SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549



(Mark One)
x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934

The number of shares of the registrant's common stock, $0.01 par value, outstanding as of ~~October 31, 2015~~April 30, 2016 was ~~30,416,283.~~31,732,229.

Item 1. ~~Condensed~~ Consolidated Financial Statements.

Commercial mortgage loans, held for investment, net of allowance of $1,053 and $888 ⁽¹⁾

Accrued interest receivable ⁽²⁾

Interest payable ⁽³⁾

The accompanying notes are an integral part of these unaudited ~~condensed~~ consolidated financial statements.

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REALTY FINANCE TRUST, INC.

~~CONDENSED~~ CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(In thousands)

(Unaudited)

Three Months Ended September 30, Nine Months Ended September 30,
2015 2014 2015 2014
Net income $ 7,425
$ 951
$ 16,360
$ 1,761
Unrealized loss on real estate securities (1,008 ) (24 ) (1,010 ) (4 )
Comprehensive income $ 6,417
$ 927
$ 15,350
$ 1,757



	Three Months Ended March 31,
	2016			2015
Net income	$	9,420		$	4,632
Unrealized (loss)/gain on available-for-sale securities	(4,964		)	141
Comprehensive income attributable to Realty Finance Trust, Inc.	$	4,456		$	4,773

The accompanying notes are an integral part of these unaudited ~~condensed~~ consolidated financial statements.

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REALTY FINANCE TRUST, INC.

~~CONDENSED~~ CONSOLIDATED STATEMENT OF CHANGES IN STOCKHOLDERS' EQUITY

(In thousands, except for share data)

(Unaudited)


	Convertible Stock			Common Stock																	Convertible Stock			Common Stock
	Number of Shares	Amount		Number of Shares		Par Value			Additional Paid-In Capital			Accumulated Other Comprehensive Loss			Accumulated Deficit			Total Stockholders' Equity			Number of Shares	Amount		Number of Shares	Par Value		Additional Paid-In Capital			Accumulated Other Comprehensive Loss			Accumulated Deficit			Total Stockholders' Equity
Balance, December 31, 2014	1,000	$	1	15,472,192		$	155		$	340,874		$	(307	)	$	(10,216	)	$	330,507
Balance, December 31, 2015																					1,000	1		31,385,280	314		691,590			(2,254		)	(35,322		)	654,329
Issuance of common stock	—	—		12,790,819		128			318,361						—			318,489			—	—		—	—					—			—			—
Common stock repurchases	—	—		(86,437	)	(1		)	(2,098		)	—			—			(2,099		)	—	—		—	—		(8		)	—			—			(8		)
Common stock offering costs, commissions and dealer manager fees																					—	—		—	—		—			—			—			—
Common stock issued through distribution reinvestment plan																					—	—		260,353	2		6,580			—			—			6,582
Share-based compensation																					—	—		—	—		9			—			—			9
Net income	—	—		—		—			—			—			16,360			16,360			—	—		—	—		—			—			9,420			9,420
Distributions declared	—	—		—		—			—			—			(34,002		)	(34,002		)	—	—		—	—								(16,179		)	(16,179		)
Common stock issued through distribution reinvestment plan	—	—		574,280		6			13,637			—			—			13,643
Share-based compensation	—	—		2,666		—			24			—			—			24
Common stock offering costs, commissions and dealer manager fees	—	—		—		—			(37,448		)	—			—			(37,448		)
Other comprehensive income	—	—		—		—			—			(1,010		)	—			(1,010		)
Balance, September 30, 2015	1,000	$	1	28,753,520		$	288		$	633,350		$	(1,317	)	$	(27,858	)	$	604,464
Other comprehensive loss																					—	—		—	—		—			(4,964		)	—			(4,964		)
Balance, March 31, 2016																					1,000	$	1	31,645,633	$	316	$	698,171		$	(7,218	)	$	(42,081	)	$	649,189

The accompanying notes are an integral part of these unaudited ~~condensed~~ consolidated financial statements.

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REALTY FINANCE TRUST, INC.

~~CONDENSED~~ CONSOLIDATED STATEMENTS OF CASH FLOWS

(In thousands)

(Unaudited)

