FORM 10-Q
☒x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
OR
☐o TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
from________to
Delaware | 82-2769085 | ||||
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Class A common stock, $0.01 par value per share | BRDG | New York Stock Exchange |
Large accelerated filer |
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Non-accelerated filer |
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Emerging growth company |
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TABLE OF CONTENTS
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Financial | ||||||||
Condensed Consolidated Balance Sheetsas of | ||||||||
Condensed Consolidated and Combined Statements of Operations (Unaudited) for the Three and Six Months Ended | ||||||||
Condensed Consolidated and Combined Statements of Changes in Shareholders’/Members’ Equity (Unaudited) for the Three and Six Months Ended | ||||||||
Condensed Consolidated and Combined Statements of Cash Flows (Unaudited) for the | ||||||||
Certain Definitions
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March 31, 2022 December 31, 2021 Assets (Unaudited) (Audited) Cash and cash equivalents $ 149,121 $ 78,417 Restricted cash 9,162 5,455 Marketable securities, at fair value 10,950 8,035 Receivables from affiliates 56,028 35,379 Notes receivable from affiliates 34,364 118,508 Other assets 32,599 44,463 Other investments 58,214 44,006 Accrued performance allocations 505,410 439,548 Intangible assets, net 6,432 3,441 Goodwill 55,982 9,830 Deferred tax assets, net 64,375 59,210 Total assets $ 982,637 $ 846,292 Liabilities and shareholdersʼ equity Accrued performance allocations compensation $ 50,258 $ 41,020 Accrued compensation and benefits 21,028 15,107 Accounts payable and accrued expenses 26,531 13,586 Due to affiliates 50,526 46,134 General Partner notes payable, at fair value 11,729 12,003 Insurance loss reserves 8,191 8,086 Self-insurance reserves and unearned premiums 4,874 3,504 Other liabilities 22,827 8,973 Notes payable 148,249 148,142 Total liabilities $ 344,213 $ 296,555 Commitments and contingencies (Note 17) 0 0 Shareholdersʼ equity: Preferred stock, $0.01 par value, 20,000,000 authorized, 0 issued and outstanding as of March 31, 2022 and December 31, 2021, respectively 0 0 Class A common stock, $0.01 par value, 500,000,000 authorized; 28,917,960 and 25,159,799 issued and outstanding as of March 31, 2022 and December 31, 2021, respectively 289 230 Class B common stock, $0.01 par value, 239,208,722 authorized; 85,838,275 and 86,672,305 issued and outstanding as of March 31, 2022 and December 31, 2021, respectively 859 867 Additional paid-in capital 59,247 53,527 Retained earnings 21,038 17,184 Accumulated other comprehensive loss (12 ) (21 ) Bridge Investment Group Holdings Inc. equity 81,421 71,787 Non-controlling interests in Bridge Investment Group Holdings LLC 311,915 272,482 Non-controlling interests in Bridge Investment Group Holdings Inc. 245,088 205,468 Total shareholdersʼ equity 638,424 549,737 Total liabilities and shareholdersʼ equity $ 982,637 $ 846,292 (Unaudited) Three Months Ended March 31, 2022 2021 Revenues: Fund management fees $ 52,700 $ 30,851 Property management and leasing fees 18,279 16,747 Construction management fees 1,887 1,826 Development fees 1,259 386 Transaction fees 21,998 5,326 Fund administration fees 3,640 — Insurance premiums 2,416 1,894 Other asset management and property income 1,955 1,520 Total revenues 104,134 58,550 Investment income: Incentive fees 0 910 Performance allocations: Realized 8,937 5,557 Unrealized 65,862 14,719 Earnings (losses) from investments in real estate 40 (3 ) Total investment income 74,839 21,183 Expenses: Employee compensation and benefits 47,480 27,151 Incentive fee compensation 0 82 Performance allocations compensation: Realized 560 494 Unrealized 9,238 1,429 Loss and loss adjustment expenses 1,751 786 Third-party operating expenses 6,768 8,626 General and administrative expenses 9,508 4,101 Depreciation and amortization 633 753 Total expenses 75,938 43,422 Other income (expense): Realized and unrealized gains (losses), net 427 5,798 Interest income 1,209 608 Interest expense (1,621 ) (1,587 ) Total other income 15 4,819 Income before provision for income taxes 103,050 41,130 Income tax provision (5,545 ) (410 ) Net income 97,505 40,720 Net income attributable to non-controlling interests in Bridge 36,713 3,949 Net income attributable to Bridge Investment Group Holdings LLC 60,792 36,771 Net income attributable to Common Control Group prior to Transactions and IPO 0 36,771 Net income attributable to non-controlling interests in Bridge Investment 51,020 0 Net income attributable to Bridge Investment Group Holdings Inc. $ 9,772 $ 0 Earnings per share of Class A common stock - Basic and Diluted (Note 21) $ 0.35 Weighted-average shares of Class A common stock outstanding - Basic and Diluted (Note 21) 23,138,030 (Unaudited) Three Months Ended March 31, 2022 2021 Net income $ 97,505 $ 40,720 Other comprehensive income - foreign currency 9 1 Total comprehensive income 97,514 40,721 Less: comprehensive income attributable to non-controlling 36,713 3,949 Comprehensive income attributable to Bridge Investment 60,801 36,772 Less: comprehensive income attributable to Common Control 0 36,772 Less: comprehensive income attributable to non-controlling 51,020 0 Comprehensive income attributable to Bridge Investment $ 9,781 $ 0 Net Investment in CCG(1) Class A Class B Additional Paid-In Capital Retained Earnings Accumulated Other Comprehensive Income (Loss) NCI in Operating Company or CCG(2) NCI in Bridge Investment Group Holdings Inc.(3) Total Shareholdersʼ/ Balance as of December 31, 2021 $ — $ 230 $ 867 $ 53,527 $ 17,184 $ (21 ) $ 272,482 $ 205,468 $ 549,737 Net income — — — — 9,772 — 36,713 51,020 97,505 Conversion of 2019 profit interest awards — 8 — (8 ) — — — — — Exchange of Class A Units for Class A common stock and redemption of corresponding Class B common stock including the deferred tax effect and amounts payable under the Tax Receivable Agreement — 8 (8 ) 775 — — — — 775 Issuance of Class A Units for acquisition — — — — — — — 14,930 14,930 Fair value of non-controlling interest in acquired business — — — — — 20,053 — 20,053 Share-based compensation, net of forfeitures — 43 — 1,570 — — 7 5,624 7,244 Capital contributions — — — — — — 170 — 170 Distributions — — — — — — (17,510 ) (28,571 ) (46,081 ) Dividends on Class A Common Stock/Units, $0.21 per share — — — — (5,918 ) — — — (5,918 ) Foreign currency translation adjustment — — — — — 9 — — 9 Reallocation of equity — — — 3,383 — — — (3,383 ) — Balance as of March 31, 2022 $ — $ 289 $ 859 $ 59,247 $ 21,038 $ (12 ) $ 311,915 $ 245,088 $ 638,424 Balance as of December 31, 2020 $ 186,091 $ — $ — $ — $ — $ 4 $ 15,376 $ — $ 201,471 Net income prior to Transactions and IPO 36,771 — — — — — 3,949 — 40,720 Foreign currency translation adjustment prior to Transactions and IPO — — — — — 1 — — 1 Share-based compensation prior to Transactions and IPO 741 — — — — — 100 — 841 Capital contributions prior to Transactions and IPO 428 — — — — — — — 428 Distributions prior to Transactions and IPO (21,796 ) — — — — — (6,190 ) — (27,986 ) Repurchase of membership interests prior to Transactions and IPO (68 ) — — — — — (43 ) — (111 ) Balance as of March 31, 2021 $ 202,167 $ — $ — $ — $ — $ 5 $ 13,192 $ — $ 215,364 Net investment in Common Control Group (“CCG”) Three Months Ended March 31, 2022 2021 CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 97,505 $ 40,720 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 633 753 Amortization of financing costs and debt discount and premium 131 131 Share-based compensation 7,266 841 Equity in income of investments (997 ) (4,258 ) Changes in unrealized gain on General Partner notes payable (171 ) (1,540 ) Amortization of lease liabilities (100 ) (68 ) Unrealized performance allocations (65,862 ) (14,719 ) Unrealized accrued performance allocations compensation 9,238 1,429 Changes in operating assets and liabilities: Receivable from affiliates (19,873 ) 2,499 Prepaid and other assets 2,140 1,792 Accounts payable and accrued expenses 13,320 (3,814 ) Accrued payroll and benefits 5,921 1,862 Other liabilities 323 (298 ) Insurance loss and self-insurance reserves 1,475 (179 ) Accrued performance allocations compensation (560 ) 1,153 Net cash provided by operating activities 50,389 26,304 CASH FLOWS FROM INVESTING ACTIVITIES Purchase of investments (17,273 ) (2,584 ) Distributions from investments 1,147 0 Issuance of notes receivable (68,980 ) (60,001 ) Proceeds from collections on notes receivable 190,092 96,392 Purchase of tenant improvements, furniture and equipment (195 ) (133 ) Deposits (13,748 ) 0 Cash paid for acquisition, net of cash acquired (15,089 ) 0 Net cash provided by investing activities 75,954 33,674 CASH FLOWS FROM FINANCING ACTIVITIES Capital contributions from non-controlling interests 170 429 Distributions to non-controlling interests (46,081 ) (27,986 ) Repurchase of membership interests 0 (111 ) Repayments of General Partner notes payable (103 ) (62 ) Dividends paid on Class A common stock (5,918 ) 0 Net cash used in financing activities (51,932 ) (27,730 ) Net increase in cash, cash equivalents, and restricted cash 74,411 32,248 Cash, cash equivalents and restricted cash - beginning of period 83,872 107,354 Cash, cash equivalents and restricted cash - end of period $ 158,283 $ 139,602 Supplemental disclosure of cash flow information: Cash paid for income taxes $ 618 $ 410 Cash paid for interest 3,041 3,019 Non-cash investing and financing activities: Establishment of lease liabilities in exchange for lease right-of-use assets $ 15,824 $ 0 Origination of short-term loan receivable for prepaid acquisitions 40,000 0 Deferred tax effect resulting from exchange of Class A Units under Tax Receivable Agreement 5,166 0 Issuance of Class A Units for acquisition 14,930 0 Non-controlling interest assumed in business combination 20,053 0 Reconciliation of cash, cash equivalents and restricted cash: Cash and cash equivalents $ 149,121 $ 133,620 Restricted cash 9,162 5,982 Cash, cash equivalents, and restricted cash $ 158,283 $ 139,602 Non-controlling interests (“NCI”) in Bridge Investment Group Holdings LLC or Common Control Group Basis of Presentation — The Operating Company and the Contributed Bridge GPs were historically under common control. Prior to the IPO, the financial statements were the combined financial statements of the Operating Company and the then-existing Contributed Bridge GPs. Subsequent to the IPO, the financial statements are the consolidated financial statements of the Company and its subsidiaries. The accompanying unaudited condensed consolidated and combined financial statements are prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information. Management believes it has made all necessary adjustments (consisting of only normal recurring items) such that the condensed consolidated and combined financial statements are presented fairly and that estimates made in preparing the condensed consolidated and combined financial statements are reasonable and prudent. The operating results presented for interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the entire year. The condensed consolidated and combined financial statements include the accounts of the Company, its wholly owned or majority-owned subsidiaries and entities in which the Company is deemed to have a direct or indirect controlling financial interest based on either a variable interest model or voting interest model. All intercompany balances and transactions have been eliminated in consolidation. These unaudited condensed consolidated and combined financial statements should be read in conjunction with the Company’s audited consolidated and combined financial statements included in its Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the Securities and Exchange Commission (“SEC”). Reclassifications — Certain prior year amounts on the condensed consolidated balance sheet have been reclassified to conform with the presentation as of These reclassifications did not affect net income or shareholders’ equity as of or for the periods ended Voting Interest Entities — Unlike VIEs, voting interest entities have sufficient equity to finance their activities and equity investors exhibit the characteristics of a controlling financial interest through their voting rights. The Company consolidates such entities when it has the power to control these entities through ownership of a majority of the entities’ voting interests or through other arrangements. Non-controlling Interests — Non-controlling interests represent the share of consolidated entities owned by third parties. Bridge recognizes each non-controlling shareholder’s respective ownership at the estimated fair value of the net assets at the date of formation or acquisition. Non-controlling interests are subsequently adjusted for the non-controlling shareholder’s additional contributions, distributions and their share of the net earnings or losses of each respective consolidated entity. Net income is allocated to non-controlling interests based on the weighted-average ownership interest during the period. The net income that is not attributable to Bridge is reflected in net income attributable to non-controlling interests in the consolidated statements of operations and comprehensive income and shareholders’ equity. Use of Estimates — The preparation of condensed consolidated and combined financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Management believes that estimates utilized in the preparation of the consolidated financial statements are prudent and reasonable.Such estimates include those used in the valuation of investments, which directly affect accrued performance allocations and related compensation, the carrying amount of the Company's equity method investments, the measurement of deferred tax balances (including valuation allowances), and the accounting for goodwill, all of which involve a high degree of judgement and complexity and may have a significant impact on net income. Actual results could differ from those estimates and such differences could be material. Cash and Cash Equivalents — The Company considers all cash on hand, demand deposits with financial institutions and short-term highly liquid investments with original maturities of three months or less to be cash equivalents. Cash and cash equivalents are financial instruments that are exposed to concentrations of credit risk. Cash balances may be invested in money market accounts that are not insured. The Company holds and invests its cash with high-credit quality institutions in amounts that regularly exceed the amount insured by the Federal Deposit Insurance Corporation for a single financial institution. However, the Company has not realized any losses in such cash investments or accounts and believes it is not exposed to any significant credit risk. Restricted Cash — Restricted cash primarily consists of a collateral trust account for the benefit of the insurance carriers associated with Bridge Investment Group Risk Management, Inc. (“BIGRM”). These funds are held as collateral for the insurance carriers in the event of a claim that would require a high deductible payment from BIGRM. Fair Value — GAAP establishes a Fair Value Option — The fair value option provides an option to elect fair value as a measurement alternative for selected financial instruments. (See Note 7 “Fair Value Measurements” for further detail). The fair value option may be elected only upon the occurrence of certain specified events, including when the Company enters into an eligible firm commitment, at initial recognition of the financial instrument, as well as upon a business combination or consolidation of a subsidiary. The election is irrevocable unless a new election event occurs. The Company elected the fair value option for the General Partner notes payable. The carrying value of the General Partner notes payable represents the related General Partner lenders’ net asset value (“NAV”), in the respective fund and the General Partner lenders are entitled to receive distributions and carried interest. The NAV changes over time so marking the General Partner notes payable to fair value reflect these changes. Receivables from Affiliates — Receivables consist principally of amounts due from the funds and other affiliates. These include receivables associated with fund or asset management fees, property management fees and other fees. Additionally, the Company is entitled to reimbursements and/or recovers certain costs paid on behalf of the private funds managed by the Company and related properties operated by the Company, which include: (i) organization and offering costs associated with the formation and offering; (ii) direct and indirect operating costs associated with managing the operations of the properties; and (iii) costs incurred in performing investment due diligence. During the normal course of business, the Company makes short-term uncollateralized loans to the funds for asset acquisition and working capital. Accrued Performance Allocations — Performance allocations that are received in advance that remain subject to clawback are recorded as accrued performance allocations in the consolidated balance sheets. The Company’s share of net income or loss may differ from the stated ownership percentage interest in an entity if the governing documents prescribe a substantive non-proportionate earnings allocation formula or a preferred return to certain investors. The Company’s share of earnings (losses) from equity method investments is determined using a balance sheet approach referred to as the hypothetical liquidation at book value (“HLBV”) method. Under the HLBV method, at the end of each reporting period Bridge calculates the accrued performance allocations that would be due to Bridge for each fund pursuant to the fund agreements as if the fair value of the underlying investments were realized as of such date, irrespective of whether such amounts have been realized. As the fair value of underlying investments varies between reporting periods, it is necessary to make adjustments to amounts recorded as accrued performance allocations to reflect either (a) positive performance resulting in an increase in the accrued performance allocation to the general partner, or (b) negative performance that would cause the amount due to Bridge to be less than the amount previously recognized as revenue, resulting in a negative adjustment to the accrued performance allocation to the general partner. In each scenario, it is necessary to calculate the accrued performance allocation on cumulative results compared to the accrued performance allocation recorded to date and make the required positive or negative adjustments. Bridge ceases to record negative performance allocations once previously accrued performance allocations for such fund have been fully reversed. Bridge is not obligated to pay guaranteed returns or hurdles in this situation, and therefore, cannot have negative performance allocations over the life of a fund. The carrying amounts of equity method investments are reflected in accrued performance allocations on the consolidated balance sheets as of Other Investments — A non-controlling, unconsolidated ownership interest in an entity may be accounted for using one of: (i) equity method where applicable; (ii) fair value option if elected; (iii) fair