Maryland | 1-32733 | 20-2287134 | ||
(State or other jurisdiction | (Commission | (IRS Employer | ||
of Incorporation) | File Number) | Identification No.) | ||
712 Fifth Avenue, 12th Floor New York, NY | 10019 | |||
(Address of principal executive offices) | (Zip Code) |
(d) | The exhibit furnished as part of this report is identified in the Exhibit Index immediately following the signature page of this report. Such Exhibit Index is incorporated herein by this reference. |
Resource Capital Corp. | ||||
/s/ David J. Bryant | ||||
Date: | November 3, 2014 | David J. Bryant Chief Financial Officer |
Exhibit No. | Description | |||
EX 99.1 | Press Release |
CONTACT: | DAVID J. BRYANT |
• | Adjusted Funds from Operations (“AFFO”) of $0.18 and $0.57 per share-diluted (see Schedule I). |
• | Originated $144.3 million in new CRE loans during the three months ended September 30, 2014, with $128.4 million funded. |
• | Originated $475.0 million in new CRE loans during the nine months ended September 30, 2014, with $421.0 million funded. Through October 31, 2014, we have originated commitments of CRE loans totaling $641.7 million. |
• | GAAP net income allocable to common shares of $0.06 and $0.29 per share-diluted. |
• | Closed a $354 million commercial real estate securitization at a weighted average cost of LIBOR + 129 bps. |
• | Common stock cash dividend of $0.20 and $0.60 per share. |
• | Book value of $5.21 as of September 30, 2014. |
• | AFFO for the three and nine months ended September 30, 2014 was $24.3 million, or $0.18 per share-diluted and $73.3 million, or $0.57 per share-diluted, respectively, as compared to $30.8 million, or $0.24 per share-diluted and $71.4 million, or $0.61 per share-diluted for the three and nine months ended September 30, 2013, respectively. A reconciliation of GAAP net income to AFFO is set forth in Schedule I of this release. |
• | GAAP net income allocable to common shares for the three and nine months ended September 30, 2014 was $7.3 million, or $0.06 per share-diluted and $37.1 million, or $0.29 per share-diluted, respectively, as compared to $22.1 million, or $0.18 per share-diluted and $40.2 million, or $0.34 per share-diluted for the three and nine months ended September 30, 2013, respectively. |
• | CRE loan portfolio is comprised of approximately 92% senior whole loans as of September 30, 2014, as compared to 90% a year ago. |
• | RSO closed and funded $501.2 million of new whole loans in the last 12 months with a weighted average yield of 5.66%, including origination fees. In addition, RSO funded $17.1 million of previous loan commitments on existing loans. |
• | RSO originated $166.7 million of new whole loans during October 2014, including $40.9 million of unfunded commitments. |
Three Months Ended | Nine Months Ended | 12 Months Ended | Floating Weighted Average Spread (2) (3) | Weighted Average Fixed Rate | |||||||||||||
September 30, 2014 | September 30, 2014 | September 30, 2014 | |||||||||||||||
New whole loans funded (1) (4) | $ | 128.4 | $ | 421.0 | $ | 518.3 | 5.13 | % | — | ||||||||
New mezzanine loan funded | — | 3.0 | 3.0 | — | 16.00 | % | |||||||||||
Payoffs (5) | (58.1 | ) | (138.4 | ) | (151.0 | ) | |||||||||||
Sales | — | — | — | ||||||||||||||
Principal paydowns | (1.6 | ) | (3.5 | ) | (3.5 | ) | |||||||||||
Loans, net | $ | 68.7 | $ | 282.1 | $ | 366.8 |
(1) | New whole loan production does not include unfunded commitments on whole loans of $20.9 million, which bring total origination of new commercial real estate whole loans to $144.3 million during the three months ended September 30, 2014. |
