 March 2014
*
*
*
*
*
*
****
Exhibit 99.1 |
 Forward-Looking Statements and Other Matters
1
This
presentation
contains
forward-looking
statements
within
the
meaning
of
Section
27A
of
the
Securities
Act
of
1933,
as
amended,
and
Section
21E
of
the
Securities
Exchange
Act
of
1934,
as
amended,
which
reflect
the
current
views
of
Blackstone
Mortgage
Trust,
Inc.
(“BXMT”)
with
respect
to,
among
other
things,
its
operations
and
financial
performance.
You
can
identify
these
forward-looking
statements
by
the
use
of
words
such
as
“outlook,”
“believes,”
“expects,”
“potential,”
“continues,”
“may,”
“will,”
“should,”
“seeks,”
“approximately,”
“predicts,”
“intends,”
“plans,”
“estimates,”
“anticipates”
or
the
negative
version
of
these
words
or
other
comparable
words.
Such
forward-looking
statements
are
subject
to
various
risks
and
uncertainties.
Accordingly,
there
are
or
will
be
important
factors
that
could
cause
actual
outcomes
or
results
to
differ
materially
from
those
indicated
in
these
statements.
BXMT
believes
these
factors
include,
but
are
not
limited,
to
those
described
under
the
section
entitled
“Risk
Factors”
in
its
Annual
Report
on
Form
10-K
for
the
fiscal
year
ended
December
31,
2013
as
such
factors
may
be
updated
from
time
to
time
in
its
periodic
filings
with
the
Securities
and
Exchange
Commission,
which
are
accessible
on
the
SEC’s
website
at
www.sec.gov.
These
factors
should
not
be
construed
as
exhaustive
and
should
be
read
in
conjunction
with
the
other
cautionary
statements
that
are
included
in
this
presentation
and
in
the
filings.
BXMT
undertakes
no
obligation
to
publicly
update
or
review
any
forward-looking
statement
or
other
information
in
this
presentation,
whether
as
a
result
of
new
information,
future
developments
or
otherwise.
We
refer
to
“core
earnings”,
which
is
a
non-GAAP
financial
measure,
in
this
presentation.
A
reconciliation
of
core
earnings
to
net
income,
the
most
directly
comparable
GAAP
measure,
is
included
in
this
presentation
and
our
most
recent
Annual
Report
on
Form
10-K,
and
is
available
on
our
website
at
www.bxmt.com.
Slide
11
of
this
presentation
includes
a
reference
to
imputed
core
return
on
equity
(“Imputed
Core
ROE”)
and
other
economic
terms
relating
to
a
sample
BXMT
loan
transaction
that
are
presented
solely
for
purposes
of
illustrating
the
impact
of
using
floating-rate
financing
to
finance
the
origination
of
a
floating-rate
loan
and
should
not
be
viewed
as
indicative
of
the
results
that
will
be
achieved
for
any
particular
loan
in
BXMT’s
portfolio
or
of
BXMT’s
results
as
a
whole.
The
loan
economics
presented
are
hypothetical
and
based
upon
a
number
of
assumptions,
including
no
defaults
on
the
loan,
and
are
subject
to
various
risks
and
uncertainties.
Accordingly,
there
are
or
will
be
important
factors,
including
those
referred
to
above
that
could
cause
the
actual
economics
that
are
achieved
on
this
or
any
other
loan
in
BXMT’s
loan
portfolio
to
differ
materially
from
those
indicated
in
this
illustration.
In
particular,
it
should
be
noted
that
as
a
result
of
such
factors
the
net
spread
between
whole
loan
yields
and
the
cost
of
related
leverage,
the
leverage
multiple
applicable
to
any
particular
loan
and
allocable
overhead
may
vary
materially
from
period
to
period
and
across
BXMT’s
loan
portfolio.
Imputed
Core
ROE
also
excludes
potential
incentive
management
fees
and
is
presented
before
any
tax
effects. |
 Blackstone
Mortgage
Trust,
Inc.