value through earnings if fair value is readily determinable, including election of net asset value (“NAV”) practical expedient where applicable; or (iv) for equity investments without readily determinable fair values, the measurement alternative to measure at cost adjusted for any impairment and observable price changes, as applicable. Changes in fair value of equity method investments are recorded as realized and unrealized gains (losses) in other income (expense) on the condensed consolidated and combined statements of operations. Leases — In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842) (“ASC 842”). ASC 842 requires an entity to recognize right-of-use assets and lease liabilities on its balance sheet for all leases and to disclose certain information about leasing arrangements. Lessees and lessors are required to disclose qualitative and quantitative information about leasing arrangements to enable a user of the financial statements to assess the amount, timing and uncertainty of cash flows arising from leases. For public business entities, ASC 842 was effective for annual reporting periods beginning after December 15, 2018. On June 3, 2020, the FASB extended the adoption date for all other entities, including emerging growth Business Combinations — The determination of whether an acquisition qualifies as an asset acquisition or business combination is an area that requires management’s use of judgment in evaluating the criteria of the screen Goodwill — Goodwill represents the excess amount of consideration transferred in a business combination above the fair value of the identifiable net assets. As of that an impairment may exist. Goodwill is tested for impairment at the reporting unit level. The initial assessment for impairment under the qualitative approach is to determine whether it is more likely than not that the fair value of a reporting unit is less than its carrying amount, including goodwill. If the qualitative assessment indicates that it is more likely than not that the fair value of a reporting unit is less than the carrying amount, a quantitative assessment is performed to measure the amount of impairment loss, if any. The quantitative assessment includes comparing the fair value of a reporting unit with its carrying amount, including goodwill. If the carrying amount of the reporting unit exceeds its fair value, an impairment loss is recognized equal to the lesser of (a) the difference between the carrying amount of the reporting unit and its fair value and (b) the total carrying amount of the reporting unit’s goodwill. The Company performed an annual goodwill impairment assessment as of December 31, 2021, and determined that there was no impairment of goodwill. Revenue Recognition — Revenues consist of fund management fees, property management and leasing fees, construction management fees, development fees, transaction fees, insurance premiums and other asset management and property income. The Company recognizes revenue in a way that depicts the transfer of promised goods or services to customers in an amount that reflects the consideration to which the Company expects to be entitled in exchange for those invested or deployed capital. Fund administration fees also include investor services fees which are based on an annual fee per investor. Investment Income — Investment income is based on certain specific hurdle rates as defined in the applicable investment management agreements or fund or joint venture governing documents. Substantially all performance income is earned from funds and joint ventures managed by affiliates of the Company. Employee Compensation and Benefits — Employee compensation and benefits comprises salaries, bonus (including discretionary awards), related benefits, share-based compensation, and cost of processing payroll. Bonuses are accrued over the employment period to which they relate. Equity-classified awards granted to employees that have a service condition are measured at fair value at date of grant and remeasured at fair value only upon a modification of the award. The fair value of Incentive Fees and Performance Allocations Compensation — The Company records incentive fee compensation when it is probable that a liability has been incurred and the amount is reasonably estimable. The incentive fee compensation accrual is based on a number of factors, including the cumulative activity for the period and the expected timing of the distribution of the net proceeds in accordance with the applicable governing agreement. Realized and Unrealized Gain Income Taxes — Prior to the IPO, other than our subsidiaries BIGRM and BPM, the Operating Company and its subsidiaries were limited liability companies or limited partnerships and, as such, were not subject to income taxes and the individual owners of Bridge were required to report their distributive share of the Operating Company’s realized income, gains, losses, deductions, or credits on their individual income tax returns. In preparation for the IPO, the Company was incorporated as a corporation for U.S. federal income tax purposes and from the IPO therefore is subject to U.S. federal and state income taxes on its share of taxable income generated by the Operating Company. deferred tax assets is dependent on the amount, timing and character of the Company’s future taxable income. When evaluating the realizability of deferred tax assets, all evidence – both positive and negative – is considered. This evidence includes, but is not limited to, expectations regarding future earnings, future reversals of existing temporary tax differences and tax planning strategies. Segments — The Company operates as one business, a fully integrated real estate investment manager. The Company’s chief operating decision maker, which is the executive chairman, utilizes a consolidated approach to assess financial performance and allocate resources. As such, the Company operates as one business segment. Earnings Per Share — Basic earnings per share is calculated by dividing net income available to Class A common stockholders by the weighted-average number of Class A common shares outstanding for the period. Company’s performance obligations and the basis for calculating each amount for the three and six months ended Three Months Ended March 31, FUND MANAGEMENT FEES 2022 2021 Funds $ 51,209 $ 29,470 Joint ventures and separately managed accounts 1,491 1,381 Total fund management fees $ 52,700 $ 30,851 Three Months Ended March 31, PROPERTY MANAGEMENT AND LEASING FEES 2022 2021 Seniors Housing $ 7,106 $ 6,557 Multifamily 5,313 4,094 Office 4,264 6,096 Single-Family Rental 1,596 0 Total property management and leasing fees $ 18,279 $ 16,747 Three Months Ended March 31, CONSTRUCTION MANAGEMENT FEES 2022 2021 Multifamily $ 1,383 $ 925 Office 434 749 Seniors Housing 70 152 Total construction management fees $ 1,887 $ 1,826 June 30, 2022 December 31, 2021 Assets (Unaudited) (Audited) Cash and cash equivalents $ 102,777 $ 78,417 Restricted cash 7,401 5,455 Marketable securities, at fair value 10,777 8,035 Receivables from affiliates 34,186 35,379 Notes receivable from affiliates 66,104 118,508 Other assets 44,836 44,463 Other investments 73,395 44,006 Accrued performance allocations 575,527 439,548 Intangible assets, net 5,862 3,441 Goodwill 55,982 9,830 Deferred tax assets, net 65,221 59,210 Total assets $ 1,042,068 $ 846,292 Liabilities and shareholdersʼ equity Accrued performance allocations compensation $ 58,688 $ 41,020 Accrued compensation and benefits 28,655 15,107 Accounts payable and accrued expenses 25,221 13,586 Due to affiliates 51,302 46,134 General Partner notes payable, at fair value 12,364 12,003 Insurance loss reserves 8,540 8,086 Self-insurance reserves and unearned premiums 3,515 3,504 Other liabilities 24,430 8,973 Notes payable 148,356 148,142 Total liabilities $ 361,071 $ 296,555 Commitments and contingencies (Note 17) — — Shareholdersʼ equity: Preferred stock, $0.01 par value, 20,000,000 authorized, 0 issued and outstanding as of June 30, 2022 and December 31, 2021 — — Class A common stock, $0.01 par value, 500,000,000 authorized; 29,077,806 and 25,159,799 issued and outstanding as of June 30, 2022 and December 31, 2021, respectively 291 230 Class B common stock, $0.01 par value, 238,228,038 and 239,208,722 authorized; 85,691,621 and 86,672,305 issued and outstanding as of June 30, 2022 and December 31, 2021, respectively 857 867 Additional paid-in capital 60,962 53,527 Retained earnings 26,364 17,184 Accumulated other comprehensive loss (25) (21) Bridge Investment Group Holdings Inc. equity 88,449 71,787 Non-controlling interests in Bridge Investment Group Holdings LLC 323,141 272,482 Non-controlling interests in Bridge Investment Group Holdings Inc. 269,407 205,468 Total shareholdersʼ equity 680,997 549,737 Total liabilities and shareholdersʼ equity $ 1,042,068 $ 846,292 5(Unaudited)
Investment Group Holdings LLC
Group Holdings Inc. subsequent to Transactions and IPO
subsequent to Transactions and IPOThree Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Revenues: Fund management fees $ 49,380 $ 34,536 $ 102,080 $ 65,387 Property management and leasing fees 19,616 14,335 37,895 31,081 Construction management fees 2,426 2,065 4,312 3,891 Development fees 793 1,163 2,052 1,549 Transaction fees 17,643 16,242 39,641 21,568 Fund administration fees 3,657 — 7,297 — Insurance premiums 2,845 2,022 5,261 3,916 Other asset management and property income 2,659 1,611 4,614 3,131 Total revenues 99,019 71,974 203,152 130,523 Investment income: Incentive fees — — — 910 Performance allocations: Realized 33,581 35,629 42,518 41,185 Unrealized 70,116 43,248 135,978 57,967 Earnings (losses) from investments in real estate 1,251 980 1,291 976 Total investment income 104,948 79,857 179,787 101,038 Expenses: Employee compensation and benefits 46,693 42,306 94,172 69,457 Incentive fee compensation — — — 82 Performance allocations compensation: Realized 2,165 3,747 2,725 4,241 Unrealized 7,987 6,048 17,225 7,477 Loss and loss adjustment expenses 1,439 2,132 3,191 2,917 Third-party operating expenses 6,749 6,117 13,517 14,743 General and administrative expenses 9,769 5,392 19,277 9,492 Depreciation and amortization 887 727 1,520 1,480 Total expenses 75,689 66,469 151,627 109,889 Other income (expense): Realized and unrealized gains (losses), net 3,489 300 3,916 6,097 Interest income 1,353 557 2,562 1,165 Interest expense (2,901) (2,554) (4,522) (4,140) Total other income (expense) 1,941 (1,697) 1,956 3,122 Income before provision for income taxes 130,219 83,665 233,268 124,794 Income tax provision (5,837) (424) (11,382) (834) Net income 124,382 83,241 221,886 123,960 Net income attributable to non-controlling interests in Bridge Investment Group Holdings LLC 49,748 5,815 86,461 9,764 Net income attributable to Bridge Investment Group Holdings LLC 74,634 77,426 135,425 114,196 Net income attributable to Common Control Group prior to Transactions and IPO — 77,426 — 114,196 Net income attributable to non-controlling interests in Bridge Investment Group Holdings Inc. subsequent to Transactions and IPO 61,694 — 112,714 — Net income attributable to Bridge Investment Group Holdings Inc. subsequent to Transactions and IPO $ 12,940 $ — $ 22,711 $ — Earnings per share of Class A common stock - Basic and Diluted (Note 21) $ 0.44 00 $ 0.79 00 Weighted-average shares of Class A common stock outstanding - Basic and Diluted (Note 21) 24,029,107 00 23,581,393 00 6(Unaudited)
translation adjustments, net of tax
interests in Bridge Investment Group Holdings LLC
Group Holdings LLC
Group prior to Transactions and IPO
interests in Bridge Investment Group Holdings Inc. subsequent
to Transactions and IPO
Group Holdings Inc. subsequent to Transactions and IPOThree Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Net income $ 124,382 $ 83,241 $ 221,886 $ 123,960 Other comprehensive income - foreign currency translation adjustments, net of tax (13) 6 (4) 7 Total comprehensive income 124,369 83,247 221,882 123,967 Less: comprehensive income attributable to non-controlling interests in Bridge Investment Group Holdings LLC 49,748 5,815 86,461 9,764 Comprehensive income attributable to Bridge Investment Group Holdings LLC 74,621 77,432 135,421 114,203 Less: comprehensive income attributable to Common Control Group prior to Transactions and IPO — 77,432 — 114,203 Less: comprehensive income attributable to non-controlling interests in Bridge Investment Group Holdings Inc. subsequent to Transactions and IPO 61,694 — 112,714 — Comprehensive income attributable to Bridge Investment Group Holdings Inc. subsequent to Transactions and IPO $ 12,927 $ — $ 22,707 $ — 7BRIDGE
Common Stock
Common Stock
Membersʼ EquityClass A
Common StockClass B
Common StockAdditional Paid-In
CapitalRetained
EarningsAccumulated Other
Comprehensive Income
(Loss)Total Shareholdersʼ/
Membersʼ EquityBalance as of March 31, 2022 $ — $ 289 $ 859 $ 59,247 $ 21,038 $ (12) $ 311,915 $ 245,088 $ 638,424 Net income — — — — 12,940 — 49,748 61,694 124,382 Exchange of Class A Units for Class A common stock and redemption of corresponding Class B common stock including the deferred tax effect and amounts payable under the Tax Receivable Agreement — 2 (2) 5 — — — — 5 Share-based compensation, net of forfeitures — — — 2,119 6 4,428 6,553 Capital contributions — — — — — — 31 — 31 Distributions — — — — — — (38,559) (42,212) (80,771) Dividends on Class A Common Stock/Units, $0.26 per share — — — — (7,614) — — — (7,614) Foreign currency translation adjustment — — — — — (13) — — (13) Reallocation of equity — — — (409) — — — 409 — Balance as of June 30, 2022 $ — $ 291 $ 857 $ 60,962 $ 26,364 $ (25) $ 323,141 $ 269,407 $ 680,997
For a description of the Transactions related to our initial public offering (“IPO”) refer to Note 1.Balance as of March 31, 2021 $ 202,167 $ — $ — $ — $ — $ 5 $ 13,192 $ — $ 215,364 Net income prior to Transactions and IPO 77,426 — — — — — 5,815 — 83,241 Foreign currency translation adjustment prior to Transactions and IPO — — — — — 6 — — 6 Share-based compensation prior to Transactions and IPO 13,767 — — — — — 857 — 14,624 Capital contributions prior to Transactions and IPO — — — — — — 323 — 323 Distributions prior to Transactions and IPO (136,107) — — — — — (7,810) — (143,917) Repurchase of membership interests prior to Transactions and IPO — — — — — — — — — Balance as of June 30, 2021 $ 157,253 $ — $ — $ — $ — $ 11 $ 12,377 $ — $ 169,641 IncInc..8Cash FlowsChanges in Shareholders’/Members’ Equity (Unaudited)thousands)thousands, except per share data)Class A
Common StockClass B
Common StockAdditional Paid-In
CapitalRetained
EarningsAccumulated Other
Comprehensive Income
(Loss)Total Shareholdersʼ/
Membersʼ EquityBalance as of December 31, 2021 $ — $ 230 $ 867 $ 53,527 $ 17,184 $ (21) $ 272,482 $ 205,468 $ 549,737 Net income — — — — 22,711 — 86,461 112,714 221,886 Conversion of 2019 profits interest awards — 8 — (8) — — — — — Exchange of Class A Units for Class A common stock and redemption of corresponding Class B common stock including the deferred tax effect and amounts payable under the Tax Receivable Agreement — 10 (10) 780 — — — — 780 Issuance of Class A Units for acquisition — — — — — — — 14,930 14,930 Fair value of non-controlling interest in acquired business — — — — — 20,053 — 20,053 Share-based compensation, net of forfeitures — 43 — 3,689 — — 14 10,072 13,818 Capital contributions — — — — — — 201 — 201 Distributions — — — — — — (56,070) (70,803) (126,873) Dividends on Class A Common Stock/Units, $0.47 per share — — — — (13,531) — — — (13,531) Foreign currency translation adjustment — — — — — (4) — — (4) Reallocation of equity — — — 2,974 — — — (2,974) — Balance as of June 30, 2022 $ — $ 291 $ 857 $ 60,962 $ 26,364 $ (25) $ 323,141 $ 269,407 $ 680,997 Balance as of December 31, 2020 $ 186,091 $ — $ — $ — $ — $ 4 $ 15,376 $ — $ 201,471 Net income prior to Transactions and IPO 114,196 — — — — — 9,764 — 123,960 Foreign currency translation adjustment prior to Transactions and IPO — — — — — 7 — — 7 Share-based compensation prior to Transactions and IPO 14,508 — — — — — 957 — 15,465 Capital contributions prior to Transactions and IPO 422 — — — — — 323 — 745 Distributions prior to Transactions and IPO (157,896) — — — — — (14,000) — (171,896) Repurchase of membership interests prior to Transactions and IPO (68) — — — — — (43) — (111) Balance as of June 30, 2021 $ 157,253 $ — $ — $ — $ — $ 11 $ 12,377 $ — $ 169,641 9Six Months Ended 2022 2021 CASH FLOWS FROM OPERATING ACTIVITIES Net income $ 221,886 $ 123,960 Adjustments to reconcile net income to net cash provided by operating activities: Depreciation and amortization 1,520 1,480 Amortization of financing costs and debt discount and premium 303 278 Share-based compensation 13,818 15,465 Equity in income of investments (4,837) (5,725) Changes in unrealized gain (loss) on General Partner notes payable 822 (415) Amortization of lease liabilities (208) (135) Unrealized performance allocations (135,978) (57,967) Unrealized accrued performance allocations compensation 17,225 7,477 Change in deferred income taxes (63) — Changes in operating assets and liabilities: Receivable from affiliates 1,969 3,173 Prepaid and other assets 708 (384) Accounts payable and accrued expenses 11,453 1,301 Accrued payroll and benefits 13,548 8,392 Other liabilities (694) (134) Insurance loss and self-insurance reserves 465 204 Accrued performance allocations compensation 442 1,507 Net cash provided by operating activities 142,379 98,477 CASH FLOWS FROM INVESTING ACTIVITIES Purchase of investments (35,384) (2,717) Proceeds from sale of investments — 81 Distributions from investments 855 — Issuance of notes receivable (242,905) (146,040) Proceeds from collections on notes receivable 318,255 182,192 Purchase of tenant improvements, furniture and equipment (788) (321) Deposits 661 — Cash paid for acquisition, net of cash acquired (15,089) — Net cash provided by investing activities 25,605 33,195 CASH FLOWS FROM FINANCING ACTIVITIES Capital contributions from non-controlling interests 201 745 Distributions to non-controlling interests (126,873) (171,896) Repurchase of membership interests — (111) Repayments of General Partner notes payable (460) (607) Dividends paid on Class A common stock (13,531) — Proceeds from revolving line of credit 50,000 64,800 Payments on revolving line of credit (50,000) (64,800) Payments of deferred financing costs (1,015) — Net cash used in financing activities (141,678) (171,869) Net increase in cash, cash equivalents, and restricted cash 26,306 (40,197) Cash, cash equivalents and restricted cash - beginning of period 83,872 107,354 Cash, cash equivalents and restricted cash - end of period $ 110,178 $ 67,157 Supplemental disclosure of cash flow information: Cash paid for income taxes $ 2,066 $ 834 Cash paid for interest 3,118 3,019 Non-cash investing and financing activities: Establishment of lease liabilities in exchange for lease right-of-use assets $ 18,808 $ — Origination of short-term loan receivable for prepaid acquisitions 40,000 — Deferred tax effect resulting from exchange of Class A Units under Tax Receivable Agreement 5,948 — Issuance of Class A Units for acquisition 14,930 — Non-controlling interest assumed in business combination 20,053 — Reconciliation of cash, cash equivalents and restricted cash: Cash and cash equivalents $ 102,777 $ 61,548 Restricted cash 7,401 5,609 Cash, cash equivalents, and restricted cash $ 110,178 $ 67,157 tenvarious specialized and synergistic investment platforms, including Multifamily, Workforce and Affordable Housing, Seniors Housing, Office, Development, Net Lease Income, Logistics, Debt Strategies, Agency MBS, Single-Family Rental, PropTech and Single-Family Rental.Solar. We provide investors with a diverse range of real estate investment products managed by our dedicated, specialized and synergistic investment teams. Our broad range of products allow us to capture new market opportunities and serve investors with various investment objectives.