Other Expenses

3 Months Ended

Mar. 31, 2024

Other Income and Expenses [Abstract]

Other Expenses

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 a management agreement between our Manager and us, or our Management Agreement, our Manager earns a base management fee in an amount equal to 1.50% per annum multiplied by our Equity, 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 our Management Agreement) for the previous 12-month period over (b) an amount equal to 7.00% per annum multiplied by our Equity, provided that our Core Earnings over the prior three-year period is greater than zero. Core Earnings, as defined in our Management Agreement, is generally equal to our GAAP net income (loss), including realized gains and losses not otherwise recognized in current period GAAP net income (loss), and excluding (i) non-cash equity compensation expense, (ii) depreciation and amortization, (iii) unrealized gains (losses), (iv) net income (loss) attributable to our legacy portfolio, (v) certain non-cash items, and (vi) incentive management fees.

During the three months ended March 31, 2024 and 2023, we incurred $18.9 million and $18.6 million, respectively, of management fees payable to our manager. During the three months ended March 31, 2024, we did not incur incentive fees payable to our Manager. During the three months ended March 31, 2023, we incurred $12.5 million of incentive fees payable to our Manager.

As of March 31, 2024 and December 31, 2023 we had accrued management and incentive fees payable to our Manager of $18.9 million and $26.3 million, respectively.

General and Administrative Expenses

General and administrative expenses consisted of the following ($ in thousands):

	Three Months Ended March 31,
	2024		2023
Professional services	$	4,140	$	3,279
Operating and other costs	1,476		1,931
Subtotal(1)	5,616		5,210
Non-cash compensation expenses
Restricted class A common stock earned	7,911		7,492
Director stock-based compensation	201		163
Subtotal	8,112		7,655
Total general and administrative expenses	$	13,728	$	12,865

(1)During the three months ended March 31, 2024 and 2023, we recognized an aggregate $223,000 and $308,000, respectively, of expenses related to our Multifamily Joint Venture.