(NYSE:
BXMT)
is
a
real
estate
investment
trust
that
primarily
originates
and
purchases
senior
mortgage
loans
collateralized
by
properties
in
the
U.S.
and
Europe
We are managed by Blackstone (“BX”), a world leader in real estate investing with
nearly $79 billion AUM and over $130
billion of owned real estate
•
BX’s equity investment platform, Blackstone Real Estate Partners, has nearly $70 billion
AUM •
BX’s CRE lending platform, Blackstone Real Estate Debt Strategies, has over $9 billion
AUM •
Significant
alignment
of
interest:
$99
million
BX
investment
(1)
Reluctance among traditional CRE lenders coupled with increased transaction volume creates a
compelling lending environment in the U.S. and Europe
BXMT has a demonstrated ability to originate target
assets,
with
over
$3.4
billion
of
gross
originations since May 2013 equity recapitalization
(2)
•
Our
diversified
portfolio
of
loans
has
a
weighted
average
loan
to
value
of
64%
(2)
Our
focused
senior
lending
strategy
is
designed
both
to
provide
attractive
current
income
and
protect
investors’
capital
•
Commercial
mortgages,
prudently
levered,
offer
excellent
risk
adjusted
returns
•
Simple
business
model
translates
net
interest
margin
to
shareholder
dividends
•
With
a
LIBOR-based
lending
and
funding
model,
our
returns
increase
with
rising
short-term
interest
rates
Blackstone Mortgage Trust Overview
2
(1)
Based upon closing price on the NYSE on February 19, 2014. Includes BX employees
and associates. (2) As of February 19, 2014, includes loans closed and loans in
closing; excludes CT Legacy portfolio. |
 Superior Real Estate Platform
3
(1)
As of December 31, 2013.
Blackstone Real Estate
Blackstone Real Estate
Debt Strategies (“BREDS”)
Blackstone Real Estate
Partners (“BREP”)
Nearly $70 billion AUM
210 professionals
(1)
Over $9 billion AUM
61 professionals
(1)
Actively managed CMBS hedge
funds ($691 million
(1)
)
Liquid CMBS income funds
Rated/Approved Special Servicer
BX investment committee process and investment philosophy
Superior sourcing capabilities through long-standing industry relationships
Underwriting process includes proprietary data from extensive investment holdings
BREDS
BREDS
Blackstone
Real Estate
Blackstone
Drawdown Funds
Hedge Funds
Income Fund
Mortgage Trust |
 Seasoned and Fully Integrated Platform
4
Origination
Europe –
United States
22 Professionals
Asset
Management
7 Professionals
Legal /
Compliance
4 Professionals
Michael Nash
Executive Chairman
CIO of BREDS
Jonathan Gray
Global Head of Real Estate
Member of Blackstone Board of Directors
Member of BXMT Investment Committee
John Schreiber
Co-Founder of Blackstone Real Estate Advisors
Member of BXMT Board of Directors
Chair of BXMT Investment Committee
Stephen Plavin
CEO & President
SMD of BREDS
Douglas
Armer
Anthony
Marone
Weston
Tucker
Robert
Harper
Thomas
Ruffing
Randall
Rothschild
Peter
Sotoloff
Capital Markets / Investor Relations / Finance
12 Professionals
Paul
Quinlan
Tim
Johnson |
 Real
Estate Market Overview 5
Positive
Feedback
Loop
Market conditions are sustaining a favorable commercial real estate environment
•
Liquidity and fundamentals in the commercial real estate market are generally in balance
|
 Real
Estate Market Overview 6
Limited new supply coupled with modest growth is a favorable investment environment for
senior commercial real estate debt
U.S. Aggregate Construction Completions
(Office, Industrial, and Retail
Sectors)
U.S. GDP ($ in billions)
(Office, Industrial, and Retail
Sectors)
Sources: REIS & Federal Reserve Economic Data as of Q4 2013 |
 Real
Estate Market Overview 7
Source: Real Capital Analytics as of Q4 2013
U.S. Aggregate Property Sale Volume
($ in billions)
Improving fundamentals and increased demand are driving volume |
 Real
Estate Market Overview 8
Real Estate Deleveraging
(2)
Overleveraged Banks
(1)
European banks have over 2x the leverage of U.S. banks…
…
and have only shed 25% of expected RE dispositions
€450B to come
European banks remain overleveraged with enormous real estate exposure
(1)
SNL, ECB, April 2013; The ratio of tangible assets to tangible common equity for
all banks. (2) Morgan Stanley “Banks Deleveraging and Real Estate”
August 2013. |
 Target Investments
9
Loan Size
$50 million to $500 million
Collateral
First mortgages on stabilized or transitional assets
Property Type
All commercial property types
Geographies
North America and Europe
Loan to Value
Last dollar 60-80%
Rate
LIBOR + 3.75% and higher, scaled to risk
Term
3 to 5 years
Amortization
Typically interest only
Fees
Typically 1.0% origination fee and 0.25% to 0.50% extension fees
Prepayment
12 to 24 months of spread maintenance |
 BXMT Sample Transaction: SFO Airport Hotels
$89.8 million floating rate, first mortgage loan secured by the Westin and aLoft San Francisco
Airport hotels (1)
•
70.7% LTV; $138,290 per key
•
Diverse demand drivers including airport traffic and SF/Silicon Valley business overflow
Transaction sourced through existing Blackstone relationship with high quality sponsor
BX office holdings in northern CA and hospitality investments globally enabled definitive,
efficient execution 10
(1)
Loan closed during 4Q 2013. |
 BXMT Sample Transaction: SFO Airport Hotels
BXMT’s floating rate senior mortgage loans are supported by significant owner’s
equity Prudent use of balance sheet leverage drives strong risk adjusted returns for
BXMT shareholders 11
LTV
Capital Structure
$ Cum.
