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Investments in Unconsolidated Entities
 12 Months Ended
Dec. 31, 2023
Equity Method Investments and Joint Ventures [Abstract]  
Investments in Unconsolidated Entities Investments in Unconsolidated Entities
The Company has various equity investments in entities where it has the ability to exert significant influence over such entity, but does not control such entity. In these cases the criteria for consolidation have not been met and the Company is required to account for such investments under ASC 323-10; the Company has elected the FVO for its investments in unconsolidated entities. As of December 31, 2023 and 2022, the Company's investments in unconsolidated entities had an aggregate fair value of $116.4 million and $127.0 million, respectively, which is included on the Consolidated Balance Sheet in Investments in unconsolidated entities, at fair value. For the years ended December 31, 2023, 2022, and 2021, the Company recognized $(0.9) million, $(63.6) million, and $58.1 million, respectively, in Earnings (losses) from investments in unconsolidated entities, on its Consolidated Statement of Operations. Certain of the entities that the Company accounts for under ASC 323-10 are deemed to be VIEs, and the maximum amount at risk is generally limited to the Company's investment
in the VIE. As of December 31, 2023 and 2022, the fair value of the Company's investments in unconsolidated entities that have been deemed to be VIEs was $87.8 million and $82.4 million, respectively.
The following table provides details about the Company's investments in unconsolidated entities as of December 31, 2023 and 2022:
Percentage Ownership
of Unconsolidated Entity
Investment in Unconsolidated EntityForm of InvestmentDecember 31, 2023December 31, 2022
Loan Originators:
LendSure Mortgage Corp.(1)(2)
Common shares49.9%49.9%
Other(1)
Various45.0%–50.0%24.7%–80.0%
Co-investments with Ellington affiliate(s)(1):
Elizon DB 2015-1 LLC(3)(4)
Membership Interest30.4%14.6%
Elizon NM CRE 2020-1 LLC(3)(5)
Membership Interest11.5%20.2%
Elizon CH CRE 2021-1 LLC(3)(6)
Membership Interest29.2%34.2%
Elizon NAT CRE 2021-1 LLC(3)(7)
Membership Interest—%15.5%
Equity investments in securitization-related vehicles, including risk retention vehicles(8)
Membership Interest24.6%–84.5%24.6%–84.5%
Other:
Jepson Holdings Limited(1)(3)
Membership Interest7.9%1.9%
Other(1)(3)(9)
Various6.1%–79.0%9.9%–79.0%
(1)See Note 16 for additional details on the Company's related party transactions.
(2)Excludes investment in equity interests convertible into non-voting common shares; including such interests the Company's additional non-voting stake in the entity was 13.8% as of both December 31, 2023 and 2022. See Note 16 Related Party Transactions—Transactions Involving Certain Loan Originators for additional information.
(3)The Company has evaluated this entity and determined that it meets the definition of a VIE. The Company evaluated its interest in the VIE and determined that the Company does not have the power to direct the activities of the VIE and does not have control of the underlying assets, where applicable. As a result, the Company determined that it is not the primary beneficiary of this VIE and therefore has not consolidated the VIE.
(4)As discussed in Note 16 Related Party Transactions—Participation in Multi-Borrower Financing Facilities, the Company and the Affiliated Entities (as defined in Note 16) each consolidate their segregated silos of the Joint Entity (as defined in Note 16). The Company's effective percentage ownership before the effects of consolidation of both its and the Affiliated Entities' respective segregated silos of the Joint Entity, was 60.0% and 62.4% as of December 31, 2023 and 2022, respectively.
(5)As discussed in Note 16 Related Party Transactions—Participation in Multi-Borrower Financing Facilities, the Company and the Affiliated Entities (as defined in Note 16) each consolidate their segregated silos of the Joint Entity (as defined in Note 16). The Company's effective percentage ownership before the effects of consolidation of both its and the Affiliated Entities' respective segregated silos of the Joint Entity, was 74.1% and 54.2% as of December 31, 2023 and 2022, respectively.
(6)As discussed in Note 16 Related Party Transactions—Participation in Multi-Borrower Financing Facilities, the Company and the Affiliated Entities (as defined in Note 16) each consolidate their segregated silos of the Joint Entity (as defined in Note 16). The Company's effective percentage ownership before the effects of consolidation of both its and the Affiliated Entities' respective segregated silos of the Joint Entity, was 52.1% and 57.4% as of December 31, 2023 and 2022, respectively.
(7)As discussed in Note 16 Related Party Transactions—Participation in Multi-Borrower Financing Facilities, the Company and the Affiliated Entities (as defined in Note 16) each consolidate their segregated silos of the Joint Entity (as defined in Note 16). The Company's effective percentage ownership before the effects of consolidation of both its and the Affiliated Entities' respective segregated silos of the Joint Entity, was 66.6% as of December 31, 2022.
(8)Includes interests in Consumer Risk Retention Vehicles, as defined in Note 13—Participation in Multi-Seller Consumer Loan Securitizations, and Participated Risk Retention Vehicle and Residential Loan JV, as defined in Note 13—Residential Mortgage Loan Securitizations. The Company has evaluated these entities and determined that they do not meet the definition of a VIE. The Company evaluated its interest in the entity under the voting interest model outlined in ASC 810, and has determined that the Company does not control these entities. As a result, the Company has not consolidated the entity. See Note 13 for additional details on the Company's securitization transactions.
(9)Includes interest in warehouse facilities; see Note 16—Participation in CLO Transactions, for additional details.
The following table(1) provides a summary of the combined financial position of the unconsolidated entities in which the Company has an investment, excluding LendSure, as of December 31, 2023 and 2022:
December 31, 2023December 31, 2022
(In thousands)
Assets
Investments in securities, loans, and REO(2)
$1,143,198 $938,395 
Other assets67,595 183,312 
Total assets$1,210,793 $1,121,707 
Liabilities
Borrowings$986,828 $779,932 
Other liabilities28,819 104,805 
Total liabilities1,015,647 884,737 
Equity195,146 236,970 
Total liabilities and equity$1,210,793 $1,121,707 
(1)LendSure's financial information has been excluded as they were considered significant pursuant to Regulation S-X for certain of the periods shown in these Notes to Consolidated Financial Statements.
(2)Includes investments carried at the lower of cost or fair value as well as investments where the unconsolidated entity has elected the FVO.
The following table(1) provides a summary of the combined results of operations of the unconsolidated entities, in which the Company has an investment, excluding LendSure and Longbridge, for the years ended December 31, 2023, 2022, and 2021:
Year Ended December 31,
202320222021
(In thousands)
Net Interest Income (Expense)
Interest income$139,340 $63,985 $53,400 
Interest expense(76,129)(22,514)(5,078)
Total net interest income (expense)63,211 41,471 48,322 
Other Income (Loss)
Realized and unrealized gains (losses) on securities, loans, REO, and secured borrowings, at fair value, net(39,215)(35,527)(35,814)
Other, net29,099 33,839 12,304 
Total other income (loss)(10,116)(1,688)(23,510)
Total expenses53,230 44,317 16,330 
Net Income (Loss)$(135)$(4,534)$8,482 
(1)Longbridge's and LendSure's financial information has been excluded as they were considered significant (in the case of Longbridge, prior to consolidation as a result of the Longbridge Transaction) pursuant to Regulation S-X for certain of the periods shown.