Nine Months Ended September 30,
2015 2014
Cash flows from operating activities:
Net income $ 16,360
$ 1,761
Adjustments to reconcile net income to net cash provided by operating activities:
Discount accretion and premium amortization, net (877 ) (229 )
Accretion of loan exit fees (603 ) (53 )
Amortization of deferred financing costs 1,872
170
Share-based compensation 24
20
Loan loss provision 302
302
Changes in assets and liabilities:
Accrued interest receivable (2,041 ) (1,686 )
Prepaid expenses and other assets (416 ) (97 )
Accounts payable and accrued expenses 519
877
Due to affiliate 1,353
—
Interest payable 304
95
Net cash provided by operating activities $ 16,797
$ 1,160
Cash flows from investing activities:
Origination and purchase of commercial mortgage loans $ (526,919 ) $ (282,563 )
Purchase of real estate securities (53,304 ) (33,581 )
Principal repayments received on commercial mortgage loans 45,542
103
Principal repayments received on real estate securities 1,573
—
Net cash used in investing activities $ (533,108 ) $ (316,041 )
Cash flows from financing activities:
Proceeds from issuances of common stock $ 316,614
$ 243,978
Common stock repurchases (2,899 ) —
Payments of offering costs and fees related to common stock issuances (36,981 ) (25,500 )
Borrowings on revolving line of credit with affiliate —
5,550
Repayments of revolving line of credit with affiliate —
(12,855 )
Borrowings on repurchase agreements - commercial mortgage loans 244,178
87,292
Repayments of repurchase agreements - commercial mortgage loans (18,257 ) —
Borrowings on repurchase agreements - real estate securities 50,274
23,572
Repayments of repurchase agreements - real estate securities (3,946 ) (10 )
Increase in restricted cash related to financing activities (1,339 ) —
Repayments to affiliate —
(1,078 )
Payments of deferred financing costs —
(2,189 )
Distributions paid (18,215 ) (3,909 )
Net cash provided by financing activities $ 529,429
$ 314,851
Net change in cash $ 13,118
$ (30 )
Cash, beginning of period 386
178
Cash, end of period $ 13,504
$ 148

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~~REALTY FINANCE TRUST, INC.~~

~~CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS~~

~~(In thousands)~~

~~(Unaudited)~~


	Nine Months Ended September 30,				Three Months Ended March 31,
	2015		2014		2016			2015
Cash flows from operating activities:
Net income					$	9,420		$	4,632
Adjustments to reconcile net income to net cash provided by operating activities:
Premium amortization and (discount accretion), net					(575		)	(189		)
Accretion of deferred commitment fees					(382		)	(145		)
Amortization of deferred financing costs					541			479
Share-based compensation					9			6
Loan loss provision					165			144
Changes in assets and liabilities:
Accrued interest receivable					582			705
Prepaid expenses and other assets					(35		)	859
Accounts payable and accrued expenses					155			(364		)
Due to affiliates					76			(894		)
Interest payable					132			25
Net cash provided by operating activities					$	10,088		$	5,258
Cash flows from investing activities:
Origination and purchase of commercial mortgage loans					$	(9,697	)	$	(116,434	)
Purchase of real estate securities					—			(8,016		)
Principal repayments received on commercial mortgage loans					9,253			14,321
Principal repayments received on real estate securities					928			—
Net cash provided by (used in) investing activities					$	484		$	(110,129	)
Cash flows from financing activities:
Proceeds from issuances of common stock					$	—		$	92,806
Common stock repurchases					(6,003		)	(144		)
Payments of offering costs and fees related to common stock issuances					—			(9,178		)
Borrowings on repurchase agreements - commercial mortgage loans					85,614			38,376
Repayments of repurchase agreements - commercial mortgage loans					(48,270		)	(6,238		)
Borrowings on repurchase agreements - real estate securities					319,001			99,560
Repayments of repurchase agreements - real estate securities					(315,763		)	(88,095		)
Increase in restricted cash related to financing activities					(1,132		)	—
Payments of deferred financing costs					—			(750		)
Distributions paid					(9,619		)	(4,697		)
Net cash provided by financing activities					$	23,828		$	121,640
Net change in cash					$	34,400		$	16,769
Cash, beginning of period					14,807			386
Cash, end of period					$	49,207		$	17,155
Supplemental disclosures of cash flow information:
Income taxes paid					$	—		$	9
Interest paid	$	5,749	$	537	4,095			2,471
Supplemental disclosures of non-cash flow information:
Distributions payable	$	4,767	$	1,078	$	5,530		$	3,269
Common stock issued through distribution reinvestment plan	13,643		2,385		6,582			3,445
Receivable for common stock issued	3,065		2,283		—			3,006

The accompanying notes are an integral part of these unaudited ~~condensed~~ consolidated financial statements.

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REALTY FINANCE TRUST, INC.