$/Unit
Illustrative Loan Economics
(1)
Whole Loan Yield
(2)
L + 4.50%
Leverage:
Advance Rate
75.0%
Credit Facility Advance
All-in Cost
(2)
L + 2.25%
$67.3 million
Net Spread
2.25%
Leverage Multiple
3.0 X
53.0%
$67.3 million
$103,717
Levered Spread
6.75%
Base Return
L + 4.50%
BXMT Equity
Gross ROI
L + 11.25%
$22.4 million
70.7%
$89.8 million
$138,290
Less Overhead Allocations
(3)
:
Management Fee
1.50%
General & Administrative
0.50%
Owner Equity
Working Capital/
$37.2 million
Equity Deployment
1.50% - 0.75%
100.0%
$126.9 million
$195,532
Imputed Core ROE
(4)
L + 7.75% - 8.50%
(1) This illustration is presented solely for purposes our floating-rate business model
and should not be viewed as indicative of the results that will be achieved for any particular loan in BXMT’s portfolio or of BXMT’s results
as a whole. The loan economics presented are
hypothetical and are subject to various risks and uncertainties. See “Forward-Looking Statements and Other Matters” for further discussion of such risks and uncertainties.
(2) Whole loan yield and all-in cost of leverage include amortization of fees and expenses
pursuant to GAAP in addition to current pay rates assuming no defaults. (3) Overhead
allocations are illustrative, actual allocations vary materially and depend on expenses incurred, working capital needs and defensive liquidity needs, overall capital deployment and performance among other factors.
(4) Imputed Core ROE for this illustrative loan excludes potential incentive fees and is a
hypothetical illustrative measure and does not represent BXMT Core Earnings. |
 Capital Deployment
(1)
12
(1)
As of February 19, 2014
(2)
Excludes loans in closing
Since May, BXMT has closed $2.8 billion of loans; and another $666 million of loans are
currently in closing
•
32 loans closed; 8 in closing; median loan size is $68 million
The $2.8 billion portfolio has a weighted average all-in yield of L + 5.28%
(2)
•
100% of BXMT’s new loans are floating rate; 90% are senior mortgage loans
|
 Portfolio Snapshot
13
Note: Portfolio data as of February 19, 2014; includes loans closed and in closing; excludes
CT Legacy portfolio. BXMT’s
portfolio
is
geographically
diversified,
but
weighted
towards
New
York
and
California
U.K.
