2013, and 2012, respectively.

(2) Share amounts have been retroactively updated to reflect the one-for-ten reverse stock split which we effected as of May 6, 2013. See below for further discussion.

Schedule of Basic and Diluted Earnings Per Share, or EPS, Based on Weighted-Average of Both Restricted and Unrestricted Class A Common Stock Outstanding

The following table sets forth the calculation of basic and diluted net income per share of class A common stock based on the weighted-average of both restricted and unrestricted class A common stock outstanding for the indicated periods ($ in thousands, except per share data):

	Year Ended December 31,
	2014		2013		2012
Net income	$	90,045	$	15,032	$	181,024
Weighted-average shares outstanding(1)		48,394,478		18,520,052		2,345,943
Warrants and options outstanding for the purchase of class A common stock		—		—		129,351
Weighted-average shares outstanding, diluted		48,394,478		18,520,052		2,475,294
Per share amount, basic	$	1.86	$	0.81	$	77.16
Per share amount, diluted	$	1.86	$	0.81	$	73.13

(1) Share and per share amounts have been retroactively updated to reflect the one-for-ten reverse stock split which we effected as of May 6, 2013. See above for further discussion.

Schedule of Basic and Diluted Earnings Per Share, Continuing Operations

The following table sets forth the calculation of basic and diluted income from continuing operations per share based on the weighted-average of our shares of class A common stock, including restricted class A common stock and deferred stock units outstanding ($ in thousands, except per share data):

	Year Ended December 31,
	2014			2013			2012
Income from continuing operations	$	100,494		$	25,424		$	282,213
Net income attributable to non-controlling interests		(10,449	)		(10,392	)		(98,780	)
Income from continuing operations attributable to Blackstone Mortgage Trust, Inc.		90,045			15,032			183,433
Weighted-average shares outstanding(1)		48,394,478			18,520,052			2,345,943
Warrants and options outstanding for the purchase of class A common stock		—			—			129,351
Weighted-average shares outstanding, diluted		48,394,478			18,520,052			2,475,294
Per share amount, basic	$	1.86		$	0.81		$	78.19
Per share amount, diluted	$	1.86		$	0.81		$	74.16

(1) Share and per share amounts have been retroactively updated to reflect the one-for-ten reverse stock split which we effected as of May 6, 2013. See above for further discussion.

Schedule of Primary Components of Accumulated Other Comprehensive Loss

The following table details the primary components of accumulated other comprehensive loss as of, and for the year ended, December 31, 2012 ($ in thousands):

Accumulated Other Comprehensive Loss	Mark-to-Market on Interest Rate Hedges			Deferred Gains on Settled Hedges			Other-than- Temporary Impairments			Unrealized Gains on Securities			Total
Total as of December 31, 2011		(27,423	)		56			(16,578	)		3,361			(40,584	)
Unrealized gain on derivative financial instruments		8,367			—			—			—			8,367
Ineffective portion of cash flow hedges(1)		2,481			—			—			—			2,481
Amortization of net unrealized gains on securities		—			—			—			(775	)		(775	)
Amortization of net deferred gains on settlement of swaps		—			(56	)		—			—			(56	)
Other-than-temporary impairments of securities		—			—			678			—			678
Deconsolidation of subsidiaries		16,575			—			15,900			(2,586	)		29,889
Total as of December 31, 2012	$	—		$	—		$	—		$	—		$	—

(1) As a result of the deconsolidation of CT Legacy Asset in the first quarter of 2012, the balance of accumulated other comprehensive income related to cash flow hedges of CT Legacy Asset was reclassified to interest expense.

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Fair Values - Schedule of Range of Key Assumptions for Each Type of Loans Receivable (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013
Accounts, Notes, Loans and Financing Receivable [Line Items]
Book Value	$ 19,000	$ 40,700
Hotel [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Recovery Percentage	100.00%
Book Value	15,000	15,000
Office [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Recovery Percentage	100.00%
Book Value	$ 4,000	$ 25,700

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Summary of Significant Accounting Policies - Additional Information (Detail) (USD $)	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2012	Dec. 31, 2013
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Loss on deconsolidation	$ (8,615,000)	$ 200,283,000
Income accrual, description	Income accrual is generally suspended for loans at the earlier of the date at which payments become 90 days past due or when, in the opinion of our Manager, recovery of income and principal becomes doubtful.
Cash and cash equivalents, Description	Cash and cash equivalents represent cash held in banks, cash on hand, and liquid investments with original maturities of three months or less.
Consolidation Variable Interest Entities [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Other assets			49,800,000
Other liabilities			40,200,000
Loss on deconsolidation	8,600,000
Impairment of residual interests	100.00%
Cash and Cash Equivalents [Member]
Fair Value Inputs, Assets, Quantitative Information [Line Items]
Expected loss	$ 0

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Secured Financings - Revolving Repurchase Facilities Outstanding (Parenthetical) (Detail) (Revolving Repurchase Facilities [Member]) In Millions, unless otherwise specified	Dec. 31, 2014 JP Morgan [Member] USD ($)	Dec. 31, 2014 JP Morgan [Member] GBP (£)	Dec. 31, 2014 Maximum [Member] JP Morgan [Member] USD ($)	Dec. 31, 2014 Maximum [Member] Morgan Stanley [Member] USD ($)	Dec. 31, 2014 Maximum [Member] Morgan Stanley [Member] GBP (£)
Line of Credit Facility [Line Items]
Facility size	$ 238.2	£ 153.0	$ 250.0	$ 389.1	£ 250.0

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Equity - Schedule of Primary Components of Accumulated Other Comprehensive Loss (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2012	Dec. 31, 2014	Dec. 31, 2013
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance, beginning		$ (15,024)	$ 798
Amortization of net deferred gains on settlement of swaps	(56)
Deconsolidation of subsidiaries	29,889
Balance, ending		(15,024)	798
Mark-to-Market on Interest Rate Hedges [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance, beginning	(27,423)
Unrealized gain on derivative financial instruments	8,367
Ineffective portion of cash flow hedges	2,481
Deconsolidation of subsidiaries	16,575
Deferred Gains on Settled Hedges [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance, beginning	56
Amortization of net deferred gains on settlement of swaps	(56)
Other-Than-Temporary Impairments [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance, beginning	(16,578)
Other-than-temporary impairments of securities	678
Deconsolidation of subsidiaries	15,900
Unrealized Gains on Securities [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance, beginning	3,361
Amortization of net unrealized gains on securities	(775)
Deconsolidation of subsidiaries	(2,586)
Accumulated Other Comprehensive Income (loss) [Member]
Accumulated Other Comprehensive Income (Loss) [Line Items]
Balance, beginning	(40,584)
Unrealized gain on derivative financial instruments	8,367
Ineffective portion of cash flow hedges	2,481
Amortization of net unrealized gains on securities	(775)
Amortization of net deferred gains on settlement of swaps	(56)
Other-than-temporary impairments of securities	678
Deconsolidation of subsidiaries	$ 29,889

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Consolidated Balance Sheets (USD $) In Thousands, unless otherwise specified	Dec. 31, 2014	Dec. 31, 2013
Assets
Cash and cash equivalents	$ 51,810	$ 52,342
Restricted cash	11,591	10,096
Loans receivable, net	4,428,500	2,047,223
Equity investments in unconsolidated subsidiaries	10,604	22,480
Accrued interest receivable, prepaid expenses, and other assets	86,016	80,639
Total assets	4,588,521	2,212,780
Liabilities and Equity
Accounts payable, accrued expenses, and other liabilities	61,013	97,153
Revolving repurchase facilities	2,040,783	863,622
Asset-specific repurchase agreements	324,553	245,731
Loan participations sold	499,433	90,000
Convertible notes, net	161,853	159,524
Total liabilities	3,087,635	1,456,030
Equity
Class A common stock, $0.01 par value, 100,000,000 shares authorized, 58,269,889 and 29,501,651 shares issued and outstanding as of December 31, 2014 and 2013, respectively	583	295
Additional paid-in capital	2,027,404	1,252,986
Accumulated other comprehensive (loss) income	(15,024)	798
Accumulated deficit	(547,592)	(536,170)
Total Blackstone Mortgage Trust, Inc. stockholders' equity	1,465,371	717,909
Non-controlling interests	35,515	38,841
Total equity	1,500,886	756,750
Total liabilities and equity	$ 4,588,521	$ 2,212,780

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Loans Receivable - Types of Loans in Loan Portfolio, as well as Property Type and Geographic Distribution of Properties Securing these Loans (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2014	Dec. 31, 2013
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	$ 4,428,500	$ 2,047,223
Senior Loans [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	4,340,586	1,800,329
Percentage of Book Value	98.00%	88.00%
Subordinate Loans [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	87,914	246,894
Percentage of Book Value	2.00%	12.00%
Loans Receivable [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	4,428,500	2,047,223
Percentage of Book Value	100.00%	100.00%
Office [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	1,878,605	864,666
Percentage of Book Value	42.00%	42.00%
Hotel [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	1,267,486	390,492
Percentage of Book Value	29.00%	19.00%
Multifamily [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	426,094	341,819
Percentage of Book Value	10.00%	17.00%
Condominium [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	315,686	275,645
Percentage of Book Value	7.00%	13.00%
Retail [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	270,812	43,115
Percentage of Book Value	6.00%	2.00%
Other [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	269,817	131,486
Percentage of Book Value	6.00%	7.00%
United States Northeast [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	1,383,258	828,571
Percentage of Book Value	31.00%	40.00%
United States Southeast [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	657,484	243,798
Percentage of Book Value	15.00%	12.00%
United States West [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	628,275	469,262
Percentage of Book Value	14.00%	23.00%
United States Southwest [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	405,741	216,429
Percentage of Book Value	9.00%	11.00%
United States Midwest [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	335,406	85,708
Percentage of Book Value	8.00%	4.00%
United States Northwest [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	138,796	166,207
Percentage of Book Value	3.00%	8.00%
United States [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	3,548,960	2,009,975
Percentage of Book Value	80.00%	98.00%
United Kingdom [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	622,692	37,248
Percentage of Book Value	14.00%	2.00%
Canada [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	137,024
Percentage of Book Value	3.00%
Spain [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	86,289
Percentage of Book Value	2.00%
Netherlands [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	33,535
Percentage of Book Value	1.00%
International [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	$ 879,540	$ 37,248
Percentage of Book Value	20.00%	2.00%

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Consolidated Statements of Changes in (Deficit) Equity (USD $) In Thousands	Total	Common Stock [Member]	Additional Paid-In Capital [Member]	Accumulated Other Comprehensive Income (loss) [Member]	Accumulated Deficit [Member]	Blackstone Mortgage Trust Inc [Member]	Non-Controlling Interests [Member]
Balance at Dec. 31, 2011	$ (128,939)	$ 222	$ 597,049	$ (40,584)	$ (667,111)	$ (110,424)	$ (18,515)
Shares of class A common stock issued	10,000	50	9,950			10,000
Restricted class A common stock earned	997	4	993			997
Shares issued upon exercise of warrants		17	(17)
Deferred directors' compensation	1,027		1,027			1,027
Other comprehensive income	10,705			10,695		10,695	10
Deconsolidation of subsidiaries	29,889			29,889		29,889
Net income	279,804				181,024	181,024	98,780
Dividends declared on common stock	(49,764)				(49,764)	(49,764)
Distributions to non-controlling interests	(266)						(266)
Balance at Dec. 31, 2012	153,453	293	609,002		(535,851)	73,444	80,009
Shares of class A common stock issued	633,807	265	633,549			633,807
Adjustment to par value for reverse stock split and charter amendment		(263)	263
Restricted class A common stock earned	1,064		1,057			1,064
Issuance of convertible notes	8,826		8,826			8,826
Deferred directors' compensation	289		289			289
Other comprehensive income	798			798		798
Consolidation of subsidiaries	11,962				5,727	5,727	6,235
Net income	25,424				15,032	15,032	10,392
Dividends declared on common stock	(21,078)				(21,078)	(21,078)
Contributions from non-controlling interests	15,000						15,000
Distributions to non-controlling interests	(72,795)						(72,795)
Balance at Dec. 31, 2013	756,750	295	1,252,986	798	(536,170)	717,909	38,841
Shares of class A common stock issued	766,143	288	765,855			766,143
Restricted class A common stock earned	7,983		7,983			7,983
Dividends reinvested			205		(205)
Deferred directors' compensation	375		375			375
Other comprehensive income	(15,822)			(15,822)		(15,822)
Net income	100,494				90,045	90,045	10,449
Dividends declared on common stock	(101,262)				(101,262)	(101,262)
Distributions to non-controlling interests	(13,775)						(13,775)
Balance at Dec. 31, 2014	$ 1,500,886	$ 583	$ 2,027,404	$ (15,024)	$ (547,592)	$ 1,465,371	$ 35,515

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Schedule IV - Reconciliation of Mortgage Loans on Real Estate (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Mortgage Loans on Real Estate [Abstract]
Balance at January 1,	$ 2,047,223	$ 141,500	$ 869,269
Additions during period:
Consolidation (deconsolidation) of subsidiary			(645,163)
Loan fundings	3,067,263	2,327,914	26
Amortization of deferred fees and expenses	19,785	5,965	180
Unrealized gain (loss) on foreign currency translation		796
Valuation allowance on loans held-for-sale	1,300	1,259
Recovery of provision for loan losses			36,147
Deductions during period:
Collections of principal	(564,183)	(383,647)	(118,959)
Unrealized gain (loss) on foreign currency translation	(52,076)
Deferred origination fees and expenses	(35,449)	(25,402)
Loans sold	(27,063)	(21,162)
Transfers to other assets	(27,000)
Balance at December 31,	$ 4,428,500	$ 2,047,223	$ 141,500

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Convertible Notes, Net - Additional Information (Detail) (USD $)	0 Months Ended	12 Months Ended
	Nov. 30, 2013	Dec. 31, 2014	Dec. 31, 2013	Nov. 30, 2013
Debt Instrument [Line Items]
Convertible notes, net		$ 161,853,000	$ 159,524,000
Convertible Senior Notes [Member]
Debt Instrument [Line Items]
Convertible Senior Notes, Principal amount	172,500,000			172,500,000
Convertible Senior Notes, Interest rate	5.25%			5.25%
Maturity Date		Dec. 01, 2018
Convertible Senior Notes, Interest rate including underwriter discounts	5.87%			5.87%
Convertible notes, net		161,900,000
Discount upon issuance of Convertible Notes	9,100,000	7,300,000		9,100,000
Description of Convertible Notes conversion		The Convertible Notes are convertible at the holders' option into shares of our class A common stock, only under specific circumstances, prior to the close of business on August 31, 2018, at the applicable conversion rate in effect on the conversion date.
Debt instrument, convertible, if-converted value in excess of principal		2,900,000
Convertible Notes, assumed effective interest rate	6.50%
Convertible Senior Notes, Interest rate including amortization of discount upon issuance	7.16%			7.16%
Total interest on convertible notes		11,500,000	1,100,000
Interest on convertible notes related to cash coupon		9,100,000	874,000.0
Interest on convertible notes related to amortization of discount and certain issuance costs		2,400,000	197,000.0
Convertible Senior Notes [Member] | Class A Common Stock [Member]
Debt Instrument [Line Items]
Convertible Notes, debt conversion, common stock issued	34.8943
Convertible Notes, debt conversion, principal amount	$ 1,000
Debt instrument, conversion price	$ 28.66	$ 29.14		$ 28.66
Debt instrument, conversion price above distribution	$ 0.50

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Stock-Based Incentive Plans (Tables)

12 Months Ended

Dec. 31, 2014

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Movement in Outstanding Shares of Restricted Class A Common Stock and Weighted-Average Grant Date Fair Value Per Share

The following table details the movement in our outstanding shares of restricted class A common stock and the weighted-average grant date fair value per share:

	Restricted Class A Common Stock			Weighted-Average Grant Date Fair Value Per Share
Balance as of December 31, 2013		700,000		$	25.69
Granted		490,381			27.82
Vested		(270,662	)		25.57
Balance as of December 31, 2014		919,719		$	26.86

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Equity - Summary of Class A Common Stock Issuances (Detail) (USD $) In Thousands, except Share data, unless otherwise specified	1 Months Ended	12 Months Ended			1 Months Ended
	Dec. 31, 2014	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012	Sep. 30, 2014	Apr. 30, 2014	Jan. 31, 2014
Shares Issued	100,000	28,275,006	25,875,000	669,047
Net Proceeds	$ 2,800	$ 766,138	$ 633,807	$ 10,000
Class A Common Stock [Member]
Shares Issued	100,000	28,275,000			9,200,000	9,200,000	9,775,000
Net Proceeds	$ 2,758	$ 766,138			$ 252,530	$ 254,758	$ 256,092
Issue Price	$ 27.58	$ 27.14			$ 27.49	$ 27.72	$ 26.25

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Transactions with Related Parties

12 Months Ended

Dec. 31, 2014

Related Party Transactions [Abstract]

Transactions with Related Parties

15. TRANSACTIONS WITH RELATED PARTIES

Transactions Related to Our Manager and its Affiliates

As further described in Note 11, in December 2012 we concluded multiple, related transactions with Blackstone and its affiliates, including: (i) the Investment Management Business Sale; (ii) the sale of 500,000 shares of our class A common stock for $20.00 per share; and (iii) the execution of a new external management agreement with our Manager. In addition, Blackstone received the right to designate two members of our board of directors and exercised that right by designating an employee and one of its senior advisors to replace two former members of our board of directors who resigned effective December 19, 2012. Certain of our former employees are now employed by an affiliate of our Manager.

The initial term of the Management Agreement expires on December 19, 2015 and will be automatically renewed for a one-year term each anniversary thereafter unless earlier terminated.