(”(“BSHM”),Bridge Debt Strategies Fund Manager LLC, Bridge Office Fund Manager LLC (”(“BOFM”), Bridge Development Fund Manager LLC, Bridge Agency MBS Fund Manager LLC, Bridge Net Lease Fund Manager LLC, Bridge Logistics Properties Fund Manager LLC, and Bridge Single-Family Rental Fund Manager LLC, and Bridge Renewable Energy Fund Manager LLC (together, the “Fund Managers”). The Fund Managers provide real estate and fund investment advisory services on a discretionary basis to multiple investment funds and other vehicles, including joint venture real estate projects, separately managed accounts and privately offered real estate-related limited partnerships, including any parallel investment vehicles and feeder funds (collectively, the “funds”). The Operating Company is entitled to a pro rata portion of the management fees of the funds based on its ownership in the Fund Managers.10$16.00$16.00 per share (the “IPO”) receiving approximately $277.2$277.2 million in net proceeds, after deducting the underwriting discounts and commissions and estimated offering expenses. The net proceeds from the IPO were used to purchase 18,750,000 newly issued Class A common units (“Class A Units”) from the Operating Company at a price per unit equal to the initial public offering price per share of Class A common stock in the IPO, less the underwriting discounts and commissions and estimated offering expenses. The Operating Company used net proceeds from the public offering to pay approximately $139.9$139.9 million in cash to redeem certain of the Class A Units held directly or indirectly by certain of the owners of LLC Interests in the Operating Company, prior to the IPO (collectively, “Original Equity Owners”). See Note 16, “Shareholders’ Equity,” for additional details.100%100% of the operations of the Contributed Bridge GPs for the periods presented on the basis of common control.100%100% of the net proceeds of approximately $18.2$18.2 million, after taking into account the underwriting discounts and commissions and estimated offering expenses, to purchase 1,416,278 newly issued Class A Units directly from the Operating Company, at a price per Class A Unit equal to the IPO price per share of Class A common stock in the IPO, less the underwriting discounts and commissions and estimated offering expenses payable by the Company. The Operating Company used all of the net proceeds from the sale of Class A Units to the Company related to this over-allotment option to redeem certain of the Class A Units held directly or indirectly by certain of the Original Equity Owners.100%100% of the Class B Common Units (“Class B Units”) (voting only) in the Operating Company. TheThe Company acts as the sole managing member of the Operating Company and, as a result, indirectly operates and controls all of the Operating Company’s business and affairs and its direct and indirect subsidiaries. As a result, the Company consolidates the financial results of the Operating Company and reports non-controlling interests related to the Class A Units of the Operating Company. The assets and liabilities of the Operating Company represent substantially all of the Company’s consolidated assets and liabilities, with the exception of certain deferred income taxes and payables due to affiliates pursuant to the Tax Receivable Agreement, as amended and restated (the “TRA”) (see Note 15, “Income Taxes,” for additional information). As of March 31,June 30, 2022, the Company held approximately 23%23% of the economic interest in the Operating Company. To the extent the Operating Company’s members exchange their Class A Units into the Company’s Class A common stock in the future, the Company’s economic interest in the Operating Company will increase.11March 31,June 30, 2022. These prior year reclassifications included combining current and long-term asset classifications to present a non-classified balance sheet and to condense tenant improvements, furniture and equipment with other assets. Certain prior year amounts on the condensed consolidated and combined statement of operations related to fund administration fees were reclassified from other asset management and property income to conform with presentation as of March 31, 2022.March 31,June 30, 2022 and December 31, 2021, respectively.12profit interestsprofits interest awards. Non-controlling interests attributable to Bridge Investment Group Holdings Inc. include equity interests in the Operating Company owned by third-party investors. Non-controlling interests in the Operating Company are adjusted to reflect their ownership percentage in the Operating Partnership at the end of the period, through a reallocation between controlling and non-controlling interest in the Operating Partnership, as applicable.on investments.in other income (expense). Fair value is based on quoted prices for identical assets in active markets. Realized gains and losses are determined on the basis for the actual cost of the securities sold. Dividends on equity securities are recognized as income when declared.hierarchalhierarchical disclosure framework that prioritizes the inputs used in measuring financial instruments at fair value into three levels based on their market price observability. Market price observability is affected by a number of factors, including the type of instrument and the characteristics specific to the instrument. Financial instruments with readily available quoted prices from an active market or for which fair value can be measured based on actively quoted prices generally have a higher degree of market price observability and a lesser degree of judgment inherent in measuring fair value.13NaNNone of the receivables were considered not collectible as of March 31,June 30, 2022 and December 31, 2021, respectively.March 31,June 30, 2022 and December 31, 2021, respectively, which are based on asset valuations one quarter in arrears.14companiescompanies (“EGCs”), as defined by the SEC, thatthat have elected to defer adoption until the standard is effective for non-public business entities, to annual periods beginning after December 15, 2021, and interim periods within annual periods beginning after December 15, 2022, with early adoption permitted. The Company qualifies as an EGC and elected to take advantage of the extended transition period afforded to EGCs as it applies to the adoption of new accounting standards.15$13.7$13.7 million and $15.8$15.8 million,, respectively, which represents the aggregate discounted amount of the Company’s minimum lease obligations as of the adoption date. Included in the ROU asset was approximately $2.1$2.1 million of deferred rent and lease incentives, which was reclassified from other liabilities upon adoption of ASC 842; however, these amounts were 0tnot reclassified as of December 31, 2021, and are therefore not comparative. The adoption of this standard did not have a material impact on the condensed consolidated statement of operations for the three and six months ended March 31,June 30, 2022, as all of the Company’s leases are still classified as operating leases, which under the new guidance will continue to be recognized as expense on a straight-line basis.spacespace and certain equipment. Operating leases are included in other assets and other liabilities in the condensed consolidated balance sheet. Certain leases include lease and non-lease components, which the Company accounts for separately. Lease ROU assetsassets and lease liabilities are measured based on the present value of future minimum lease payments over the lease term at the commencementcommencement date. Leases may include options to extend or terminate the lease which are included in the ROU assets and lease liability when they are reasonably certain of exercise. LeaseLease ROU assets are presented net of deferred rent and lease incentives. The Company uses its incremental borrowing rate based on information available at the inception date in determining the present value of future minimum lease payments. Operating lease expense associated with minimum lease payments is recognized on a straight-line basis over the lease term in general, administrative and other expenses in the condensed consolidated statements of income. Minimum lease payments for leases with an initial term of twelve months or less are not recorded in the condensed consolidated balance sheet. SeeSee Note 17 for moremore information.tetest.st.March 31,June 30, 2022 and December 31, 2021, the Company had goodwill of $56.0$56.0 million and $9.8$9.8 million, respectively. In January 2022, the Company acquired a 60%60% interest in Gorelick Brothers Capital’s (“GBC”) asset and property management business. The acquisition of GBC was accounted for as a business combination and recorded pursuant to the acquisition method of accounting. A majority of the fair value of the purchase consideration was attributed to goodwill, which was due to synergies expected through the ability to provide a vertically integrated approach upon launching the Bridge Single-Family Rental (“Bridge SFR”) investment strategy. Refer to Note 8 for further details on the GBC transaction. As of December 31, 2021, the Company had goodwill of $9.8$9.8 million related to the acquisitions of Bridge Property Management, L.C. (“BPM”) and Bridge Acquisitions, Asset Management, and Dispositions LLC (“BAA&D”) in 2012, and Bridge Commercial Real Estate LLC (“BCRE”) and affiliated companies in 2016.16March 31,June 30, 2022, there were 0no indicators of goodwill impairment.1718profit interestsprofits interest awards is determined using a Monte Carlo valuation at date of grant or date of remeasurement. The fair value of Restricted Stock Units (“RSUs”) and Restricted Stock Awards is determined using the Company's closing stock price on the grant date. The Company recognizes compensation expense over the requisite service period of the awards, with the amount of compensation expense recognized at the end of a reporting period at least equal to the fair value of the portion of the award that has vested through that date. Compensation expense is adjusted for actual forfeituresforfeitures upon occurrence. Please refer to Note 20, “Share-Based“Share-Based Compensation and Profits Interests,” for additional information.(Losses)(Losses) — Realized gain (loss) occurs when the Company redeems all or a portion of its investment or when the Company receives cash income, such as dividends or distributions. Unrealized appreciation (depreciation) results from changes in the fair value of the underlying investment as well as from the reversal of previously recognized unrealized appreciation (depreciation) at the time an investment is realized. Realized and unrealized gains (losses) are presented together as realized gains (losses) in the condensed consolidated and combined statements of operations.19“Income“Income Taxes” for more information.enteredentered into a TRA with the OperatingOperating Company and each of the Continuing Equity Owners that provides for the payment by the Company to the Continuing Equity Owners of 85%85% of the amount of tax benefits, if any, that the Company actually realizes (or in some circumstances is deemed to realize) as a result of (1) increases in the Company’s allocable share of the tax basis of the Operating Company’s assets resulting from (a) the Company’s purchase of Class A Units directly from the Operating Company and the partial redemption of Class A Units by the Operating Company in connection with the IPO, (b) future redemptions or exchanges (or deemed exchanges in certain circumstances) of Class A Units for Class A common stock or cash and (c) certain distributions (or deemed distributions) by the Operating Company; (2) the Company’s allocable share of the existing tax basis of the Operating Company’s assets at the time of any redemption or exchange of Class A Units (including in connection with the IPO), which tax basis is allocated to the Class A Units being redeemed or exchanged and acquired by the Company and (3) certain additional tax benefits arising from payments made under the TRA. The Company will retain the benefit of the remaining 15%15% of these net cash tax savings under the TRA.20March 31,June 30, 2022 and 2021, respectively (in thousands):Three Months Ended June 30, Six Months Ended June 30, FUND MANAGEMENT FEES 2022 2021 2022 2021 Funds $ 47,617 $ 33,510 $ 98,826 $ 62,980 Joint ventures and separately managed accounts 1,763 1,026 3,254 2,407 Total fund management fees $ 49,380 $ 34,536 $ 102,080 $ 65,387 Three Months Ended June 30, Six Months Ended June 30, PROPERTY MANAGEMENT AND LEASING FEES 2022 2021 2022 2021 Seniors Housing $ 7,059 $ 6,597 $ 14,165 $ 13,153 Multifamily 5,964 4,322 11,277 8,416 Office 4,083 3,416 8,347 9,512 Single-Family Rental 2,510 — 4,106 — Total property management and leasing fees $ 19,616 $ 14,335 $ 37,895 $ 31,081 Three Months Ended June 30, Six Months Ended June 30, CONSTRUCTION MANAGEMENT FEES 2022 2021 2022 2021 Multifamily $ 1,900 $ 1,133 $ 3,282 $ 2,058 Office 468 829 902 1,578 Seniors Housing 58 103 128 255 Total construction management fees $ 2,426 $ 2,065 $ 4,312 $ 3,891
|
| Three Months Ended March 31, |
| Three Months Ended June 30, | Six Months Ended June 30, | ||||||||||||||||||||||||||
TRANSACTION FEES |
| 2022 |
|
| 2021 |
| TRANSACTION FEES | 2022 | 2021 | 2022 | 2021 | ||||||||||||||||||||
Acquisition fees |
| $ | 16,597 |
|
| $ | 4,651 |
| Acquisition fees | $ | 15,075 | $ | 13,137 | $ | 31,672 | $ | 17,789 | ||||||||||||||
Brokerage fees |
|
| 5,401 |
|
|
| 675 |
| Brokerage fees | 2,568 | 3,105 | 7,969 | 3,779 | ||||||||||||||||||
Total transaction fees |
| $ | 21,998 |
|
| $ | 5,326 |
| Total transaction fees | $ | 17,643 | $ | 16,242 | $ | 39,641 | $ | 21,568 |
The Company invests a portion of the premiums received at BIGRM in exchange traded funds and mutual funds. As of Unrealized Unrealized Fair Cost Gains Losses Value March 31, 2022: Exchange traded funds $ 1,594 $ 0 $ (18 ) $ 1,576 Mutual funds 9,424 0 (50 ) 9,374 Total marketable securities $ 11,018 $ 0 $ (68 ) $ 10,950 December 31, 2021: Exchange traded funds $ 1,159 $ 16 $ (4 ) $ 1,171 Mutual funds 6,873 18 (27 ) 6,864 Total marketable securities $ 8,032 $ 34 $ (31 ) $ 8,035 Carrying Value Investments March 31, 2022 December 31, 2021 Accrued performance allocations (1) $ 505,410 $ 439,548 Other investments: Partnership interests in Company-sponsored funds (2) 43,423 31,984 Investments in third-party partnerships (3) 10,465 7,701 Other (4) 4,326 4,321 Total other investments $ 58,214 $ 44,006 March 31,June 30, 2022 and 2021, no individual client represented 10%10% or more of the Company’s total reported revenues and substantially all of revenue was derived from operations in the United States.March 31,June 30, 2022 and December 31, 2021, the Company had $5.1$5.1 million and $3.2$3.2 million, respectively, of deferred revenues, which is included in other liabilities in the condensed consolidated balance sheets for the periods then ended. During the three and six months ended March 31,June 30, 2022, the Company recognized $0.8recognized $1.2 million and $3.2 million as revenuerevenue from amounts included in the deferred revenue balance as of December 31, 2021. The Company expects to recognize the deferred revenues within a year of the balance sheet date.March 31,June 30, 2022 and December 31, 2021, the Company’s investment securities are summarized as follows (in thousands):21Cost Unrealized
GainsUnrealized
LossesFair
ValueJune 30, 2022: Exchange traded funds $ 1,610 $ — $ (28) $ 1,582 Mutual funds 9,567 — (372) 9,195 Total marketable securities $ 11,177 $ — $ (400) $ 10,777 December 31, 2021: Exchange traded funds $ 1,159 $ 16 $ (4) $ 1,171 Mutual funds 6,873 18 (27) 6,864 Total marketable securities $ 8,032 $ 34 $ (31) $ 8,035 Bridge-sponsoredBridge sponsored funds. The Company’s investments are summarized below (in thousands):Carrying Value Investments June 30, 2022 December 31, 2021 $ 575,527 $ 439,548 Other investments: 55,505 31,984 11,380 7,701 6,510 4,321 Total other investments $ 73,395 $ 44,006 proptech”PropTech”) venture capital firms are valued using NAV of the respective vehicle.
third-party entities unless information is available on a more-timely basis. As of March 31, 2022 December 31, 2021 Bridge Multifamily Fund V $ 0 $ 55,000 Bridge Logistics U.S. Venture I 0 31,644 Bridge Seniors Housing Fund III 0 24,500 Bridge Office Fund II 15,000 3,000 Bridge Single-Family Rental Fund IV 15,000 0 Total short-term notes receivables from affiliates $ 30,000 $ 114,144 Notes receivables from employees 4,364 4,364 Total notes receivable from affiliates $ 34,364 $ 118,508 investment income related to its accrued performance allocations and other investments of $75.2$107.2 million and $26.0$79.2 million for the three months ended March 31,June 30, 2022 and 2021 and $182.4 million and $106.2 million for the six months ended June 30, 2022 and 2021, respectively, of which $74.8$103.7 million and $20.3$78.9 million for three months ended, and $178.5 million and $99.2 million for six months ended, respectively, related to accrued performance allocations recognized under the equity method.March 31,June 30, 2022 and December 31, 2021, $50.9$58.7 million and $41.0$41.0 million, respectively, were payable to affiliates of which $50.3 million and $41.0 million, respectively, wereare included in accrued performance allocations compensation in the condensed consolidated balance sheets as of the periods then endedended.$0.6 million was included in accounts payable and accrued expenses as of March 31, 2022.March 31,June 30, 2022 and December 31, 2021, no individual equity method investment held by the Company met the significance criteria. As a result, the Company is not required to provide separate financial statements for any of its equity method investments.Fair value of the investments is reported on a three-month lag from the fund financial statements due to timing of the information provided by the funds and third-party entities unless information is available on a more-timely basis.22March 31,June 30, 2022 and December 31, 2021,, the Company had the following notes receivable from affiliates outstanding (in thousands):June 30, 2022 December 31, 2021 Bridge Logistics U.S. Venture I $ 19,793 $ 31,644 Bridge Office Fund II 18,000 3,000 Bridge Single-Family Rental Fund IV 15,000 — Bridge Debt Strategies Fund II 7,000 — 2,000 — Bridge Multifamily Fund V — 55,000 Bridge Seniors Housing Fund III — 24,500 Total short-term notes receivables from affiliates $ 61,793 $ 114,144 Notes receivables from employees 4,311 4,364 Total notes receivable from affiliates $ 66,104 $ 118,508 Interestnterest on the short-term notes receivables from affiliates accrues at a fixed rate of 4.025%4.025% per annum. As of March 31,June 30, 2022 and December 31, 2021, the Company had approximately $0.1$0.4 million and $0.3$0.3 million, respectively, of interest receivable outstanding, which is included in other assets in the accompanying condensed consolidated balance sheets for the periods then ended.