4.4%
HI
1.8%
AZ
2.5%
CO
FL
GA
4.1%
IL
7.1%
NV
0.4%
RI
1.6%
TX
VA
1.7%
NY
37.8%
CA
18.6%
3.3%
3.9%
3.3%
WA
7.7%
OR
1.2%
MI
0.3%
OH
0.2% |
 Portfolio Snapshot
14
Note: Portfolio data as of February 19, 2014; includes loans closed and in closing; excludes
CT Legacy portfolio. Collateral
property
type
tends
towards
office,
lodging
and
residential;
portfolio
LTVs
cluster
around
the
65%
-
70%
range
Property Type Diversification
($ in millions)
Loan to Value
($ in millions) |
 Debt
Facilities ($2.8 billion in total) •
Revolving
debt
facilities
totaling
$2.5
billion
(1)
from
five
lenders
•
Asset Specific Financings totaling $253 million
Other Funding Sources
•
Executed A-note sale financing transactions
•
Exploring potential CLO issuance
•
Corporate finance options
Financing
15
(1)
Depending on amount of collateral pledged, includes two GBP denominated facilities (£153
million and £250 million respectively) represented in USD terms. (2)
Assuming five year senior mortgage transactions; includes applicable origination and extension
fees. Prudent
use
of
leverage
to
enhance
returns
and
diversification
with
an
emphasis
on
stability
of
the
right
hand
side
of
the
balance
sheet
All-in
Pricing
(2)
L + 2.00% -
L + 2.50%
Advance Rate
75% -
80%
Term
Term matched to expected life of collateral loans
Mark-to-Market
No capital market marks; underlying RE performance mark-to-market only
Index / Currency
Index matched; currency matched |
 Superior
Sponsorship •
Affiliation
with
BX
Real
Estate,
the
largest
private
equity
real
estate
business
in
the
world
•
Significant alignment of interest: $99 million BX investment
(1)
•
BREDS has approximately $9 billion AUM
Strong Origination Platform
•
$3.4 billion of loans closed or in-closing
(2)
since May 2013 equity recapitalization
•
Robust pipeline generated from BX network
Attractive Market Opportunity
•
Reluctance among traditional CRE lenders coupled with increased transaction volume
Focused Strategy
•
Senior lending strategy provides attractive current income and protects capital
Floating-Rate Business Model
•
Returns increase with rising short-term interest rates, and therefore our asset and equity
values are insulated from such increases
BXMT Investment Highlights
16
(1)
Based upon closing price on the NYSE on February 19, 2014. Includes BX employees and
associates. (2)
As of February 19, 2014. |
 Appendix |
 Fourth Quarter 2013 Balance Sheet, Results and Core Earnings
18
($ in millions)
Interest income
Interest expense
Non-cash comp.
G&A expenses
Net results
($3.7)
($9.1)
($1.2)
($3.5)
$24.6
$7.1
$3.7
$0.1
(2)
$1.2
$-
$-
$24.6
$-
($9.0)
$-
($3.5)
Core
Earnings
Net
Income
$12.0
+
+
+
+
Includes stockholders’
equity of $717.9 million, less the net of (i) cash and cash equivalents of $52.3 million,
(ii) accrued interest receivable, prepaid expenses, and other assets of $21.0 million,
and (iii) accounts payable, accrued expenses, and other liabilities of $21.1 million.
Adjustment represents amortization of the deemed issue discount on convertible notes resulting
from the conversion option value accounting under GAAP. (1)
(2) |
 Loan
Capitalization (1)
($ in millions)
L + 5.3%
L + 2.6%
Floating-Rate Business Model
19
(1)
Includes
only
the
Loan
Origination
portfolio
withanaggregate
principal
balance
of
$2.0
billion,
capitalized
with$1.2
billion
of
secured
borrowings,
and
withan
$819.5
million
net
investment
as
of
December
31,
2013.
Excludes
the
assets,
liabilities,
and
equity
of
the
CT
Legacy
Portfolio.
(2)
Excludesthe
impact
of
LIBOR
floors
on
certain
of
our
loans
receivable
investments.
Because of BXMT’s LIBOR-based lending and funding business model, its returns
increase with rising short-term interest rates.
As of December 31, 2013:
•
$2.0 billion of floating-rate loans, indexed to LIBOR.
•
$1.2 billion of floating-rate liabilities, also indexed to
LIBOR.
•
Return on net investment of $819.5 million is highly
correlated to LIBOR.
–
All else equal, as of December 31, 2013, a 100bp
increase in LIBOR would have increased net
interest income by $8.2
million
(2)
per year.
•
BXMT’s equity value is insulated from changes in
interest rates because its loans and secured
borrowings are both LIBOR-based.
Floating-rate
loans
Floating-rate
borrowings
Net investment |
 Loan Origination Portfolio Details
20
(1)
Includes only loans in the Loan Origination portfolio. For information on loans in the CT
Legacy Portfolio, refer to BXMT’s Form 10-K for the year ended December 31, 2013.
(2)
Includes senior mortgage loans, related contiguous subordinate loans with a net book value of
$68.6 million, and pari passu participations in mortgages. (3)
All loans are floating-rate loans indexed to LIBOR as of December 31, 2013.
(4)
Maximum maturity date assumes all extension options are exercised.
(5)
Minimum LIBOR floor ranging from 0.20% to 1.00%.