NOTES TO ~~CONDENSED~~ CONSOLIDATED FINANCIAL STATEMENTS

~~September 30, 2015~~March 31, 2016

(Unaudited)

Note 1 - Organization and Business Operations

Realty Finance Trust, Inc. (the "Company") was incorporated in Maryland on November 15, 2012 and ~~has conducted~~conducts its operations to qualify as a real estate investment trust ("REIT") for U.S. federal income tax purposes beginning with the ~~filing of its tax return for the~~ taxable year ended December 31, 2013. Substantially all of the Company's business is conducted through Realty Finance Operating Partnership, L.P. (the “OP”), a Delaware limited partnership. Realty Finance Advisors, LLC is the Company's advisor (the "Advisor"). The Company is the sole general partner and directly or indirectly hold all of the units of limited partner interests in the OP. Additionally, the Advisor contributed $1,000 to the Company in exchange for 1,000 convertible shares of Realty Finance Trust, Inc. The convertible shares will automatically convert to shares of the Company's common stock upon the first occurrence of any of the following triggering events, (each a "Triggering Event"): (i) the Company has paid total distributions on the then-outstanding shares of the Company's common stock in an amount equal to or in excess of the sum of the invested capital (as defined in the Company's charter) plus an aggregate 6.0% cumulative, pre-tax, non-compounded, annual return on such invested capital, (ii) a listing of the Company's shares of common stock on a national securities exchange or (iii) the termination of the Company's advisory agreement under certain circumstances. The Company did not incur any of the aforementioned trigger events to date.

Prior to January 2016 the Company was offering for sale a maximum of 80.0 million shares of common stock, $0.01 par value per share, on a reasonable best efforts basis, pursuant to a registration statement on Form S-11 (the "Offering") filed with the U.S. Securities and Exchange Commission ~~("SEC")~~ under the Securities Act of 1933, as ~~amended (the "Securities Act").~~amended. The Offering also ~~covers~~covered the offer and sale of up to approximately 16.8 million shares of common stock pursuant to a distribution reinvestment plan (the "DRIP") under which common stockholders may elect to have their distributions reinvested in additional shares of the Company’s common stock. ~~On May 14, 2013,~~Effective January 2016, the Company ~~commenced business operations after raising in excess of $2.0 million of equity in~~terminated the Offering, deregistered 4,069 unsold shares from the ~~amount required for~~Offering and reallocated 49.7 million unsold shares from the ~~Company to release equity proceeds from escrow.~~

~~Prior~~Offering to the NAV pricing date (as described below), the Company has offered shares of its common stock in the primary offering through Realty Capital Securities, LLC (the "Dealer Manager") at a share price of up to $25.00 per share (including the maximum allowed to be charged for commissions and fees, subject to certain discounts as described in the Company's prospectus). Prior to the NAV pricing date, the Company has offered shares of its common stock through the DRIP at a price equal to $23.75 per share, which is 95% of the primary offering price. As of close of business on November 10, 2015 (the "NAV pricing date"), pursuant to the net asset value ("NAV") calculation described in Note 13, the Company is offering shares of its common stock in the primary offering at a price of up to $28.08 per share, inclusive of applicable commissions and dealer manager fees and through the DRIP at a price equal to $25.27, the NAV per share. As of September 30, 2015, the aggregate gross proceeds from the sale of common stock in the offering, including DRIP, was $714.2 million. Beginning with the NAV pricing date, the per share price for shares in the primary offering and the DRIP will vary quarterly and will be equal to the Company's NAV as of the end of the prior quarter, divided by the number of shares of the Company's common stock outstanding as of such date, plus, in the case of the primary offering, applicable commissions and fees.offering.

The Company ~~was formed~~is in business to originate, acquire and manage a diversified portfolio of commercial real estate debt ~~investments~~ secured by properties located both within and outside of the United States. The Company ~~may~~ also ~~invest~~invests in commercial real estate ~~securities and commercial real estate properties.~~securities. Commercial real estate debt ~~investments~~ may include first mortgage loans, subordinated mortgage loans, mezzanine loans and participations in such loans. Real estate securities may include commercial mortgage-backed securities ("CMBS"), senior unsecured debt of publicly traded REITs, debt or equity securities of other publicly traded real estate companies and collateralized debt obligations ("CDOs").

The Company has no ~~direct~~ employees. The Company has retained ~~Realty Finance Advisors, LLC (the "Advisor")~~the Advisor to manage the Company's affairs on a day-to-day basis. The ~~Dealer Manager serves as the dealer manager of the Offering. The~~ Advisor ~~and Dealer Manager are under common control with~~is controlled by AR ~~Capital,~~Global Investments, LLC ("AR ~~Capital"~~Global"), the parent of American Realty Capital VIII, LLC (the "Sponsor"), as a result of which they are related parties and each of them has received or will receive compensation and fees for services related to the ~~Offering, the~~ investment and management of the Company's assets, the operations of the Company and the liquidation of the Company.

Note 2 - Summary of Significant Accounting Policies

The accompanying ~~condensed~~ consolidated financial statements and related footnotes are unaudited and have been prepared on the accrual basis of accounting in conformity with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial ~~statements. The accompanying condensed consolidated financial~~ statements include the accounts of the Company, its wholly owned subsidiary, Realty Finance Operating Partnership, L.P. (the "OP") and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.