23
The following table presents assets that are measured at fair value on a recurring basis as of March 31,June 30, 2022 and December 31, 2021 (in thousands):
|
|
|
|
|
|
|
|
|
|
| Measured at |
|
|
|
| |||||
|
| Level 1 |
|
| Level 2 |
|
| Level 3 |
|
| NAV |
|
| Total |
| |||||
March 31, 2022 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Exchange traded funds |
| $ | 1,576 |
|
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | 1,576 |
|
Mutual funds |
|
| 9,374 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 9,374 |
|
Accrued performance allocations |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 505,410 |
|
|
| 505,410 |
|
Partnership interests |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 53,888 |
|
|
| 53,888 |
|
Other investments |
|
| — |
|
|
| — |
|
|
| 4,326 |
|
|
| — |
|
|
| 4,326 |
|
Total assets at fair value |
| $ | 10,950 |
|
| $ | — |
|
| $ | 4,326 |
|
| $ | 559,298 |
|
| $ | 574,574 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
General Partner notes payable |
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | 11,729 |
|
| $ | 11,729 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
December 31, 2021 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Assets: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Exchange traded funds |
| $ | 1,171 |
|
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | 1,171 |
|
Mutual funds |
|
| 6,864 |
|
|
| — |
|
|
| — |
|
|
| — |
|
|
| 6,864 |
|
Accrued performance allocations |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 439,548 |
|
|
| 439,548 |
|
Partnership interests |
|
| — |
|
|
| — |
|
|
| — |
|
|
| 39,685 |
|
|
| 39,685 |
|
Other investments |
|
| — |
|
|
| — |
|
|
| 4,321 |
|
|
| — |
|
|
| 4,321 |
|
Total assets at fair value |
| $ | 8,035 |
|
| $ | — |
|
| $ | 4,321 |
|
| $ | 479,233 |
|
| $ | 491,589 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
Liabilities: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||
General Partner notes payable |
| $ | — |
|
| $ | — |
|
| $ | — |
|
| $ | 12,003 |
|
| $ | 12,003 |
|
Level 1 Level 2 Level 3 Measured at
NAVTotal June 30, 2022 Assets: Exchange traded funds $ 1,582 $ — $ — $ — $ 1,582 Mutual funds 9,195 — — — 9,195 Accrued performance allocations — — — 575,527 575,527 Partnership interests — — — 66,885 66,885 Other investments — — 6,510 — 6,510 Total assets at fair value $ 10,777 $ — $ 6,510 $ 642,412 $ 659,699 Liabilities: General Partner notes payable $ — $ — $ — $ 12,364 $ 12,364 December 31, 2021 Assets: Exchange traded funds $ 1,171 $ ��� $ — $ — $ 1,171 Mutual funds 6,864 — — — 6,864 Accrued performance allocations — — — 439,548 439,548 Partnership interests — — — 39,685 39,685 Other investments — — 4,321 — 4,321 Total assets at fair value $ 8,035 $ — $ 4,321 $ 479,233 $ 491,589 Liabilities: General Partner notes payable $ — $ — $ — $ 12,003 $ 12,003
Other Investments | |||||
Balance as of December 31, 2021 | $ | 4,321 | |||
Purchases | 2,189 | ||||
Balance as of June 30, 2022 | $ | 6,510 |
| Other |
| |
| Investments |
| |
Balance as of December 31, 2021 | $ | 4,321 |
|
Purchases |
| 5 |
|
Balance as of March 31, 2022 | $ | 4,326 |
|
24
|
|
|
|
| Unfunded |
| Fair Value | Unfunded Commitments | |||||||||||
|
| Fair Value |
|
| Commitments |
| |||||||||||||
March 31, 2022: |
|
|
|
|
| ||||||||||||||
June 30, 2022: | June 30, 2022: | ||||||||||||||||||
Accrued performance allocations |
| $ | 505,410 |
|
| $ | 0 |
| Accrued performance allocations | $ | 575,527 | $ | — | ||||||
|
|
|
|
|
|
| |||||||||||||
Partnership interests: |
|
|
|
|
|
| Partnership interests: | ||||||||||||
Company-sponsored open-end fund |
|
| 14,440 |
| 0 |
| Company-sponsored open-end fund | 19,444 | — | ||||||||||
Company-sponsored closed-end funds |
|
| 28,983 |
| 3,927 |
| Company-sponsored closed-end funds | 36,061 | 3,291 | ||||||||||
Third-party closed-end funds |
|
| 10,465 |
|
|
| 4,258 |
| Third-party closed-end funds | 11,380 | 6,302 | ||||||||
Total partnership interests |
| $ | 53,888 |
|
| $ | 8,185 |
| Total partnership interests | $ | 66,885 | $ | 9,593 | ||||||
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| \ |
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| |||||||||||||
December 31, 2021: |
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|
|
|
|
| December 31, 2021: | ||||||||||||
Accrued performance allocations |
| $ | 439,548 |
|
| $ | 0 |
| Accrued performance allocations | $ | 439,548 | $ | — | ||||||
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|
| |||||||||||||
Partnership interests: |
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|
|
|
|
| Partnership interests: | ||||||||||||
Company-sponsored open-end fund |
|
| 15,474 |
| 0 |
| Company-sponsored open-end fund | 15,474 | — | ||||||||||
Company-sponsored closed-end funds |
|
| 16,510 |
| 20,885 |
| Company-sponsored closed-end funds | 16,510 | 20,885 | ||||||||||
Third-party closed-end funds |
|
| 7,701 |
|
|
| 2,436 |
| Third-party closed-end funds | 7,701 | 2,436 | ||||||||
Total partnership interests |
| $ | 39,685 |
|
| $ | 23,321 |
| Total partnership interests | $ | 39,685 | $ | 23,321 |
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| Carrying |
| Level 1 | Level 2 | Level 3 | Total | Carrying Value | ||||||||||||||||||||||||||||||||
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| Level 1 |
|
| Level 2 |
|
| Level 3 |
|
| Total |
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| Value |
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As of March 31, 2022: |
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As of June 30, 2022: | As of June 30, 2022: | ||||||||||||||||||||||||||||||||||||||||||||||||
Notes payable (private notes) |
| $ | 0 |
|
| $ | 0 |
|
| $ | 138,122 |
|
| $ | 138,122 |
|
| $ | 150,000 |
| Notes payable (private notes) | $ | — | $ | — | $ | 135,004 | $ | 135,004 | $ | 150,000 | ||||||||||||||||||
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As of December 31, 2021: |
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| As of December 31, 2021: | |||||||||||||||||||||||||||||||||||||
Notes payable (private notes) |
| $ | 0 |
|
| $ | 0 |
|
| $ | 144,577 |
|
| $ | 144,577 |
|
| $ | 150,000 |
| Notes payable (private notes) | $ | — | $ | — | $ | 144,577 | $ | 144,577 | $ | 150,000 |
markets of the United States. The Operating Company now indirectly owns a 60% majority of the newly created Bridge SFR investment manager, and the former principals of GBC own the remaining 40%. Consideration Cash $ 15,089 Class A Units 14,930 Total consideration for equity interest acquired $ 30,019 Assets acquired, liabilities assumed and non-controlling interests Cash $ 56 Working capital 623 Trade name(1) 150 In place contracts(1) 3,195 Other liabilities (104 ) Fair value of net assets acquired $ 3,920 Non-controlling interest(1) (20,053 ) Goodwill(1) 46,152 Total assets acquired, liabilities assumed and non-controlling interests, net $ 30,019 reserved $0.3 million and $1.0 million, respectively. have elected the fair value option for the General Partner Notes Payable so that changes in value are recorded in investment income (loss). The following table summarizes the carrying value of the General Partner Notes Payable (in thousands): Fair Value Commitment March 31, 2022 December 31, 2021 Bridge Seniors Housing Fund I $ 4,775 $ 5,107 $ 5,309 Bridge Multifamily Fund III 9,300 6,622 6,694 Total $ 14,075 $ 11,729 $ 12,003 The following table presents scheduled principal payments of the Operating Company’s debt as of 2022 $ 0 2023 0 2024 0 2025 75,000 2026 0 Thereafter 75,000 Total $ 150,000 The following table presents the activity of the Company’s debt issuance costs for the Unamortized debt issuance costs as of December 31, 2021 $ 1,858 Amortization of debt issuance costs (107 ) Unamortized debt issuance costs as of March 31, 2022 $ 1,751 The following table summarizes realized gains (losses) on investments and other financial instruments for the three and six months ended Three Months Ended March 31, 2022 Net Realized Net Unrealized Total Investment in Company-sponsored funds $ 6 $ (1,240 ) $ (1,234 ) Investment in third-party partnerships (11 ) 1,569 1,558 General Partner Notes Payable (96 ) 267 171 Total realized gains (losses) $ (101 ) $ 596 $ 495 Three Months Ended March 31, 2021 Net Realized Net Unrealized Total Investment in Company-sponsored funds $ 1 $ 4,044 $ 4,045 Investment in third-party partnerships (43 ) 243 200 Other investments 17 (4 ) 13 General Partner Notes Payable 0 1,540 1,540 Total realized gains (losses) $ (25 ) $ 5,823 $ 5,798 member of Operating Company, through issuance of shares of Class A common stock on a one-for-one basis. At the end of each period, non-controlling interests in Operating Company is adjusted to reflect their ownership percentage in Operating Company at the end of the period, through a reallocation between controlling and non-controlling interests in Operating Company. The following table presents a reconciliation of Bridge Investment Group Holdings Inc. common stock for the Bridge Investment Group Holdings Inc. Class A Class A Restricted Class B Common Common Common Stock Stock Stock Balance as of December 31, 2021 22,742,137 2,417,662 86,672,305 Class A common stock issued - 2019 Profits Interests conversion 56,134 734,290 0 Class A common stock issued - unitholder conversions 834,030 0 (834,030 ) Class A restricted common stock issued 0 2,176,482 — Class A restricted common stock forfeited 0 (42,775 ) — Class A restricted common stock vested 260,234 (260,234 ) — Balance as of March 31, 2022 23,892,535 5,025,425 85,838,275 (dollars in thousands, except per share amounts): The following table presents a reconciliation of Bridge Investment Group Holdings LLC Interests for the Bridge Investment Group Holdings LLC Class A Class B Units Units Balance as of December 31, 2021 109,699,232 97,463,981 Issuance of Class A Units 14,740,724 — Balance as of March 31, 2022 124,439,956 97,463,981 The following is a summary of the Company’s leases as of Right-of-use assets, included in Other assets $ 13,469 Lease Liabilities, included in Other liabilities $ 15,642 Weighted average remaining lease term (in years) 5.3 Weighted average discount rate 4.03 % Operating lease costs $ 1,065 Variable lease costs 32 Total lease costs, included in general and administrative expenses $ 1,097 Cash paid for amounts included in the measurement of operating lease liabilities $ 1,167 As of Remainder of 2022 $ 2,593 2023 3,496 2024 2,958 2025 2,901 2026 2,864 Thereafter 2,621 Total lease liabilities 17,433 Less: Imputed interest (1,791 ) Total operating lease liabilities $ 15,642 substantive participating rights that could be exercised by a simple majority of limited partners or by a single limited partner. Accordingly, the absence of such rights, which represent voting rights in a limited partnership, results in the private funds being considered VIEs. The nature of the Company’s involvement with its sponsored funds comprises fee arrangements and equity interests. The fee arrangements are commensurate with the level of management services provided by the Company and contain terms and conditions that are customary to similar at-market fee arrangements. March 31, 2022 December 31, 2021 Fees receivable from non-consolidated funds $ 31,630 $ 23,991 Payments made on behalf of and amounts due from non-consolidated entities 24,398 11,388 Total receivables from affiliates $ 56,028 $ 35,379 Weighted- average fair Restricted value per Stock share Balance as of December 31, 2021 2,417,662 $ 15.82 Issued 2,910,772 24.55 Vested (260,234 ) 24.60 Forfeited (42,775 ) 16.00 Balance as of March 31, 2022 5,025,425 $ 20.42 The following table summarizes our share-based compensation expense associated with our profits interests awards, Restricted Stock, and RSUs, which is recorded in employee compensation and benefits on the condensed consolidated and combined statement of operations and comprehensive income (in thousands): Three Months Ended March 31, 2022 2021 Profits interests award shares $ 1,616 $ 841 Restricted Stock and RSUs 5,650 0 Total share-based compensation $ 7,266 $ 841 As of March 31, 2022 Total Restricted Stock Profit interest Remainder of 2022 $ 26,628 $ 22,990 $ 3,638 2023 25,967 22,935 3,032 2024 23,486 21,341 2,145 2025 13,026 12,070 956 2026 5,349 5,034 315 Thereafter 42 42 0 Total $ 94,498 $ 84,412 $ 10,086 Numerator: Three Months Ended Income attributable to Bridge Investment Group Holdings Inc. $ 9,780 Less: Income allocated to Restricted Stock and RSUs (695 ) Distributions on Restricted Stock and RSUs (1,071 ) Earnings available to Class A common shareholders - basic and diluted $ 8,014 Denominator: Weighted-average shares of Class A common stock outstanding - basic and diluted 23,138,030 Earnings per share of Class A common stock - basic and diluted $ 0.35 of other public health crises remain, and some restrictions remain in place and lifted restrictions may be reimposed to mitigate risks to public health in jurisdictions where additional outbreaks have been detected. Moreover, even where restrictions are and remain lifted, people may not participate in the economy at pre-pandemic levels for a prolonged period of time, potentially further delaying global economic recovery. basis. For small projects, we occasionally charge an immaterial flat fee. For significant projects, the range is generally 0.5% to 5.0% of construction costs. amount received to date exceeds the amount due to us based on cumulative results. As such, a liability is accrued for the potential clawback obligations if amounts previously distributed to us would require repayment to a fund if such fund were to be liquidated based on the current fair value of their underlying investments as of the reporting date. Actual repayment obligations generally do not become realized until the end of a fund’s life. Three Months Ended March 31, 2022 2021 AUM as of January 1, $ 36,315 $ 25,214 New capital / commitments raised(1) 1,101 178 Distributions / return of capital(2) (583 ) (2,670 ) Change in fair value and acquisitions(3) 2,014 3,205 AUM as of end of period $ 38,847 $ 25,927 Increase 2,532 713 Increase % 7 % 3 % Three Months Ended March 31, 2022 2021 Fee-earning AUM as of beginning of period $ 13,363 $ 10,214 Increases (capital raised/deployment)(1) 1,565 383 Changes in fair market value 10 2 Decreases (liquidations/other)(2) (281 ) (289 ) Fee-earning AUM as of end of period $ 14,657 $ 10,310 Increase $ 1,294 $ 96 Increase % 10 % 1 % As of March 31, As of December 31, 2022 2021 2021 2020 Fee-Earning AUM by Fund Bridge Debt Strategies Fund IV $ 1,627 $ 474 $ 1,133 $ 305 Bridge Opportunity Zone Fund IV 1,490 41 1,490 — Bridge Multifamily Fund V 1,378 — 976 — Bridge Multifamily Fund IV 1,342 1,574 1,284 1,574 Bridge Debt Strategies Fund III 1,137 1,549 1,286 1,549 Bridge Workforce Fund II 1,126 300 915 166 Bridge Opportunity Zone Fund III 1,019 1,028 1,019 1,028 Bridge Seniors Housing Fund II 801 769 805 769 Bridge Seniors Housing Fund I 626 622 626 626 Bridge Workforce Fund I 556 499 556 499 Bridge Office Fund I 499 500 499 500 Bridge Opportunity Zone Fund I 482 477 482 482 Bridge Opportunity Zone Fund II 408 408 408 408 Bridge Debt Strategies III JV Partners 285 329 308 416 Bridge Debt Strategies Fund II 280 604 354 678 Bridge Multifamily Fund III 260 356 269 401 Bridge Single-Family Rental IV Fund 222 — — — Bridge Agency MBS Fund 194 116 123 104 Bridge Office Fund II 176 118 176 89 Bridge Debt Strategies II JV Partners 176 270 195 343 Bridge Debt Strategies Fund IV JV Partners 160 — 129 — Bridge Office I JV Partners 130 154 130 154 Bridge Logistics U.S. Venture I 120 — 110 — Bridge Net Lease Income Fund 58 — 29 — Bridge Seniors Housing Fund III 57 33 33 33 Bridge Opportunity Zone Fund V 20 — — — Bridge Debt Strategies I JV Partners 18 18 18 18 Bridge Office II JV Partners 6 21 6 21 Bridge Multifamily III JV Partners 4 10 4 10 Bridge Debt Strategies Fund I — 40 — 41 Total Fee-Earning AUM $ 14,657 $ 10,310 $ 13,363 $ 10,214 years as of December 31, 2020 and June 30, 2021, respectively. Multifamily Bridge Multifamily I $ 124 $ — $ 150 $ 280 $ — N/A $ 280 1.87 x 21.0 % 15.3 % Bridge Multifamily II 596 — 605 1,264 — N/A 1,264 2.09 x 30.2 % 23.4 % Bridge Multifamily III 912 — 876 1,433 778 3.45 x 2,211 2.52 x 28.7 % 20.7 % Bridge Multifamily IV 1,590 1,518 1,353 212 2,770 2.20 x 2,983 2.20 x 47.4 % 37.2 % Total Multifamily Funds $ 3,222 $ 1,518 $ 2,984 $ 3,189 $ 3,548 2.40 x $ 6,738 2.26 x 30.3 % 23.5 % Bridge Workforce Housing I 619 640 563 93 1,229 2.35 x 1,322 2.35 x 40.9 % 33.1 % Bridge Office I 573 624 596 172 558 1.21 x 730 1.23 x 7.3 % 4.5 % Bridge Office II 208 199 205 21 261 1.37 x 282 1.37 x 29.3 % 21.0 % Total Office Funds $ 781 $ 823 $ 801 $ 193 $ 819 1.26 x $ 1,012 1.26 x 9.8 % 6.2 % Seniors Housing Bridge Seniors I 578 784 640 310 554 1.32 x 864 1.35 x 6.4 % 3.9 % Bridge Seniors II 820 816 717 182 779 1.33 x 961 1.34 x 10.3 % 7.0 % Total Senior Housing Funds $ 1,398 $ 1,600 $ 1,357 $ 492 $ 1,333 1.33 x $ 1,825 1.35 x 7.9 % 5.1 % Total Equity Strategies Funds $ 6,020 $ 4,581 $ 5,705 $ 3,967 $ 6,929 1.87 x $ 10,897 1.91 x 24.6 % 18.3 % Debt Strategies Funds Bridge Debt I 132 — 219 262 2 1.23 x 264 1.21 x 8.4 % 5.9 % Bridge Debt II 1,002 244 2,459 2,636 290 1.28 x 2,926 1.19 x 11.6 % 8.8 % Bridge Debt III 1,624 1,146 5,310 4,735 1,152 1.26 x 5,887 1.11 x 13.4 % 10.3 % Total Debt Strategies Funds $ 2,758 $ 1,390 $ 7,988 $ 7,633 $ 1,444 1.27 x $ 9,077 1.14 x 12.2 % 9.3 % Three Months Ended March 31, Amount % (in thousands) 2022 2021 Change Change Revenues: Fund management fees $ 52,700 $ 30,851 $ 21,849 71 % Property management and leasing fees 18,279 16,747 1,532 9 % Construction management fees 1,887 1,826 61 3 % Development fees 1,259 386 873 226 % Transaction fees 21,998 5,326 16,672 313 % Fund administration fees 3,640 — 3,640 NA Insurance premiums 2,416 1,894 522 28 % Other asset management and property income 1,955 1,520 435 29 % Total revenues $ 104,134 $ 58,550 $ 45,584 78 % in 2021. Three Months Ended March 31, Amount % (in thousands) 2022 2021 Change Change Investment income: Incentive fees $ — $ 910 $ (910 ) -100 % Performance allocations: Realized gains 8,937 5,557 3,380 61 % Unrealized gains 65,862 14,719 51,143 347 % Earnings from investments in real estate 40 (3 ) 43 NM(1) Total investment income $ 74,839 $ 21,183 $ 53,656 253 % Three Months Ended March 31, 2022 Three Months Ended March 31, 2021 Realized Unrealized Realized Unrealized BMF IV GP $ — $ 39,082 $ — $ 6,350 BMF III GP 1,709 9,301 