(2) | Represents the weighted average rate above the one-month London Interbank Offered Rate (“LIBOR”) on loans whose interest rate is based on LIBOR as of September 30, 2014. Of these loans, $394.3 million have LIBOR floors with a weighted average floor of 0.41%. |
(3) | Reflects rates on RSO's portfolio balance as of September 30, 2014. |
(4) | Whole loan production includes the funding of previous commitments of $5.0 million for the three months, $12.0 million for the nine months and $17.1 million for the twelve months ended September 30, 2014, respectively. |
(5) | CRE loan payoffs and extensions resulted in $2.6 million in extension and exit fees during the three months ended September 30, 2014. |
• | During the nine months ended September 30, 2014, RSO purchased $66.2 million par value of CMBS which were partially financed by 30-day repurchase contracts with a repurchase value of $47.3 million. In addition, RSO purchased $4.5 million, par value, of CMBS, which were financed by RSO's Wells Fargo repurchase facility and were AAA-rated by at least one rating agency. |
Three Months Ended September 30, 2014 | Nine Months Ended September 30, 2014 | 12 Months Ended September 30, 2014 | Weighted Average Spread (1) (2) | Weighted Average All-in Rate (2) | Weighted Average Yield | |||||||||||||||
Middle Market loan production (3) | $ | 46.0 | $ | 156.1 | $ | 206.3 | 7.64 | % | 8.63 | % | 8.72 | % | ||||||||
Sales | (16.2 | ) | (27.8 | ) | (32.9 | ) | ||||||||||||||
Principal paydowns | (5.1 | ) | (12.3 | ) | (13.0 | ) | ||||||||||||||
Loans, net | $ | 24.7 | $ | 116.0 | $ | 160.4 |
(1) | Represents the weighted average rate above the one-month and three-month LIBOR on loans whose interest rate is based on LIBOR as of September 30, 2014, excluding fees. Of these loans, $185.1 million have LIBOR floors with a weighted average floor of 0.99%. |
(2) | Reflects rates on RSO's portfolio balance as of September 30, 2014, excluding fees. |
(3) | Loan production does not include $26.7 million of unfunded commitments as of September 30, 2014. |
• | RSO closed a $125.0 million syndicated credit facility to support the anticipated growth of its middle market lending platform. At September 30, 2014, $35.5 million was outstanding on the facility. |
• | RSO's bank loan portfolio, including asset-backed securities (“ABS”), corporate bonds, certain loans held for sale and middle market loans, at the end of the third quarter of 2014 was $707.2 million, at amortized cost, with a weighted-average spread of one-month and three-month LIBOR plus 4.76% at September 30, 2014. RSO's bank loan portfolio was substantially match-funded through four CLO issuances. |
• | RSO, through its subsidiary Resource Capital Asset Management, earned $4.0 million of net fees during the nine months ended September 30, 2014. |
• | RSO issued 4.8 million shares of its 8.625% Series C Cumulative Redeemable Preferred Stock, at a price of $24.2125 per share with a liquidation preference of $25.00 per share, for net proceeds of $116.2 million. |
• | Total revenues increased by $10.9 million, or 46.0%, and $24.6 million, or 32.4%, as compared to revenues for the three and nine months ended September 30, 2013, respectively. |
Amortized cost | Dollar price | Net carrying amount | Dollar price | Net carrying amount less amortized cost | Dollar price(4) | |||||||||||||||
September 30, 2014 | ||||||||||||||||||||
Floating rate | ||||||||||||||||||||
RMBS, trading | $ | 1,897 | 20.57 | % | $ | 66 | 0.72 | % | $ | (1,831 | ) | (19.86 | )% | |||||||
CMBS-private placement | 26,625 | 91.85 | % | 19,850 | 68.48 | % | (6,775 | ) | (23.37 | )% | ||||||||||
Structured notes - trading | 10,821 | 49.00 | % | 9,121 | 41.30 | % | (1,700 | ) | (7.70 | )% | ||||||||||