~~Interim financial statements are prepared in accordance with GAAP for interim financial information~~ and pursuant to the requirements for reporting on Form 10-Q and Regulation S-X, as appropriate. Accordingly, the ~~condensed~~ consolidated financial statements may not include all of the information and notes required by GAAP for annual consolidated financial statements. GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities as of the date of the financial statements and the reported amounts of income and expenses during the reported periods. Changes in the economic environment, financial markets and any other parameters used in determining these estimates

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~~REALTY FINANCE TRUST, INC.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~September 30, 2015~~

~~(Unaudited)~~

could cause actual results to differ materially. In the opinion of management, the interim data includes all adjustments, of a normal and recurring nature, necessary for a fair statement of the results for the periods presented. The current period’s results of operations will not necessarily be indicative of results that ultimately may be achieved for the ~~fiscal~~entire year ~~ending on~~or any subsequent interim periods.

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REALTY FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016

(Unaudited)

These financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto as of, and for the year ended December 31, ~~2015.~~2015, which are included in the Company's Annual Report on Form 10-K filed with the Securities and Exchange Commission ("SEC") on March 11, 2016. There have been no significant changes to the Company's significant accounting policies during the three months ended March 31, 2016, other than the updates described below.

Principles of Consolidation

The Company consolidate all entities that the Company control through either majority ownership or voting rights. In addition, the Company consolidates all variable interest entities ("VIE") of which the Company is considered the primarily beneficiary. VIEs are defined as entities in which equity investors (i) do not have the characteristics of a controlling financial interest and/or (ii) do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. The entity that consolidates a VIE is known as its primary beneficiary and is generally the entity with (i) the power to direct the activities that most significantly affect the VIE’s economic performance and (ii) the right to receive benefits from the VIE or the obligation to absorb losses of the VIE that could be significant to the VIE.

The accompanying consolidated financial statements include the accounts of the Company, its wholly owned subsidiary, Realty Finance Operating Partnership, L.P. (the "OP") and its subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation.In determining whether the Company has a controlling financial interest in a joint venture and the requirement to consolidate the accounts of that entity, management considers factors such as ownership interest, authority to make decisions and contractual and substantive participating rights of the other partners or members as well as whether the entity is a variable interest entity ("VIE") for which the Company is the primary beneficiary. The Company has determined the OP is a VIE of which the Company is the primary beneficiary. Substantially all of the Company's assets and liabilities are held by the OP.

The accompanying consolidated financial statements include the accounts of a collateralized loan obligation ("CLO") issued and securitized by a wholly owned subsidiary of the Company. The Company has determined the CLO is a VIE of which the Company's subsidiary is the primary beneficiary. The Company has disclosed the assets and liabilities of the CLO on the face of the balance sheet in accordance with ASC 810 - Consolidation.

Allowance for Loan Losses

The allowance for loan losses reflects management's estimate of loan losses inherent in the loan portfolio as of the balance sheet date. The reserve is increased through the loan loss provision on the Company's ~~condensed~~ consolidated statement of operations and is decreased by charge-offs when losses are confirmed through the receipt of assets, such as cash in a pre-foreclosure sale or upon ownership control of the underlying collateral in full satisfaction of the loan upon foreclosure or when significant collection efforts have ceased. The Company uses a uniform process for determining its allowance for loan losses. The allowance for loan losses includes a general, formula-based component and an asset-specific component.

General reserves are recorded when (i) available information as of each balance sheet date indicates that it is probable a loss has occurred in the portfolio and (ii) the amount of the loss can be reasonably estimated. The Company currently estimates loss rates based on historical realized losses experienced in the industry and takes into account current collateral and economic conditions affecting the probability and severity of losses when establishing the allowance for loan losses. The Company performs a comprehensive analysis of its loan portfolio and assigns risk ratings to loans that incorporate management's current judgments about their credit quality based on all known and relevant internal and external factors that may affect collectability. The Company considers, among other things, payment status, lien position, borrower financial resources and investment in collateral, collateral type, project economics and geographic location as well as national and regional economic factors. This methodology results in loans being segmented by risk classification into risk rating categories that are associated with estimated probabilities of default and principal loss. Ratings range from "1" to "5" with "1" representing the lowest risk of loss and "5" representing the highest risk of loss.

The asset-specific reserve component relates to reserves for losses on individual impaired loans. The Company considers a loan to be impaired when, based upon current information and events, it believes that it is probable that the Company will be unable to collect all amounts due under the contractual terms of the loan agreement. This assessment is made on an individual loan basis each quarter based on such factors as payment status, lien position, borrower financial resources and investment in collateral, collateral type, project economics and geographical location as well as national and regional economic factors. A reserve is established for an impaired loan when the present value of payments expected to be received, observable market prices or the estimated fair value of the collateral (for loans that are dependent on the collateral for repayment) is lower than the carrying value of that loan.