3,976 1,040 BWH I GP — 8,812 — 2,442 BDS IV GP — 4,852 — — BOF II GP — 3,620 — (299 ) BWH II GP — 2,698 — — BDS II GP 1,664 1,721 — 3,325 BDS III GP 5,564 (3,601 ) 1,581 8,413 BAMBS GP — (558 ) — 843 BOF I GP — (65 ) — (7,385 ) BDS I GP — — — (10 ) Total $ 8,937 $ 65,862 $ 5,557 $ 14,719 Three Months Ended March 31, Amount % (in thousands) 2022 2021 Change Change Expenses: Employee compensation and benefits $ 47,480 $ 27,151 $ 20,329 75 % Incentive fee compensation — 82 (82 ) -100 % Performance allocations compensation: Realized gains 560 494 66 13 % Unrealized gains 9,238 1,429 7,809 546 % Loss and loss adjustment expenses 1,751 786 965 123 % Third-party operating expenses 6,768 8,626 (1,858 ) -22 % General and administrative expenses 9,508 4,101 5,407 132 % Depreciation and amortization 633 753 (120 ) -16 % Total expenses $ 75,938 $ 43,422 $ 32,516 75 % Three Months Ended March 31, Amount % (in thousands) 2022 2021 Change Change Other income (expense) Realized and unrealized gains (losses), net $ 427 $ 5,798 $ (5,371 ) -93 % Interest income 1,209 608 601 99 % Interest expense (1,621 ) (1,587 ) (34 ) 2 % Total other income $ 15 $ 4,819 $ (4,804 ) -100 % Three Months Ended March 31, 2022 2021 Non-controlling interests related to General Partners - realized $ 6,094 $ — Non-controlling interests related to General Partners - unrealized 30,769 — Non-controlling interests related to Fund Managers (378 ) 2,293 Non-controlling interests related to 2019 profits interests awards — 1,656 Non-controlling interests related to 2020 profits interests awards 228 — Total $ 36,713 $ 3,949 United States, or GAAP. We believe that excluding certain items from our GAAP results allows management to better understand our consolidated financial performance from period to period and better project our future consolidated financial performance as forecasts are developed at a level of detail different from that used to prepare GAAP-based financial measures. Fee Related Revenues and Fee Related Expenses are presented separately in our calculation of non-GAAP measures in order to better illustrate the profitability of our Fee Related Earnings. Moreover, we believe these non-GAAP financial measures provide our stakeholders with useful information to help them evaluate our operating results by facilitating an enhanced understanding of our operating performance and enabling them to make more meaningful period to period comparisons. operators is a metric that is included in management’s review of our business. Please refer to the reconciliation below to the comparable line items on the consolidated and combined statements of operations. Fee Related Revenues differs from revenue computed in accordance with U.S. GAAP in that it excludes insurance premiums. Additionally, Fee Related Revenues is reduced by the costs associated with our property operations, which are managed internally in order to enhance returns to the Limited Partners in our funds. Three Months Ended March 31, 2022 2021 Net income $ 97,505 $ 40,720 Income tax provision 5,545 410 Income before provision for income taxes 103,050 41,130 Depreciation and amortization 633 753 Less: Unrealized performance allocations (65,862 ) (14,719 ) Plus: Unrealized performance allocations compensation 9,238 1,429 Less: Unrealized (gains) losses, net (479 ) (5,780 ) Plus: Share-based compensation 7,264 841 Less: Net income attributable to noncontrolling interests in subsidiaries 150 (3,949 ) Less: Net realized performance allocations attributable to non-controlling interests (6,094 ) — Distributable Earnings attributable to the Operating 47,900 19,705 Realized performance allocations and incentive fees (8,937 ) (6,467 ) Realized performance allocations and incentive fees 560 576 Net realized performance allocations to non-controlling interests 6,094 — Net insurance income (665 ) (1,108 ) (Earnings) losses from investments in real estate (40 ) 3 Net interest (income) expense and realized (gain) loss 450 940 Less: Net income attributable to noncontrolling interests in subsidiaries (150 ) 3,949 Total Fee Related Earnings 45,212 17,598 Less: Total Fee Related Earnings attributable to non-controlling interests 150 (3,949 ) Total Fee Related Earnings attributable to the Operating Company $ 45,362 $ 13,649 Three Months Ended March 31, 2022 2021 Fund-level fee revenues Fund management fees $ 52,700 $ 30,851 Transaction fees 21,998 5,326 Total net fund-level fee revenues 74,698 36,177 Net earnings from Bridge property operators 2,939 2,094 Development fees 1,259 386 Fund administration fees 3,640 — Other asset management and property income 1,955 1,520 Fee Related Revenues 84,491 40,177 Cash-based employee compensation and benefits (32,539 ) (20,308 ) Net administrative expenses (6,740 ) (2,271 ) Fee Related Expenses (39,279 ) (22,579 ) Total Fee Related Earnings 45,212 17,598 Fee Related Earnings margin 54 % 44 % Net income attributable to non-controlling interests in 150 (3,949 ) Total fee related earnings to the Operating Company 45,362 13,649 Realized performance allocations and incentive fees 8,937 6,467 Realized performance allocations and incentive fees (560 ) (576 ) Net realized performance allocations attributable to non-controlling interests (6,094 ) — Net insurance income 665 1,108 Earnings (losses) from investments in real estate 40 (3 ) Net interest income (expense) and realized gain (loss) (450 ) (940 ) Distributable Earnings attributable to the Operating $ 47,900 $ 19,705 Three Months Ended March 31, 2022 2021 Cash-based employee compensation and benefits $ 32,539 $ 20,308 Compensation expense of Bridge property operators 7,677 6,002 Share-based compensation 7,264 841 Employee compensation and benefits $ 47,480 $ 27,151 Administrative expenses, net of Bridge property operators $ 6,740 $ 2,271 Administrative expenses of Bridge property operators 2,768 1,830 General and administrative expenses $ 9,508 $ 4,101 Net realized and unrealized gains (losses) $ 479 $ 5,780 Other expenses from Bridge property operators (14 ) (21 ) Net interest income (expense) and realized gain (loss) (450 ) 940 Total other income (expense) $ 15 $ 4,819 See Notes 17 and 18, respectively, to our condensed consolidated and combined financial statements included elsewhere in this quarterly report on Form 10-Q for information on commitments and contingencies and variable interest entities. Three Months Ended March 31, 2022 2021 Net cash provided by operating activities $ 50,389 $ 26,304 Net cash provided by investing activities 75,954 33,674 Net cash used in financing activities (51,932 ) (27,730 ) Net increase in cash, cash equivalents, and restricted cash $ 74,411 $ 32,248 The 2020 Private Placement Notes have two tranches, a five-year 3.9% fixed rate that matures on July 22, 2025, and a seven-year 4.15% fixed rate that matures on July 22, 2027. financial officer have concluded that as of June 30, 2022. Incorporated by Reference Exhibit Number Exhibit Description Form Filing Date Exhibit Number Filed Herewith 3.1 Amended and Restated Certificate of Incorporation of Bridge Investment Group Holdings Inc. 10-Q 8/17/21 3.1 3.2 Amended and Restated Bylaws of Bridge Investment Group Holdings Inc. 10-Q 8/17/21 3.2 4.1 Specimen stock certificate evidencing the shares of Class A common stock S-1/A 7/2/2021 4.1 10.1 X 31.1 X 31.2 X 32.1* Certification of Chief Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. X 32.2* Certification of Chief Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. X 101.SCH* Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document) X 101.CAL* Inline XBRL Taxonomy Extension Schema Document X 101.DEF* Inline XBRL Taxonomy Extension Definition Linkbase Document X 101.LAB* Inline XBRL Taxonomy Extension Label Linkbase Document X 101.PRE* Inline XBRL Taxonomy Extension Presentation Linkbase Document X 104 Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) X BRIDGE INVESTMENT GROUP HOLDINGS INC. Date: By: /s/ Jonathan Slager Jonathan Slager Chief Executive Officer Date: By: /s/ Katherine Elsnab Chief Financial Officer60%60% interest in GBC’s asset and property management business was acquired by the Operating Company for consideration of $30.0$30.0 million (total implied value of $50.0$50.0 million) with 50% paid in cash and 50% with 694,412 Class A Units of the Operating Company, which wasana 15-day average of the Company’s closing stock price prior to the closing of the transaction. Upon consummation of the GBC Acquisition, (i) the GBC team and Bridge launched a single-family rental (“SFR”) strategy on the Bridge platform, (ii) Bridge and the former key principals of GBC formed and jointly own a new SFR investment manager within Bridge, and (iii) Bridge and the former GBC principals completed a $660.0$660.0 million recapitalization of a portfolio comprising more than 2,700 homes in 14 markets, concentrated in the Sunbelt and certain Midwest25$1.0$1.0 million of liabilities were assumed by the Operating Company as consideration for the purchase price. As of June 30, 2022, the remaining balance of the liabilities was $0.5 million. The number of Class A Units of the Operating Company that were transferred to GBC as a portion of the total consideration was based on an average closing price of the Company'sCompany’s Class A common stock from January 13, 2022 through January 27, 2022. Class A Units of the Operating Company are exchangeable on a one-for-one basis with Class A common stock, subject to certain conditions.As of March 31, 2022,The following summarizes the estimated fair valuestotal consideration for the GBC acquisition and the related purchase price allocation of consideration are preliminary, based on information available atfor the time of closing as the Company continues to evaluate the underlying inputsassets acquired, liabilities assumed and assumptions. Accordingly, these provisional values may be subject to adjustment during the measurement period, not to exceed one year, based upon new information obtained about facts and circumstances that existed at the time of closingnon-controlling interests (in thousands).:Consideration Cash $ 15,089 Class A Units 14,930 Total consideration for equity interest acquired $ 30,019 Assets acquired, liabilities assumed and non-controlling interests Cash $ 56 Working capital 623 150 3,195 Other liabilities (104) Fair value of net assets acquired $ 3,920 (20,053) 46,152 Total assets acquired, liabilities assumed and non-controlling interests, net $ 30,019 (1) The fair value was determined using Level 3 assumptions.8.5%8.5% with remaining lives estimated between 5 and 10 years for fund management contracts and 30-days30-days for property management contracts. The trade name was valued using a relief-from-royalty method, based on estimated savings from an avoided royalty rate of 1%1% on expected revenue discounted at 8.5%8.5%, with an estimated useful life of 4 years.$500$500 per occurrence/per property unit)$100,000$100,000 per occurrence/per property unit)$250,000$250,000 per occurrence)750,0001,500,000 per occurrence/$2,000,0003,000,000 policy annual aggregate)$25,000$25,000 per occurrence; $10,000,000$10,000,000 policy annual aggregate)26March 31,June 30, 2022. The insurance loss provisions are estimates and the actual amounts may ultimately be settled for a significantly greater or lesser amount. Any subsequent differences arising will be recorded in the period in which they are determined. As of March 31,June 30, 2022 and December 31, 2021, the Company had reserved $8.2$8.5 and $8.1$8.1 million, respectively.$125,000$125,000 per individual per year. If more claims are made than were estimated or if the costs of actual claims increase beyond what was anticipated, reserves recorded may not be sufficient and additional accruals may be required in future periods. As of March 31,June 30, 2022 and December 31, 2021, the Company had reserved $3.8$3.2 million and $2.5$2.5 million, respectively.$25,000$25,000 deductible for property and casualty claims for insured events. Insured property losses in excess of $25,000$25,000 for multifamily properties and $50,000$50,000 of commercial office properties are self-insured or fully insured as described below.$25,000$25,000 deductible for each claim. That layer covers losses between $25,000$25,000 and $100,000$100,000 and has no aggregate limit for that layer of risk. All multifamily losses above $100,000$100,000 are fully insured. For commercial office and senior housing properties, all losses are fully insuredinsured after the $50,000$50,000 deductible has been met. For logisitcs and net lease properties, all losses are fully insured after the $100,000 dedecutible has been met and for single-family rental properties all losses are fully insured after the $250,000 deductible has met. BIGRM, the captive risk management company wholly owned by the Operating Company, provides a $5.0$5.0 million insurance policy to cover the following: 100%100% of the $2.0$3.0 million layer above the multifamily deductible and SIR. All losses above $2.0$3.0 million are fully insured by multiple outside insurance carriers. There is also a $750,000 per occurrenceOn June 20, 2022 the per-occurrence limit increased from $750,000 for any single loss.loss with an aggregate limit of $2.0 million to a per-occurrence limit of $1.5 million for any single loss with an aggregate limit of $3.0 million. All losses above the SIR thresholds are fully insured with the exception of catastrophic loss deductibles in excess of the deductibles outlined above. Catastrophic losses, in zones deemed catastrophic (CAT Zones), such as earthquake, named storm and flood zones, have deductibles that equal up to 5%5% of the insurable value of the property affected for a particular loss. Any catastrophic losses in non-CAT Zones are insured with the same $25,000/$25,000/$50,000 deductibles and SIR of $75,000$75,000 for multifamily properties as outlined above.$10.0$10.0 million with a per occurrence limit of $2.0$2.0 million and per location limit of $4.0$4.0 million, which was increased on June 20, 2022 to a per-occurrence of limit $5.0 million and per location limit of $10.0 million. Any insurance claims above these limits are fully insured by multiple insurance carriers. BPM insured this retention with the BIGRM captive. As of both March 31,June 30, 2022 and December 31, 2021, the Company had reserved $1.0 million.March 31,June 30, 2022 and December 31, 2021, the total self-insurance reserve liability was $4.9$3.5 million and $3.5$3.5 million, respectively.27Fair Value Commitment June 30, 2022 December 31, 2021 Bridge Seniors Housing Fund I $ 4,775 $ 5,010 $ 5,309 Bridge Multifamily Fund III 9,300 7,354 6,694 Total $ 14,075 $ 12,364 $ 12,003 July 22, 2020,June 3, 2022, the Operating Company entered ininto a securedcredit agreement with CIBC, Inc. and Zions Bancorporation, N.A. d/b/a Zions First Nation Bank as Joint Lead Arrangers (“the Credit Agreement”). The Credit Agreement allows for total revolving linecommitments of credit to borrow up to $75.0$125.0 million, (“Linewhich may increased up to $225.0 million, contingent on certain criteria being met (the “Credit Facility”). The Credit Facility matures on June 3, 2024, subject to potential extension under certain circumstances.Credit”). Debt issuance costs relateda 2.50% to 3.00% over the LineTerm Secured Overnight Financing Rate (“SOFR”) as determined by the Company’s leverage ratio, or upon achievement of an investment grade rating, interest is then based on a range of 1.75% to 2.25% over Term SOFR. The Credit are included in other assets in the condensed consolidated balance sheets. The Company did 0t have an outstanding balanceFacility is also subject to a quarterly unused commitment fee of up to 0.20%, which is based on the Linedaily unused portion of the Credit as of March 31, 2022 and December 31, 2021.Facility. Borrowings under this arrangement accrue interestthe Credit Facility may be repaid at LIBOR plus2.25%. any time during the term of the Credit Agreements, but require paydown at least once annually.revolving Line of Credit Agreement also contains various financial covenants applicable torequiring the Company. The covenants require theOperating Company to maintain (1) a Consolidated Total Debtdebt to Consolidated Earnings Before Interest, Taxes, Depreciation, and Amortization (“EBITDA”) ratio of no more than 3.0x,3.75x, (2) minimum liquidity of $2.5$15.0 million and (3) minimum quarterly EBITDA of $15 million and minimum EBITDA for the trailing four fiscal quarters of $80 million.$20.0$20.0 million of affiliate deposits in a specific financial institution and (4) minimum quarterly EBITDA of $$10.0 million. The Line of Credit was to mature on July 22, 2022, however the Company terminated the Line of Credit in June 2022 in connection with its entry into the Credit Agreement.10.0 million.March 31,June 30, 2022, the Company was in full compliance with all debt covenants. The Line of Credit matures on July 22, 2022.$150.0$150.0 million Note Purchase Agreement, pursuant to which it issued two tranches of notes (the “Private“2020 Private Placement Notes”). As of March 31,June 30, 2022 and December 31, 2021, unamortized deferred financing costs were $1.8$1.6 million and $1.9$1.9 million, respectively, and the net carrying value of the 2020 Private Placement Notes was $148.2$148.4 million and $148.1$148.1 million, respectively. The 2020 Private Placement Notes have two tranches: a 5-year 3.9%5-year 3.9% fixed rate tranche that matures on July 22, 2025 and a 7-year 4.15%7-year 4.15% fixed rate tranche that matures on July 22, 2027.2027. The 2020 Private Placement Notes contain various financial covenants applicable to the Operating Company. The covenants, as amended in June 3, 2022, require the Operating Company to maintain (1) a Consolidated Total Debtdebt to Consolidated EBITDA ratio of no more than 3.0x,3.75x, (2) minimum liquidity of $2.5$15.0 million, and (3) minimum quarterly EBITDA of $10.0$15.0 million. As and a minimum EBITDA for the trailing four fiscal quarters of March 31,$80.0 million. The 2020 Private Placement Notes are collateralized by the assets of the Operating Company. The Private Notes are collateralized by the assets held by the Operating Company.March 31,June 30, 2022 (in thousands):2022 $ — 2023 — 2024 — 2025 75,000 2026 — Thereafter 75,000 Total $ 150,000 threesix months ended March 31,June 30, 2022 (in thousands):28Unamortized debt issuance costs as of December 31, 2021 $ 1,858 Amortization of debt issuance costs (214) Unamortized debt issuance costs as of June 30, 2022 $ 1,644 March 31,June 30, 2022 and 2021, respectively (in thousands):