On March 26, 2013, we amended the Management Agreement with our Manager to, among other things, amend our investment guidelines to permit the investment risk management committee of our board of directors, which consists of only independent directors, to approve any proposed investment by our Manager.

On July 30, 2013, we and our Manager entered into Amendment No. 1 to our amended and restated Management Agreement with our Manager. The amendments consisted of: (i) revisions to clarify that internal audit expenses (including through one or more third parties and/or affiliates of our Manager) are to be paid by us and not our Manager; and (ii) updates to reflect our recent name change and the merger of our CT Legacy REIT Mezz Borrower, Inc. subsidiary with and into CT Legacy Partners, LLC.

On October 23, 2014, we and our Manager entered into a Second Amended and Restated Management Agreement, or the Second Amended and Restated Management Agreement. The Second Amended and Restated Management Agreement amended and restated the existing Management Agreement to, among other things: (i) incorporate the terms of Amendment No. 1 to our amended and restated Management Agreement; (ii) amend our investment guidelines to increase the threshold required for approval by the investment risk management committee of our board of directors from any proposed investment in excess of $150.0 million to any proposed investment in excess of $250.0 million; and (iii) revise the definitions for Incentive Compensation and Management Fee (in each case as defined in the Second Amended and Restated Management Agreement) to remove wording regarding the calculation of payments during 2013 that is no longer relevant.

As of December 31, 2014, our consolidated balance sheet included $6.3 million of accrued management and incentive fees payable to our Manager. During the year ended December 31, 2014, we paid $15.7 million of management and incentive fees to our Manager and reimbursed our Manager for $115,000 of expenses incurred on our behalf. In addition, as of December 31, 2014, our consolidated balance sheet includes $151,000 of preferred distributions payable by CT Legacy Partners to an affiliate of our Manager. During the year ended December 31, 2014, CT Legacy Partners made aggregate preferred distributions of $2.1 million to such affiliate.

On October 23, 2014, we issued 337,941 shares of restricted class A common stock with a fair value of $9.4 million as of the grant date to our Manager under the 2013 Manager Plan. On October 3, 2013, we issued 339,431 shares of restricted class A common stock with a grant date fair value of $8.5 million to our Manager under the 2013 Manager Plan. The shares of restricted class A common stock vest ratably in quarterly installments over three years from the date of issuance. During the years ended, December 31, 2014 and 2013, we recorded a non-cash expense related to these shares of $3.8 million and $767,000, respectively. Refer to Note 13 for further discussion of our restricted class A common stock.

During the years ended December 31, 2014 and 2013, CT CDO I incurred special servicing fees to our Manager of $522,000 and $847,000 respectively, of which it paid $139,000 and $847,000 respectively.

During the years ended December 31, 2014 and 2013, we paid fees of $26,000 and $9,000, respectively, to a third-party service provider for equity capital markets data services. This service provider was acquired by an affiliate of our Manager on August 6, 2014.

During the year ended December 31, 2014, we incurred $96,000 of fees to a third-party service provider for various administrative services that was owned by an affiliate of our Manager. We did not incur any of these fees during the year ended December 31, 2013.

During the year ended December 31, 2014, we incurred $80,000 of fees to an affiliate of our Manager for various administrative services. We did not incur any of these fees during the year ended December 31, 2013.

There may be conflicts between us and our Manager with respect to certain of the investments in the CT Legacy Partners and CTOPI portfolios where an affiliate of our Manager holds a related investment that is senior, junior, or pari passu to the investments held by these portfolios.

The Management Agreement with our Manager excludes from the management fee calculation our interests in CT Legacy Partners, CTOPI, and CT CDO I, which may result in further conflicts between the economic interests of us and our Manager. Refer to Note 10 for further discussion of the Management Agreement with our Manager.

On May 13, 2013, we entered into a joint venture, 42-16 Partners, with an affiliate of our Manager to originate and warehouse loans prior to the completion of our class A common stock offering on May 29, 2013. 42-16 Partners was owned 16.7% by us and 83.3% by an affiliate of our Manager and originated one senior mortgage loan on May 21, 2013. On May 30, 2013, we ended this relationship with the affiliate of our Manager and purchased 100% of the equity interests in 42-16 Partners held by the affiliate of our Manager using proceeds from the sale of our class A common stock, and, as a result, 42-16 Partners became a 100% owned and consolidated subsidiary. We recorded a $193,000 charge to non-controlling interest as a result of the purchase of these equity interests at their fair value, rather than GAAP book value.

An affiliate of our Manager purchased 1,960,784 shares of our class A common stock as part of our stock offering on May 22, 2013. These shares were purchased for $25.50 each, the same price offered to non-affiliated purchasers. This affiliate owned class A common stock representing 5.4% of outstanding class A common stock and stock units as of February 10, 2015. In addition, an affiliate of our Manager was compensated $1.0 million for its role as co-manager of our offering of class A common stock on May 22, 2013 and $188,000 for its role as co-manager of our offering of convertible notes on November 19, 2013.

On October 2, 2013 we originated a $71.0 million loan, the proceeds of which were used by the borrower to repay an existing loan owned by an affiliate of our Manager.

On October 23, 2013, we purchased a $176.9 million loan from a third party. In conjunction with our acquisition of this loan, we consented to its restructuring, which restructuring resulted in an affiliate of our Manager earning a $2.3 million modification fee. During 2014, we received $119.4 million of proceeds from partial repayments of this loan, resulting in a net book value of $53.8 million as of December 31, 2014.

On June 20, 2014, CT CDO I, CT Legacy Partners, CTOPI, and other affiliates of our Manager entered into a deed-in-lieu of foreclosure transaction which resulted in a restructuring of the interests held by each entity with respect to certain loans in our CT Legacy Portfolio segment with an aggregate principal balance of $35.0 million and an aggregate book value of $27.0 million.

Other Related-Party Transactions

In conjunction with the Investment Management Business Sale, we entered into a letter agreement with W.R. Berkley Corporation, or WRBC, pursuant to which we agreed not to undertake any offering of our class A common stock, or other equity securities, in an aggregate amount greater than $30.0 million without prior approval of a majority of the independent members of our board of directors. This one-time approval was obtained in conjunction with our May 2013 offering of class A common stock, and we are no longer required to obtain such approval for future offerings. An employee of WRBC was a member of our board of directors until our annual meeting held on June 18, 2014.

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Fair Values (Tables)

12 Months Ended

Dec. 31, 2014

Fair Value Disclosures [Abstract]

Assets Measured and Reported at Fair Value on Recurring Basis

The following table summarizes our assets measured and reported at fair value on a recurring basis ($ in thousands):

	Level 1		Level 2		Level 3		Fair Value
December 31, 2014
Other assets, at fair value(1)	$	—	$	2,648	$	47,507	$	50,155
December 31, 2013
Other assets, at fair value(1)	$	—	$	1,944	$	54,461	$	56,405

(1) Other assets include loans, securities, equity investments, and other receivables carried at fair value.

Reconciliation of Beginning and Ending Balances of Assets Measured at Fair Value on Recurring Basis Using Level 3 Inputs

The following table reconciles the beginning and ending balances of assets measured at fair value on a recurring basis using Level 3 inputs ($ in thousands):

	2014 Other Assets			2013
				Loans Held-for-Sale, net			Other Assets			Investment in CT Legacy Assets
January 1,	$	54,461		$	—		$	—		$	132,000
Consolidation of CT Legacy Partners		—			—			164,780			(132,000	)
Transfer from loans receivable, at fair value		—			2,000			—			—
Proceeds from investments		(20,231	)		(3,259	)		(118,635	)		—
Adjustments to fair value included in earnings
Gain on investments at fair value		13,277			—			7,332			—
Valuation allowance on loans held-for-sale		—			1,259			—			—
Deferred interest		—			—			984			—
December 31,	$	47,507		$	—		$	54,461		$	—

Schedule of Range of Key Assumptions for Each Type of Loans Receivable

The following table lists the range of key assumptions for each type of loans receivable as of December 31, 2014 and December 31, 2013 ($ in millions):

	Discount Rate			Recovery Percentage(1)			Fair Value as of
Collateral Type							December 31, 2014		December 31, 2013
Hotel		(2	)		100	%	$	15.0	$	15.0
Office		(3	)		100	%		4.0		25.7
							$	19.0	$	40.7

(1) Represents the proportion of the principal expected to be collected relative to the loan balances as of December 31, 2014 and 2013, excluding loans for which there is no expectation of future cash flows.

(2) The discount rate used to value our hotel loan portfolio was 7% as of December 31, 2014 and 2013. A 100 bp discount rate increase would result in a decrease in fair value of 0.3% and 1.4% as of December 31, 2014 and 2013, respectively.

(3) The discount rates used to value our office loan portfolio was 15% as of December 31, 2014 and ranged from 6% to 15% as of December 31, 2013. A 100 bp discount rate increase would result in a decrease in fair value of 1.1% and 0.3% as of December 31, 2014 and 2013, respectively.

Schedule of Details of Carrying Amount, Face Amount, and Fair Value of Financial Instruments

The following table details the carrying amount, face amount, and fair value of the financial instruments described in Note 2 that are not reported in the statement of financial position at fair value ($ in thousands):

	December 31, 2014						December 31, 2013
	Carrying Amount		Face Amount		Fair Value		Carrying Amount		Face Amount		Fair Value
Financial assets
Cash and cash equivalents	$	51,810	$	51,810	$	51,810	$	52,342	$	52,342	$	52,342
Restricted cash		11,591		11,591		11,591		10,096		10,096		10,096
Loans receivable, net		4,428,500		4,462,897		4,462,897		2,047,223		2,077,227		2,058,699
Financial liabilities
Revolving repurchase facilities		2,040,783		2,040,783		2,040,783		863,622		863,622		863,622
Asset-specific repurchase agreements		324,553		324,553		324,553		245,731		245,731		245,731
Loan participations sold		499,433		499,433		499,433		90,000		90,000		90,000
Convertible notes, net		161,853		172,500		181,341		159,524		172,500		181,772

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Segment Reporting

12 Months Ended

Dec. 31, 2014

Segment Reporting [Abstract]

Segment Reporting

17. SEGMENT REPORTING

We operate our real estate finance business through a Loan Origination segment and a CT Legacy Portfolio segment. The Loan Origination segment includes our activities associated with the origination and acquisition of mortgage loans, the capitalization of our loan portfolio, and the costs associated with operating our business generally. The CT Legacy Portfolio segment includes our activities specifically related to CT Legacy Partners and our equity investment in CTOPI. Our Manager identifies, makes operating decisions, and assesses the performance of each of our business segments based on financial and operating data and metrics generated from our internal information systems.

Our Loan Origination segment business commenced during 2013. Accordingly, no comparable segment data exists for 2012, or any other prior period, and we have therefore not retrospectively restated our previously reported 2012 information.

There were no transactions between our operating segments during the years ended December 31, 2014 and 2013. For the year ended December 31, 2014, 11% of our revenues were generated from international sources. Substantially all of our revenues for the year ended December 31, 2013 were generated from domestic sources.

The following table presents our consolidated statement of operations for each segment for the year ended December 31, 2014 ($ in thousands):

	Loan Origination		CT Legacy Portfolio			Total
Income from loans and other investments
Interest and related income	$	180,654	$	4,112		$	184,766
Less: Interest and related expenses		68,098		1,045			69,143
Income from loans and other investments, net		112,556		3,067			115,623
Other expenses
Management and incentive fees		19,491		—			19,491
General and administrative expenses		12,665		15,134			27,799
Total other expenses		32,156		15,134			47,290
Gain on investments at fair value		—		13,258			13,258
Loss on deconsolidation of subsidiaries		—		(8,615	)		(8,615	)
Income from equity investments in unconsolidated subsidiaries		—		28,036			28,036
Income before income taxes		80,400		20,612			101,012
Income tax provision		194		324			518
Net income		80,206		20,288			100,494
Net income attributable to non-controlling interests		—		(10,449	)		(10,449	)
Net income attributable to Blackstone Mortgage Trust, Inc.	$	80,206	$	9,839		$	90,045

The following table presents our consolidated balance sheet for each segment as of December 31, 2014 ($ in thousands):

	Loan Origination		CT Legacy Portfolio		Total
Assets
Cash and cash equivalents	$	51,810	$	—	$	51,810
Restricted cash		—		11,591		11,591
Loans receivable, net		4,428,500		—		4,428,500
Equity investments in unconsolidated subsidiaries		—		10,604		10,604
Accrued interest receivable, prepaid expenses, and other assets		36,531		49,485		86,016
Total assets	$	4,516,841	$	71,680	$	4,588,521
Liabilities and Equity
Accounts payable, accrued expenses, and other liabilities	$	47,328	$	13,685	$	61,013
Revolving repurchase facilities		2,040,783		—		2,040,783
Asset-specific repurchase agreements		324,553		—		324,553
Loan participations sold		499,433		—		499,433
Convertible notes, net		161,853		—		161,853
Total liabilities		3,073,950		13,685		3,087,635
Equity
Total Blackstone Mortgage Trust, Inc. stockholders’ equity		1,442,891		22,480		1,465,371
Non-controlling interests		—		35,515		35,515
Total equity		1,442,891		57,995		1,500,886
Total liabilities and equity	$	4,516,841	$	71,680	$	4,588,521

The following table presents our consolidated statement of operations for each segment for the year ended December 31, 2013 ($ in thousands):

	Loan Origination			CT Legacy Portfolio			Total
Income from loans and other investments
Interest and related income	$	41,621		$	11,543		$	53,164
Less: Interest and related expenses		13,053			4,964			18,017
Income from loans and other investments, net		28,568			6,579			35,147
Other expenses
Management and incentive fees		5,937			—			5,937
General and administrative expenses		5,149			6,356			11,505
Total other expenses		11,086			6,356			17,442
Valuation allowance on loans held-for-sale		—			1,259			1,259
Gain on investments at fair value		—			7,417			7,417
Gain on extinguishment of debt		—			38			38
Income before income taxes		17,482			8,937			26,419
Income tax benefit		31			964			995
Net income		17,451			7,973			25,424
Net income attributable to non-controlling interests		(193	)		(10,199	)		(10,392	)
Net income (loss) attributable to Blackstone Mortgage Trust, Inc.	$	17,258		$	(2,226	)	$	15,032

The following table presents our consolidated balance sheet for each segment as of December 31, 2013 ($ in thousands):

	Loan Origination		CT Legacy Portfolio		Total
Assets
Cash and cash equivalents	$	52,342	$	—	$	52,342
Restricted cash		—		10,096		10,096
Loans receivable, net		2,000,223		47,000		2,047,223
Equity investments in unconsolidated subsidiaries		—		22,480		22,480
Accrued interest receivable, prepaid expenses, and other assets		21,020		59,619		80,639
Total assets	$	2,073,585	$	139,195	$	2,212,780
Liabilities and Equity
Accounts payable, accrued expenses, and other liabilities	$	21,104	$	76,049	$	97,153
Revolving repurchase facilities		863,622		—		863,622
Asset-specific repurchase agreements		245,731		—		245,731
Loan participations sold		90,000		—		90,000
Convertible notes, net		159,524		—		159,524
Total liabilities		1,379,981		76,049		1,456,030
Equity
Total Blackstone Mortgage Trust, Inc. stockholders’ equity		693,604		24,305		717,909
Non-controlling interests		—		38,841		38,841
Total equity		693,604		63,146		756,750
Total liabilities and equity	$	2,073,585	$	139,195	$	2,212,780

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Equity - Schedule of Movement in Outstanding Shares of Class A Common Stock, Restricted Class A Common Stock and Deferred Stock Units (Parenthetical) (Detail)	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Deferred stock units held by directors	118,919	101,233	89,754
Class A Common Stock [Member]
Reverse stock split ratio	0.1

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Consolidated Statements of Cash Flows (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Cash flows from operating activities
Net income	$ 100,494	$ 25,424	$ 279,804
Adjustments to reconcile net income to net cash provided by operating activities
Recovery of provision for loan losses			(36,147)
Valuation allowance on loans held-for-sale	(1,300)	(1,259)
Unrealized gain on investments at fair value	(13,258)	(7,417)	(51,904)
Income from equity investments in unconsolidated subsidiaries	(28,036)		(1,781)
Loss (gain) on deconsolidation of subsidiary	8,615		(200,283)
Other non-cash income (loss)		(38)	(5,896)
Non-cash compensation expense	9,716	6,242	3,808
Distributions of income from unconsolidated subsidiaries	17,867	8,795	1,933
Distributions from CT Legacy Asset			9,581
Loss on sale of discontinued operations			271
Amortization of deferred interest on loans	(19,785)	(6,290)	(566)
Amortization of deferred financing costs and premiums/discount on debt obligations	9,900	4,935	12,133
Changes in assets and liabilities, net
Accrued interest receivable, prepaid expenses, and other assets	(13,166)	116	(1,751)
Accounts payable, accrued expenses, and other liabilities	8,290	(1,839)	(2,434)
Net cash provided by operating activities	80,637	28,669	6,768
Cash flows from investing activities
Proceeds from Investment Management Business Sale			21,424
Origination and fundings of loans receivable	(3,067,263)	(2,327,913)
Origination and exit fees received on loans receivable	35,449	25,402
Principal collections and proceeds from the sale of loans receivable and other assets	620,413	508,718	172,462
Distributions from equity investments		7,151
Contributions to unconsolidated subsidiaries			(4,030)
Distributions from unconsolidated subsidiaries			1,006
(Increase) decrease in restricted cash	(1,495)	4,151	(1,261)
Net cash (used in) provided by investing activities	(2,412,896)	(1,782,491)	189,601
Cash flows from financing activities
Repayment and purchase of secured notes		(11,059)
Borrowings under revolving repurchase facilities	2,898,427	1,356,796	123,977
Repayments under revolving repurchase facilities	(1,709,740)	(571,380)	(58,464)
Borrowings under asset-specific repurchase agreements	298,512	310,827
Repayments under asset-specific repurchase agreements	(216,904)	(7,104)
Proceeds from issuance of convertible notes		168,415
Repayment of other liabilities	(20,794)	(98,965)	(241,945)
Proceeds from sale of loan participations	494,306	90,000
Repayment of loan participations	(61,836)
Payment of deferred financing costs	(16,160)	(8,867)
Settlement of interest rate swaps		(6,123)
Contributions from non-controlling interests		15,000
Purchase of and distributions to non-controlling interests	(13,775)	(72,853)	(16)
Proceeds from issuance of common stock	766,138	633,807	10,000
Dividends paid on class A common stock	(84,238)	(7,776)	(48,960)
Vesting of restricted class A common stock			(356)
Net cash provided by (used in) financing activities	2,333,936	1,790,718	(215,764)
Net increase (decrease) in cash and cash equivalents	1,677	36,896	(19,395)
Cash and cash equivalents at beginning of year	52,342	15,423	34,818
Effects of currency translation on cash and cash equivalents	(2,209)	23
Cash and cash equivalents at end of year	51,810	52,342	15,423
Supplemental disclosure of cash flows information
Payments of interest	(55,174)	(12,702)	(26,363)
(Payments) receipts of income taxes	(1,473)	8	(2,747)
Supplemental disclosure of non-cash investing and financing activities
Dividends declared, not paid	30,357	13,302	804
Participations sold, net	432,470	90,000
Deconsolidation (consolidation) of subsidiaries	$ 8,615	$ (38,913)	$ 371,621

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Consolidated Balance Sheets (Parenthetical) (USD $)	Dec. 31, 2014	Dec. 31, 2013
Statement of Financial Position [Abstract]
Common stock, par value	$ 0.01	$ 0.01
Common stock, shares authorized	100,000,000	100,000,000
Common stock, shares issued	58,269,889	29,501,651
Common stock, shares outstanding	58,269,889	29,501,651

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Other Expenses

12 Months Ended

Dec. 31, 2014

Other Income and Expenses [Abstract]

Other Expenses

10. OTHER EXPENSES

Our other expenses consist of the management and incentive fees we pay to our Manager and our general and administrative expenses.