Structured notes - available-for-sale | 33,016 | 23.75 | % | 42,924 | 30.87 | % | 9,908 | 7.13 | % | |||||||||||
RMBS - available-for-sale | 30,697 | 94.24 | % | 31,545 | 96.84 | % | 848 | 2.60 | % | |||||||||||
Mezzanine loans | 12,544 | 99.27 | % | 12,491 | 98.85 | % | (53 | ) | (0.42 | )% | ||||||||||
Whole loans (1) | 1,022,971 | 99.47 | % | 1,019,286 | 99.11 | % | (3,685 | ) | (0.36 | )% | ||||||||||
Bank loans (2) | 640,198 | 99.65 | % | 639,734 | 99.58 | % | (464 | ) | (0.07 | )% | ||||||||||
Loans held for sale (3) | 36,674 | 97.85 | % | 36,674 | 97.85 | % | — | — | % | |||||||||||
ABS Securities | 27,964 | 95.05 | % | 28,832 | 98.00 | % | 868 | 2.95 | % | |||||||||||
Corporate Bonds | 2,413 | 98.29 | % | 2,401 | 97.80 | % | (12 | ) | (0.49 | )% | ||||||||||
Total floating rate | 1,845,820 | 93.00 | % | 1,842,924 | 92.86 | % | (2,896 | ) | (0.15 | )% | ||||||||||
Fixed rate | ||||||||||||||||||||
CMBS-private placement | 150,345 | 80.34 | % | 155,466 | 83.08 | % | 5,121 | 2.74 | % | |||||||||||
CMBS-linked transactions | 13,707 | 105.26 | % | 14,272 | 109.60 | % | 565 | 4.34 | % | |||||||||||
B notes (1) | 16,107 | 99.65 | % | 16,038 | 99.22 | % | (69 | ) | (0.43 | )% | ||||||||||
Mezzanine loans (1) | 54,761 | 99.99 | % | 54,525 | 99.56 | % | (236 | ) | (0.43 | )% | ||||||||||
Residential mortgage loans | 2,825 | 100.00 | % | 2,825 | 100.00 | % | — | — | % | |||||||||||
Loans held for sale (3) | 54,708 | 100.00 | % | 54,708 | 100.00 | % | — | — | % | |||||||||||
Loans receivable-related party | 5,108 | 100.00 | % | 4,172 | 81.68 | % | (936 | ) | (18.32 | )% | ||||||||||
Total fixed rate | 297,561 | 89.16 | % | 302,006 | 90.50 | % | 4,445 | 1.33 | % | |||||||||||
Other (non-interest bearing) | ||||||||||||||||||||
Property available-for-sale | 29,581 | 100.00 | % | 29,581 | 100.00 | % | — | — | % | |||||||||||
Investment in unconsolidated entities | 60,540 | 100.00 | % | 60,540 | 100.00 | % | — | — | % | |||||||||||
Total other | 90,121 | 100.00 | % | 90,121 | 100.00 | % | — | — | % | |||||||||||
Grand total | $ | 2,233,502 | 92.73 | % | $ | 2,235,051 | 92.80 | % | $ | 1,549 | 0.06 | % |
(1) | Net carrying amount includes an allowance for loan losses of $4.0 million at September 30, 2014, allocated as follows: B notes $69,000, mezzanine loans $289,000 and whole loans $3.7 million. |
(2) | Net carrying amount includes allowance for loan losses of $464,000 at September 30, 2014. |
(3) | Loans held for sale are carried at the lower of cost or fair market value. Amortized cost is equal to fair value. |
(4) | Differences in percentages are due to rounding. |
• | unrestricted cash and cash equivalents of $79.5 million, restricted cash of $500,000 in margin call accounts and $2.1 million in the form of real estate escrows, reserves and deposits; |
• | capital available for reinvestment in one of our CRE CDO's of $250,000 and one of our CRE securitizations of $3.0 million, all of which is designated to finance future funding commitments on CRE loans; and |
• | loan principal repayments of $45.8 million that will pay down outstanding CLO note balances as well as interest collections of $3.8 million. |
• | Schedule I - Reconciliation of GAAP Net Income to Funds from Operations (“FFO”) and AFFO. |
• | Schedule II - Book Value Allocable to Common Shareholders Rollforward. |
• | Schedule III - Summary of Securitization Performance Statistics. |
• | Supplemental Information regarding loan investment statistics, CRE loans and bank loans. |
• | fluctuations in interest rates and related hedging activities; |
• | the availability of debt and equity capital to acquire and finance investments; |