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REALTY FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016

(Unaudited)

For collateral dependent impaired loans, impairment is measured using the estimated fair value of collateral less the estimated cost to sell. Valuations are performed or obtained at the time a loan is determined to be impaired and designated non-performing, and they are updated if circumstances indicate that a significant change in value has occurred. The Advisor generally will use the income approach through internally developed valuation models to estimate the fair value of the collateral for such loans. In more limited cases, the Advisor will obtain external "as is" appraisals for loan collateral, generally when third party participations exist.

A loan is also considered impaired if its terms are modified in a troubled debt restructuring ("TDR"). A TDR occurs when a concession is granted and the debtor is experiencing financial difficulties. Impairments on TDR loans are generally measured based on the present value of expected future cash flows discounted at the effective interest rate of the original loans.

The Company designates non-performing loans at such time as (i) loan payments become 90-days past due; (ii) the loan has a maturity default; or (iii) in the opinion of the Company, it is probable the Company will be unable to collect all amounts due according to the contractual terms of the loan. Income recognition will be suspended when a loan is designated non-performing and resumed only when the suspended loan becomes contractually current and performance is demonstrated to have resumed. A loan will be written off when it is no longer realizable and legally discharged.

The Company calculates basic earnings per share by dividing net income attributable to the Company for the period by the weighted-average number of shares of common stock outstanding for that period. Diluted earnings per share reflects the potential dilution that ~~that~~ could occur from shares issuable in connection with the restricted stock plan and if convertible shares were exercised, except when doing so would be anti-dilutive.

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~~REALTY FINANCE TRUST, INC.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~September 30, 2015~~

~~(Unaudited)~~

The Company conducts its business through the following segments:

See Note 12 - Segment Reporting for further information regarding the Company's segments.

~~New~~Recently Issued Accounting Pronouncements

In ~~May 2014,~~February 2015, the ~~Financial Accounting Standards Board (“FASB”) issued revised guidance relating to revenue recognition. Under~~FASB amended the ~~revised guidance, an entity is required to recognize revenue when it transfers promised goods~~accounting for consolidation of certain legal entities. The amendments modify the evaluation of whether certain legal entities are VIEs or ~~services to customers in an amount~~voting interest entities, eliminate the presumption that ~~reflects~~a general partner should consolidate a limited partnership and affect the ~~consideration to which the entity expects to be entitled in exchange for~~consolidation analysis of reporting entities that are involved with VIEs (particularly those ~~goods or services.~~that have fee arrangements and related party relationships). The revised guidance ~~was to become~~is effective for fiscal years, and for interim periods within those fiscal years, beginning after December 15, ~~2016.~~2015. Early adoption was ~~not~~ permitted, under GAAP. The revised guidance allows entities to apply the full retrospective or modified retrospective transition method upon adoption. In July 2015, the FASB deferred the effective date of the revised guidance by one year to annual reporting periods beginning after December 15, 2017, although entities will be allowed to early adopt the guidance as of the original effective date.including adoption in an interim period. The Company ~~does not engage in~~elected to adopt this guidance effective January 1, 2016. The Company has evaluated the ~~sale~~impact of ~~goods or services and as such~~ the adoption of ~~this standard~~the new guidance on its consolidated financial statements and has determined the Company’s OP is ~~not expected to have an impact on~~considered a VIE. However, the Company meets the disclosure exemption criteria as the Company is the primary beneficiary of the VIE and the Company's ~~condensed consolidated financial statements.~~

~~In June 2014,~~partnership interest is considered a majority voting interest in a business and the ~~FASB issued Accounting Standards Update ("ASU") 2014-11 "Repurchase-to-Maturity Transactions, Repurchase Financings and Disclosures." ASU 2014-11 makes limited changes to~~assets of the ~~accounting~~OP can be used for ~~repurchase agreements, clarifies when repurchase agreements and securities lending transactions should be accounted for~~purposes other than settling its obligation, such as ~~secured borrowings and requires additional disclosures regarding these types of transactions. The Company has historically recorded repurchase arrangements as secured borrowings and as~~paying distributions. As such, the ~~adoption of ASU 2014-11~~new guidance did not have a material impact on the Company's ~~condensed~~ consolidated financial statements.

In ~~April 2015,~~March 2016, the FASB issued ~~ASU 2015-03 "Interest - Imputation of Interest: Simplifying the Presentation of Debt Issuance Costs." ASU 2015-03 simplifies the presentation of debt issuance costs by amending~~an update that changes the accounting for certain aspects of share-based compensation. Among other things, the revised guidance allows companies to ~~require~~make an entity-wide accounting policy election to either estimate the number of awards that ~~debt issuance costs related~~are expected to ~~a recognized debt liability be presented in the balance sheet as a direct deduction from the carrying amount of the related debt liability.~~vest or account for forfeitures when they occur. The ~~amendments are consistent with the accounting guidance related to debt discounts. This~~revised guidance is effective for ~~the first interim or annual period~~reporting periods beginning after December 15, ~~2015.~~2016. Early adoption is permitted. The Company is currently ~~assessing the~~evaluating impact of this new guidance, ~~on its condensed~~however, adoption of the guidance is not expected to have material impact to the Company's consolidated financial statements.