Management and Incentive Fees

Pursuant to our management agreement, our Manager earns a base management fee in an amount equal to 1.50% per annum multiplied by our average outstanding Equity balance, as defined in the management agreement. In addition, our Manager is entitled to an incentive fee in an amount equal to the product of (i) 20% and (ii) the excess of (a) our Core Earnings (as defined in the management agreement) for the previous 12-month period over (b) an amount equal to 7.00% per annum multiplied by our average outstanding Equity, provided that our Core Earnings over the prior three-year period (or the period since May 29, 2013, the date of the first offering of our class A common stock following December 19, 2012, whichever is shorter) is greater than zero. Core Earnings is generally equal to our net income (loss) prepared in accordance with GAAP, excluding (i) certain non-cash items and (ii) the net income (loss) related to our CT Legacy Portfolio segment.

During the years ended December 31, 2014 and 2013, we incurred $17.8 million and $5.9 million of management fees payable to our Manager, respectively. We did not incur any management fees payable to our Manager during the year ended December 31, 2012. During the year ended December 31, 2014, we incurred $1.7 million of incentive fees payable to our Manager. We did not incur any incentive fees payable to our Manager during the years ended December 31, 2013 and 2012.

General and Administrative Expenses

General and administrative expenses consisted of the following ($ in thousands):

	Year Ended December 31, 2014
	2014		2013		2012
Professional services	$	2,627	$	2,441	$	895
Operating and other costs		2,009		1,797		1,732
Transaction costs – investment management sale		—		—		3,870
		4,636		4,238		6,497
Non-cash and CT Legacy Portfolio compensation expenses
Management incentive awards plan – CTOPI(1)		12,898		—		—
Management incentive awards plan – CT Legacy Partners(2)		1,374		5,089		2,232
Restricted class A common stock earned		7,988		1,064		1,353
Director stock-based compensation		375		263		223
		22,635		6,416		3,808
Expenses of consolidated securitization vehicles		528		851		64
	$	27,799	$	11,505	$	10,369

(1) Represents the portion of CTOPI carried interest revenue paid under compensation awards. See Note 5 for further discussion.

(2) Represents the accrual of amounts payable under the CT Legacy Partners management incentive awards during the period. See below for discussion of the CT Legacy Partners management incentive awards plan.

CT Legacy Partners Management Incentive Awards Plan

In conjunction with our March 2011 Restructuring, we created an employee pool for up to 6.75% of the distributions paid to the common equity holders of CT Legacy Partners (subject to certain caps and priority distributions). As of December 31, 2014, incentive awards for 94% of the pool have been granted, and the remainder was unallocated. If any awards remain unallocated at the time distributions are paid, any amounts otherwise payable to the unallocated awards will be distributed pro rata to the plan participants then employed by an affiliate of our Manager.

Approximately 53% of these grants have the following vesting schedule: (i) 25% on the date of grant; (ii) 25% in March 2013; (iii) 25% in March 2014; and (iv) the remainder is contingent on continued employment with an affiliate of our Manager and our receipt of distributions from CT Legacy Partners. Of the remaining 47% of these grants, 29% are fully vested as a result of an acceleration event, and 18% vest only upon our receipt of distributions from CT Legacy Partners.

We accrue a liability for the amounts due under these grants based on the value of CT Legacy Partners and the periodic vesting of the awards granted. Accrued payables for these awards were $2.8 million as of both December 31, 2014 and 2013.

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Schedule IV - Mortgage Loans on Real Estate (Parenthetical) (Detail) (USD $) In Billions, unless otherwise specified	Dec. 31, 2014
Mortgage Loans on Real Estate [Abstract]
Tax basis of mortgage loans	$ 3.9

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Summary of Quarterly Results of Operations - Summary of Quarterly Results of Operations (Detail) (USD $) In Thousands, except Per Share data, unless otherwise specified	3 Months Ended												12 Months Ended
	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Quarterly Financial Information Disclosure [Abstract]
Revenues	$ 58,258	$ 50,386	$ 42,466	$ 33,656	$ 26,837	$ 18,853	$ 6,017	$ 1,456	$ 6,517	$ 6,944	$ 6,763	$ 14,716
Net (loss) income	25,338	23,601	38,439	13,116	9,728	10,526	6,768	(1,597)	122,931	12,900	3,351	140,622	100,494	25,424	279,804
Net (loss) income attributable to Blackstone Mortgage Trust, Inc.	$ 21,490	$ 22,024	$ 33,466	$ 13,065	$ 7,079	$ 8,320	$ 2,748	$ (3,115)	$ 105,189	$ 6,999	$ 2,283	$ 66,553	$ 90,045	$ 15,032	$ 181,024
Net (loss) income per share of class A common stock:
Basic	$ 0.37	$ 0.45	$ 0.70	$ 0.34	$ 0.24	$ 0.29	$ 0.22	$ (1.03)	$ 42.21	$ 3.02	$ 1.00	$ 29.14	$ 1.86	$ 0.81	$ 77.16
Diluted	$ 0.37	$ 0.45	$ 0.70	$ 0.34	$ 0.24	$ 0.29	$ 0.22	$ (1.03)	$ 40.65	$ 2.84	$ 0.93	$ 27.39	$ 1.86	$ 0.81	$ 73.13

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Document and Entity Information (USD $)	12 Months Ended
	Dec. 31, 2014	Feb. 10, 2015	Jun. 30, 2014
Document And Entity Information [Abstract]
Document Type	10-K
Amendment Flag	false
Document Period End Date	Dec. 31, 2014
Document Fiscal Year Focus	2014
Document Fiscal Period Focus	FY
Trading Symbol	BXMT
Entity Registrant Name	BLACKSTONE MORTGAGE TRUST, INC.
Entity Central Index Key	0001061630
Current Fiscal Year End Date	--12-31
Entity Well-known Seasoned Issuer	Yes
Entity Current Reporting Status	Yes
Entity Voluntary Filers	No
Entity Filer Category	Large Accelerated Filer
Entity Common Stock, Shares Outstanding		58,270,028
Entity Public Float			$ 1,303,564,616

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Discontinued Operations

12 Months Ended

Dec. 31, 2014

Discontinued Operations and Disposal Groups [Abstract]

Discontinued Operations

11. DISCONTINUED OPERATIONS

Investment Management Business Sale

On December 19, 2012, pursuant to a purchase and sale agreement, dated as of September 27, 2012, or Purchase Agreement, by and between us and an affiliate of Blackstone, we completed the disposition of our investment management and special servicing business for a purchase price of $21.4 million. The sale included our equity interests in CT Investment Management Co., LLC, our related private investment fund co-investments, and 100% of the outstanding class A preferred stock of CT Legacy REIT. We refer to the entire transaction as our Investment Management Business Sale. As a result of the Investment Management Business Sale, the income and expense items related to our investment management business have been reclassified to income from discontinued operations on our consolidated statements of operations for the year ended December 31, 2012.

The following table provides additional information on the components of discontinued operations ($ in thousands):

	Year Ended December 31,
	2014		2013		2012
Servicing fees	$	—	$	—	$	9,686
Management fees from affiliates		—		—		6,312
Total revenues				—		15,998
General and administrative expenses		—		—		12,938
Income from discontinued operations before income taxes		—		—		3,060
Income tax provision		—		—		(5,198	)
Loss from discontinued operations	$	—	$	—	$	(2,138	)
Loss on sale of discontinued operations		—		—		(271	)
Loss from discontinued operations per share common stock:
Basic	$	—	$	—	$	(1.03	)
Diluted	$	—	$	—	$	(1.03	)

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Fair Values - Assets Measured and Reported at Fair Value on Recurring Basis (Detail) (Recurring [Member], USD $) In Thousands, unless otherwise specified	Dec. 31, 2014	Dec. 31, 2013
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other assets, at fair value	$ 50,155	$ 56,405
Level 2 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other assets, at fair value	2,648	1,944
Level 3 [Member]
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items]
Other assets, at fair value	$ 47,507	$ 54,461

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Segment Reporting - Consolidated Balance Sheet for Each Segment (Detail) (USD $)	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012	Dec. 31, 2011
Assets
Cash and cash equivalents	$ 51,810,000	$ 52,342,000	$ 15,423,000	$ 34,818,000
Restricted cash	11,591,000	10,096,000
Loans receivable, net	4,428,500,000	2,047,223,000
Equity investments in unconsolidated subsidiaries	10,604,000	22,480,000
Accrued interest receivable, prepaid expenses, and other assets	86,016,000	80,639,000
Total assets	4,588,521,000	2,212,780,000
Liabilities and Equity
Accounts payable, accrued expenses, and other liabilities	61,013,000	97,153,000
Revolving repurchase facilities	2,040,783,000	863,622,000
Asset-specific repurchase agreements	324,553,000	245,731,000
Loan participations sold	499,433,000	90,000,000
Convertible notes, net	161,853,000	159,524,000
Total liabilities	3,087,635,000	1,456,030,000
Equity
Total Blackstone Mortgage Trust, Inc. stockholders' equity	1,465,371,000	717,909,000
Non-controlling interests	35,515,000	38,841,000
Total equity	1,500,886,000	756,750,000	153,453,000	(128,939,000)
Total liabilities and equity	4,588,521,000	2,212,780,000
Loan Origination [Member]
Assets
Cash and cash equivalents	51,810,000	52,342,000
Loans receivable, net	4,428,500,000	2,000,223,000
Accrued interest receivable, prepaid expenses, and other assets	36,531,000	21,020,000
Total assets	4,516,841,000	2,073,585,000
Liabilities and Equity
Accounts payable, accrued expenses, and other liabilities	47,328,000	21,104,000
Revolving repurchase facilities	2,040,783,000	863,622,000
Asset-specific repurchase agreements	324,553,000	245,731,000
Loan participations sold	499,433,000	90,000,000
Convertible notes, net	161,853,000	159,524,000
Total liabilities	3,073,950,000	1,379,981,000
Equity
Total Blackstone Mortgage Trust, Inc. stockholders' equity	1,442,891,000	693,604,000
Total equity	1,442,891,000	693,604,000
Total liabilities and equity	4,516,841,000	2,073,585,000
CT Legacy Portfolio [Member]
Assets
Restricted cash	11,591,000	10,096,000
Loans receivable, net		47,000,000
Equity investments in unconsolidated subsidiaries	10,604,000	22,480,000
Accrued interest receivable, prepaid expenses, and other assets	49,485,000	59,619,000
Total assets	71,680,000	139,195,000
Liabilities and Equity
Accounts payable, accrued expenses, and other liabilities	13,685,000	76,049,000
Total liabilities	13,685,000	76,049,000
Equity
Total Blackstone Mortgage Trust, Inc. stockholders' equity	22,480,000	24,305,000
Non-controlling interests	35,515,000	38,841,000
Total equity	57,995,000	63,146,000
Total liabilities and equity	$ 71,680,000	$ 139,195,000

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Consolidated Statements of Operations (USD $) In Thousands, except Share data, unless otherwise specified	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Income from loans and other investments
Interest and related income	$ 184,766	$ 53,164	$ 34,939
Less: Interest and related expenses	69,143	18,017	38,138
Income (loss) from loans and other investments, net	115,623	35,147	(3,199)
Other expenses
Management and incentive fees	19,491	5,937
General and administrative expenses	27,799	11,505	10,369
Total other expenses	47,290	17,442	10,369
Recovery of provision for loan losses			36,147
Valuation allowance on loans held-for-sale	1,300	1,259
Unrealized gain on investments at fair value	13,258	7,417	51,904
(Loss) gain on deconsolidation of subsidiary	(8,615)		200,283
Other income		38	5,840
Income from equity investments in unconsolidated subsidiaries	28,036		1,781
Income before income taxes	101,012	26,419	282,387
Income tax provision	518	995	174
Income from continuing operations	100,494	25,424	282,213
Loss from discontinued operations, net of tax			(2,138)
Loss on sale of discontinued operations			(271)
Net income	100,494	25,424	279,804
Net income attributable to non-controlling interests	(10,449)	(10,392)	(98,780)
Net income attributable to Blackstone Mortgage Trust, Inc.	$ 90,045	$ 15,032	$ 181,024
Income from continuing operations per share of common stock
Basic	$ 1.86	$ 0.81	$ 78.19
Diluted	$ 1.86	$ 0.81	$ 74.16
Loss from discontinued operations per share of common stock
Basic			$ (1.03)
Diluted			$ (1.03)
Net income per share of common stock
Basic	$ 1.86	$ 0.81	$ 77.16
Diluted	$ 1.86	$ 0.81	$ 73.13
Weighted-average shares of common stock outstanding
Basic	48,394,478	18,520,052	2,345,943
Diluted	48,394,478	18,520,052	2,475,294

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Equity Investments in Unconsolidated Subsidiaries

12 Months Ended

Dec. 31, 2014

Equity Method Investments and Joint Ventures [Abstract]

Equity Investments in Unconsolidated Subsidiaries

5. EQUITY INVESTMENTS IN UNCONSOLIDATED SUBSIDIARIES

As of December 31, 2014, our equity investments in unconsolidated subsidiaries consisted solely of our carried interest in CTOPI, a fund sponsored and managed by an affiliate of our Manager. Activity relating to our equity investments in unconsolidated subsidiaries was ($ in thousands):

	CTOPI Carried Interest
Total as of December 31, 2013	$	22,480
Distributions		(17,867	)
Deferred income allocation(1)		5,991
Total as of December 31, 2014	$	10,604

(1) In instances where we have not received cash or all appropriate contingencies have not been eliminated, we have deferred the recognition of revenue allocated to us from CTOPI in respect of our carried interest in CTOPI, and recorded an offsetting liability as a component of accounts payable, accrued expenses, and other liabilities on our consolidated balance sheets.

Our carried interest in CTOPI entitles us to earn carried interest revenue in an amount equal to 17.7% of the fund’s profits, after a 9% preferred return and 100% return of capital to the CTOPI partners. As of December 31, 2014, we had been allocated $10.6 million of carried interest revenue from CTOPI based on a hypothetical liquidation of the fund at its net asset value. Accordingly, we have recognized this allocation as an equity investment in CTOPI on our consolidated balance sheets. Generally, we defer recognition of income from CTOPI until cash is received and appropriate contingencies have been eliminated. During the year ended December 31, 2014, we received a $17.9 million distribution from CTOPI in respect of our carried interest and recorded such amount as income in our consolidated statement of operations. In addition, we had previously recorded, but deferred recognition of, $10.2 million of advance distributions in respect of our carried interest to allow us to pay any taxes owed on phantom taxable income allocated to us from the partnership. We recognized $28.0 million of distributions as income during the year ended December 31, 2014 as all fund-level contingencies had been satisfied.

CTOPI Incentive Management Fee Grants

In January 2011, we created a management compensation pool for employees equal to 45% of the CTOPI carried interest distributions received by us. As of December 31, 2014, we had granted 96% of the pool, and the remainder was unallocated. If any awards remain unallocated at the time carried interest distributions are received by us, any amounts otherwise payable to the unallocated awards will be distributed pro rata to the plan participants then employed by an affiliate of our Manager.

Approximately 65% of these grants have the following vesting schedule: (i) one-third on the date of grant; (ii) one-third on September 13, 2012; and (iii) the remainder is contingent on continued employment with an affiliate of our Manager and upon our receipt of carried interest distributions from CTOPI. Of the remaining 35% of these grants, 31% are fully vested as a result of an acceleration event, and 4% vest solely upon our receipt of carried interest distributions from CTOPI or the disposition of certain investments owned by CTOPI.

During the year ended December 31, 2014, we made payments of $12.9 million under the CTOPI incentive plan, which amount was recognized as a component of general and administrative expenses in our consolidated statement of operations.