• | defaults or bankruptcies by borrowers on RSO's loans or on loans underlying its investments; |
• | adverse market trends which have affected and may continue to affect the value of real estate and other assets underlying RSO's investments; |
• | increases in financing or administrative costs; and |
• | general business and economic conditions that have impaired and may continue to impair the credit quality of borrowers and RSO's ability to originate loans. |
September 30, 2014 | December 31, 2013 | ||||||
(unaudited) | |||||||
ASSETS (1) | |||||||
Cash and cash equivalents | $ | 163,269 | $ | 262,270 | |||
Restricted cash | 83,604 | 63,309 | |||||
Investment securities, trading | 9,187 | 11,558 | |||||
Investment securities available-for-sale, pledged as collateral, at fair value | 204,843 | 162,608 | |||||
Investment securities available-for-sale, at fair value | 76,175 | 52,598 | |||||
Linked transactions, net at fair value | 14,272 | 30,066 | |||||
Loans held for sale | 91,382 | 21,916 | |||||
Property available-for-sale | 29,581 | 25,346 | |||||
Investment in real estate | — | 29,778 | |||||
Loans, pledged as collateral and net of allowances of $4.5 million and $13.8 million ($83.0 million and $0 at fair value) | 1,744,899 | 1,369,526 | |||||
Loans receivable–related party net of allowances of $936,000 and $0 | 4,172 | 6,966 | |||||
Investments in unconsolidated entities | 60,540 | 69,069 | |||||
Derivatives, at fair value | 21,618 | — | |||||
Interest receivable | 14,831 | 8,965 | |||||
Deferred tax asset | 4,853 | 5,212 | |||||
Principal paydown receivable | 34,297 | 6,821 | |||||
Intangible assets | 10,254 | 11,822 | |||||
Prepaid expenses | 4,529 | 2,871 | |||||
Other assets | 20,075 | 10,726 | |||||
Total assets | $ | 2,592,381 | $ | 2,151,427 | |||
LIABILITIES (2) | |||||||
Borrowings | $ | 1,590,958 | $ | 1,319,810 | |||
Distribution payable | 30,340 | 27,023 | |||||
Accrued interest expense | 3,875 | 1,693 | |||||
Derivatives, at fair value | 8,830 | 10,586 | |||||
Accrued tax liability | 3,131 | 1,629 | |||||
Deferred tax liability | — | 4,112 | |||||
Accounts payable and other liabilities | 11,331 | 12,650 | |||||
Total liabilities | 1,648,465 | 1,377,503 | |||||
EQUITY | |||||||
Preferred stock, par value $0.001: 10,000,000 shares authorized 8.50% Series A cumulative redeemable preferred shares, liquidation preference $25.00 per share, 1,011,743 and 680,952 shares issued and outstanding | 1 | 1 | |||||
Preferred stock, par value $0.001: 10,000,000 shares authorized 8.25% Series B cumulative redeemable preferred shares, liquidation preference $25.00 per share 4,734,495 and 3,485,078 shares issued and outstanding | 5 | 3 | |||||
Preferred stock, par value $0.001: 10,000,000 shares authorized 8.625% Series C cumulative redeemable preferred shares, liquidation preference $25.00 per share 4,800,000 and 0 shares issued and outstanding | 5 | — | |||||
Common stock, par value $0.001: 500,000,000 shares authorized; 133,406,123 and 127,918,927 shares issued and outstanding (including 2,742,476 and 3,112,595 unvested restricted shares) | 133 | 128 | |||||
Additional paid-in capital | 1,224,533 | 1,042,480 | |||||
Accumulated other comprehensive income (loss) | 3,990 | (14,043 | ) | ||||
Distributions in excess of earnings | (296,253 | ) | (254,645 | ) | |||
Total stockholders’ equity | 932,414 | 773,924 | |||||
Non-controlling interest | 11,502 | — | |||||
Total equity | 943,916 | 773,924 | |||||
TOTAL LIABILITIES AND EQUITY | $ | 2,592,381 | $ | 2,151,427 |
September 30, 2014 | December 31, 2013 | ||||||
(unaudited) | |||||||
(1) Assets of consolidated VIEs included in total assets: | |||||||