(6)
Includes 12 senior mortgage loans with an aggregate principal balance of $460.0 million and
one mezzanine loan with a principal balance of $33.5 million. The following table
provides details of our loan portfolio (1)
as of December 31, 2013:
($ in Millions)
Origination Date
Loan Type
(2)
Principal
Balance
Book
Value
Cash
Coupon
(3)
All-In
Yield
(3)
Maximum
Maturity
(4)
Geographic
Location
Property
Type
Origination
LTV
Loan 1
6/7/13
Sr. Mortgage
194.0
$
193.2
$
L + 3.80%
L + 3.97%
(5)
6/15/18
CA
Office
51%
Loan 2
11/21/13
Sr. Mortgage
181.0
179.3
L + 4.50%
L + 4.86%
11/9/18
NY
Multifamily
68%
Loan 3
10/23/13
Sub. Mortgage Part.
173.8
166.2
L + 5.66%
L + 9.25%
4/9/15
WA
Office
67%
Loan 4
12/17/13
Sr. Mortgage
140.0
138.6
L + 4.75%
L + 5.27%
(5)
1/9/19
NY
Office
70%
Loan 5
9/30/13
Sr. Mortgage
140.0
139.7
L + 3.70%
L + 3.83%
9/30/20
NY
Diversified
67%
Loan 6
10/30/13
Sr. Mortgage
89.8
89.2
L + 4.38%
L + 4.63%
11/9/18
CA
Hotel
71%
Loan 7
8/8/13
Sr. Mortgage
87.0
86.5
L + 4.25%
L + 4.64%
8/10/18
Diversified
Diversified
61%
Loan 8
6/27/13
Sr. Mortgage
81.0
80.7
L + 3.85%
L + 4.03%
7/9/18
GA
Multifamily
75%
Loan 9
5/21/13
Sr. Mortgage
70.3
70.1
L + 3.95%
L + 3.89%
(5)
6/9/18
CA
Office
71%
Loan 10
8/8/13
Sr. Mortgage
68.0
67.8
L + 4.00%
L + 4.23%
6/10/16
NY
Office
68%
Loan 11
10/2/13
Sr. Mortgage
67.7
67.0
L + 5.00%
L + 5.44%
9/14/18
Diversified
Other
66%
Loan 12
6/27/13
Sr. Mortgage
64.0
64.5
L + 8.00%
L + 9.46%
(5)
2/9/15
NY
Other
69%
Loan 13
10/8/13
Sr. Mortgage
63.2
62.7
L + 5.00%
L + 5.30%
11/6/16
NY
Multifamily
59%
Loan 14
9/27/13
Sr. Mortgage
57.1
56.5
L + 3.85%
L + 4.24%
10/10/18
Diversified
Multifamily
76%
Loan 15
6/25/13
Sr. Mortgage
48.4
48.5
L + 5.00%
L + 5.68%
(5)
12/9/16
IL
Hotel
53%
Loans 16-28
Various
Various
(6)
493.5
489.8
L + 4.85%
L + 5.29%
Various
Various
Various
64%
Total/Wtd. Avg.
2,018.9
$
2,000.2
$
L + 4.64%
L + 5.28%
4.2 years
65% |
 CT
Legacy Portfolio – 4Q Highlights
21
The CT Legacy Portfolio primarily consists of BXMT’s carried interest in CTOPI, its
investment in CT Legacy Partners, and its residual interests in CT CDO I.
Received
an
$8.8
million
tax-advance
distribution
from
CTOPI.
BXMT’s
carried
interest
in
CTOPI
increases
with
the
value
of
CTOPI’
s net
assets.
Revenue
recognition
has
been
deferred
from
this
investment,
producing
a
negative
component
book
value
as
a
result
of
cumulative
tax-advance
distributions.
CT
Legacy
Partners
made
aggregate
distributions
of
$100.0
million
to
its
common
equity
holders,
including
$46.6
million
to
BXMT.
Of
this,
BXMT
retained
$28.0
million,
net
of
$11.1
million
to
fully
repay
the
related
secured
notes,
and
$7.6
million
for
the
related
incentive
awards.
The
largest
remaining
collateral
asset
in
CT
CDO
I
repaid
for
net
proceeds
of
$31.4
million.
These
proceeds
were
directed
to
pay
senior
CDO
notes
outstanding.
Total
$24.3
CT CDO I and
other
$10.7
CT Legacy
partners
$23.8
CTOPI
($10.2)
CT Legacy Portfolio
Component Book Value
($ in Millions) |
 *
*
*
*
*
* |