~~The FASB’s proposed model represents a significant departure from existing GAAP, and may result in material changes to the Company’s accounting for financial instruments. The impact~~

Note 3 - Commercial Mortgage Loans

The following table is a summary of the Company's commercial mortgage ~~loans~~loan carrying values by class (in thousands):

September 30, 2015 December 31, 2014
Senior loans $ 657,785
$ 250,093
Mezzanine loans 271,919
191,863
Subordinated loans 10,000
15,498
Total gross carrying value of loans 939,704
457,454
Less: Allowance for loan losses 872
570
Total commercial mortgage loans, net $ 938,832
$ 456,884

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	March 31, 2016		December 31, 2015
Senior loans	$	901,272	$	894,075
Mezzanine loans	216,131		221,014
Subordinated loans	10,000		10,000
Total gross carrying value of loans	1,127,403		1,125,089
Less: Allowance for loan losses	1,053		888
Total commercial mortgage loans, net	$	1,126,350	$	1,124,201

~~REALTY FINANCE TRUST, INC.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~September 30, 2015~~

~~(Unaudited)~~

The following table presents the activity in the Company's allowance for loan losses (in thousands):

As of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014,~~2015, the Company's commercial mortgage loan portfolio comprised 6976 and 3877 loans, respectively. ~~The following table summarizes the Company's loan portfolio by sectors on a par value basis (in thousands):~~

Credit Characteristics

As part of the Company's process for monitoring the credit quality of its loans, it performs a quarterly loan portfolio assessment and assigns risk ratings to each of its ~~performing~~ loans. The loans are scored on a scale of 1 to 5 as follows:



Investment Rating		Summary Description
1		Investment exceeding fundamental performance expectations and/or capital gain expected. Trends and risk factors since time of investment are favorable.
2		Performing consistent with expectations and a full return of principal and interest expected. Trends and risk factors are neutral to favorable.
3		Performing investments requiring closer monitoring. Trends and risk factors show some deterioration.
4		Underperforming investment with some loss of interest expected but still expecting a positive return on investment. Trends and risk factors are negative.
5		Underperforming investment with expected loss of interest and some principal.

All commercial mortgage loans are assigned an initial risk rating of 2.2.0. As of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014,~~2015, the weighted average risk rating of loans was 2.0 and 2.0, respectively. As of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014,~~2015, the Company did not have any loans that were past due on their payments, in non-accrual status or impaired.

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REALTY FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016

(Unaudited)

For the ~~nine~~three months ended ~~September 30,~~March 31, 2016 and March 31, 2015, ~~and year ended December 31, 2014,~~ the activity in the Company's loan portfolio was as follows (in thousands):

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~~REALTY FINANCE TRUST, INC.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~September 30, 2015~~

~~(Unaudited)~~

________________________

* Includes amortization of capitalized acquisition fees and expenses.

Note 4 - Real Estate Securities

The following is a summary of the Company's real estate securities, CMBS (in thousands):

Weighted Average
Number of Investments Interest Rate Maturity Par Value Fair Value
September 30, 2015 13
1M LIBOR + 3.836% November 2017 $ 102,335
$ 100,959
December 31, 2014 8
1M LIBOR + 3.124% November 2017 50,447
50,234



		Weighted Average
	Number of Investments	Interest Rate		Maturity	Par Value		Fair Value
March 31, 2016	16	4.81	%	January 2019	$	132,255	$	124,871
December 31, 2015	16	4.71	%	February 2019	133,183		130,754

The Company classified its CMBS as available-for-sale as of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014.~~2015. These investments are reported at fair value in the balance sheet with changes in fair value recorded in accumulated other comprehensive income or loss. The following table shows the ~~changes in~~amortized cost, unrealized gains/losses and fair value of the Company's CMBS ~~(in~~investments as of March 31, 2016 and December 31, 2015(in thousands):

Amortized Cost Unrealized Gains Unrealized Losses Fair Value
September 30, 2015 $ 102,276
$ —
$ (1,317 ) $ 100,959
December 31, 2014 50,541
14
(321 ) 50,234



	Amortized Cost		Unrealized Gains		Unrealized Losses			Fair Value
March 31, 2016	$	132,089	$	8	$	(7,226	)	$	124,871
December 31, 2015	133,008		—		(2,254		)	130,754