Restricted cash | $ | 80,633 | $ | 61,372 | |||
Investment securities available-for-sale, pledged as collateral, at fair value | 110,376 | 105,846 | |||||
Loans held for sale | 36,674 | 2,376 | |||||
Loans, pledged as collateral and net of allowances of $4.0 million and $8.8 million ($83.0 million and $0 at fair value) | 1,405,788 | 1,219,569 | |||||
Interest receivable | 8,066 | 5,627 | |||||
Prepaid expenses | 217 | 247 | |||||
Principal paydown receivable | 34,100 | 6,821 | |||||
Other assets | (12 | ) | — | ||||
Total assets of consolidated VIEs (a) | $ | 1,675,842 | $ | 1,401,858 | |||
(2) Liabilities of consolidated VIEs included in total liabilities: | |||||||
Borrowings | $ | 1,214,923 | $ | 1,070,339 | |||
Accrued interest expense | 1,280 | 918 | |||||
Derivatives, at fair value | 7,958 | 10,191 | |||||
Accounts payable and other liabilities | (418 | ) | 1,604 | ||||
Total liabilities of consolidated VIEs (b) | $ | 1,223,743 | $ | 1,083,052 |
(a) | Assets of each of the consolidated variable interest entities ("VIE"s) may only be used to settle the obligations of each respective VIE. |
(b) | The creditors of the Company's VIEs have no recourse to the general credit of the Company. |
Three Months Ended | Nine Months Ended | ||||||||||||||
September 30, | September 30, | ||||||||||||||
2014 | 2013 | 2014 | 2013 | ||||||||||||
REVENUES | |||||||||||||||
Interest income: | |||||||||||||||
Loans | $ | 27,026 | $ | 24,374 | $ | 73,474 | $ | 78,370 | |||||||
Securities | 5,168 | 3,411 | 12,563 | 10,949 | |||||||||||
Interest income − other | 1,647 | 679 | 5,481 | 3,180 | |||||||||||
Total interest income | 33,841 | 28,464 | 91,518 | 92,499 | |||||||||||
Interest expense | 11,589 | 11,762 | 31,836 | 34,061 | |||||||||||
Net interest income | 22,252 | 16,702 | 59,682 | 58,438 | |||||||||||
Rental income | 1,118 | 4,649 | 7,777 | 15,875 | |||||||||||
Dividend income | 16 | 223 | 169 | 256 | |||||||||||
Equity in net earnings (losses) of unconsolidated subsidiaries | 887 | (535 | ) | 4,663 | (888 | ) | |||||||||
Fee income | 2,344 | 1,245 | 7,166 | 4,182 | |||||||||||
Net realized and unrealized gains on sales of investment securities available-for-sale and loans | 7,546 | 570 | 15,487 | 3,355 | |||||||||||
Net realized and unrealized gains (losses) on investment securities, trading | 376 | (229 | ) | (1,834 | ) | (864 | ) | ||||||||
Unrealized gains (losses) and net interest income on linked transactions, net | 177 | 1,161 | 7,494 | (4,343 | ) | ||||||||||
Total revenues | 34,716 | 23,786 | 100,604 | 76,011 | |||||||||||
OPERATING EXPENSES | |||||||||||||||
Management fees − related party | 3,606 | 5,113 | 10,000 | 11,006 | |||||||||||
Equity compensation − related party | 798 | 2,120 | 4,497 | 7,866 | |||||||||||
Rental operating expense | 695 | 3,523 | 5,168 | 11,084 | |||||||||||
General and administrative | 11,586 | 2,898 | 30,936 | 8,761 | |||||||||||
Depreciation and amortization | 562 | 904 | 2,158 | 3,041 | |||||||||||
Income tax (benefit) expense | (237 | ) | 722 | (667 | ) | 4,221 | |||||||||
Net impairment losses recognized in earnings | — | 255 | — | 811 | |||||||||||
Provision (recovery) for loan losses | 1,439 | 741 | (1,739 | ) | 541 | ||||||||||
Total operating expenses | 18,449 | 16,276 | 50,353 | 47,331 | |||||||||||
16,267 | 7,510 | 50,251 | 28,680 | ||||||||||||
OTHER REVENUE (EXPENSE) | |||||||||||||||
Loss on reissuance of debt | (1,867 | ) | — | (2,469 | ) | — | |||||||||
Other expense | — | — | (1,262 | ) | — | ||||||||||
(Loss) gain on sale of real estate | (69 | ) | 16,607 | 2,973 | 16,607 | ||||||||||
Total other revenue | (1,936 | ) | 16,607 | (758 | ) | 16,607 | |||||||||