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Loans Held-for-Sale

12 Months Ended

Dec. 31, 2014

Debt Disclosure [Abstract]

Loans Held-for-Sale

4. LOANS HELD-FOR-SALE

During the first quarter of 2013, we reclassified a $6.6 million subordinate mortgage loan and its related $4.6 million provision for loan losses to loans held-for-sale. We subsequently sold this loan and recorded a $1.3 million valuation adjustment to reflect the position at its fair value based on the proceeds received from the sale. We did not have any loans classified as held-for-sale as of December 31, 2014 or 2013.

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Commitments and Contingencies

12 Months Ended

Dec. 31, 2014

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

16. COMMITMENTS AND CONTINGENCIES

Unfunded Commitments Under Loans Receivable

As of December 31, 2014, we had unfunded commitments of $513.2 million related to 35 loans receivable, which amounts will generally be funded to finance lease-related or capital expenditures by our borrowers. These future commitments will expire over the next five years.

Income Tax Audit of CTIMCO

The Internal Revenue Service, or the IRS, is currently undergoing an examination of the federal income tax returns for the year ended December 31, 2012 of our former subsidiary, CT Investment Management Co., LLC, or CTIMCO. The examination is on-going, and no adjustments have been communicated to us by the IRS. When we sold CTIMCO in December 2012, we provided certain indemnifications related to its operations, and any amounts determined by the IRS to be owed by CTIMCO would ultimately be paid by us.

Litigation

In the normal course of business, we are subject to various legal proceedings and claims, the resolution of which, in our Manager’s opinion, will not have a material adverse effect on our consolidated financial position or results of operations. As of December 31, 2014, there are no reserves recorded for pending litigation.

Board of Director’s Compensation

As of December 31, 2014, of the eight members of our board of directors, five are entitled to annual compensation of $125,000 each. The other three board members, including our chairman and our chief executive officer, serve as directors with no compensation. As of December 31, 2014, the annual compensation for our directors was paid 50% in cash and 50% in the form of deferred stock units. In addition, the member of our board of directors that serves as the chairperson of the audit committee of our board of directors receives additional annual cash compensation of $12,000. Compensation to the board of directors is payable in four equal quarterly installments.

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Income Taxes

12 Months Ended

Dec. 31, 2014

Income Tax Disclosure [Abstract]

Income Taxes

12. INCOME TAXES

We made an election to be taxed as a REIT, effective January 1, 2003, under the Internal Revenue Code, for U.S. federal income tax purposes. We generally must distribute annually at least 90% of our net taxable income, subject to certain adjustments and excluding any net capital gain, in order for U.S. federal income tax not to apply to our earnings that we distribute. To the extent that we satisfy this distribution requirement, but distribute less than 100% of our net taxable income, we will be subject to U.S. federal income tax on our undistributed taxable income. In addition, we will be subject to a 4% nondeductible excise tax if the actual amount that we pay out to our stockholders in a calendar year is less than a minimum amount specified under U.S. federal tax laws.

Our qualification as a REIT also depends on our ability to meet various other requirements imposed by the Internal Revenue Code, which relate to organizational structure, diversity of stock ownership and certain restrictions with regard to the nature of our assets and the sources of our income. Even if we qualify as a REIT, we may be subject to certain U.S. federal excise taxes and state and local taxes on our income and assets. If we fail to qualify as a REIT in any taxable year, we will be subject to U.S. federal income taxes at regular corporate rates (including any applicable alternative minimum tax) and will not be able to qualify as a REIT for the subsequent four full taxable years.

During the years ended December 31, 2014, 2013, and 2012, we recorded a current income tax provision of $518,000, $995,000, and $174,000, respectively, primarily related to activities of our taxable REIT subsidiaries and various state and local taxes. We did not have any deferred tax assets or liabilities as of December 31, 2014 or 2013.

As a result of our issuance of 25,875,000 shares of class A common stock in May 2013, the availability of our net operating losses, or NOLs, and net capital losses, or NCLs, is generally limited to $2.0 million per annum by change of control provisions promulgated by the Internal Revenue Service with respect to the ownership of Blackstone Mortgage Trust. As of December 31, 2014, we had estimated NOLs of $159.0 million and NCLs of $32.0 million available to be carried forward and utilized in current or future periods. To the extent we are unable to utilize our NOLs, they will expire in 2029. To the extent we are unable to utilize our NCLs, $31.4 million will expire in 2015, and $602,000 will expire in 2017.

As of December 31, 2014, tax years 2011 through 2014 remain subject to examination by taxing authorities.

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Fair Values - Schedule of Range of Key Assumptions for Each Type of Loans Receivable (Parenthetical) (Detail)	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013
Hotel [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Discount Rate	7.00%	7.00%
Fair Value of a 100 bp discount rate increase	0.30%	1.40%
Office [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Fair Value of a 100 bp discount rate increase	1.10%	0.30%
Minimum [Member] | Office [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Discount Rate		6.00%
Maximum [Member] | Office [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Discount Rate	15.00%	15.00%

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Derivative Financial Instruments

12 Months Ended

Dec. 31, 2014

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivative Financial Instruments

8. DERIVATIVE FINANCIAL INSTRUMENTS

We may, from time to time, enter into derivative contracts to achieve certain risk management objectives. Currently, we use derivative financial instruments to manage, or hedge, the variability in the carrying value of certain of our net investments in consolidated, foreign currency-denominated subsidiaries caused by the fluctuations in foreign currency exchange rates. Historically, our consolidated subsidiary, CT Legacy Partners, also used derivative financial instruments to manage, or hedge, the cash flow variability caused by the fluctuations in interest rates.

As of and during the year ended December 31, 2014, we had a net investment hedge on one Canadian dollar-denominated subsidiary which consisted of two Canadian dollar forward contracts. These foreign currency contracts had an aggregate notional value of $42.5 million, and their fair value of $1.1 million has been included as part of accrued interest receivable, prepaid expenses, and other assets on our consolidated balance sheet. The following table summarizes the notional and fair value amounts of our derivative financial instruments as of December 31, 2014 and 2013 ($ in thousands):

	December 31, 2014				December 31, 2013
	Notional Amount		Fair Value		Notional Amount		Fair Value
Foreign Currency Contracts	$	42,525	$	1,138	$	—	$	—
	$	42,525	$	1,138	$	—	$	—

The following table summarizes the impact of our derivative financial instruments to our consolidated statement of operations and consolidated statement of comprehensive income for the year ended December 31, 2014, 2013, and 2012 ($ in thousands):

	For the year ended December 31,
	2014		2013		2012
Net investment hedges – Foreign currency contracts
Gain recognized in other comprehensive income	$	1,138	$	—	$	—
Gain reclassified from AOCI into net income	$	—	$	—	$	—
Gain recognized in net income	$	—	$	—	$	—
Freestanding derivatives – Interest rate contracts(1)
Loss recognized in other comprehensive income	$	—	$	—	$	(10,449	)
Loss reclassified from AOCI into net income	$	—	$	—	$	(15,066	)
Gain recognized in net income	$	—	$	136	$	—

(1) The interest rate derivatives represent five interest rate swaps that our consolidated subsidiary, CT Legacy Partners was party to during 2013. In June 2013, CT Legacy Partners terminated these interest rate swaps and recorded a gain of $136,000 which was included as a component of interest expense on our consolidated statements of operations for the year ended December 31, 2013. CT Legacy Partners is no longer party to any derivative financial instruments as of December 31, 2014.

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Derivative Financial Instruments - Additional Information (Detail) (USD $)	12 Months Ended
	Dec. 31, 2014
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, notional amount	$ 42,525,000
Derivative, fair value	1,138,000
Derivative, description of hedged item	We had a net investment hedge on one Canadian dollar-denominated subsidiary which consisted of two Canadian dollar forward contracts.
Foreign Currency Contracts [Member]
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, notional amount	42,525,000
Derivative, fair value	1,138,000
Foreign Currency Contracts [Member] | Other Assets [Member]
Derivative Instruments and Hedging Activities Disclosures [Line Items]
Derivative, notional amount	42,500,000
Derivative, fair value	$ 1,100,000

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Secured Financings

12 Months Ended

Dec. 31, 2014

Debt Disclosure [Abstract]

Secured Financings

6. SECURED FINANCINGS

As of December 31, 2014, our secured financings included revolving repurchase facilities, asset-specific financings, and senior loan participations sold. During the year ended December 31, 2014, we entered into three revolving repurchase facilities, two asset-specific repurchase agreements, and sold three senior loan participations, providing an additional $2.2 billion of credit capacity.

Repurchase Agreements

Revolving Repurchase Facilities

The following table details our revolving repurchase facilities outstanding ($ in thousands):

	December 31, 2014										Dec. 31, 2013 Borrowings Outstanding
	Maximum Facility Size(1)		Collateral Assets(2)		Repurchase Borrowings(3)
Lender					Potential		Outstanding		Available
Wells Fargo	$	1,000,000	$	747,256	$	585,737	$	484,365	$	101,372	$	—
Citibank		500,000		621,025		472,080		392,455		79,625		334,692
Bank of America		500,000		557,810		441,201		389,347		51,854		271,320
JP Morgan(4)		488,155		544,654		422,249		341,487		80,762		257,610
MetLife		500,000		476,499		366,902		305,889		61,013		—
Morgan Stanley(5)		389,050		174,297		137,181		127,240		9,941		—
	$	3,377,205	$	3,121,541	$	2,425,350	$	2,040,783	$	384,567	$	863,622

(1) Maximum facility size represents the total amount of borrowings in each repurchase agreement, however these borrowings are only available to us once sufficient collateral assets have been pledged under each facility at the discretion of the lender.

(2) Represents the principal balance of the collateral assets.

(3) Potential borrowings represent the total amount we could draw under each facility based on collateral already approved and pledged. When undrawn, these amounts are immediately available to us at our sole discretion under the terms of each revolving credit facility.

(4) The JP Morgan maximum facility size is composed of a $250.0 million facility and a £153.0 million ($238.2 million) facility.

(5) The Morgan Stanley maximum facility size represents a £250.0 million ($389.1 million) facility.

The weighted-average outstanding balance of our revolving repurchase facilities was $1.4 billion for the year ended December 31, 2014. As of December 31, 2014, we had aggregate borrowings of $2.0 billion outstanding under our revolving repurchase facilities, with a weighted-average cash coupon of LIBOR plus 1.88% per annum and a weighted-average all-in cost of credit, including associated fees and expenses, of LIBOR plus 2.11% per annum. As of December 31, 2014, outstanding borrowings under these facilities had a weighted-average maturity, excluding extension options and term-out provisions, of 1.8 years. Borrowings under each facility are subject to the initial approval of eligible collateral loans by the lender and the maximum advance rate and pricing rate of individual advances are determined with reference to the attributes of the respective collateral loan.

The following table outlines the key terms of our revolving repurchase facilities:

Lender	Rate(1)(2)			Guarantee(1)(3)			Advance Rate(1)			Margin Call(4)	Term/Maturity
Wells Fargo		L+1.82	%		25	%		78.82	%	Collateral marks only	Term matched(5)
Citibank		L+1.93	%		25	%		76.68	%	Collateral marks only	Term matched(5)
Bank of America		L+1.77	%		50	%		79.59	%	Collateral marks only	May 21, 2019(6)
JP Morgan		L+1.94	%		25	%		77.92	%	Collateral marks only	Term matched(5)(7)
MetLife		L+1.81	%		50	%		77.27	%	Collateral marks only	June 29, 2020(8)
Morgan Stanley		L+2.32	%		25	%		78.71	%	Collateral marks only	March 3, 2017

(1) Represents a weighted-average based on collateral assets pledged and borrowings outstanding as of December 31, 2014.

(2) Represents weighted-average cash coupon on borrowings outstanding as of December 31, 2014. As of December 31, 2014, our floating rate loans and related liabilities were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Therefore the net exposure to each benchmark rate is in direct proportion to our net assets indexed to that rate.

(3) Other than amounts guaranteed based on specific collateral asset types, borrowings under our revolving repurchase facilities are not recourse to us.

(4) Margin call provisions under our revolving repurchase facilities do not permit valuation adjustments based on capital markets activity, and are limited to collateral-specific credit marks.

(5) These revolving repurchase facilities have various availability periods during which new advances can be made and which are generally subject to each lender’s discretion. Maturity dates for advances outstanding are tied to the term of each respective collateral asset.

(6) Includes two one-year extension options which may be exercised at our sole discretion.

(7) Borrowings denominated in British pound sterling under this facility mature on December 30, 2016.

(8) Includes five one-year extension options which may be exercised at our sole discretion.

Asset-Specific Repurchase Agreements

The following table details statistics for our asset-specific repurchase agreements ($ in thousands):

	December 31, 2014						December 31, 2013
	Repurchase Agreements			Collateral Assets			Repurchase Agreements			Collateral Assets
Number of loans		3			4			4			4
Principal balance	$	324,553		$	429,197		$	245,731		$	334,857
Weighted-average cash coupon(1)		L+2.68	%		L+5.07	%		L+2.55	%		L+4.79	%
Weighted-average all-in yield / cost(1)		L+3.16	%		L+5.53	%		L+3.03	%		L+5.38	%

(1) As of December 31, 2014, our floating rate loans and related liabilities were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Therefore the net exposure to each benchmark rate is in direct proportion to our net assets indexed to that rate. In addition to cash coupon, all-in yield / cost includes the amortization of deferred origination fees / financing costs.

The weighted-average outstanding asset-specific balance was $257.9 million for the year ended December 31, 2014.

Debt Covenants

Each of the guarantees related to our revolving repurchase facilities and asset-specific repurchase agreements contain the following uniform financial covenants: (i) our ratio of earnings before interest, taxes, depreciation, and amortization, or EBITDA, to fixed charges shall be not less than 1.40 to 1.0; (ii) our tangible net worth, as defined in the agreements, shall not be less than $1.1 billion as of December 31, 2014 plus 75% of the net cash proceeds of future equity issuances subsequent to December 31, 2014; (iii) cash liquidity shall not be less than the greater of (x) $10.0 million or (y) 5% of our recourse indebtedness; and (iv) our indebtedness shall not exceed 83.33% of our total assets. As of December 31, 2014 and 2013, we were in compliance with these covenants.

Loan Participations Sold

The financing of a loan by the non-recourse sale of a senior interest in the loan through a participation agreement does not qualify as a sale under GAAP. Therefore, in the instance of such sales, we present the whole loan as an asset and the loan participation sold as a liability on our consolidated balance sheet until the loan is repaid. The gross presentation of loan participations sold does not impact stockholders’ equity or net income.

The following table details statistics for our loan participations sold ($ in thousands):

	December 31, 2014						December 31, 2013
	Participations Sold			Underlying Loans			Participations Sold			Underlying Loans
Number of loans		4			4			1			1
Principal balance	$	499,433		$	635,701		$	90,000		$	173,837
Weighted-average cash coupon(1)		L+2.51	%		L+4.10	%		L+5.12	%		L+5.66	%
Weighted-average all-in yield / cost(1)		L+2.71	%		L+4.71	%		L+5.26	%		L+9.25	%

(1) As of December 31, 2014, our floating rate loans and related liabilities were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Therefore the net exposure to each benchmark rate is in direct proportion to our net assets indexed to that rate. In addition to cash coupon, all-in yield / cost includes the amortization of deferred origination fees / financing costs.

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Convertible Notes, Net

12 Months Ended

Dec. 31, 2014

Text Block [Abstract]

Convertible Notes, Net

7. CONVERTIBLE NOTES, NET

In November 2013, we issued $172.5 million of 5.25% convertible senior notes due on December 1, 2018, or Convertible Notes. The Convertible Notes’ issuance costs are amortized through interest expense over the life of the Convertible Notes using the effective interest method. Including this amortization, our all-in cost of the Convertible Notes is 5.87% per annum. As of December 31, 2014, the Convertible Notes were carried on our consolidated balance sheet at $161.9 million, net of an unamortized discount of $7.3 million.

The Convertible Notes are convertible at the holders’ option into shares of our class A common stock, only under specific circumstances, prior to the close of business on August 31, 2018, at the applicable conversion rate in effect on the conversion date. Thereafter, the Convertible Notes are convertible at the option of the holder at any time until the second scheduled trading day immediately preceding the maturity date. The Convertible Notes were not convertible as of December 31, 2014. The conversion rate was initially set to equal 34.8943 shares of class A common stock per $1,000 principal amount of Convertible Notes, which is equivalent to an initial conversion price of $28.66 per share of class A common stock, subject to adjustment upon the occurrence of certain events including distributions above $0.50 per share, subject to certain limited exceptions. We may not redeem the Convertible Notes prior to maturity. As of December 31, 2014 we had the intent and ability to settle the Convertible Notes in cash. As a result, the Convertible Notes did not have any impact on our diluted earnings per share. As of December 31, 2014, the closing price of our class A common stock was $29.14 which exceeds our Convertible Notes conversion price of $28.66. As a result, the if-converted value of our convertible notes exceeded the principal balance by $2.9 million as of December 31, 2014.

We recorded a $9.1 million discount upon issuance of the Convertible Notes based on the implied value of the conversion option and an assumed effective interest rate of 6.50%. Including the amortization of this discount and the issuance costs, our total cost of the Convertible Notes is 7.16% per annum. For the year ended December 31, 2014, we incurred total interest on our convertible notes of $11.5 million, of which $9.1 million related to cash coupon and $2.4 million related to the amortization of discount and certain issuance costs. We incurred total interest on our convertible notes of $1.1 million for the year ended December 31, 2013, of which $874,000 related to cash coupon and $197,000 related to the amortization of discount and certain issuance costs. Refer to Note 2 for additional discussion of our accounting policies for the Convertible Notes.