Gains (Losses)
Gains (Losses)
Gains (Losses)
Gains (Losses)Three Months Ended June 30, 2022 Three Months Ended June 30, 2021 Total Total Investment in Company-sponsored funds $ (256) $ 5,097 $ 4,841 $ (5) $ 411 $ 406 Investment in third-party partnerships (49) 7 (42) (270) 1,279 1,009 Other investments — — — (17) 26 9 General Partner Notes Payable 28 (1,021) (993) — (1,124) (1,124) Total realized gains (losses) $ (277) $ 4,083 $ 3,806 $ (292) $ 592 $ 300 Six Months Ended June 30, 2022 Six Months Ended June 30, 2021 Net Realized
Gains (Losses)Net Unrealized
Gains (Losses)Total Net Realized
Gains (Losses)Net Unrealized
Gains (Losses)Total Investment in Company-sponsored funds $ (249) $ 3,857 $ 3,608 $ (4) $ 4,452 $ 4,448 Investment in third-party partnerships (61) 1,593 1,532 (312) 1,523 1,211 Other investments — — — — 22 22 General Partner Notes Payable (68) (754) (822) — 416 416 Total realized gains (losses) $ (378) $ 4,696 $ 4,318 $ (316) $ 6,413 $ 6,097 $44.4$44.4 million, representing 85%85% of the incremental net cash tax savings for the Company due to the exchanging Original Equity Owners. During the threesix months ended March 31,June 30, 2022, certain Original Equity Owners exchanged a portion of their Class A Units for Class A common stock, which also resulted in a redemption of the corresponding Class B common stock. The exchange increased the deferred income tax asset from $59.0$59.0 million, and the corresponding TRA liability from $46.1$46.1 million, as of December 31, 2021, to $64.1$64.9 million and $50.5$51.3 million as of March 31,June 30, 2022, respectively.5%2% and 1%1% for the threequarters ended June 30, 2022 and 2021, respectively, and 4% and 1% for the six months ended March 31,June 30, 2022 and 2021, respectively. The Company’s effective tax rate is dependent on many factors, including the estimated amount of income subject to tax. Consequently, the effective tax rate can vary from period to period. The Company’s overall effective tax rate in each of the periods described above is less than the statutory rate primarily because (a) the Company was not subject to U.S. federal taxes prior to the Transactions and the IPO and (b) a portion of income is allocated to non-controlling interests, and the tax liability on such income is borne by the holders of such non-controlling interests.29March 31,June 30, 2022, the Company had 0no unrecognized tax positions and does not expect any changes to uncertain tax positions within the next 12 months.distributabledistributable earnings of the Operating Company prior to the IPO were payable to the Original Equity Owners. As of March 31,June 30, 2022 and December 31, 2021, there was $1.4 million$1.4 million that was declared that had notnot yet been distributed to Original Equity Owners.$0.6$0.6 million for the threesix months ended March 31,June 30, 2022.$30$30 million, with 50% paid in cash and 50% with 694,412 Class A Units of the Operating Company valued at $14.9$14.9 million, which was based on an average of the Company’s closing stock price prior to the closing of the GBC Acquisition.30March 31, 2021, 834,030June 30, 2022, 146,654 and 980,684 Class A Units, respectively, were redeemed, with the issuance of Class A common stock on a one-for-one basis.$0.01$0.01 per share, 239,208,722 shares of Class B common stock with a par value of $0.01$0.01 per share, and 20,000,000 shares of preferred stock, with a par value of $0.01$0.01 per share. Each share of Class A common stock is entitled to one1 vote and each share of Class B common stock is entitled to ten10 votes. See Note 1 “Organization” for more information about the Company’s common stock.March 31,June 30, 2022,,28,917,960 shares 29,077,806 shares of Class A common stock (including Restricted Stock) were outstanding, 85,838,27585,691,621 shares of Class B common stock were outstanding, and there were 0no shares of our preferred stock outstanding.threesix months ended March 31,June 30, 2022:Bridge Investment Group Holdings Inc. Class A
Common
StockClass A
Restricted
Common
StockClass B
Common
StockBalance as of December 31, 2021 22,742,137 2,417,662 86,672,305 Class A common stock issued - 2019 Profits Interests conversion 56,134 734,290 — Class A common stock issued - unitholder conversions 980,684 — (980,684) Class A restricted common stock issued — 2,211,485 — Class A restricted common stock forfeited — (64,586) — Class A restricted common stock vested 299,152 (299,152) — Balance as of June 30, 2022 24,078,107 4,999,699 85,691,621 quarterthree and six months ended March 31,June 30, 2022,, the Company declared and paid a quarterly dividend of $0.21 per sharethe following dividends on Class A commoncommon stock totaling $5.9 million.Dividend Record Date Dividend Payment Date Dividend per Share of Common Stock Dividend to Common Stockholders March 11, 2022 March 25, 2022 $ 0.21 $ 5,917 June 3, 2022 June 17, 2022 0.26 7,614 $ 0.47 $ 13,531 March 31,June 30, 2022, $17.5$38.6 million and $56.1 million, respectively, was distributed to non-controlling interests in the Operating Company and $28.6$42.2 million and $70.8 million, respectively, was distributed to non-controlling interest in the Company. DuringDuring the three and six months ended March 31,June 30, 2021, $21.8$136.1 million and $157.9 million, respectively, was distributed to the Operating Company’s members prior to the IPO and Transactions and $6.2$7.8 million and $14.0 million, respectively, was distributed to non-controlling interests.31March 31,June 30, 2022,, the Company is the sole managing member of the Operating Company, and owns28,984,797 Class 29,144,443 Class A Units and 97,463,981 million Class B Units (voting only), respectively, of the Operating Company, whichwhich is 23% and 100%23% and 100% of the total outstanding Class A Units and Class B Units, respectively. The Company controls the business and affairs of the Operating Company and its direct and indirect subsidiaries.threesix months ended March 31,June 30, 2022:Bridge Investment Group Holdings LLC Class A
UnitsClass B
UnitsBalance as of December 31, 2021 109,699,232 97,463,981 Issuance of Class A Units 14,760,227 — Balance as of June 30, 2022 124,459,459 97,463,981 March 31,June 30, 2022 (dollar amounts in thousands):Right-of-use assets, included in Other assets $ 16,116 Lease Liabilities, included in Other liabilities $ 18,318 Weighted-average remaining lease term (in years) 4.7 Weighted-average discount rate 4.19 % statementand combined statements of operations for the three and six months ended March 31,June 30, 2022 are as follows (in thousands):Three Months Ended June 30, 2022 Six Months Ended June 30, 2022 Operating lease costs $ 1,056 $ 2,121 Variable lease costs 70 102 Total lease costs, included in general and administrative expenses $ 1,126 $ 2,223 Cash paid for amounts included in the measurement of operating lease liabilities $ 894 $ 2,061 March 31,June 30, 2022, $0.2$0.2 million and $0.4 million, respectively, was related to short-term leases with a term of less than one year. Total rent expense for all of the Company’s office leases for the three and six months ended March 31,June 30, 2021 was $1.0$1.0 million and $2.1 million, respectively, (net of lease incentive amortization of $and $0.1 million and $0.2 million, respectively).0.1 million).March 31,June 30, 2022, the maturities of operating lease liabilities were as follows (in thousands):32Remainder of 2022 $ 2,262 2023 5,009 2024 4,029 2025 3,120 2026 3,061 Thereafter 2,738 Total lease liabilities 20,219 Less: Imputed interest (1,901) Total operating lease liabilities $ 18,318 March 31,June 30, 2022 and December 31, 2021, if the Company assumed all existing investments were worthless, the amount of performance income subject to potential repayment by the Bridge GPs, net of tax distributions, which may differ from the recognition of revenue, would have been approximately $122.6$153.0 million and $120.9$120.9 million, respectively, of which $108.0$126.4 million and $106.9 million, respectively, is reimbursable to the Bridge GPs by certain professionals who are the recipients of such performance income. Management believes the possibility of all of the investments becoming worthless is remote. If the funds were liquidated at their fair values as of March 31,June 30, 2022,, there is 0would be no contingent repayment obligation or liability.March 31,June 30, 2022, the Company has guaranteed a $6.0$6.0 million standby letter of credit related to the self-insurance program of the properties owned by the funds. Additionally, as of March 31,June 30, 2022,, the Company has guaranteed a $362,000$362,000 standby letter of credit related to an operating lease.March 31, 2022.June 30, 2022. Based on past experience, management believes that the risk of loss related to these indemnities is remote.33$53.9$66.9 million and $39.7$39.7 million as of March 31,June 30, 2022 and December 31, 2021, respectively, included in other investments on the condensed consolidated balance sheets.$916.2$976.1 million and $787.3$787.3 million as of March 31,June 30, 2022 and December 31, 2021 respectively, while the liabilities of the consolidated VIEs totaled $288.0$304.7 million and $249.7$249.7 million as of same dates. The assets of the consolidated VIEs may only be used to settle obligations of the same VIE. In addition, there is no recourse to the Company for the consolidated VIEs’ liabilities. Additionally, the Operating Company is a VIE that is consolidated by the Company.June 30, 2022 December 31, 2021 Fees receivable from non-consolidated funds $ 21,273 $ 23,991 Payments made on behalf of and amounts due from non-consolidated entities 12,913 11,388 Total receivables from affiliates $ 34,186 $ 35,379 March 31,June 30, 2022 and December 31, 2021,, the Company hadhad accrued a $50.5$51.3 million and $46.1$46.1 million due to affiliates in connection with the TRA (see Note 2, “Significant Accounting Policies,” for more details), which was included in due to affiliates for the period then ended.34shares shares of the Company’s Class A common stock were reserved for issuance. On January 1, 2022, the number of shares available under the 2021 Incentive Award Plan increased to 8,836,972.8,836,972. As of March 31,June 30, 2022, 4,503,7564,490,564 shares remainedremained available for future grants. Restricted Stock and RSUs are subject to graded vesting with approximately one-third of such grants vesting on the third, fourth and fifth anniversaries of the grant date. At vesting of the RSUs, the Company issues shares of Class A common stock.March 31,June 30, 2022, the Company reversed $55,000 ofapproximately $55,000 and $0.1 million, respectively, of share-based compensation related to Restricted Stock and RSU forfeitures.threesix months ended March 31,June 30, 2022, 50,137 RSUs were issued at a weighted-average fair value per share of $23.84. $23.84. The following summarizes Restricted Stock activity for the threesix months ended March 31,June 30, 2022 (in thousands, except per share data):Restricted
StockWeighted-Average Fair Value per Share Balance as of December 31, 2021 2,417,662 $ 15.82 Issued 2,945,775 24.49 Vested (299,152) 23.83 Forfeited (64,586) 15.79 Balance as of June 30, 2022 Balance as of June 30, 2022 4,999,699 $ 20.45 threesix months ended March 31,June 30, 2022, was $71.5$72.1 million and $1.2$1.2 million, respectively. As of March 31,June 30, 2022, 5,025,4254,999,699 shares of Restricted Stock and 66,637 RSUs were expected to vest with an aggregate intrinsic value of $102.3$72.7 million and $1.4$1.0 million, respectively.At March 31,$84.4$73.2 million, which is expected to be recognized over a weighted-average period of 2.42.7 years.5%5% to 40%40% of the related Fund Managers above a certain income and valuation threshold. The Operating Company issued two types of profits interests: (i) award shares and (ii) anti-dilutive shares. The fair value of these awards was determined using a Monte Carlo Valuation model. Each of the awards has an earnings threshold for distributions and equity appreciation. The grant date fair value of the profits interests awards are expensed over the vesting period. The award shares are subject to graded vesting with approximately one-third of such grants vesting on the third, fourth and fifth anniversaries of the grant date. The Operating Company also issued anti-dilutive awards to active partners. Since the anti-dilutive awards were fully vested, the Company recorded 100%100% of the fair value as share-based compensation in the year the anti-dilutive shares were granted.March 31,June 30, 2022, the aggregateaggregate unrecognized compensation cost for all unvested profits interests awards was $10.1$7.8 million, which is expected to be recognized over a weighted-average period of 2.12.4 years.35Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Antidulutive profits interest awards $ — $ 13,609 $ — $ 13,609 Profits interests award shares $ 841 $ 1,015 $ 2,457 $ 1,856 Restricted Stock and RSUs 5,712 — 11,361 — Total share-based compensation $ 6,553 $ 14,624 $ 13,818 $ 15,465 March 31,June 30, 2022, unrecognized share-based compensation on Restricted Stock, RSUs and profits interests awards is expected to be recognized as follows (in thousands):
and RSUs
awardsAs of June 30, 2022 Total Restricted Stock
and RSUsProfits interest
awardsRemainder of 2022 $ 13,334 $ 11,678 $ 1,656 2023 25,807 22,966 2,841 2024 23,334 21,277 2,057 2025 13,056 12,102 954 2026 5,441 5,127 314 Thereafter 82 82 — Total $ 81,054 $ 73,232 $ 7,822 March 31,June 30, 2022. There were no shares of Class A common stock outstanding prior to the Transactions and the IPO, therefore, no earnings per share information has been presented for any period prior to the date of the IPO. The followingMarch 31,June 30, 2022, respectively (in thousands, except per share amounts):
March 31, 2022Numerator: Three Months Ended
June 30, 2022Six Months Ended
June 30, 2022Net income attributable to Bridge Investment Group Holdings Inc. $ 12,940 $ 22,711 Less: Income allocated to Restricted Stock and RSUs (915) (1,608) Distributions on Restricted Stock and RSUs (1,436) (2,432) Net income available to Class A common shareholders - basic and diluted $ 10,589 $ 18,671 Denominator: Weighted-average shares of Class A common stock outstanding - basic and diluted 24,029,107 23,581,393 Earnings per share of Class A common stock - basic and diluted $ 0.44 $ 0.79 3637approximately $38.8approximately $42.0 billion of AUM as of March 31,June 30, 2022. Our ability to scale our specialized and operationally driven investment approach across multiple attractive sectors within real estate equity and debt, in a way that creates sustainable and thriving communities, is the ethos of who we are and the growth engine of our success. We have enjoyed significant growth since our establishment as an institutional fund manager in 2009, driven by strong investment returns, and our successful efforts to develop an array of investment platforms focused on sectors of the U.S. real estate market that we believe are the most attractive. We have extensive multi-channel distribution capabilities and currently manage capital on behalf ofof more than 190 global210 global institutions and more than 11,00011,700 individual investors across our investment strategies.ana 15-day average of the Company’s closing stock price prior to the closing of the GBC Acquisition. Upon consummation of the GBC Acquisition, (i) the GBC team and Bridge launched a single-family rental (“SFR”) strategy on the Bridge platform, (ii) Bridge and the former key principals of GBC formed and jointly own a new SFR investment manager within Bridge, and (iii) Bridge and the former GBC principals completed a $660 million recapitalization of a portfolio comprising more than 2,700 homes in 14 markets, concentrated in the Sunbelt and certain Midwest markets of the United States. The Operating Company now indirectly owns a 60% interest in the newly created Bridge SFR investment manager, and the former principals of GBC own the remaining 40%. See Note 8, “Business Combinations and Goodwill,” to our condensed consolidated and combined financial statements for additional information on this transaction.3839March 31,June 30, 2022, our weighted-average management fee varies by fund and is based upon the size of the commitment; however, the low average for a single fund is 0.85% and the high average for a single fund is 1.99% of committed or invested capital for our closed-end funds. Fund management fees also includes management fees for joint ventures and separately managed assets. Management fees for those types of assets is usually less than 1% and typically charged on invested capital or invested equity. For our sponsored closed-end funds, our capital raising period is traditionally 18 to 24 months. After the initial closing of a closed-end fund, we charge catch-up management fees to investors who subscribe in subsequent closings in amounts equal to the fees they would have paid if they had subscribed in the initial closing plus interest. Catch-up management fees are recognized in the period infunds.funds. As of March 31,June 30, 2022, we managed approximately 100% of the multifamily properties, 93% of the workforce and affordable housing properties, 81% of the office properties, and 33%40% of the seniors housing properties owned by our funds. We also provide property management services for a limited number of third-party owned assets. These fees are based upon cash collections at the managed properties and traditionally range from 2.5% to 3.5% for multifamily and workforce and affordable housing properties, 2% to 3% for office properties and 4% to 5% for seniors housing properties. Additionally, we receive leasing fees upon the execution of a leasing agreement for our office assets. We determined that certain third-party asset management costs, for which we are deemed to be the primary obligor, are recorded as gross revenue with a corresponding expense. The gross presentation has no impact on our net income to the extent the expense incurred, and corresponding cost reimbursement income are recognized, in the same period. The offset is recorded in third-party operating expenses on the condensed consolidated and combined statementstatements of operations.40threesix months ended March 31,June 30, 2022, the fee range for acquisitionacquisition fees was 0.5% to 1.0% of the gross acquisition cost of the investment or, in