NET INCOME | 14,331 | 24,117 | 49,493 | 45,287 | |||||||||||
Net income allocated to preferred shares | (5,545 | ) | (1,996 | ) | (11,303 | ) | (5,107 | ) | |||||||
Net income allocable to non-controlling interest, net of taxes | (1,458 | ) | — | (1,069 | ) | — | |||||||||
NET INCOME ALLOCABLE TO COMMON SHARES | $ | 7,328 | $ | 22,121 | $ | 37,121 | $ | 40,180 | |||||||
NET INCOME PER COMMON SHARE – BASIC | $ | 0.06 | $ | 0.18 | $ | 0.29 | $ | 0.34 | |||||||
NET INCOME PER COMMON SHARE – DILUTED | $ | 0.06 | $ | 0.18 | $ | 0.29 | $ | 0.34 | |||||||
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING − BASIC | 129,654,365 | 124,212,032 | 127,434,378 | 116,471,142 | |||||||||||
WEIGHTED AVERAGE NUMBER OF COMMON SHARES OUTSTANDING − DILUTED | 131,227,759 | 126,072,682 | 128,705,916 | 117,973,978 |
Three Months Ended | Nine Months Ended | |||||||||||||||
September 30, | September 30, | |||||||||||||||
2014 | 2013 | 2014 | 2013 | |||||||||||||
Net income allocable to common shares - GAAP | $ | 7,328 | $ | 22,121 | $ | 37,121 | $ | 40,180 | ||||||||
Adjustments: | ||||||||||||||||
Real estate depreciation and amortization | — | 477 | 506 | 1,741 | ||||||||||||
Gains on sale of property (1) | (701 | ) | (14,277 | ) | (5,479 | ) | (14,255 | ) | ||||||||
Gains on sale of preferred equity | (58 | ) | — | (1,107 | ) | — | ||||||||||
FFO | 6,569 | 8,321 | 31,041 | 27,666 | ||||||||||||
Adjustments: | ||||||||||||||||
Non-cash items: | ||||||||||||||||
Provision (recovery) for loan losses | 528 | (405 | ) | 1,091 | (2,139 | ) | ||||||||||
Amortization of deferred costs (non real estate) and intangible assets | 3,070 | 1,439 | 7,256 | 4,909 | ||||||||||||
Equity investment (gains) losses | (13 | ) | 347 | 1,547 | 378 | |||||||||||
Share-based compensation | 798 | 2,120 | 4,497 | 7,866 | ||||||||||||
Impairment losses | — | 255 | — | 811 | ||||||||||||
Unrealized losses (gains) on CMBS marks - linked transactions | 211 | (561 | ) | (1,991 | ) | 5,823 | ||||||||||
Unrealized (gains) losses on trading portfolio | (214 | ) | — | 1,257 | — | |||||||||||
Straight-line rental adjustments | — | (9 | ) | 2 | 6 | |||||||||||
Loss on resale of debt | 1,867 | — | 2,469 | — | ||||||||||||
Add-back interest related to Whitney note discount amortization | — | 2,549 | — | 2,549 | ||||||||||||
MTM adjustments on consolidated European CLO | 1,943 | — | 1,797 | — | ||||||||||||
Unrealized loss on forward exchange transactions, net | 744 | — | 744 | — | ||||||||||||
Unrealized loss on forward commitments | 208 | — | 208 | — | ||||||||||||
Unrealized loss on life settlement contracts | 171 | — | 171 | — | ||||||||||||
PCM expenses | — | — | 300 | — | ||||||||||||
REIT tax planning adjustments | 293 | 721 | 1,420 | 3,079 | ||||||||||||
Cash items: | ||||||||||||||||
Gains on sale of property (1) | 701 | 14,277 | 5,479 | 14,255 | ||||||||||||
Gains on sale of preferred equity | 58 | — | 1,107 | — | ||||||||||||
Gains on the resale of debt | 7,333 | 1,949 | 14,932 | 7,250 | ||||||||||||
Capital expenditures | — | (188 | ) | (38 | ) | (1,010 | ) | |||||||||
AFFO | $ | 24,267 | $ | 30,815 | $ | 73,289 | $ | 71,443 | ||||||||
Weighted average shares – diluted | 131,227,759 | 126,072,682 | 128,705,916 | 117,973,978 | ||||||||||||
AFFO per share – diluted | $ | 0.18 | $ | 0.24 | $ | 0.57 | $ | 0.61 |
(1) | Amount represents gains/losses on sales of owned real estate as well as sales of joint venture real estate interests that were recorded by RSO on an equity basis. |
Amount | Per Share | |||||||
Book value at December 31, 2013, allocable to common shareholders (1) | $ | 674,681 | $ | 5.41 | ||||