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Equity

12 Months Ended

Dec. 31, 2014

Equity [Abstract]

Equity

9. EQUITY

Total equity increased by $744.1 million during the year ended December 31, 2014 to $1.5 billion. This increase was primarily driven by the issuance of additional shares of our class A common stock. See below for further discussion of our share issuances.

Share and Share Equivalents

Authorized Capital

We have the authority to issue up to 200,000,000 shares of stock, consisting of 100,000,000 shares of class A common stock and 100,000,000 shares of preferred stock. Subject to applicable NYSE listing requirements, our board of directors is authorized to cause us to issue additional shares of authorized stock without stockholder approval. In addition, to the extent not issued, currently authorized stock may be reclassified between class A common stock and preferred stock. We do not have any shares of preferred stock issued and outstanding as of December 31, 2014.

Class A Common Stock and Deferred Stock Units

Holders of shares of our class A common stock are entitled to vote on all matters submitted to a vote of stockholders and are entitled to receive such dividends as may be authorized by our board of directors and declared by us, in all cases subject to the rights of the holders of shares of outstanding preferred stock, if any.

The following table details our issuances of class A common stock during the year ended December 31, 2014 ($ in thousands, except share and per share data):

	Class A Common Stock Offerings								2014 Total / Wtd.-Avg.
	January 2014		April 2014		September 2014		December 2014(3)
Shares Issued		9,775,000		9,200,000		9,200,000		100,000		28,275,000
Issue Price(1)	$	26.25	$	27.72	$	27.49	$	27.58	$	27.14
Net Proceeds(2)	$	256,092	$	254,758	$	252,530	$	2,758	$	766,138

(1) Represents price per share paid to the underwriters.

(2) Net proceeds represents proceeds received from the underwriters less applicable transaction costs.

(3) Issuance represents 100,000 shares issued over a five-day period in December, with a weighted average issue price of $27.58, and generating net proceeds of $2.8 million.

We also issue restricted class A common stock under our stock-based incentive plans. Refer to Note 13 for additional discussion of these long-term incentive plans.

In addition to our class A common stock, we also issue deferred stock units to certain members of our board of directors in lieu of cash compensation for services rendered. These deferred stock units are non-voting, but carry the right to receive dividends in the form of additional deferred stock units in an amount equivalent to the cash dividends paid to holders of shares of class A common stock. During 2014, we issued 2,851 shares of class A common stock to Joshua A. Polan in exchange for his deferred stock units upon his decision not to stand for reelection to our board of directors.

The following table details the movement in our outstanding shares of class A common stock, including restricted class A common stock and deferred stock units:

	Year Ended December 31,
Common Stock Outstanding(1)(2)	2014		2013		2012
Beginning balance		29,602,884		3,016,407		2,277,344
Issuance of class A common stock		28,275,006		25,875,000		669,047
Issuance of restricted class A common stock, net		490,381		700,000		36,493
Issuance of deferred stock units		20,537		11,477		33,523
Ending balance		58,388,808		29,602,884		3,016,407

(1) Deferred stock units held by members of our board of directors totalled 118,919, 101,233, and 89,754 as of December 31, 2014, 2013, and 2012, respectively.

(2) Share amounts have been retroactively updated to reflect the one-for-ten reverse stock split which we effected as of May 6, 2013. See below for further discussion.

Dividend Reinvestment and Direct Stock Purchase Plan

On March 25, 2014, we adopted a dividend reinvestment and direct stock purchase plan, under which we registered and reserved for issuance, in the aggregate, 10,000,000 shares of class A common stock. Under the dividend reinvestment component of this plan, our class A common stockholders can designate all or a portion of their cash dividends to be reinvested in additional shares of class A common stock. The direct stock purchase component allows stockholders and new investors, subject to our approval, to purchase shares of class A common stock directly from us. During the year ended December 31, 2014, we issued six shares of class A common stock under the dividend reinvestment component and zero shares under the direct stock purchase plan component. As of December 31, 2014, 9,999,994 shares of class A common stock, in the aggregate, remain available for issuance under the dividend reinvestment and direct stock purchase plan.

At the Market Stock Offering Program

On May 9, 2014, we entered into equity distribution agreements, or ATM Agreements, pursuant to which we may sell, from time to time, up to an aggregate sales price of $200.0 million of our class A common stock. Sales of class A common stock made pursuant to the ATM Agreements, if any, may be made in negotiated transactions or transactions that are deemed to be “at the market” offerings as defined in Rule 415 under the Securities Act of 1933, as amended. Actual sales will depend on a variety of factors including market conditions, the trading price of our class A common stock, our capital needs, and our determination of the appropriate sources of funding to meet such needs. During the year ended December 31, 2014, we sold 100,000 shares of class A common stock under the ATM Agreements, with net proceeds totaling $2.8 million. As of December 31, 2014, sales of our class A common stock with an aggregate sales price of $197.2 million remain available for issuance under the ATM Agreements.

Reverse Stock Split

On April 26, 2013, our board of directors approved a one-for-ten reverse stock split of our class A common stock which we effected on May 6, 2013. As a result of the reverse stock split, the number of outstanding shares of our class A common stock was reduced to 2,926,651. In addition, there was a reclassification of $263,000 from the par value of our class A common stock to additional paid-in capital to reflect the impact of the reverse stock split.

Dividends

We generally intend to distribute substantially all of our taxable income, which does not necessarily equal net income as calculated in accordance with GAAP, to our stockholders each year to comply with the REIT provisions of the Internal Revenue Code of 1986, as amended, or the Internal Revenue Code.

Our dividend policy remains subject to revision at the discretion of our board of directors. All distributions will be made at the discretion of our board of directors and will depend upon our taxable income, our financial condition, our maintenance of REIT status, applicable law, and other factors as our board of directors deems relevant.

During the years ended December 31, 2014, 2013, and 2012 we declared dividends per share of $1.98, $0.72, and $20.00, respectively, representing aggregate dividends payment of $101.3 million, $21.1 million, and $49.8 million during each year.

Earnings Per Share

We calculate our basic and diluted earnings per share using the two-class method for all periods presented as the unvested shares of our restricted class A common stock qualify as participating securities, as defined by GAAP. These restricted shares have the same rights as our other shares of class A common stock, including participating in any gains and losses, and therefore have been included in our basic and diluted net income per share calculation.

The following table sets forth the calculation of basic and diluted net income per share of class A common stock based on the weighted-average of both restricted and unrestricted class A common stock outstanding for the indicated periods ($ in thousands, except per share data):

	Year Ended December 31,
	2014		2013		2012
Net income	$	90,045	$	15,032	$	181,024
Weighted-average shares outstanding(1)		48,394,478		18,520,052		2,345,943
Warrants and options outstanding for the purchase of class A common stock		—		—		129,351
Weighted-average shares outstanding, diluted		48,394,478		18,520,052		2,475,294
Per share amount, basic	$	1.86	$	0.81	$	77.16
Per share amount, diluted	$	1.86	$	0.81	$	73.13

(1) Share and per share amounts have been retroactively updated to reflect the one-for-ten reverse stock split which we effected as of May 6, 2013. See above for further discussion.

The following table sets forth the calculation of basic and diluted income from continuing operations per share based on the weighted-average of our shares of class A common stock, including restricted class A common stock and deferred stock units outstanding ($ in thousands, except per share data):

	Year Ended December 31,
	2014			2013			2012
Income from continuing operations	$	100,494		$	25,424		$	282,213
Net income attributable to non-controlling interests		(10,449	)		(10,392	)		(98,780	)
Income from continuing operations attributable to Blackstone Mortgage Trust, Inc.		90,045			15,032			183,433
Weighted-average shares outstanding(1)		48,394,478			18,520,052			2,345,943
Warrants and options outstanding for the purchase of class A common stock		—			—			129,351
Weighted-average shares outstanding, diluted		48,394,478			18,520,052			2,475,294
Per share amount, basic	$	1.86		$	0.81		$	78.19
Per share amount, diluted	$	1.86		$	0.81		$	74.16

(1) Share and per share amounts have been retroactively updated to reflect the one-for-ten reverse stock split which we effected as of May 6, 2013. See above for further discussion.

Other Balance Sheet Items

Accumulated Other Comprehensive Loss

As of December 31, 2014, total accumulated other comprehensive loss was $15.0 million, representing the cumulative currency translation adjustment on assets and liabilities denominated in foreign currencies. During the year ended December 31, 2014, we recorded a $15.8 million currency translation loss in other comprehensive income. As of and during the year ended December 31, 2013, total accumulated other comprehensive income was $798,000 representing the currency translation adjustment on assets denominated in foreign currencies. The following table details the primary components of accumulated other comprehensive loss as of, and for the year ended, December 31, 2012 ($ in thousands):

Accumulated Other Comprehensive Loss	Mark-to-Market on Interest Rate Hedges			Deferred Gains on Settled Hedges			Other-than- Temporary Impairments			Unrealized Gains on Securities			Total
Total as of December 31, 2011		(27,423	)		56			(16,578	)		3,361			(40,584	)
Unrealized gain on derivative financial instruments		8,367			—			—			—			8,367
Ineffective portion of cash flow hedges(1)		2,481			—			—			—			2,481
Amortization of net unrealized gains on securities		—			—			—			(775	)		(775	)
Amortization of net deferred gains on settlement of swaps		—			(56	)		—			—			(56	)
Other-than-temporary impairments of securities		—			—			678			—			678
Deconsolidation of subsidiaries		16,575			—			15,900			(2,586	)		29,889
Total as of December 31, 2012	$	—		$	—		$	—		$	—		$	—

(1) As a result of the deconsolidation of CT Legacy Asset in the first quarter of 2012, the balance of accumulated other comprehensive income related to cash flow hedges of CT Legacy Asset was reclassified to interest expense.

Non-controlling Interests

The non-controlling interests included on our consolidated balance sheets represent the equity interests in CT Legacy Partners that are not owned by us. A portion of CT Legacy Partners’ consolidated equity and results of operations are allocated to these non-controlling interests based on their pro rata ownership of CT Legacy Partners. As of December 31, 2014, CT Legacy Partners’ total equity was $60.8 million, of which $25.3 million was owned by Blackstone Mortgage Trust, Inc., and $35.5 million was allocated to non-controlling interests.

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Equity - Additional Information (Detail) (USD $)	1 Months Ended	12 Months Ended			0 Months Ended	1 Months Ended
	Dec. 31, 2014	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012	May 09, 2014	Sep. 30, 2014	Apr. 30, 2014	Jan. 31, 2014	Dec. 31, 2011	May 31, 2013	May 06, 2013	Mar. 25, 2014
Class of Stock [Line Items]
Increase in total equity		$ 744,100,000
Total equity	1,500,886,000	1,500,886,000	756,750,000	153,453,000					(128,939,000)
Total stock, shares authorized	200,000,000	200,000,000
Common stock, shares authorized	100,000,000	100,000,000	100,000,000
Preferred stock, shares authorized	100,000,000	100,000,000
Preferred stock issued	0	0
Preferred stock outstanding	0	0
Plan adoption date		March 25, 2014
Common stock issued	58,269,889	58,269,889	29,501,651
Net proceeds from issuance of common stock	2,800,000	766,138,000	633,807,000	10,000,000
Sale of common stock sales price	583,000	583,000	295,000
Common stock, shares outstanding	58,269,889	58,269,889	29,501,651
Dividends paid		84,238,000	7,776,000	48,960,000
Dividends per common stock		$ 1.98	$ 0.72	$ 20.00
Accumulated other comprehensive (loss) income	(15,024,000)	(15,024,000)	798,000
Loss on foreign currency translation		15,800,000
CT Legacy Partners' total equity	60,800,000	60,800,000
Equity interests owned by Blackstone Mortgage Trust, Inc.	25,300,000	25,300,000
Non-controlling interests in CT Legacy Partners	35,500,000	35,500,000
Installment 1 Fiscal Year 2014 [Member]
Class of Stock [Line Items]
Dividends paid		101,300,000	21,100,000	49,800,000
Class A Common Stock [Member]
Class of Stock [Line Items]
Common stock issued										25,875,000
Aggregate sales price					200,000,000
Net proceeds from issuance of common stock	2,758,000	766,138,000				252,530,000	254,758,000	256,092,000
Common stock, shares outstanding											2,926,651,000,000
Reverse stock split ratio		0.1
Description reverse stock split		On April 26, 2013, our board of directors approved a one-for-ten reverse stock split of our class A common stock which we effected on May 6, 2013.
Reclassification of common stock to additional paid-in capital		263,000,000,000
Class A Common Stock [Member] | ATM Agreements [Member]
Class of Stock [Line Items]
Common stock issued	100,000	100,000
Net proceeds from issuance of common stock		2,815,000
Sale of common stock sales price	$ 197,200,000	$ 197,200,000
Class A Common Stock [Member] | Director [Member]
Class of Stock [Line Items]
Shares issued for deferred stock units upon resignation		2,851
Class A Common Stock [Member] | Direct Stock Purchase Plan [Member]
Class of Stock [Line Items]
Common stock issued	0	0
Class A Common Stock [Member] | Dividend Reinvestment Plan [Member]
Class of Stock [Line Items]
Common stock issued	6	6
Class A Common Stock [Member] | Dividend Reinvestment and Direct Stock Purchase Plan [Member]
Class of Stock [Line Items]
Reserved for issuance of class A common stock	9,999,994	9,999,994										10,000,000

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Fair Values - Schedule of Details of Carrying Amount, Face Amount, and Fair Value of Financial Instruments (Detail) (USD $) In Thousands, unless otherwise specified	Dec. 31, 2014	Dec. 31, 2013
Financial assets
Loans receivable, net	$ 19,000	$ 40,700
Financial liabilities
Revolving repurchase facilities	2,040,783	863,622
Asset-specific repurchase agreements	324,553	245,731
Loan participations sold	499,433	90,000
Carrying Amount [Member]
Financial assets
Cash and cash equivalents	51,810	52,342
Restricted cash	11,591	10,096
Loans receivable, net	4,428,500	2,047,223
Financial liabilities
Revolving repurchase facilities	2,040,783	863,622
Asset-specific repurchase agreements	324,553	245,731
Loan participations sold	499,433	90,000
Convertible notes, net	161,853	159,524
Face Amount [Member]
Financial assets
Cash and cash equivalents	51,810	52,342
Restricted cash	11,591	10,096
Loans receivable, net	4,462,897	2,077,227
Financial liabilities
Revolving repurchase facilities	2,040,783	863,622
Asset-specific repurchase agreements	324,553	245,731
Loan participations sold	499,433	90,000
Convertible notes, net	172,500	172,500
Fair Value [Member]
Financial assets
Cash and cash equivalents	51,810	52,342
Restricted cash	11,591	10,096
Loans receivable, net	4,462,897	2,058,699
Financial liabilities
Revolving repurchase facilities	2,040,783	863,622
Asset-specific repurchase agreements	324,553	245,731
Loan participations sold	499,433	90,000
Convertible notes, net	$ 181,341	$ 181,772

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Equity - Summary of Class A Common Stock Issuances (Parenthetical) (Detail) (USD $) In Thousands, except Share data, unless otherwise specified	1 Months Ended	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Equity [Abstract]
Shares Issued	100,000	28,275,006	25,875,000	669,047
Weighted average issue price	$ 27.58
Net Proceeds	$ 2,800	$ 766,138	$ 633,807	$ 10,000

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Derivative Financial Instruments - Summary of Impact of Derivative Financial Instruments to Consolidated Statement of Operations and Consolidated Statement of Comprehensive Income (Parenthetical) (Detail) (USD $)	12 Months Ended
	Dec. 31, 2013 Contract
Derivative Instruments, Gain (Loss) [Line Items]
Gain on termination of residual interest rate swaps	$ 136,000
Number of interest rate swap agreements terminated	5
Interest Rate Swaps [Member]
Derivative Instruments, Gain (Loss) [Line Items]
Interest rate swaps, termination period	June 2013