the case of development projects, the total development budget, and the fee range for debt origination was 0.3% to 1.0%.March 31,June 30, 2022, we had approximately $14.6$15.5 billion of carry-eligible AUM across approximately 43 funds and other vehicles, of which 1920 were in accrued carried interest positions.41investment income (loss)gains (losses) results from changes in the fair value of the underlying investment as well as from the reversal of previously recognized unrealized income (loss)gains (losses) at the time an investment is realized. The Company’s share of the investee’s income and expenses for the Company’s equity method investments (exclusive of carried interest) is also included within other investment income (loss)(expense). Investment income (loss) isRealized and unrealized gains (losses) are presented together as net realized and unrealized income (losses)gains(losses) in the condensed consolidated and combined statements of operations. Finally, the realized and unrealized change in incomegain (loss) associated with the financial instruments that we elect the fair value option is also included in net realized and unrealized investment income (loss)gains (losses).42, and our revolving. Our existing line of credit facility which hasthat was terminated in June 2022 had a variable interestinterest rate of LIBOR plus 2.25%. Our new revolving credit facility executed in June 2022, incurs interest based on a pricing grid, as determined by the Company’s leverage ratio, over term SOFR and an unused commitment fee of up to 0.20%, which is based on the daily unused portion of the revolving credit facility. As of June 30, 2022 the weighted-average interest rate on our revolving credit facility was 2.84%.non-controllingnon-controlling interests are allocated a share of income or loss in the respective consolidated subsidiary in proportion to their relative ownership interests, after consideration of contractual arrangements that govern allocations of income or loss.43March 31,June 30, 2022 andand 2021 (dollar amounts in millions):Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 AUM as of beginning of period $ 38,847 $ 25,927 $ 36,315 $ 25,214 1,389 1,057 2,490 1,235 (461) (320) (1,044) (582) 2,194 2,085 4,208 2,882 AUM as of end of period $ 41,969 $ 28,749 $ 41,969 $ 28,749 Increase 3,122 2,822 5,654 3,535 Increase % 8 % 11 % 16 % 14 % realizedthe realization proceeds from the disposition of assets, current income, or capital returned to investors.March 31,June 30, 2022 and 2021 (dollar amounts in millions):Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Fee-earning AUM as of beginning of period $ 14,657 $ 10,314 $ 13,363 $ 10,214 985 1,052 2,550 1,432 Changes in fair market value 2 (11) 12 (11) (102) (536) (383) (816) Fee-earning AUM as of end of period $ 15,542 $ 10,819 $ 15,542 $ 10,819 Increase $ 885 $ 505 $ 2,179 $ 605 Increase % 6 % 5 % 16 % 6 % 44March 31,June 30, 2022 and 2021. Fee-earning AUM increased $4.7 billion, or 44%, from approximately $10.3$10.8 billion as of March 31,June 30, 2021 and $13.4to approximately $15.5 billion as of December 31, 2021 to $14.7 billion as of March 31,June 30, 2022 due to our capital raising activities and deployment.ourthe balances of fee-earning AUM by fund as of March 31,June 30, 2022 and 2021 and December 31, 2021 and 2020 (in millions):As of June 30, As of December 31, 2022 2021 2021 Fee-Earning AUM by Fund Bridge Debt Strategies Fund IV $ 2,038 $ 606 $ 1,133 Bridge Opportunity Zone Fund IV 1,476 544 1,490 Bridge Multifamily Fund V 1,471 — 976 Bridge Multifamily Fund IV 1,342 1,259 1,284 Bridge Workforce Fund II 1,212 616 915 Bridge Debt Strategies Fund III 1,137 1,485 1,286 Bridge Opportunity Zone Fund III 1,019 1,019 1,019 Bridge Seniors Housing Fund II 797 814 805 Bridge Seniors Housing Fund I 626 626 626 Bridge Workforce Fund I 556 523 556 Bridge Office Fund I 499 500 499 Bridge Opportunity Zone Fund I 482 482 482 Bridge Opportunity Zone Fund II 408 408 408 Bridge Debt Strategies Fund II 280 545 354 Bridge Debt Strategies III JV Partners 264 329 308 Bridge Logistics U.S. Venture I 250 — 110 Bridge Opportunity Zone Fund V 240 — — Bridge Multifamily Fund III 228 335 269 Bridge Single-Family Rental Fund IV 227 — — Bridge Agency MBS Fund 194 118 123 Bridge Office Fund II 176 130 176 Bridge Debt Strategies IV JV Partners 158 — 129 Bridge Debt Strategies II JV Partners 152 225 195 Bridge Office I JV Partners 130 148 130 Bridge Net Lease Income Fund 95 — 29 Bridge Seniors Housing Fund III 57 33 33 Bridge Debt Strategies I JV Partners 18 18 18 Bridge Office II JV Partners 6 6 6 Bridge Multifamily III JV Partners 4 10 4 Bridge Debt Strategies Fund I — 40 — Total Fee-Earning AUM $ 15,542 $ 10,819 $ 13,363 approximately 8.0y 7.9 years as of March 31,June 30, 2022, December 31, 2021 and March 31, 2021, respectively, and 7.28.0 years as of December 31, 2020.2021, and 7.4March 31,June 30, 2022, we had $2.9$3.2 billion of undeployed capital available to be deployed for future investment or reinvestment. Of this amount, $2.2$1.7 billion is currently fee-earning based on commitments and $0.7$1.5 billion will be fee-earning if and when it is deployed.Performance Summary as of March 31, 2022(in millions)Fund
Committed Capital (2)Unreturned
Drawn
Capital +
Accrued
Pref (3)Cumulative Invested Capital (4)Realized Proceeds(5)Remaining
Fair Value
(RFV) (6)Unrealized
MOIC (7)Total
Fair Value
(TFV) (8)TFV
MOIC(9)Fund
Gross
IRR(10)Net IRR(11)Closed-End Funds(1)(Investment Period Beginning, Ending Date)Equity Strategies Funds45
(Mar 2009, Mar 2012)
(Apr 2012, Mar 2015)
(Jan 2015, Jan 2018)
(Jun 2018, Jun 2021)
(Aug 2017, Aug 2020)
(Jul 2017, Jul 2020)
(Dec 2019, to present)
(Jan 2014, Jan 2018)
(Mar 2017, Mar 2020)
(Sep 2014, Sep 2017)
(July 2016, July 2019)
(May 2018, May 2021)Performance Summary as of June 30, 2022 (in millions) Equity Strategies Funds Multifamily Bridge Multifamily I $ 124 $ — $ 150 $ 280 $ — N/A $ 280 1.87x 21.0 % 15.3 % 596 — 605 1,264 — N/A 1,264 2.09x 30.2 % 23.4 % 912 — 877 1,614 594 3.43x 2,208 2.52x 28.2 % 21.8 % 1,590 1,525 1,373 240 2,805 2.22x 3,045 2.22x 42.9 % 33.6 % Total Multifamily Funds $ 3,222 $ 1,525 $ 3,005 $ 3,398 $ 3,399 2.41x $ 6,797 2.26x 29.7 % 23.4 % Workforce & Affordable Housing 619 651 568 105 1,224 2.34x 1,329 2.34x 37.1 % 29.9 % Office 573 634 596 182 513 1.15x 695 1.17x 5.0 % 2.2 % 208 202 205 24 272 1.44x 296 1.44x 28.9 % 19.5 % Total Office Funds $ 781 $ 836 $ 801 $ 206 $ 785 1.23x $ 991 1.24x 8.2 % 4.3 % Seniors Housing 578 793 644 387 434 1.14x 821 1.27x 4.9 % 2.5 % 820 809 720 207 771 1.34x 978 1.36x 10.0 % 6.9 % Total Seniors Housing Funds $ 1,398 $ 1,602 $ 1,364 $ 594 $ 1,205 1.26x $ 1,799 1.32x 7.0 % 4.3 % Total Equity Strategies Funds $ 6,020 $ 4,614 $ 5,738 $ 4,303 $ 6,613 1.85x $ 10,916 1.90x 23.6 % 17.7 % Debt Strategies Funds 132 — 219 262 2 1.24x 264 1.21x 8.3 % 5.7 % 1,002 242 2,500 2,673 296 1.32x 2,969 1.19x 11.5 % 8.9 % 1,624 1,062 5,359 4,838 1,100 1.29x 5,938 1.11x 12.6 % 9.8 % 2,888 1,886 5,435 3,880 1,671 1.04x 5,551 1.02x 8.1 % 6.1 % Total Debt Strategies Funds $ 5,646 $ 3,190 $ 13,513 $ 11,653 $ 3,069 1.17x $ 14,722 1.09x 11.4 % 8.8 % Closed-Ended fundsClose-Ended Funds represented herein does not include performance for (i) Opportunity Zone funds as such funds are invested in active development projects and have minimal stabilized assets, or (ii) funds that are currently raising capital, including our open-ended funds. Each fund identified contemplates all associated parallel and feeder limited partnerships in which investors subscribe and accordingly share common management. All intercompany accounts and transactions have been eliminated in the combined presentation. Values and performance presented herein are the combined investor returns gross of any applicable legal entity taxes.excluding(excluding joint ventures or separately managed accounts.accounts).andplus Accrued PreferredPref represents the amount the fund needs to distribute to its investors as a return of capital and a preferred return before the General Partner is entitled to receive performance fees or allocations from the fund.(“RFV”) is(RFV) represents the estimated liquidation values of remaining fund investments that are generally based upon appraisals, contracts and internal estimates. There can be no assurance that RFVRemaining Fair Value will be realized at valuations shown, and realized values will depend on numerous factors including, among others, future asset-level operating results, asset values and market conditions at the time of disposition, transaction costs, and the timing and manner of disposition, all of which may differ from the assumptions on which the RFVRemaining Fair Value are based. Direct fund investments in real property are held at cost minus transaction expenses for the first six months from investment.RFVTotal Fair Value associated with unrealized investments before management fees, fund level expenses and carried interest, divided by the remaining invested capitalCumulative Invested Capital attributable to those unrealized investments.(“TFV”)(TFV) represents the sum of Realized Proceeds and Remaining Fair Value, before management fees, expenses and carried interest.before management fees, expenses and carried interest, divided by Cumulative Invested Capital.fund-level internal rate of return to fund investors gross of all investments, before management fees expenses and carried interest. (including GP affiliated fund investors that pay reduced or no fees), net of management fees, fund-level expenses and carried interest. Net return information reflects average fund investor level returns, which may differ from actual investor level returns due to timing, variance in fees paid by investors, and other investor-specific investment costs such as taxes. Bridge Multifamily I and II funds reported their final IRRs in 2018 and 2019 respectively in a manner that includes a small share of affiliate capital who paid zero fees.46March 31,June 30, 2022 comparedCompared to the Three Months Ended March 31,June 30, 2021Three Months Ended June 30, Amount
Change%
Change(in thousands) 2022 2021 Revenues: Fund management fees $ 49,380 $ 34,536 $ 14,844 43 % Property management and leasing fees 19,616 14,335 5,281 37 % Construction management fees 2,426 2,065 361 17 % Development fees 793 1,163 (370) (32 %) Transaction fees 17,643 16,242 1,401 9 % Fund administration fees 3,657 — 3,657 N/A Insurance premiums 2,845 2,022 823 41 % Other asset management and property income 2,659 1,611 1,048 65 % Total revenues $ 99,019 $ 71,974 $ 27,045 38 % $1.3from approximately $10.8 billion, or 10%44%, from $13.4as of June 30, 2021 to $15.5 billion as of December 31, 2021 and increased $4.3 billion, or 42%, from $10.3 billion as of March 31, 2021 to $14.7 billion as of March 31,June 30, 2022. OurOur weighted-average management fee, which varies largely due to the size of investor commitments,, increased from to 1.54% as of June 30, 2022 and December 31, 2021 and 1.47%from 1.51% as of March 31, 2021 to 1.57% as of March 31, 2022.June 30, 2021.$21.8$14.8 million, or 71%43%, largely due to the launch of new funds in 2021, including Bridge OpportunityOpportunity Zone Fund IV and Bridge Multifamily Fund V, coupled with Bridge Opportunity Zone Fund V and Bridge Single-Family Fund IV, both of which had its first closing subsequent to March 31, 2021.launched in 2022. These twofour funds contributed an additional $10.4$13.1 million of recurring fund management fees for three months ended March 31,June 30, 2022 compared to the three months ended March 31,June 30, 2021. Increased fee-earning AUM related to capital raises in our other funds, mainly from Bridge Workforce and Affordable Housing Fund II and Bridge Debt Strategies Fund IV, generated an additional $5.8$1.5 million of recurring management fees. These increases were partially offset by decreases of $2.8 million related to reductions in fee-earning AUM, of which $1.3 million was primarily attributed to Bridge Multifamily Funds III and IV and Bridge Debt Strategies Funds II and III.47One-timeMarch 31,June 30, 2022, totaled $8.4 million, which was primarily attributed to Bridge Multifamily Fund V, Bridge Workforce and Affordable Housing Fund II and Bridge Debt Strategies Fund IV that launched in 2021. The following chart presents the composition of our fund management fees for the three months ended March 31, 20222020 and 2021 (in millions)(1): (1)Bridge Multifamily Fund management fees for the three months ended March 31, 2021, excludes fees for those fundsV, which launched subsequent to such date.$1.5$5.3 million, or 9%37%, primarily due to acquisition of the SFR property management business, which was part of the GBC Acquisition.Development Fees. Development fees increased by $0.9 million, or 226%, due toAcquisition, and an increase in the number of development dealsmultifamily and workforce and affordable housing properties under management, largely due to continued development of projects under the Bridge Opportunity Zone Funds I, II and III, and the launch of Bridge Opportunity Zone Fund IV in 2021.management.$16.7$1.4 million, or 313%9%, primarily driven by a $11.9 million increase in due diligence fees attributed to the deployment of $639 million of capital during the three months ended March 31,June 30, 2022. The remaining $4.7 million increase was related to debt origination fees, which were largely due to an increase in acquisitions and mortgage re-financings related to multifamily and SFR assets.$3.6$3.7 million during the three months ended March 31,June 30, 2022, for services Bridge began providing on January 1, 2022.$0.5$0.8 million, or 28%41%, largely due to the increase in AUM.$0.4$1.0 million, or 29%65%, primarily due to an increase in other income.Investment income48(1) The percentage change is not material.Total investment income. Total investment income increased by $53.7 million largely driven by our performance allocations.the growth in AUM.Three Months Ended June 30, Amount
Change%
Change(in thousands) 2022 2021 Investment income: Performance allocations: Realized $ 33,581 $ 35,629 $ (2,048) (6) % Unrealized 70,116 43,248 26,868 62 % Earnings from investments in real estate 1,251 980 271 28 % Total investment income $ 104,948 $ 79,857 $ 25,091 31 % PerformanceNet performance allocations increased by $54.5 million.$24.8 million, or 31%. The following table reflects our carried interest and incentive fees by fund (in thousands):Three Months Ended June 30, 2022 Three Months Ended June 30, 2021 Realized Unrealized Realized Unrealized BMF IV GP $ — $ 66,381 $ — $ 22,640 BWH I GP — 17,192 — 7,525 BWH II GP — 6,597 — — BOF II GP — 796 — 1,157 BNLI GP — 695 — — BAMBS GP — (151) — (154) BDS IV GP 493 (2,698) — 948 BDS II GP 1,132 (3,675) — 4,903 BDS III GP 2,040 (3,900) 14,012 6,913 BMF III GP 29,916 (11,121) 21,617 (4,643) BOF I GP — — — 3,915 BDS I GP — — — 44 Total $ 33,581 $ 70,116 $ 35,629 $ 43,248 March 31,June 30, 2022, the increase in unrealized performance allocationallocations was largely due to an increase in performance income allocation related to the market appreciation from properties within our multifamily and workforce and affordable housing real estate equity funds, and includes the increase inreversal of realized performance allocation was attributed to favorable market conditions in our debt funds. Performance income allocation is recorded one quarter in arrears,during the second quarters of both 2022 and as such the performance allocation income reflects asset valuations as of December 31, 2021. For the three months ended March 31,June 30, 2022 and 2021, the realized gains were primarily related to dispositions in our Debt funds and Bridge Multifamily Fund III and favorable market conditions in our Bridge Debt Strategies Funds II and III.Three Months Ended June 30, Amount
Change%
Change(in thousands) 2022 2021 Expenses: Employee compensation and benefits $ 46,693 $ 42,306 $ 4,387 10 % Performance allocations compensation: Realized gains 2,165 3,747 (1,582) (42) % Unrealized gains 7,987 6,048 1,939 32 % Loss and loss adjustment expenses 1,439 2,132 (693) (33) % Third-party operating expenses 6,749 6,117 632 10 % General and administrative expenses 9,769 5,392 4,377 81 % Depreciation and amortization 887 727 160 22 % Total expenses $ 75,689 $ 66,469 $ 9,220 14 % $20.3$4.4 million, or 75%10%, largely due to a $13.9$12.5 million increase in salaries, bonuses and benefits attributed to higher headcount driven by ourthe increase in our AUM and the number of Bridge-sponsored funds, including the launch of the SFR platform upon consummation of the GBC Acquisition in January 2022. Further, share-based compensation expense2022. An additional increase of $5.7 million was $6.4 million higher for the three months ended March 31, 2022 compared to March 31, 2021, partially due to the accelerated share-based compensation recognized as part of the collapse of the 2019 Profits Interests awards in January 2022, but was primarily attributed to share-based compensation related to restricted stockRestricted Stock and RSUs that were issued concurrent with the IPO in July 2021 and for awards granted in January 2022. These increases were offset by a reduction of $13.6 million attributed to the anti-dilutive shares associated with the 2021 profits interests awards that were fully vested upon issuance in the second quarter of 2021.PerformanceNet performance allocation compensation increased by $7.9approximately $0.4 million, or 410%4%, due to ana $1.9 million increase in unrealized performance allocation compensation offset by a decrease of $0.1$1.6 million related to realized performance allocation awards, and a $7.8 million increase in unrealized performance allocation compensation which is directly correlated to our performance allocations income during the three months ended March 31,June 30, 2022 compared to the three months ended March 31, 2021, and carryJune 30, 2021. This increase was coupled with the carried interest awards issued to employees in December 2021.49increaseddecreased by $1.0$0.7 million, or 33%, primarily due to tenant, workers comp,compensation, and general liability losses incurred or paid during the three months ended March 31,June 30, 2022 compared to 2021.decreasedincreased by $1.9$0.6 million, or 22%10%, primarily due to leasing commissions on our significant leasing of commercial real estate in the Atlanta region during 2021, which did not recur in the first quarter of 2022.commissions.$5.4$4.4 million, or 132%81%, primarily due an increase in insurance, professional services and software licensing fees.Three Months Ended June 30, Amount