Net income allocable to common shareholders - nine months ended | 37,121 | 0.29 | ||||||
Change in other comprehensive loss: | ||||||||
Available for sale securities | 15,666 | 0.12 | ||||||
Derivatives | 2,564 | 0.02 | ||||||
Foreign currency conversion | (196 | ) | — | |||||
Common dividends | (78,523 | ) | (0.60 | ) | ||||
Proceeds (dilution) from additional shares issued during the period (2) | 30,051 | (0.03 | ) | |||||
Total net increase (decrease) | 6,683 | (0.20 | ) | |||||
Book value at September 30, 2014, allocable to common shareholders (1)(3) | $ | 681,364 | $ | 5.21 |
(1) | Per share calculations exclude unvested restricted stock, as disclosed on the consolidated balance sheets, of 2.7 million and 3.1 million shares as of September 30, 2014 and December 31, 2013, respectively. |
(2) | Includes issuance of common shares from the Company's dividend reinvestment plan of 4.6 million shares as well as 312,000 shares issued upon vesting of shares of restricted stock. |
(3) | Book value is calculated as total stockholder's equity of $932.4 million less preferred stock equity of $251.1 million. |
Amount | Per Share | |||||||
Book value at June 30, 2014, allocable to common shareholders (1) | $ | 674,152 | 5.24 | |||||
Net income allocable to common shareholders - three months ended | 7,328 | 0.06 | ||||||
Change in other comprehensive loss: | ||||||||
Available for sale securities | 12,953 | 0.10 | ||||||
Derivatives | 1,232 | 0.01 | ||||||
Common dividends | (26,681 | ) | (0.20 | ) | ||||
Proceeds (dilution) from additional shares issued during the period (2) | 12,380 | — | ||||||
Total net increase (decrease) | 7,212 | (0.03 | ) | |||||
Book value at September 30, 2014, allocable to common shareholders (1)(3) | $ | 681,364 | $ | 5.21 |
(1) | Per share calculations exclude unvested restricted stock, as disclosed on the consolidated balance sheets, of 2.7 million and 2.6 million shares as of September 30, 2014 and June 30, 2014, respectively. |
(2) | Includes issuance of common shares from the Company's dividend reinvestment plan of 2.0 million shares as well as 192,000 shares issued upon vesting of shares of restricted stock. |
(3) | Book value is calculated as total stockholder's equity of $932.4 million less preferred stock equity of $251.1 million. |
Name | Cash Distributions | Annualized Interest Coverage Cushion | Overcollateralization Cushion | |||||||||||||||||
Nine Months Ended September 30, | Year Ended December 31, | As of September 30, | As of September 30, | As of Initial Measurement Date | ||||||||||||||||
2014 (1) | 2013 (1) | 2014 (2) (3) | 2014 (4) | |||||||||||||||||
Apidos CDO I (5) | $ | 1,289 | $ | 4,615 | $ | 584 | $ | 13,847 | $ | 17,136 | ||||||||||
Apidos CDO III (6) | $ | 2,930 | $ | 6,495 | $ | 3,086 | $ | 8,730 | $ | 11,269 | ||||||||||
Apidos Cinco CDO (7) | $ | 7,571 | $ | 12,058 | $ | 9,229 | $ | 20,410 | $ | 17,774 | ||||||||||
RREF 2006-1 (8) | $ | 4,706 | $ | 36,828 | $ | 5,186 | $ | 69,490 | $ | 24,941 | ||||||||||
RREF 2007-1 (9) | $ | 6,084 | $ | 10,880 | $ | 5,555 | $ | 57,613 | $ | 26,032 | ||||||||||
RCC CRE Notes 2013 (10) | $ | 9,072 | N/A | N/A | N/A | N/A | ||||||||||||||
RCC 2014-CRE2(11) | $ | 1,499 | N/A | N/A | N/A | N/A | ||||||||||||||
Moselle CLO S.A. (12) | $ | 2,103 | N/A | N/A | N/A | N/A |
(1) | Distributions on retained equity interests in CDOs (comprised of note investments and preference share ownership) and principal paydowns on notes owned; RREF CDO 2006-1 includes $231,000 and $28.1 million of paydowns during the nine months ended September 30, 2014 and the year ended December 31, 2013, respectively. |
(2) | Interest coverage includes annualized amounts based on the most recent trustee statements. |