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Schedule IV - Mortgage Loans on Real Estate (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014
Mortgage Loans on Real Estate [Line Items]
Prior Liens	$ 199,374
Face Amount of Loans	4,462,897
Carrying Amount of Loans	4,428,500
Senior Mortgage Loans [Member]
Mortgage Loans on Real Estate [Line Items]
Face Amount of Loans	4,374,532
Carrying Amount of Loans	4,340,586
Senior Mortgage Loans [Member] | Various / Diversified [Member] | All Other Mortgage Loans Individually Less Than 3% [Member]
Mortgage Loans on Real Estate [Line Items]
Location	Various / Diversified
Debt instrument variable rate basis	LIBOR
Maximum Maturity Date - earliest	Jun. 10, 2016
Maximum Maturity Date	Sep. 30, 2020
Face Amount of Loans	2,852,148
Carrying Amount of Loans	2,831,478
Senior Mortgage Loans [Member] | Hotel [Member] | Borrower A [Member]
Mortgage Loans on Real Estate [Line Items]
Location	Hotel / UK
Debt instrument variable rate basis	LIBOR
Interest Payment Rates	4.00%
Maximum Maturity Date	May 22, 2019
Periodic Payment Terms	I/O
Face Amount of Loans	311,240
Carrying Amount of Loans	307,084
Senior Mortgage Loans [Member] | Hotel [Member] | Borrower F [Member]
Mortgage Loans on Real Estate [Line Items]
Location	Hotel / UK
Debt instrument variable rate basis	LIBOR
Interest Payment Rates	3.40%
Maximum Maturity Date	Nov. 20, 2019
Periodic Payment Terms	I/O
Face Amount of Loans	149,395
Carrying Amount of Loans	147,936
Senior Mortgage Loans [Member] | Hotel [Member] | Borrower I [Member]
Mortgage Loans on Real Estate [Line Items]
Location	Hotel / Northeast
Debt instrument variable rate basis	LIBOR
Interest Payment Rates	4.30%
Maximum Maturity Date	Dec. 01, 2017
Periodic Payment Terms	I/O
Face Amount of Loans	133,350
Carrying Amount of Loans	132,987
Senior Mortgage Loans [Member] | Condo / Northeast [Member] | Borrower B [Member]
Mortgage Loans on Real Estate [Line Items]
Location	Condo / Northeast
Debt instrument variable rate basis	LIBOR
Interest Payment Rates	4.50%
Maximum Maturity Date	Nov. 09, 2018
Periodic Payment Terms	I/O
Face Amount of Loans	181,000
Carrying Amount of Loans	179,839
Senior Mortgage Loans [Member] | Office [Member] | Borrower C [Member]
Mortgage Loans on Real Estate [Line Items]
Location	Office / Diversified
Debt instrument variable rate basis	LIBOR
Interest Payment Rates	3.80%
Maximum Maturity Date	Dec. 09, 2019
Periodic Payment Terms	I/O
Face Amount of Loans	163,300
Carrying Amount of Loans	161,770
Senior Mortgage Loans [Member] | Office [Member] | Borrower D [Member]
Mortgage Loans on Real Estate [Line Items]
Location	Office / Midwest
Debt instrument variable rate basis	LIBOR
Interest Payment Rates	3.50%
Maximum Maturity Date	Aug. 09, 2019
Periodic Payment Terms	I/O
Face Amount of Loans	153,879
Carrying Amount of Loans	152,751
Senior Mortgage Loans [Member] | Office [Member] | Borrower G [Member]
Mortgage Loans on Real Estate [Line Items]
Location	Office / Northeast
Debt instrument variable rate basis	LIBOR
Interest Payment Rates	4.75%
Maximum Maturity Date	Jan. 09, 2019
Periodic Payment Terms	I/O
Face Amount of Loans	139,809
Carrying Amount of Loans	139,099
Senior Mortgage Loans [Member] | Office [Member] | Borrower H [Member]
Mortgage Loans on Real Estate [Line Items]
Location	Office / Canada
Debt instrument variable rate basis	LIBOR
Interest Payment Rates	5.50%
Maximum Maturity Date	Dec. 09, 2019
Periodic Payment Terms	I/O
Face Amount of Loans	138,644
Carrying Amount of Loans	137,024
Senior Mortgage Loans [Member] | Other [Member] | Borrower E [Member]
Mortgage Loans on Real Estate [Line Items]
Location	Other / Diversified
Debt instrument variable rate basis	LIBOR
Interest Payment Rates	4.75%
Maximum Maturity Date	Jan. 07, 2019
Periodic Payment Terms	I/O
Face Amount of Loans	151,767
Carrying Amount of Loans	150,618
Subordinate Loans [Member]
Mortgage Loans on Real Estate [Line Items]
Prior Liens	199,374
Face Amount of Loans	88,365
Carrying Amount of Loans	87,914
Subordinate Loans [Member] | Condo / Northeast [Member] | Borrower BB [Member]
Mortgage Loans on Real Estate [Line Items]
Location	Condo / Northeast
Debt instrument variable rate basis	LIBOR
Interest Payment Rates	12.56%
Maximum Maturity Date	Dec. 13, 2017
Periodic Payment Terms	I/O
Prior Liens	110,388
Face Amount of Loans	33,966
Carrying Amount of Loans	34,081
Subordinate Loans [Member] | Office [Member] | Borrower AA [Member]
Mortgage Loans on Real Estate [Line Items]
Location	Office / Northwest
Debt instrument variable rate basis	LIBOR
Interest Payment Rates	5.66%
Maximum Maturity Date	Apr. 09, 2015
Periodic Payment Terms	I/O
Prior Liens	88,986
Face Amount of Loans	54,399
Carrying Amount of Loans	$ 53,833
Minimum [Member] | Senior Mortgage Loans [Member] | Various / Diversified [Member] | All Other Mortgage Loans Individually Less Than 3% [Member]
Mortgage Loans on Real Estate [Line Items]
Interest Payment Rates	365.00%
Maximum [Member] | Senior Mortgage Loans [Member] | Various / Diversified [Member] | All Other Mortgage Loans Individually Less Than 3% [Member]
Mortgage Loans on Real Estate [Line Items]
Interest Payment Rates	683.00%

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Discontinued Operations (Tables)

12 Months Ended

Dec. 31, 2014

Discontinued Operations and Disposal Groups [Abstract]

Schedule of the Components of Discontinued Operations

The following table provides additional information on the components of discontinued operations ($ in thousands):

	Year Ended December 31,
	2014		2013		2012
Servicing fees	$	—	$	—	$	9,686
Management fees from affiliates		—		—		6,312
Total revenues				—		15,998
General and administrative expenses		—		—		12,938
Income from discontinued operations before income taxes		—		—		3,060
Income tax provision		—		—		(5,198	)
Loss from discontinued operations	$	—	$	—	$	(2,138	)
Loss on sale of discontinued operations		—		—		(271	)
Loss from discontinued operations per share common stock:
Basic	$	—	$	—	$	(1.03	)
Diluted	$	—	$	—	$	(1.03	)

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Secured Financings - Additional Information (Detail) (USD $)	12 Months Ended
	Dec. 31, 2014 Participants Facility Assets
Debt Instrument [Line Items]
Number of revolving repurchase facilities closed	3
Closing of asset specific repurchase facilities	2
Number of senior loan participations sold	3
Proceeds from line of credit	$ 2,200,000,000
Aggregate borrowings	2,000,000,000
Weighted-average initial maturity	1 year 9 months 18 days
Covenants, minimum tangible net worth	1,100,000,000
Covenants, percentage of tangible assets on cash proceeds from equity issuances	75.00%
Covenants, percentage of recourse indebtedness	5.00%
Maximum [Member]
Debt Instrument [Line Items]
Covenants, EBITDA to fixed charges	1.40
Covenants, indebtedness to total assets	83.33%
Minimum [Member]
Debt Instrument [Line Items]
Covenants, EBITDA to fixed charges	1.0
Covenants, minimum cash liquidity amount	10,000,000
Asset-Specific Repurchase Agreements [Member]
Debt Instrument [Line Items]
Weighted-average outstanding asset specific balance	257,900,000
Weighted-Average Cash Coupon [Member]
Debt Instrument [Line Items]
LIBOR basis spread on debt obligation	LIBOR plus 1.88% per annum
LIBOR basis spread on debt obligation	1.88%
Weighted-Average All-in Cost of Credit [Member]
Debt Instrument [Line Items]
LIBOR basis spread on debt obligation	LIBOR plus 2.11% per annum
LIBOR basis spread on debt obligation	2.11%
Revolving Repurchase Facilities [Member]
Debt Instrument [Line Items]
Weighted-average outstanding asset specific balance	$ 1,400,000,000

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Fair Values

12 Months Ended

Dec. 31, 2014

Fair Value Disclosures [Abstract]

Fair Values

14. FAIR VALUES

Assets Recorded at Fair Value

The following table summarizes our assets measured and reported at fair value on a recurring basis ($ in thousands):

	Level 1		Level 2		Level 3		Fair Value
December 31, 2014
Other assets, at fair value(1)	$	—	$	2,648	$	47,507	$	50,155
December 31, 2013
Other assets, at fair value(1)	$	—	$	1,944	$	54,461	$	56,405

(1) Other assets include loans, securities, equity investments, and other receivables carried at fair value.

The following table reconciles the beginning and ending balances of assets measured at fair value on a recurring basis using Level 3 inputs ($ in thousands):

	2014 Other Assets			2013
				Loans Held-for-Sale, net			Other Assets			Investment in CT Legacy Assets
January 1,	$	54,461		$	—		$	—		$	132,000
Consolidation of CT Legacy Partners		—			—			164,780			(132,000	)
Transfer from loans receivable, at fair value		—			2,000			—			—
Proceeds from investments		(20,231	)		(3,259	)		(118,635	)		—
Adjustments to fair value included in earnings
Gain on investments at fair value		13,277			—			7,332			—
Valuation allowance on loans held-for-sale		—			1,259			—			—
Deferred interest		—			—			984			—
December 31,	$	47,507		$	—		$	54,461		$	—

Our other assets include loans, securities, equity investments, and other receivables that are carried at fair value. The following describes the key assumptions used in arriving at the fair value of each of these assets as of December 31, 2014 and 2013.

Securities: As of December 31, 2014 and 2013, our securities, which had a book value of $10.0 million and $9.4 million, respectively, were valued by obtaining assessments from third-party dealers.

Loans: The following table lists the range of key assumptions for each type of loans receivable as of December 31, 2014 and December 31, 2013 ($ in millions):

	Discount Rate			Recovery Percentage(1)			Fair Value as of
Collateral Type							December 31, 2014		December 31, 2013
Hotel		(2	)		100	%	$	15.0	$	15.0
Office		(3	)		100	%		4.0		25.7
							$	19.0	$	40.7

(1) Represents the proportion of the principal expected to be collected relative to the loan balances as of December 31, 2014 and 2013, excluding loans for which there is no expectation of future cash flows.

(2) The discount rate used to value our hotel loan portfolio was 7% as of December 31, 2014 and 2013. A 100 bp discount rate increase would result in a decrease in fair value of 0.3% and 1.4% as of December 31, 2014 and 2013, respectively.

(3) The discount rates used to value our office loan portfolio was 15% as of December 31, 2014 and ranged from 6% to 15% as of December 31, 2013. A 100 bp discount rate increase would result in a decrease in fair value of 1.1% and 0.3% as of December 31, 2014 and 2013, respectively.

Equity investments and other receivables: As of December 31, 2014, equity investments and other receivables, which had an aggregate book value of $18.5 million, were generally valued by discounting expected cash flows.

There were no liabilities recorded at fair value as of December 31, 2014 or 2013. Refer to Note 2 for further discussion regarding fair value measurement.

Fair Value of Financial Instruments

As discussed in Note 2, GAAP requires disclosure of fair value information about financial instruments, whether or not reported in the statement of financial position at fair value, for which it is practicable to estimate that value.

The following table details the carrying amount, face amount, and fair value of the financial instruments described in Note 2 that are not reported in the statement of financial position at fair value ($ in thousands):

	December 31, 2014						December 31, 2013
	Carrying Amount		Face Amount		Fair Value		Carrying Amount		Face Amount		Fair Value
Financial assets
Cash and cash equivalents	$	51,810	$	51,810	$	51,810	$	52,342	$	52,342	$	52,342
Restricted cash		11,591		11,591		11,591		10,096		10,096		10,096
Loans receivable, net		4,428,500		4,462,897		4,462,897		2,047,223		2,077,227		2,058,699
Financial liabilities
Revolving repurchase facilities		2,040,783		2,040,783		2,040,783		863,622		863,622		863,622
Asset-specific repurchase agreements		324,553		324,553		324,553		245,731		245,731		245,731
Loan participations sold		499,433		499,433		499,433		90,000		90,000		90,000
Convertible notes, net		161,853		172,500		181,341		159,524		172,500		181,772

Estimates of fair value for cash, cash equivalents and convertible notes are measured using observable, quoted market prices, or Level 1 inputs. All other significant fair value estimates are measured using unobservable inputs, or Level 3 inputs. The use of different assumptions or methodologies could have a material effect on our estimated fair value amounts. See Note 2 for further discussion regarding fair value measurement of certain of our assets and liabilities.

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Schedule IV - Mortgage Loans on Real Estate

12 Months Ended

Dec. 31, 2014

Mortgage Loans on Real Estate [Abstract]

Schedule IV - Mortgage Loans on Real Estate

Blackstone Mortgage Trust, Inc.

Schedule IV – Mortgage Loans on Real Estate

As of December 31, 2014

(in thousands)

Type of Loan/Borrower	Description / Location	Interest Payment Rates(2)			Maximum Maturity Date(3)		Periodic Payment Terms(4)		Prior Liens(5)		Face Amount of Loans		Carrying Amount of Loans(6)
Senior Mortgage Loans(1)
Borrower A	Hotel / UK		L + 4.00	%		5/22/2019		I/O	$	—	$	311,240	$	307,084
Borrower B	Condo / Northeast		L + 4.50	%		11/9/2018		I/O		—		181,000		179,839
Borrower C	Office / Diversified		L + 3.80	%		12/9/2019		I/O		—		163,300		161,770
Borrower D	Office / Midwest		L + 3.50	%		8/9/2019		I/O		—		153,879		152,751
Borrower E	Other / Diversified		L + 4.75	%		1/7/2019		I/O		—		151,767		150,618
Borrower F	Hotel / UK		L + 3.40	%		11/20/2019		I/O		—		149,395		147,936
Borrower G	Office / Northeast		L + 4.75	%		1/9/2019		I/O		—		139,809		139,099
Borrower H	Office / Canada		L + 5.50	%		12/9/2019		I/O		—		138,644		137,024
Borrower I	Hotel / Northeast		L + 4.30	%		12/1/2017		I/O		—		133,350		132,987
All other mortgage loans individually less than 3%	Various / Diversified		L + 3.65 % – L + 6.83	%		6/10/2016 – 9/30/2020				—		2,852,148		2,831,478
Total senior mortgage loans										—		4,374,532		4,340,586
Subordinate Loans(7)
Borrower AA	Office / Northwest		L + 5.66	%		4/9/2015		I/O		88,986		54,399		53,833
Borrower BB	Condo / Northeast		L + 12.56	%		12/13/2017		I/O		110,388		33,966		34,081
Total subordinate loans										199,374		88,365		87,914
Total loans									$	199,374	$	4,462,897	$	4,428,500

(1) Includes senior mortgages and similar credit quality loans, including related contiguous subordinate loans, and pari passu participations in senior mortgage loans.

(2) As of December 31, 2014, our floating rate loans and related liabilities were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Therefore the net exposure to each benchmark rate is in direct proportion to our net assets indexed to that rate. In addition to cash coupon, all-in yield includes the amortization of deferred origination fees, loan origination costs, and accrual of both extension and exit fees.

(3) Maximum maturity date assumes all extension options are exercised.

(4) I/O = interest only.

(5) Represents only third party liens.

(6) The tax basis of the loans included above is approximately $3.9 billion as of December 31, 2014.

(7) Includes subordinate interests in mortgages and mezzanine loans.

Blackstone Mortgage Trust, Inc.

Notes to Schedule IV

As of December 31, 2014

(in thousands)

1. Reconciliation of Mortgage Loans on Real Estate:

The following table reconciles mortgage loans on real estate for the years ended:

	2014			2013			2012
Balance at January 1,	$	2,047,223		$	141,500		$	869,269
Additions during period:
Consolidation (deconsolidation) of subsidiary		—			—			(645,163	)
Loan fundings		3,067,263			2,327,914			26
Amortization of deferred fees and expenses		19,785			5,965			180
Unrealized gain on foreign currency translation		—			796			—
Valuation allowance on loans held-for-sale		—			1,259			—
Recovery of provision for loan losses		—			—			36,147
Deductions during period:
Collections of principal		(564,183	)		(383,647	)		(118,959	)
Unrealized (loss) on foreign currency translation		(52,076	)		—			—
Deferred origination fees and expenses		(35,449	)		(25,402	)		—
Loans sold		(27,063	)		(21,162	)		—
Transfers to other assets		(27,000	)		—			—
Balance at December 31,	$	4,428,500		$	2,047,223		$	141,500

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Equity Investments in Unconsolidated Subsidiaries - Activity Relating to Our Equity Investments in Unconsolidated Subsidiaries (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013
Schedule of Equity Method Investments [Line Items]
Beginning Balance		$ 22,480
Ending Balance	10,604	22,480
CTOPI Carried Interest [Member]
Schedule of Equity Method Investments [Line Items]
Beginning Balance	22,480
Distributions	(17,867)
Deferred income allocation	5,991
Ending Balance	$ 10,604

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Loans Receivable - Overall Statistics for Loans Receivable Portfolio (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014 SecurityLoan	Dec. 31, 2013 SecurityLoan
Accounts, Notes, Loans and Financing Receivable [Line Items]
Net book value	$ 4,428,500	$ 2,047,223
Unfunded loan commitments	513,200
Loans Receivable [Member]
Accounts, Notes, Loans and Financing Receivable [Line Items]
Number of Loans	60	31
Principal balance	4,462,897	2,077,227
Net book value	4,428,500	2,047,223
Unfunded loan commitments	$ 513,229	$ 164,283
Weighted-average cash coupon	L+4.36 %	L+4.64 %
Weighted-average all-in yield	L+4.81 %	L+5.26 %
Weighted-average maximum maturity (years)	3 years 10 months 24 days	4 years 1 month 6 days

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Consolidated Statements of Comprehensive Income (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Income Statement [Abstract]
Net income	$ 100,494	$ 25,424	$ 279,804
Other comprehensive income
Unrealized (loss) gain on foreign currency remeasurement	(15,822)	798
Unrealized gain on derivative financial instruments			8,367
Gain on interest rate swaps no longer designated as cash flow hedges			2,481
Amortization of unrealized gains and losses on securities			(775)
Amortization of net deferred gains on settlement of swaps			(56)
Other-than-temporary impairments of securities related to fair value adjustments in excess of expected credit losses, net of amortization			688
Other comprehensive (loss) income	(15,822)	798	10,705
Comprehensive income	84,672	26,222	290,509
Comprehensive income attributable to non-controlling interests	(10,449)	(10,392)	(98,790)
Comprehensive income attributable to Blackstone Mortgage Trust, Inc.	$ 74,223	$ 15,830	$ 191,719

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Segment Reporting - Additional Information (Detail) (Geographic Concentration Risk [Member], International Sources [Member], Sales [Member])	12 Months Ended
	Dec. 31, 2014
Geographic Concentration Risk [Member] | International Sources [Member] | Sales [Member]
Segment Reporting Information [Line Items]
Percentage of revenues generated from non-domestic sources	11.00%

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Loans Receivable

12 Months Ended

Dec. 31, 2014

Receivables [Abstract]

Loans Receivable

3. LOANS RECEIVABLE

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

	December 31, 2014			December 31, 2013
Number of loans		60			31
Principal balance	$	4,462,897		$	2,077,227
Net book value	$	4,428,500		$	2,047,223
Unfunded loan commitments(1)	$	513,229		$	164,283
Weighted-average cash coupon(2)		L+4.36	%		L+4.64	%
Weighted-average all-in yield(2)		L+4.81	%		L+5.26	%
Weighted-average maximum maturity (years)(3)		3.9			4.1

(1) Unfunded commitments will primarily be funded to finance property improvements or lease-related expenditures by the borrowers. These future commitments will expire over the next four years.