Change%
Change(in thousands) 2022 2021 Other income (expense) Realized and unrealized gains (losses), net $ 3,489 $ 300 $ 3,189 1063 % Interest income 1,353 557 796 143 % Interest expense (2,901) (2,554) (347) 14 % Total other income $ 1,941 $ (1,697) $ 3,638 (214) % RealizedRealized and Unrealized Gains. Net realized and unrealized gains decreased $5.4increased $3.2 million or 93%, for the three months ended March 31,June 30, 2022, due to the unrealizedrealized appreciation recognized on other investments during the three months ended March 31, 2021 that did not recur during the three months ended March 31, 2022.second quarter.$0.6$0.8 million, or 99%143%, largely due to the timing of short-term borrowings by theour funds.Three Months Ended June 30, 2022 2021 Non-controlling interests related to General Partners - realized $ 18,409 $ — Non-controlling interests related to General Partners - unrealized 32,316 — Non-controlling interests related to Fund Managers (2,228) 1,205 Non-controlling interests related to 2019 profits interests awards 44 4,502 Non-controlling interests related to 2020 profits interests awards 689 108 Non-controlling interests related to 2021 profits interests awards $ 518 $ — Total $ 49,748 $ 5,815 AttributableAttributable to Non-Controlling Interests in Bridge Investment Group Holdings Inc. Net income attributable to non-controlling interests in Bridge Investment Group Holdings Inc. was $51.0$61.7 million during the three months ended March 31,June 30, 2022.Six Months Ended June 30, Amount
Change%
Change(in thousands) 2022 2021 Revenues: Fund management fees $ 102,080 $ 65,387 $ 36,693 56 % Property management and leasing fees 37,895 31,081 6,814 22 % Construction management fees 4,312 3,891 421 11 % Development fees 2,052 1,549 503 32 % Transaction fees 39,641 21,568 18,073 84 % Fund administration fees 7,297 — 7,297 N/A Insurance premiums 5,261 3,916 1,345 34 % Other asset management and property income 4,614 3,131 1,483 47 % Total revenues $ 203,152 $ 130,523 $ 72,629 56 % Six Months Ended June 30, Amount
Change%
Change(in thousands) 2022 2021 Investment income: Incentive fees $ — $ 910 $ (910) (100) % Performance allocations: Realized 42,518 41,185 1,333 3 % Unrealized 135,978 57,967 78,011 135 % Earnings from investments in real estate 1,291 976 315 32 % Total investment income $ 179,787 $ 101,038 $ 78,749 78 % Six Months Ended June 30, 2022 Six Months Ended June 30, 2021 Realized Unrealized Realized Unrealized BMF IV GP $ — $ 105,464 $ — $ 28,989 BWH I GP — 26,003 — 9,967 BWH II GP — 9,295 — — BOF II GP — 4,416 — 858 BDS IV GP 493 2,154 — 948 BNLI GP — 695 — — BDS I GP — — — 35 BOF I GP — (65) — (3,470) BAMBS GP — (709) — 690 BMF III GP 31,625 (1,820) 25,592 (3,604) BDS II GP 2,796 (1,954) — 8,228 BDS III GP 7,604 (7,501) 15,593 15,326 Total $ 42,518 $ 135,978 $ 41,185 $ 57,967 Six Months Ended June 30, Amount
Change%
Change(in thousands) 2022 2021 Expenses: Employee compensation and benefits $ 94,172 $ 69,457 $ 24,715 36 % Incentive fee compensation — 82 (82) (100) % Performance allocations compensation: Realized gains 2,725 4,241 (1,516) (36) % Unrealized gains 17,225 7,477 9,748 130 % Loss and loss adjustment expenses 3,191 2,917 274 9 % Third-party operating expenses 13,517 14,743 (1,226) (8) % General and administrative expenses 19,277 9,492 9,785 103 % Depreciation and amortization 1,520 1,480 40 3 % Total expenses $ 151,627 $ 109,889 $ 41,738 38 % Six Months Ended June 30, Amount
Change%
Change(in thousands) 2022 2021 Other income (expense) Realized and unrealized gains (losses), net $ 3,916 $ 6,097 $ (2,181) (36) % Interest income 2,562 1,165 1,397 120 % Interest expense (4,522) (4,140) (382) 9 % Total other income $ 1,956 $ 3,122 $ (1,166) (37) % Six Months Ended June 30, 2022 2021 Non-controlling interests related to General Partners - realized $ 24,502 $ — Non-controlling interests related to General Partners - unrealized 63,086 — Non-controlling interests related to Fund Managers (2,606) 3,497 Non-controlling interests related to 2019 profits interests awards 44 6,159 Non-controlling interests related to 2020 profits interests awards 917 108 Non-controlling interests related to 2021 profits interests awards 518 — Total $ 86,461 $ 9,764 5051March 31,June 30, 2022 and 2021 (in thousands).Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Net income $ 124,382 $ 83,241 $ 221,886 $ 123,960 Income tax provision 5,837 424 11,382 834 Income before provision for income taxes 130,219 83,665 233,268 124,794 Depreciation and amortization 887 727 1,520 1,480 Less: Unrealized performance allocations (70,116) (43,248) (135,978) (57,967) Plus: Unrealized performance allocations compensation 7,987 6,048 17,225 7,477 Less: Unrealized (gains) losses, net (3,483) (317) (3,962) (6,098) Plus: Share-based compensation 6,553 14,624 13,818 15,465 Less: Net income attributable to noncontrolling interests in subsidiaries 977 (5,815) 1,127 (9,764) Less: Net realized performance allocations attributable to non-controlling interests (18,409) — (24,502) — Distributable Earnings attributable to the Operating Company 54,615 55,684 102,516 75,387 Realized performance allocations and incentive fees (33,581) (35,629) (42,518) (42,095) Realized performance allocations and incentive fees compensation 2,165 3,747 2,725 4,323 Net realized performance allocations to non-controlling interests 18,409 — 24,502 — Net insurance income (loss) (1,406) 110 (2,070) (999) (Earnings) losses from investments in real estate (1,251) (980) (1,291) (976) Net interest (income) expense and realized (gain) loss 1,529 1,995 1,979 2,935 Less: Net income attributable to noncontrolling interests in subsidiaries (977) 5,815 (1,127) 9,764 Total Fee Related Earnings 39,503 30,742 84,716 48,339 Less: Total Fee Related Earnings attributable to non-controlling interests 977 (5,815) 1,127 (9,764) Total Fee Related Earnings attributable to the Operating Company $ 40,480 $ 24,927 $ 85,843 $ 38,575
Company
compensation52March 31,June 30, 2022 and 2021 (in thousands).Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Fund-level fee revenues Fund management fees $ 49,380 $ 34,536 $ 102,080 $ 65,387 Transaction fees 17,643 16,242 39,641 21,568 Total net fund-level fee revenues 67,023 50,778 141,721 86,955 Net earnings from Bridge property operators 2,108 1,988 4,318 4,081 Development fees 793 1,163 2,052 1,549 Fund administration fees 3,657 — 7,297 — Other asset management and property income 2,659 1,611 4,614 3,131 Fee Related Revenues 76,240 55,540 160,002 95,716 Cash-based employee compensation and benefits (30,120) (21,403) (61,946) (41,712) Net administrative expenses (6,617) (3,395) (13,340) (5,665) Fee Related Expenses (36,737) (24,798) (75,286) (47,377) Total Fee Related Earnings 39,503 30,742 84,716 48,339 Fee Related Earnings margin 52 % 55 % 53 % 51 % Net income attributable to non-controlling interests in Operating Company subsidiaries 977 (5,815) 1,127 (9,764) Total fee related earnings to the Operating Company 40,480 24,927 85,843 38,575 Realized performance allocations and incentive fees 33,581 35,629 42,518 42,095 Realized performance allocations and incentive fees compensation (2,165) (3,747) (2,725) (4,323) Net realized performance allocations attributable to non-controlling interests (18,409) — (24,502) — Net insurance income 1,406 (110) 2,070 999 Earnings from investments in real estate 1,251 980 1,291 976 Net interest income (expense) and realized gain (loss) (1,529) (1,995) (1,979) (2,935) Distributable Earnings attributable to the Operating Company $ 54,615 $ 55,684 $ 102,516 $ 75,387
Operating Company subsidiaries
compensation
Companystatementstatements of operations. Other income (expense) is disclosed in our non-GAAP measures based upon the nature of the income. Realized amounts are disclosed separately in order to determine Distributable Earnings. Other income from Bridge property operators is included in net earnings from Bridge property operators (in thousands).53Three Months Ended June 30, Six Months Ended June 30, 2022 2021 2022 2021 Cash-based employee compensation and benefits $ 30,120 $ 21,403 $ 61,946 $ 41,711 Compensation expense of Bridge property operators 10,020 6,279 18,408 12,281 Share-based compensation 6,553 14,624 13,818 15,465 Employee compensation and benefits $ 46,693 $ 42,306 $ 94,172 $ 69,457 Administrative expenses, net of Bridge property operators $ 6,617 $ 3,395 $ 13,340 $ 5,665 Administrative expenses of Bridge property operators 3,152 1,997 5,937 3,827 General and administrative expenses $ 9,769 $ 5,392 $ 19,277 $ 9,492 Unrealized gains (losses) $ 3,483 $ 317 $ 3,962 $ 6,098 Other expenses from Bridge property operators (13) (19) (27) (41) Net interest income (expense) and realized gain (loss) (1,529) (1,995) (1,979) (2,935) Total other income (expense) $ 1,941 $ (1,697) $ 1,956 $ 3,122 $31.7$15.6 million, or 232%62%, for the three months ended March 31,June 30, 2022, compared to the three months ended March 31,June 30, 2021, while Distributable Earnings to the Operating Company increaseddecreased by $28.2$1.1 million, or 143%2%, during the same period due to the following:$44.3,$20.7 million, or 110%37%, principally due to:o◦$21.8$14.8 million, or 71%43%, primarily due to capital raising and timing of deployment of capital for new funds in 2022 and 2021, which increased our fee-earning AUM by 42%44% compared to our fee-earning AUM at March 31,June 30, 2021; ando◦$16.7$1.4 million, or 313%9%, driven by the deployment of $639 $938.2 million of capital primarily for development and multifamily assets and debt investments.$0.8$0.1 million, or 40%6%, driven by an increase in the number of managed units which grew from approximately 48,00053,000 units as of March 31,June 30, 2021 to approximately 62,00063,000 units as of March 31,June 30, 2022.$16.7$11.9 million, or 74%48%, principally due to:o◦$12.2$8.7 million, or 60%41%, primarily due to increased headcount driven by the 42% increase44% increase in our fee-earning AUM and new investment strategies launched in 2021 and 2022; ando◦$4.5$3.2 million, 197%or 95%, primarily due to higher insurance and professional fees related to being a publicly traded company after our IPO.increaseddecreased by $2.5$0.5 million, or 42%1%, compared to 2021, due to the increased realizations in Bridge Multifamily Fund III and Bridge Debt Strategies Funds II and III. The results for the prior year period included 100% of the net realized performance allocations and incentive fees as the financial statements were combined with the respective Bridge GPs. Post-IPO, the amount is shown net of the realized general partner non-controlling interest component of $6.1 $18.4$2.3$18.9 million or 61%59%.March 31,June 30, 2022 and December 31, 2021, we had total assets of $982.6$1,042.1 million and $846.3 million, respectively, which included $149.1$102.8 million and $78.4 million of cash and cash equivalents, respectively,respectively, and total liabilities of $344.2$361.1 million and $296.6 million, respectively.respectively. There were no borrowings outstanding under our revolving credit facility. We generate cash primarily from fund management fees, property and construction management fees, development fees, transaction fees, and fund administration fees. We have historically managed our liquidity and capital resource needs through (a) cash generated from our operating activities and (b) borrowings under credit agreements and other borrowing arrangements.54threesix months ended March 31,June 30, 2022 and 2021 (in thousands):Six Months Ended June 30, 2022 2021 Net cash provided by operating activities $ 142,379 $ 98,477 Net cash provided by investing activities 25,605 33,195 Net cash used in financing activities (141,678) (171,869) Net increase in cash, cash equivalents, and restricted cash $ 26,306 $ (40,197) threesix months ended March 31,June 30, 2022 — cash provided by operating activities was $50.4$142.4 million, primarily consisting of net income of $97.5$221.9 million offset by adjustments for non-cash items of $49.9$107.4 million and cash provided by operating assets and liabilities of $2.7$27.9 million. Adjustments for non-cash items primarily consisted of $65.9$136.0 million unrealized performance allocations and $4.8 million of equity in income from equity method investments, which was offset by $7.3$13.8 million of share-based compensation and $9.2$17.2 million of unrealized accrued performance allocations compensation.threesix months ended March 31,June 30, 2021 — cash provided by operating activities was $26.3$98.5 million, consisting of net income of $40.7$124.0 million and adjustments for non-cash items of $18.8$47.0 million, offset by cash provided by operating assets and liabilities of $4.4$21.5 million. Adjustments for non-cash items primarily consisted primarily of $14.7$58.0 million of unrealized performance allocations, $5.7 million of earnings on equity investments, partially offset by $0.8$15.5 million of share-based compensation amortization, and $0.8 million of depreciation and amortization related to fixed assets and intangibles.amortization.threesix months ended March 31,June 30, 2022 — net cash provided by investing activities of $76.0$25.6 million primarily consisted of $190.1$318.3 million in collections of notes receivable related to our lending activities to affiliate entities, which was offset by issuances of notes receivables of $69.0$242.9 million, $17.3$35.4 million for purchases of investments, and $15.1 million used for the acquisition of GBC, and $13.7 million of deposits.GBC.threesix months ended March 31,June 30, 2021 — net cash provided by investing activities of $33.7$33.2 million primarily consisted of $36.4$182.2 million from the collections of notes receivable related to our lending activities to affiliate entities.entities, which was offset by issuances of notes receivables of $146.0 million and $2.7 million for purchases of investments.andand revolving line of credit, and at times proceeds from issuances of our common stock.threesix months ended March 31,June 30, 2022 — net cash used in financing activities of $51.9$141.7 million was largely due to $46.1$126.9 million of distributions paid to non-controlling interests and $5.9$13.5 million of dividends paid to our Class A common stockholders.stockholders, in addition to paydowns on the revolving line of credit of $50.0 million and the payment of deferred financing costs related to the new Credit Facility entered into in June 2022. These were offset by draws on the revolving line of credit of $50.0 million.threesix months ended March 31,June 30, 2021— net cash used in financing activities of $27.7$171.9 million was primarily due to the distributions to our members of $21.8$157.9 million, which included a special dividend of $75.0 million, and to non-controlling interests of $6.2$14.0 million.55tranches.The Private Placement Notes were issued intranches with an aggregate principal amount of $150.0 million. Concurrently with the issuance of themillion (the “2020 Private Placement Notes we entered into a secured revolving line of credit, (“LOC”Notes”), with an aggregate borrowing capacity of $75.0 million.. Net proceeds from the 2020 Private Placement Notes were $147.7 million, net of arrangement fees and other expenses. A portion of the proceeds were used to repay the outstanding balances on a prior credit facility. Borrowings under the LOC accrue interest at LIBOR plus 2.25%. We had no borrowings against the LOC as of March 31, 2022 or December 31, 2021. The LOC matures on July 22, 2022. and the LOC, certain of our assets serve as pledged collateral. In addition, the 2020 Private Placement Notes and LOC contain covenants that, among other things, limit our ability to incur indebtedness. The covenants, as amended June 3, 2022, require the Operating Company to maintain (1) a Consolidated Total Debtdebt to Consolidated EBITDA ratio of no more than 3.0x,3.75x, (2) minimum liquidity of $2.5$15.0 million, and (3) minimum quarterly EBITDA of $10.0$15.0 million and minimum EBITDA for the trailing four fiscal quarters of $80 million.March 31,June 30, 2022 and December 31, 2021, the Company was in full compliance with all debt covenants.March 31,June 30, 2022.56March 31,June 30, 2022, we had cash of $77.4$74.1 million deposited in non-interest bearing accounts and $71.7$28.7 million deposited in an interest bearing account, with limited to no interest rate risk. Interest-earning instruments carry a degree of interest rate risk.risk. We do not enter into investments for trading or speculative purposes and have not used any derivative financial instruments to manage our interest rate risk exposure.57March 31,June 30, 2022, our disclosure controls and procedures were effective at the reasonable assurance level.March 31,June 30, 2022, that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.58JanuaryApril 1, 2022 to March 31, 2022, other than as previously disclosed in our current reports on Form 8-K.UponUpon Senior SecuritiesThe Tax Receivable Agreement, by and among the Company, the Operating Company, and each of the Members (as defined therein) from time to time party thereto, was amended and restated on May 4, 2022, with an effective date of January 1, 2022, as included in Exhibit 10.1 (the “TRA”). The amended and restated TRA revises the mechanics for calculating the Redemption Price on Exchanges (each as defined in the TRA) by tying the Redemption Price to the closing price of Bridge Class A Shares reported on the New York Stock Exchange on the Exchange Date (each as defined in the TRA).59Incorporated by Reference Exhibit Number Exhibit Description Form Filing Date Exhibit Number Filed Herewith 3.1 10-Q 8/17/21 3.1 3.2 10-Q 8/17/21 3.2 4.1 S-1/A 7/2/21 4.1 10.1 10-Q 5/10/22 10.1 31.1 X 31.2 X 32.1* X 32.2* X 101.SCH* Inline XBRL Instance Document (the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document) X 101.CAL* Inline XBRL Taxonomy Extension Schema Document X 101.DEF* Inline XBRL Taxonomy Extension Definition Linkbase Document X 101.LAB* Inline XBRL Taxonomy Extension Label Linkbase Document X 101.PRE* Inline XBRL Taxonomy Extension Presentation Linkbase Document X 104 Cover Page Interactive Data File (formatted as inline XBRL and contained in Exhibit 101) X 60[May 10,August 9, 2022
(Principal Executive Officer)May 10,August 9, 2022Chad BriggsKatherine ElsnabChad Briggs
(Principal Financial Officer and Principal Accounting Officer)61