(3) | Interest coverage cushion represents the amount by which annualized interest income expected exceeds the annualized amount payable on all classes of CDO notes senior to the Company's preference shares. |
(4) | Overcollateralization cushion represents the amount by which the collateral held by the CDO issuer exceeds the maximum amount required. |
(5) | Apidos CDO I's reinvestment period expired in July 2011. Apidos CDO I was recently called and substantially liquidated as of the last distribution date on October 27, 2014. |
(6) | Apidos CDO III's reinvestment period expired in June 2012. |
(7) | Apidos Cinco CDO's reinvestment period expired in May 2014. |
(8) | RREF CDO 2006-1's reinvestment period expired in September 2011. |
(9) | RREF CDO 2007-1's reinvestment period expired in June 2012. |
(10) | Resource Capital Corp. CRE Notes 2013 ("RCC CRE Notes 2013") closed on December 23, 2013; the first distribution was in January 2014. There is no reinvestment period for the securitization. Additionally, the indenture contains no coverage tests. |
(11) | Resource Capital Corp. 2014-CRE2 ("RCC 2014-CRE2") closed on July 30, 2014; the first distribution was in August 2014. There is no reinvestment period for the securitization. Additionally, the indenture contains no coverage tests. |
(12) | Moselle CLO S.A. was acquired on February 24, 2014; the first distribution was in April 2014. The reinvestment period for this securitization expired prior to the acquisition of this securitization. |
September 30, 2014 | December 31, 2013 | |||||||
Allowance for loan losses: | ||||||||
Specific allowance: | ||||||||
Commercial real estate loans | $ | — | $ | 4,572 | ||||
Bank loans | 464 | 2,621 | ||||||
Loans receivable, related party | 936 | — | ||||||
Total specific allowance | 1,400 | 7,193 | ||||||
General allowance: | ||||||||
Commercial real estate loans | 4,043 | 5,844 | ||||||
Bank loans | — | 770 | ||||||
Total general allowance | 4,043 | 6,614 | ||||||
Total allowance for loans | $ | 5,443 | $ | 13,807 | ||||
Allowance as a percentage of total loans | 0.3 | % | 1.0 | % | ||||
Loans held for sale: | ||||||||
Commercial real estate | $ | — | $ | — | ||||
Bank loans | 36,674 | 6,850 | ||||||
Residential mortgage loans | 54,708 | 15,066 | ||||||
Total loans held for sale (1) | $ | 91,382 | $ | 21,916 |
(1) | Loans held for sale are presented at the lower of cost or fair value. |
Security type: | ||
Whole loans | 92.4 | % |
Mezzanine loans | 6.1 | % |
B Notes | 1.5 | % |
Total | 100.0 | % |
Collateral type: | ||
Multifamily | 43.4 | % |
Hotel | 17.6 | % |
Retail | 16.5 | % |
Office | 15.4 | % |
Mixed Use | 1.9 | % |
Other | 5.2 | % |
Total | 100.0 | % |
Collateral location: | ||
Southern California | 24.8 | % |
Northern California | 8.3 | % |
Texas | 21.0 | % |
Arizona | 8.9 | % |
Florida | 4.6 | % |
Pennsylvania | 3.1 | % |
Utah | 3.0 | % |
Washington | 2.7 | % |
Minnesota | 2.7 | % |
Nevada | 3.2 | % |
Other | 17.7 | % |
Total | 100.0 | % |
Industry type: | ||
Healthcare, education and childcare | 15.5 | % |
Diversified/conglomerate service | 13.8 | % |
Chemicals, plastics and rubber | 6.1 | % |
Finance | 5.3 | % |
Retail stores | 5.2 | % |
Leisure, amusement, motion pictures, entertainment | 5.1 | % |
Automobile | 4.7 | % |
Broadcasting and entertainment | 4.3 | % |
CDO | 4.1 | % |
Hotels, motels, inns and gaming | 3.5 | % |
Electronics | 2.8 | % |
Personal, food and miscellaneous services | 2.5 | % |
Utilities | 2.5 | % |
Telecommunications | 2.4 | % |
Diversified/conglomerate manufacturing | 2.3 | % |
Personal transportation | 2.0 | % |
Other | 17.9 | % |
Total | 100.0 | % |