(2) As of December 31, 2014, our floating rate loans and related liabilities were indexed to the various benchmark rates relevant in each case in terms of currency and payment frequency. Therefore the net exposure to each benchmark rate is in direct proportion to our net assets indexed to that rate. In addition, 14% of our loans earned interest based on LIBOR floors, with an average floor of 0.31%, as of December 31, 2014. In addition to cash coupon, all-in yield includes the amortization of deferred origination fees, loan origination costs, and accrual of both extension and exit fees.

(3) Maximum maturity assumes all extension options are exercised by the borrower, however our loans may be repaid prior to such date. As of December 31, 2014, 85% of our loans are subject to yield maintenance, lock-out provisions, or other prepayment restrictions and 15% are open to repayment by the borrower.

Activity relating to our loans receivable was ($ in thousands):

	Principal Balance			Deferred Fees and Other Items			Net Book Value
December 31, 2013	$	2,077,227		$	(30,004	)	$	2,047,223
Loan fundings		3,067,263			—			3,067,263
Loan repayments and sales		(591,246	)		—			(591,246	)
Unrealized loss on foreign currency translation		(52,801	)		725			(52,076	)
Deferred origination fees and expenses		—			(35,449	)		(35,449	)
Amortization of deferred fees and expenses		—			19,785			19,785
Realized loan losses(1)		(10,546	)		10,546			—
Reclassification to other assets		(27,000	)		—			(27,000	)
December 31, 2014	$	4,462,897		$	(34,397	)	$	4,428,500

(1) Includes a loan loss reserve of $10.5 million as of December 31, 2013, related to one loan in the CT Legacy Portfolio segment, owned by CT CDO I, with a principal balance of $10.5 million. This loan was subsequently written off in 2014 resulting in an aggregate loan loss reserve of zero as of December 31, 2014.

The tables below detail the types of loans in our loan portfolio, as well as the property type and geographic distribution of the properties securing these loans ($ in thousands):

	December 31, 2014					December 31, 2013
Asset Type	Net Book Value		Percentage			Net Book Value		Percentage
Senior loans(1)	$	4,340,586		98	%	$	1,800,329		88	%
Subordinate loans(2)		87,914		2			246,894		12
	$	4,428,500		100	%	$	2,047,223		100	%

Property Type	Net Book Value		Percentage			Net Book Value		Percentage
Office	$	1,878,605		42	%	$	864,666		42	%
Hotel		1,267,486		29			390,492		19
Multifamily		426,094		10			341,819		17
Condominium		315,686		7			275,645		13
Retail		270,812		6			43,115		2
Other		269,817		6			131,486		7
	$	4,428,500		100	%	$	2,047,223		100	%

Geographic Location	Net Book Value		Percentage			Net Book Value		Percentage
United States
Northeast	$	1,383,258		31	%	$	828,571		40	%
Southeast		657,484		15			243,798		12
West		628,275		14			469,262		23
Southwest		405,741		9			216,429		11
Midwest		335,406		8			85,708		4
Northwest		138,796		3			166,207		8
Subtotal		3,548,960		80			2,009,975		98
International
United Kingdom		622,692		14			37,248		2
Canada		137,024		3			—		—
Spain		86,289		2			—		—
Netherlands		33,535		1			—		—
Subtotal		879,540		20			37,248		2
Total	$	4,428,500		100	%	$	2,047,223		100	%

(1) Includes senior mortgages and similar credit quality loans, including related contiguous subordinate loans, and pari passu participations in senior mortgage loans.

(2) Includes subordinate interests in mortgages and mezzanine loans.

Loan Risk Ratings

As described in Note 2, our Manager evaluates our loan portfolio on a quarterly basis. In conjunction with our quarterly loan portfolio review, our Manager assesses the risk factors of each loan, and assigns a risk rating based on several factors. One of the primary factors considered is how senior or junior each loan is relative to other debt obligations of the borrower. Additional factors considered in the assessment include risk of loss, current LTV, collateral performance, structure, exit plan, and sponsorship. Loans are rated “1” (less risk) through “5” (greater risk), which ratings are defined in Note 2.

The following table allocates the principal balance and net book value of our loans receivable based on our internal risk ratings as of December 31, 2014 ($ in thousands):

	Senior Loans(1)						Subordinate Loans(2)
Risk Rating	Number of Loans		Principal Balance		Net Book Value		Number of Loans		Principal Balance		Net Book Value		Total Net Book Value
1 – 3		58	$	4,374,532	$	4,340,586		2	$	88,365	$	87,914	$	4,428,500
4 – 5		—		—		—		—		—		—		—
		58	$	4,374,532	$	4,340,586		2	$	88,365	$	87,914	$	4,428,500

(1) Includes senior mortgages and similar credit quality loans, including related contiguous subordinate loans, and pari passu participations in senior mortgage loans.

(2) Includes subordinate interests in mortgages and mezzanine loans.

The following table allocates the principal balance and net book value of our loans receivable based on our internal risk ratings as of December 31, 2013 ($ in thousands):

	Senior Loans(1)						Subordinate Loans(2)
Risk Rating	Number of Loans		Principal Balance		Net Book Value		Number of Loans		Principal Balance		Net Book Value		Total Net Book Value
1 – 3		26	$	1,811,513	$	1,800,329		3	$	227,350	$	219,894	$	2,020,223
4 – 5		—		—		—		2		37,548		27,000		27,000
		26	$	1,811,513	$	1,800,329		5	$	264,898	$	246,894	$	2,047,223

(1) Includes senior mortgages and similar credit quality loans, including related contiguous subordinate loans, and pari passu participations in senior mortgage loans.

(2) Includes subordinate interests in mortgages and mezzanine loans.

Loan Impairments and Nonaccrual Loans

We do not have any loan impairments, nonaccrual loans, or loans in maturity default as of December 31, 2014. We did not have any material interest receivable accrued on nonperforming loans as of December 31, 2014 or 2013. As of December 31, 2013, CT CDO I, which was a component of our CT Legacy Portfolio segment, had one impaired subordinate interest in a mortgage loan with a gross book value of $10.5 million that was delinquent on its contractual payments. As of December 31, 2013, this loan was on nonaccrual status and we had recorded a 100% loan loss reserve on this loan. This loan was subsequently written off resulting in a loan loss reserve of zero as of December 31, 2014. As of December 31, 2013, CT CDO I had one loan with a net book value of $27.0 million in maturity default, but which had no reserve recorded due to our expectation of future repayment. In June 2014, this loan was restructured and reclassified to other assets.

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Secured Financings - Summary of Loan Participations Sold (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014 Participants	Dec. 31, 2013 Participants
Participating Mortgage Loans [Line Items]
Participations sold, Number of loans	4	1
Principal balance, Participations sold	$ 499,433	$ 90,000
Weighted-average cash coupon, Participations sold	L+2.51 %	L+5.12 %
Weighted-average all-in yield / cost, Participations sold	L+2.71 %	L+5.26 %
Underlying Loans, Number of loans	4	1
Principal balance, Underlying Loans	$ 635,701	$ 173,837
Weighted-average cash coupon, Underlying Loans	L+4.10 %	L+5.66 %
Weighted-average all-in yield / cost, Underlying Loans	L+4.71 %	L+9.25 %
LIBOR [Member]
Participating Mortgage Loans [Line Items]
Weighted-average cash coupon, Participations sold, rate	2.51%	5.12%
Weighted-average all-in yield / cost, Participations sold, rate	2.71%	5.26%
Weighted-average cash coupon, Underlying Loans, rate	4.10%	5.66%
Weighted-average all-in yield / cost, Underlying Loans, rate	4.71%	9.25%

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Fair Values - Additional Information (Detail) (USD $)	Dec. 31, 2014	Dec. 31, 2013
Fair Value Disclosures [Abstract]
Book value of securities	$ 10,000,000	$ 9,400,000
Aggregate book value of equity investments and other receivables	18,500,000
Liabilities recorded at fair value	$ 0	$ 0

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Equity - Schedule of Basic and Diluted Earnings Per Share, or EPS, Based on Weighted-Average of Both Restricted and Unrestricted Class A Common Stock Outstanding (Detail) (USD $) In Thousands, except Share data, unless otherwise specified	3 Months Ended												12 Months Ended
	Dec. 31, 2014	Sep. 30, 2014	Jun. 30, 2014	Mar. 31, 2014	Dec. 31, 2013	Sep. 30, 2013	Jun. 30, 2013	Mar. 31, 2013	Dec. 31, 2012	Sep. 30, 2012	Jun. 30, 2012	Mar. 31, 2012	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Earnings Per Share [Abstract]
Net income	$ 21,490	$ 22,024	$ 33,466	$ 13,065	$ 7,079	$ 8,320	$ 2,748	$ (3,115)	$ 105,189	$ 6,999	$ 2,283	$ 66,553	$ 90,045	$ 15,032	$ 181,024
Weighted-average shares outstanding													48,394,478	18,520,052	2,345,943
Warrants and options outstanding for the purchase of class A common stock															129,351
Weighted-average shares outstanding, diluted													48,394,478	18,520,052	2,475,294
Per share amount, basic	$ 0.37	$ 0.45	$ 0.70	$ 0.34	$ 0.24	$ 0.29	$ 0.22	$ (1.03)	$ 42.21	$ 3.02	$ 1.00	$ 29.14	$ 1.86	$ 0.81	$ 77.16
Per share amount, diluted	$ 0.37	$ 0.45	$ 0.70	$ 0.34	$ 0.24	$ 0.29	$ 0.22	$ (1.03)	$ 40.65	$ 2.84	$ 0.93	$ 27.39	$ 1.86	$ 0.81	$ 73.13

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Summary of Significant Accounting Policies (Policies)

12 Months Ended

Dec. 31, 2014

Accounting Policies [Abstract]

Basis of Presentation

Basis of Presentation

The accompanying consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America, or GAAP, and include, on a consolidated basis, our accounts, the accounts of our wholly-owned subsidiaries, majority-owned subsidiaries, and variable interest entities, or VIEs, of which we are the primary beneficiary. All intercompany balances and transactions have been eliminated in consolidation. Certain of the assets and credit of our consolidated subsidiaries are not available to satisfy the debt or other obligations of us, our affiliates, or other entities.

One of our subsidiaries, CT Legacy Partners, LLC, or CT Legacy Partners, accounts for its operations in accordance with industry-specific GAAP accounting guidance for investment companies, pursuant to which it reports its investments at fair value. We have retained this accounting treatment in consolidation and, accordingly, report the loans and other investments of CT Legacy Partners at fair value on our consolidated balance sheets.

Certain reclassifications have been made in the presentation of the prior period consolidated financial statements to conform to the current presentation including reclassifying (i) loans receivable, at fair value, into accrued interest receivable, prepaid expenses, and other assets, (ii) securitized debt obligations into accounts payable, accrued expenses, and other liabilities, and (iii) restricted class A common stock into class A common stock.

Principles of Consolidation

Principles of Consolidation

We consolidate all entities that we control through either majority ownership or voting rights. In addition, we consolidate all VIEs of which we are considered the primarily beneficiary. VIEs are defined as entities in which equity investors (i) do not have the characteristics of a controlling financial interest and/or (ii) do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. The entity that consolidates a VIE is known as its primary beneficiary and is generally the entity with (i) the power to direct the activities that most significantly affect the VIE’s economic performance and (ii) the right to receive benefits from the VIE or the obligation to absorb losses of the VIE that could be significant to the VIE.

Assets of consolidated VIEs can only be used to satisfy the obligations of those VIEs. The liabilities of consolidated VIEs are non-recourse to us. As of December 31, 2013, our consolidated balance sheet included $49.8 million of other assets and $40.2 million of other liabilities that were attributable to CT CDO I, a consolidated VIE which was part of our CT Legacy Portfolio segment. During 2014, we recorded a 100% impairment of our residual interests in CT CDO I. As a result of this impairment, we no longer have a variable interest in CT CDO I, and therefore ceased to be its primary beneficiary. This resulted in the recognition of an $8.6 million loss on the deconsolidation of CT CDO I on our consolidated statement of operations. As of December 31, 2014, we no longer had any assets or liabilities on our consolidated balance sheet attributable to a consolidated VIE.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results may ultimately differ from those estimates.

Revenue Recognition

Revenue Recognition

Interest income from our loans receivable is recognized over the life of each investment using the effective interest method and is recorded on the accrual basis. Recognition of fees, premiums, discounts, and direct costs associated with these investments is deferred until the loan is advanced and is then recorded over the term of the loan as an adjustment to yield. Income accrual is generally suspended for loans at the earlier of the date at which payments become 90 days past due or when, in the opinion of our Manager, recovery of income and principal becomes doubtful. Income is then recorded on the basis of cash received until accrual is resumed when the loan becomes contractually current and performance is demonstrated to be resumed.

Cash and Cash Equivalents

Cash and Cash Equivalents

Cash and cash equivalents represent cash held in banks, cash on hand, and liquid investments with original maturities of three months or less. We may have bank balances in excess of federally insured amounts; however, we deposit our cash and cash equivalents with high credit-quality institutions to minimize credit risk exposure. We have not experienced, and do not expect, any losses on our cash or cash equivalents.

Restricted Cash

Restricted Cash

We classify the cash balances held by CT Legacy Partners as restricted because, while these cash balances are available for use by CT Legacy Partners for its operations, they cannot be used by us until our allocable share is distributed from CT Legacy Partners and cannot be commingled with any of our unrestricted cash balances.

Loans Receivable and Provision for Loan Losses

Loans Receivable and Provision for Loan Losses

We originate and purchase commercial real estate debt and related instruments generally to be held as long-term investments at amortized cost. We are required to periodically evaluate each of these loans for possible impairment. Impairment is indicated when it is deemed probable that we will not be able to collect all amounts due to us pursuant to the contractual terms of the loan. If a loan is determined to be impaired, we write down the loan through a charge to the provision for loan losses. Impairment of these loans, which are collateral dependent, is measured by comparing the estimated fair value of the underlying collateral to the book value of the respective loan. These valuations require significant judgments, which include assumptions regarding capitalization rates, leasing, creditworthiness of major tenants, occupancy rates, availability of financing, exit plan, loan sponsorship, actions of other lenders, and other factors deemed necessary by our Manager. Actual losses, if any, could ultimately differ from these estimates.

Our Manager performs a quarterly review of our portfolio of loans. In conjunction with this review, our Manager assesses the risk factors of each loan, and assigns a risk rating based on a variety of factors, including, without limitation, loan-to-value ratio, debt yield, property type, geographic and local market dynamics, physical condition, cash flow volatility, leasing and tenant profile, loan structure and exit plan, and project sponsorship. Based on a 5-point scale, our loans are rated “1” through “5,” from less risk to greater risk, which ratings are defined as follows:

1  – Very Low Risk

2  – Low Risk

3  – Medium Risk

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

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

Previously, our Manager assigned risk ratings between “1” and “8,” from less risk to greater risk.

Loans Held-for-Sale and Related Allowance

Loans Held-for-Sale and Related Allowance

In certain cases, we may classify loans as held-for-sale based upon the specific facts and circumstances of particular loans, including known or expected transactions. Loans held-for-sale are carried at the lower of their amortized cost basis or fair value, less costs to sell. A reduction in the fair value of loans held-for-sale is recorded as a charge to our consolidated statements of operations as a valuation allowance on loans held-for-sale.

Equity Investments in Unconsolidated Subsidiaries

Equity Investments in Unconsolidated Subsidiaries

Our carried interest in CT Opportunity Partners I, LP, or CTOPI, is accounted for using the equity method. CTOPI’s assets and liabilities are not consolidated into our financial statements due to our determination that (i) it is not a VIE and (ii) the other investors in CTOPI have sufficient rights to preclude consolidation by us. As such, we report our allocable percentage of the net assets of CTOPI on our consolidated balance sheets. The recognition of income from CTOPI is generally deferred until cash is collected or appropriate contingencies have been eliminated.

Derivative Financial Instruments

Derivative Financial Instruments

We classify all derivative financial instruments as other assets or other liabilities on our consolidated balance sheets at fair value.

On the date we enter into a derivative contract, we designate each contract as (i) a hedge of a net investment in a foreign operation, or net investment hedge, (ii) a hedge of a forecasted transaction or of the variability of cash flows to be received or paid related to a recognized asset or liability, or cash flow hedge, (iii) a hedge of a recognized asset or liability, or fair value hedge, or (iv) a derivative instrument not to be designated as a hedging derivative, or freestanding derivative. For all derivatives other than those designated as freestanding derivatives, we formally document our hedge relationships and designation at inception. This documentation includes the identification of the hedging instruments and the hedged items, its risk management objectives, strategy for undertaking the hedge transaction and our evaluation of the effectiveness of its hedged transaction.

