11. 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 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 our Management Agreement) for the previous 12-month period over (b) an amount equal to 7.00% per annum multiplied by our outstanding 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 net income (loss) prepared in accordance with GAAP, excluding (i) certain non-cash items (ii) the net income (loss) related to our legacy portfolio and (iii) incentive management fees.

During the three months ended March 31, 2017 and 2016, we incurred $9.6 million and $9.5 million, respectively, of management fees payable to our Manager. In addition, during the three months ended March 31, 2017 and 2016, we incurred $3.3 million and $4.2 million, respectively, of incentive fees payable to our Manager.

As of March 31, 2017 and December 31, 2016 we had accrued management and incentive fees payable to our Manager of $12.9 million and $12.8 million, respectively.

General and Administrative Expenses

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


	Three Months Ended March 31,
	2017		2016
Professional services	$	1,017	$	890
Operating and other costs		445		869

Subtotal		1,462		1,759
Non-cash and CT Legacy Portfolio compensation expenses
Management incentive awards plan - CTOPI⁽¹⁾		—		170
Management incentive awards plan - CT Legacy Partners⁽²⁾		—		129
Restricted class A common stock earned		5,813		4,593
Director stock-based compensation		94		94

Subtotal		5,907		4,986

Total BXMT expenses		7,369		6,745
Other expenses		59		50

Total general and administrative expenses	$	7,428	$	6,795

(1)

Represents the portion of CTOPI promote revenue recorded under compensation awards. See Note 4 for further discussion.

(2)

Represents the amounts recorded 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 our subsidiary, CT Legacy Partners (subject to certain caps and priority distributions). During the three months ended March 31, 2016 we recognized $129,000 of expenses under the CT Legacy Partners incentive plan. Our investment in CT Legacy Partners was substantially realized as of December 31, 2016.