Repurchase Agreements - Commercial Mortgage Loans

The Company entered into repurchase facilities with JPMorgan Chase Bank, National Association (the "JPM Repo Facility") and Barclays Bank PLC (the "Barclays Repo Facility"). The JPM Repo Facility provides up to ~~$250.0~~$150.0 million in ~~advances through October 30, 2015, and then $150.0 million through maturity.~~advances. The Barclays Repo Facility provides up to ~~$170.0~~$150.0 million in ~~advances through October 19, 2015, and then $150.0 million through maturity.~~advances. Both, the JPM Repo Facility and Barclays Repo Facility are subject to ~~adjustment.~~adjustments. The Company expects to use advances from the JPM Repo Facility and the Barclays Repo Facility to finance the acquisition or origination of eligible loans, including first mortgage loans, subordinated mortgage loans, mezzanine loans and participation interests therein. The initial maturity date of the JPM Repo Facility is June 18, 2016, with a ~~one-year~~one year extension at the Company’s option, which may be exercised upon the satisfaction of certain conditions. The Company ~~exercised its first extension on~~entered into an amendment of the Barclays Repo Facility, ~~and extended~~dated as of May 12, 2016 (the “Barclays Amendment”), pursuant to which the maturity date of the Barclays Repo Facility was extended to ~~March 3,~~September 6, 2016, ~~with three six-month~~and the pricing rate for each purchased asset was increased by 0.50% per annum. There are two six months extensions remaining atunder the ~~Company’s option,~~Barclays Repo Facility, which may be ~~exercised~~granted by the lender in its sole discretion upon the satisfaction of certain conditions.

As of ~~September 30, 2015~~March 31, 2016, the Company is in compliance with all debt covenants.

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REALTY FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016

(Unaudited)

As of March 31, 2016 and December 31, ~~2014,~~2015, the Company had ~~$209.4~~$121.7 million and ~~$76.5~~$84.3 million outstanding under the JPM Repo ~~Facility, respectively.~~Facility. Advances under the JPM Repo Facility accrue interest at per annum rates equal to the sum of (i) the applicable LIBOR index rate plus (ii) a margin between 2.25% to ~~4.50%~~4.5%, depending on the attributes of the purchased assets. As of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014,~~2015, the weighted average interest rate on advances was ~~2.90%~~2.7% and ~~3.84%~~3.1%, respectively. ~~During the nine months ended September 30, 2015, the~~The Company incurred ~~$3.2~~$0.8 million ofand $0.7 million in interest expense on ~~average borrowings outstanding of $128.3 million compared to $0.5 million of interest expense on average borrowings outstanding under~~ the JPM Repo Facility ~~of $17.6 million~~ for the ~~nine~~three months ended ~~September 30, 2014.~~March 31, 2016 and 2015, respectively.

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~~REALTY FINANCE TRUST, INC.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~September 30, 2015~~

~~(Unaudited)~~

As of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014,~~2015, the Company had ~~$166.7~~$121.9 million and ~~$73.7~~$121.9 million outstanding under the Barclays Repo ~~Facility, respectively. Advances~~Facility. After giving effect to the Barclays Amendment, advances under the Barclays Repo Facility accrue interest at per annum rates equal to the sum of (i) the applicable LIBOR index rate plus (ii) a margin between ~~2.00%~~2.5% to ~~2.50%~~3.0%, depending on the attributes of the purchased assets. As of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014,~~2015, the weighted average interest rate on advances was ~~2.21%~~2.5% and ~~2.16%~~2.4%, respectively. ~~During the nine months ended September 30, 2015, the~~The Company incurred ~~$2.3~~$0.8 million ~~in interest expense on average borrowings outstanding under the Barclays Repo Facility of $137.5 million compared to less than $0.1~~and $0.5 million of interest expense on ~~average borrowings outstanding of less than $0.2 million~~the Barclays Repo Facility for the ~~nine~~three months ended ~~September 30, 2014.~~March 31, 2016 and 2015, respectively.

The JPM Repo Facility and the Barclays Repo Facility generally provide that in the event of a decrease in the value of the Company's collateral, the lenders can demand additional collateral. Should the value of the Company’s collateral decrease, whether as a result of deteriorating credit quality, an increase in credit market spreads or otherwise, resulting margin calls may cause an adverse change in the Company’s liquidity position.

Repurchase Agreements - Real Estate Securities

The Company has entered into various Master Repurchase Agreements (the "MRAs") that allow the Company to sell real estate securities while providing a fixed repurchase price for the same real estate securities in the future. The repurchase contracts on each security under an MRA generally mature in 30 to 90 days and terms are adjusted for current market rates as necessary. AsBelow is a summary of the Company's MRAs as of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014, the Company had entered into six MRAs, of which three were in use, see below~~2015 (in thousands):

* Includes $52,962 and $56,044 Tranche C of RFT issued CLO held by the Company, which eliminates within the Real estate securities, at fair value line of the consolidated balance sheets as of March 31, 2016 and December 31, 2015, respectively.