On a quarterly basis, we also formally assess whether the derivative we designated in each hedging relationship is expected to be, and has been, highly effective in offsetting changes in the value or cash flows of the hedged items. If it is determined that a derivative is not highly effective at hedging the designated exposure, hedge accounting is discontinued. Changes in the fair value of the effective portion of our hedges are reflected in accumulated other comprehensive income (loss) on our consolidated financial statements. Changes in the fair value of the ineffective portion of our hedges are included in net income (loss). Amounts are reclassified out of accumulated other comprehensive income (loss) and into net income (loss) when the hedged item is either sold or substantially liquidated. To the extent a derivative does not qualify for hedge accounting and is deemed a freestanding derivative, the changes in its value are included in net income (loss).

Repurchase Agreements

Repurchase Agreements

We record investments financed with repurchase agreements as separate assets and the related borrowings under any repurchase agreements are recorded as separate liabilities on our consolidated balance sheets. Interest income earned on the investments and interest expense incurred on the repurchase agreements are reported separately on our consolidated statements of operations.

Loan Participations Sold

Loan Participations Sold

Loan participations sold represent senior interests in certain loans that we sold, however we present such loan participations sold as liabilities because these arrangements do not qualify as sales under GAAP. These participations are non-recourse and remain on our consolidated balance sheet until the loan is repaid. The gross presentation of loan participations sold does not impact stockholders’ equity or net income.

Convertible Notes

Convertible Notes

The “Debt with Conversion and Other Options” Topic of the Financial Accounting Standards Board, or FASB, Accounting Standards Codification, or Codification, requires the liability and equity components of convertible debt instruments that may be settled in cash upon conversion, including partial cash settlement, to be separately accounted for in a manner that reflects the issuer’s nonconvertible debt borrowing rate. The initial proceeds from the sale of convertible notes are allocated between a liability component and an equity component in a manner that reflects interest expense at the rate of similar nonconvertible debt that could have been issued at such time. The equity component represents the excess initial proceeds received over the fair value of the liability component of the notes as of the date of issuance. We measured the estimated fair value of the debt component of our convertible notes as of the issuance date based on our nonconvertible debt borrowing rate. The equity component of the convertible notes is reflected within additional paid-in capital on our consolidated balance sheet, and the resulting debt discount is amortized over the period during which the convertible notes are expected to be outstanding (through the maturity date) as additional non-cash interest expense. The additional non-cash interest expense attributable to the convertible notes will increase in subsequent periods through the maturity date as the notes accrete to their par value over the same period.

Deferred Financing Costs

Deferred Financing Costs

The deferred financing costs that are included in accrued interest receivable, prepaid expenses, and other assets on our consolidated balance sheets include issuance and other costs related to our debt obligations. These costs are amortized as interest expense using the effective interest method over the life of the related obligations.

Fair Value of Financial Instruments

Fair Value of Financial Instruments

The Codification defines fair value, establishes a framework for measuring fair value, and requires certain disclosures about fair value measurements under GAAP. Specifically, this guidance defines fair value based on exit price, or the price that would be received upon the sale of an asset or the transfer of a liability in an orderly transaction between market participants at the measurement date.

The “Fair Value Measurement and Disclosures” Topic of the Codification also establishes a fair value hierarchy that prioritizes and ranks the level of market price observability used in measuring financial instruments. Market price observability is affected by a number of factors, including the type of financial instrument, the characteristics specific to the financial instrument, and the state of the marketplace, including the existence and transparency of transactions between market participants. Financial instruments with readily available quoted prices in active markets generally will have a higher degree of market price observability and a lesser degree of judgment used in measuring fair value.

Financial instruments measured and reported at fair value are classified and disclosed based on the observability of inputs used in the determination, as follows:

• Level 1: Generally includes only unadjusted quoted prices that are available in active markets for identical financial instruments as of the reporting date.

• Level 2: Pricing inputs include quoted prices in active markets for similar instruments, quoted prices in less active or inactive markets for identical or similar instruments where multiple price quotes can be obtained, and other observable inputs, such as interest rates, yield curves, credit risks, and default rates.

• Level 3: Pricing inputs are unobservable for the financial instruments and include situations where there is little, if any, market activity for the financial instrument. These inputs require significant judgment or estimation by management of third parties when determining fair value and generally represent anything that does not meet the criteria of Levels 1 and 2.

The estimated value of each asset reported at fair value using Level 3 inputs is determined by an internal committee composed of members of senior management of our Manager, including our Chief Executive Officer, Chief Financial Officer, and other senior officers.

Certain of our other assets are reported at fair value either (i) on a recurring basis, as of each quarter-end, or (ii) on a nonrecurring basis, as a result of impairment or other events. Our assets that are recorded at fair value are discussed further in Note 14. We generally value our assets recorded at fair value by either (i) discounting expected cash flows based on assumptions regarding the collection of principal and interest and estimated market rates, or (ii) obtaining assessments from third-party dealers. For collateral-dependent loans that are identified as impaired, we measure impairment by comparing our Manager’s estimation of fair value of the underlying collateral, less costs to sell, to the book value of the respective loan. These valuations may require significant judgments, which include assumptions regarding capitalization rates, leasing, creditworthiness of major tenants, occupancy rates, availability of financing, exit plan, loan sponsorship, actions of other lenders, and other factors deemed necessary by our Manager.

We are also required by GAAP to disclose fair value information about financial instruments, that are not otherwise reported at fair value in our consolidated balance sheet, to the extent it is practicable to estimate a fair value for those instruments. These disclosure requirements exclude certain financial instruments and all non-financial instruments.

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

• Cash and cash equivalents: The carrying amount of cash on deposit and in money market funds approximates fair value.

• Restricted cash: The carrying amount of restricted cash approximates fair value.

• Loans receivable, net: The fair values for these loans were estimated by our Manager taking into consideration factors, including capitalization rates, leasing, occupancy rates, availability and cost of financing, exit plan, sponsorship, actions of other lenders, and indications of market value from other market participants. In the case of impaired loans receivable, fair value was determined based on the lower of amortized cost and the value of the underlying real estate collateral.

• Derivative financial instruments: The fair value of our foreign currency contracts was valued using advice from a third party derivative specialist, based on contractual cash flows and observable inputs comprising foreign currency rates and credit spreads.

• Repurchase obligations: The fair values for these instruments were estimated based on the rate at which a similar credit facility would have currently priced.

• Convertible notes, net: The convertible notes are actively traded and their fair values were obtained using quoted market prices based on recent transactions.

• Participations sold: The fair value of these instruments were estimated based on the value of the related loan receivable asset.

Income Taxes

Income Taxes

Our financial results generally do not reflect provisions for current or deferred income taxes on our REIT taxable income. We believe that we operate in a manner that will continue to allow us to be taxed as a REIT and, as a result, we generally do not expect to pay substantial corporate level taxes other than those payable by our taxable REIT subsidiaries. If we were to fail to meet these requirements, we may be subject to federal, state, and local income tax on current and past income, and penalties. Refer to Note 12 for additional information.

Stock-Based Compensation

Stock-Based Compensation

Our stock-based compensation consists of awards issued to our Manager and certain of its employees that vest over the life of the awards as well as deferred stock units issued to certain members of our Board of Directors. Stock-based compensation expense is recognized for these awards in net income on a variable basis over the applicable vesting period of the awards, based on the value of our class A common stock. Refer to Note 13 for additional information.

Earnings per Share

Earnings per Share

Basic earnings per share, or Basic EPS, is computed in accordance with the two-class method and is based on the net earnings allocable to our class A common stock, including restricted class A common stock and deferred stock units, divided by the weighted-average number of shares of class A common stock, including restricted class A common stock and deferred stock units outstanding during the period. Our restricted class A common stock is considered a participating security, as defined by GAAP, and has been included in our Basic EPS under the two-class method as these restricted shares have the same rights as our other shares of class A common stock, including participating in any gains or losses.

Diluted earnings per share, or Diluted EPS, is determined using the treasury stock method, and is based on the net earnings allocable to our class A common stock, including restricted class A common stock and deferred stock units, divided by the weighted-average number of shares of class A common stock, including restricted class A common stock and deferred stock units. Refer to Note 9 for additional discussion of earnings per share.

Foreign Currency

Foreign Currency

In the normal course of business, we enter into transactions not denominated in United States, or U.S., dollars. Foreign exchange gains and losses arising on such transactions are recorded as a gain or loss in our consolidated statements of operations. In addition, we consolidate entities that have a non-U.S. dollar functional currency. Non-U.S. dollar denominated assets and liabilities are translated to U.S. dollars at the exchange rate prevailing at the reporting date and income, expenses, gains, and losses are translated at the prevailing exchange rate on the dates that they were recorded. Cumulative translation adjustments arising from the translation of non-U.S. dollar denominated subsidiaries are recorded in other comprehensive income.

Underwriting Commissions and Offering Costs

Underwriting Commissions and Offering Costs

Underwriting commissions and offering costs incurred in connection with common stock offerings are reflected as a reduction of additional paid-in capital. Costs incurred that are not directly associated with the completion of a common stock offering are expensed when incurred.

Segment Reporting

Segment Reporting

We operate our real estate finance business through a Loan Origination segment and a CT Legacy Portfolio segment. The Loan Origination segment includes our activities associated with loan origination and acquisition, the capitalization of our loan portfolio, and the costs associated with operating our business generally. The CT Legacy Portfolio segment includes our activities specifically related to CT Legacy Partners and our equity investment in CTOPI. Our Manager makes operating decisions and assesses the performance of each of our business segments based on financial and operating data and metrics generated from our internal information systems.

Recent Accounting Pronouncements

Recent Accounting Pronouncements

In January 2013, the FASB issued ASU 2013-01, “Balance Sheet (Topic 210): Clarifying the Scope of Disclosures About Offsetting Assets and Liabilities,” or ASU 2013-01. ASU 2013-01 was developed to clarify which instruments and transactions are subject to the offsetting disclosure requirements set forth by ASU 2011-11 “Balance Sheet (Topic 210): Disclosures about Offsetting Assets and Liabilities.” ASU 2013-01 was effective for the first interim or annual period beginning on or after January 1, 2013, and was applied retrospectively for all comparative periods presented. The adoption of ASU 2013-01 did not have a material impact on our consolidated financial statements.

In February 2013, the FASB issued ASU 2013-02, “Comprehensive Income (Topic 220): Reporting of Amounts Reclassified Out of Accumulated Other Comprehensive Income,” or ASU 2013-02. ASU 2013-02 implements the previously deferred requirement to disclose reclassification adjustments into and out of accumulated other comprehensive income in either a note or on the face of the financial statements. ASU 2013-02 was effective for the first interim or annual period beginning after December 15, 2012, and was applied prospectively. As we have not reclassified any balances into or out of accumulated other comprehensive income, the adoption of ASU 2013-02 did not have a material impact on our consolidated financial statements.

In June 2013, the FASB issued ASU 2013-08, “Financial Services-Investment Companies (Topic 946): Amendments to the Scope, Measurement, and Disclosure Requirements,” or ASU 2013-08. ASU 2013-08 amends the criteria for qualification as an investment company under Topic 946 of the FASB Accounting Standards Codification, or Topic 946, and requires additional disclosure by investment companies. ASU 2013-08 is effective for the first interim or annual period beginning after December 15, 2013, and is to be applied prospectively. We currently consolidate CT Legacy Partners, which accounts for its operations as an investment company under Topic 946. We do not expect the adoption of ASU 2013-08 to impact CT Legacy Partners’ status as an investment company. Further, because ASU 2013-08 specifically excludes REITs from its scope, it will not otherwise impact our consolidated financial statements.

In May 2014, the FASB issued ASU 2014-09, “Revenue from Contracts with Customers (Topic 606),” or ASU 2014-09. ASU 2014-09 broadly amends the accounting guidance for revenue recognition. ASU 2014-09 is effective for the first interim or annual period beginning after December 15, 2016, and is to be applied prospectively. We do not anticipate that the adoption of ASU 2014-09 will have a material impact on our consolidated financial statements.

In June 2014, the FASB issued ASU 2014-11, “Transfers and Servicing (Topic 860): Repurchase-to-Maturity Transactions, Repurchase Financings, and Disclosures,” or ASU 2014-11. ASU 2014-11 amends the accounting guidance for repurchase-to-maturity transactions and repurchase agreements executed as repurchase financings, and requires additional disclosure about certain transactions by the transferor. ASU 2014-11 is effective for certain transactions that qualify for sales treatment for the first interim or annual period beginning after December 15, 2014. The new disclosure requirements for repurchase agreements, securities lending transactions, and repurchase-to-maturity transactions that qualify for secured borrowing treatment is effective for annual periods beginning after December 15, 2014, and for interim periods beginning after March 15, 2015. We currently record our repurchase arrangements as secured borrowings and do not anticipate that ASU 2014-11 will have a material impact on our consolidated financial statements.

In August 2014, the FASB issued ASU 2014-15, “Disclosure of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” or ASU 2014-15. ASU 2014-15 introduces an explicit requirement for management to assess and provide certain disclosures if there is substantial doubt about an entity’s ability to continue as a going concern. ASU 2014-15 is effective for the annual period ending after December 15, 2016. We do not anticipate that the adoption of ASU 2014-15 will have a material impact on our consolidated financial statements.

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Other Expenses - Schedule of General and Administrative Expenses (Detail) (USD $) In Thousands, unless otherwise specified	12 Months Ended
	Dec. 31, 2014	Dec. 31, 2013	Dec. 31, 2012
Other Income and Expenses [Abstract]
Professional services	$ 2,627	$ 2,441	$ 895
Operating and other costs	2,009	1,797	1,732
Transaction costs - investment management sale			3,870
Subtotal	4,636	4,238	6,497
Non-cash and CT Legacy Portfolio compensation expenses
Management incentive awards plan-CTOPI	12,898
Management incentive awards plan-CT Legacy Partners	1,374	5,089	2,232
Restricted class A common stock earned	7,988	1,064	1,353
Director stock-based compensation	375	263	223
Subtotal	22,635	6,416	3,808
Expenses of consolidated securitization vehicles	528	851	64
Total	$ 27,799	$ 11,505	$ 10,369

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Summary of Quarterly Results of Operations (Tables)

12 Months Ended

Dec. 31, 2014

Quarterly Financial Information Disclosure [Abstract]

Summary of Quarterly Results of Operations

The following is a summary of the unaudited quarterly results of operations for the years ended December 31, 2014, 2013, and 2012 ($ in thousands except per share data):

	March 31			June 30		September 30		December 31
2014
Revenues(1)	$	33,656		$	42,466	$	50,386	$	58,258
Net income	$	13,116		$	38,439	$	23,601	$	25,338
Net income attributable to
Blackstone Mortgage Trust, Inc.	$	13,065		$	33,466	$	22,024	$	21,490
Net income per share of class A common stock:
Basic	$	0.34		$	0.70	$	0.45	$	0.37
Diluted	$	0.34		$	0.70	$	0.45	$	0.37
2013
Revenues(1)	$	1,456		$	6,017	$	18,853	$	26,837
Net (loss) income	$	(1,597	)	$	6,768	$	10,526	$	9,728
Net (loss) income attributable to
Blackstone Mortgage Trust, Inc.	$	(3,115	)	$	2,748	$	8,320	$	7,079
Net (loss) income per share of class A common stock:
Basic	$	(1.03	)	$	0.22	$	0.29	$	0.24
Diluted	$	(1.03	)	$	0.22	$	0.29	$	0.24
2012
Revenues(1)	$	14,716		$	6,763	$	6,944	$	6,517
Net income	$	140,622		$	3,351	$	12,900	$	122,931
Net income attributable to
Blackstone Mortgage Trust, Inc.	$	66,553		$	2,283	$	6,999	$	105,189
Net income per share of class A common stock:
Basic	$	29.14		$	1.00	$	3.02	$	42.21
Diluted	$	27.39		$	0.93	$	2.84	$	40.65

(1) Excludes revenues from discontinued operations.

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Stock-Based Incentive Plans

12 Months Ended

Dec. 31, 2014

Disclosure of Compensation Related Costs, Share-based Payments [Abstract]

Stock-Based Incentive Plans

13. STOCK-BASED INCENTIVE PLANS

We do not have any employees as we are externally managed by our Manager. However, our Manager, certain individuals employed by an affiliate of our Manager, and certain members of our board of directors are compensated, in part, through the issuance of stock-based instruments.

We had stock-based incentive awards outstanding under five benefit plans as of December 31, 2014: (i) our amended and restated 1997 non-employee director stock plan, or 1997 Plan; (ii) our 2007 long-term incentive plan, or 2007 Plan; (iii) our 2011 long-term incentive plan, or 2011 Plan; (iv) our 2013 stock incentive plan, or 2013 Plan; and (v) our 2013 manager incentive plan, or 2013 Manager Plan. We refer to our 1997 Plan, our 2007 Plan, and our 2011 Plan collectively as our Expired Plans and we refer to our 2013 Plan and 2013 Manager Plan collectively as our Current Plans.

Our Expired Plans have expired and no new awards may be issued under them. Under our Current Plans, a maximum of 2,160,106 shares of our class A common stock may be issued to our Manager, our directors and officers, and certain employees of affiliates of our Manager. As of December 31, 2014, there were 939,319 shares available under the Current Plans.

We issued 490,381 and 700,000 shares of restricted class A common stock under our Current Plans during 2014 and 2013, respectively. These shares generally vest in quarterly installments over a three-year period, pursuant to the terms of the respective award agreements and the terms of the Current Plans. The 919,719 shares of restricted class A common stock outstanding as of December 31, 2014 will vest as follows; 398,751 shares will vest in 2015; 357,511 shares will vest in 2016; and 163,457 shares will vest in 2017.

The following table details the movement in our outstanding shares of restricted class A common stock and the weighted-average grant date fair value per share:

	Restricted Class A Common Stock			Weighted-Average Grant Date Fair Value Per Share
Balance as of December 31, 2013		700,000		$	25.69
Granted		490,381			27.82
Vested		(270,662	)		25.57
Balance as of December 31, 2014		919,719		$	26.86