Collateralized Loan Obligation

On October 19, 2015, RFT 2015-FL1 Issuer, Ltd. (the “Issuer”) and RFT 2015-FL1 Co-Issuer, LLC (the “Co-Issuer”), both wholly owned indirect subsidiaries of the Company, entered into an indenture with the RFT OP, as advancing agent, U.S. Bank National Association as note administrator and U.S. Bank National Association as trustee, which governs the issuance of approximately $350.2 million principal balance secured floating rate notes (the “Notes”). In addition, concurrently with the issuance of the Notes, the Issuer also issued 78,188,494 Preferred Shares, par value of $0.001 per share and with an aggregate liquidation preference and notional amount equal to $1,000 per share (the “Preferred Shares”), which were not offered as part of closing the indenture. For U.S. federal income tax purposes, the Issuer and Co-Issuer are disregarded entities.

The Notes are collateralized by interests in a pool of 28 mortgage assets having a total principal balance of $428.4 million (the “Mortgage Assets”) originated by a subsidiary of the Company. The sale of the Mortgage Assets to the Issuer is governed

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REALTY FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016

(Unaudited)

by a Mortgage Asset Purchase Agreement dated as of October 19, 2015, between the Company and the Issuer. In connection with the securitization, the Issuer and Co-Issuer offered and sold the following classes of Notes to third parties: Class A, Class B, Class C. A wholly owned subsidiary of the Company retained approximately $56.0 million of the total $76.0 million of Class C and all of the preferred equity in the Issuer. The retained Class C and its related interest income and the preferred equity are eliminated in the Company's consolidated financial statements. The Company, as the holder of preferred equity in the Issuer, will absorb the first losses of the CLO, which may have a negative impact to the Company's result of operations. The issuance of the CLO also results in an increase in interest expense within the consolidated statement of operations due to increased interest expense. The following table represents the terms of the CLO issued.



Facility ($000s)	Par Value Issued		Par Value Outstanding ^(*)		Interest Rate	Maturity Date
As of March 31, 2016
Tranche A	$	231,345	$	231,345	1M LIBOR + 175	8/1/2030
Tranche B	42,841		42,841		1M LIBOR + 388	8/1/2030
Tranche C	76,044		20,000		1M LIBOR + 525	8/1/2030
	$	350,230	$	294,186

As of December 31, 2015
Tranche A	$	231,345	$	231,345	1M LIBOR + 175	8/1/2030
Tranche B	42,841		42,841		1M LIBOR + 388	8/1/2030
Tranche C	76,044		20,000		1M LIBOR + 525	8/1/2030
	$	350,230	$	294,186

________________________

* Excludes $52,962 and $56,044 of Tranche C of RFT issued CLO held by the Company, which eliminates within the Real estate securities, at fair value line of the consolidated balance sheets as of March 31, 2016 and December 31, 2015, respectively.

The below represents the total assets and liabilities of the Company's only CLO. The CLO is considered a VIE and is consolidated into the Company's consolidated financial statements as of March 31, 2016 and December 31, 2015 as the Company is the primary beneficiary of the VIE. The Company is the primary beneficiary of the CLO because (i) the Company has the power to direct the activities that most significantly affect the VIE’s economic performance and (ii) the right to receive benefits from the VIE or the obligation to absorb losses of the VIE that could be significant to the VIE.



Assets ($000s)	March 31, 2016		December 31, 2015
Cash	$	5	$	5
Commercial mortgage loans, held for investment, net	426,447		426,155
Accrued interest receivable	1,076		1,048
Total Assets	$	427,528	$	427,208

Liabilities
Notes payable ⁽¹⁾⁽²⁾	$	343,096	$	342,998
Accrued interest payable	530		513
Total Liabilities	$	343,626	$	343,511

________________________

⁽¹⁾ Includes $55,776 and $55,769 of Tranche C of RFT issued CLO held by the Company, which eliminates within the Collateral loan obligations line of the consolidated balance sheets as of March 31, 2016 and December 31, 2015, respectively.

⁽²⁾ The balance is presented net of deferred financing cost and discount of $7,134 and $7,232 as of March 31, 2016 and December 31, 2015, respectively. The notes payable balance as of December 31, 2015 of $348,269 as disclosed in Note 5 to the consolidated financial statements included in the 2015 Form 10-K was not net of deferred financing cost of $5,271.

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REALTY FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016

(Unaudited)

Note 6 - Net Income Per Share

The following table is a summary of the basic and diluted net income per share computation for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2016 and 2015, ~~and 2014,~~ respectively:

Note 7 - Common Stock

As of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014,~~2015, the Company had ~~28,753,520~~31,645,633 and ~~15,472,192~~31,385,280 shares of common stock outstanding, respectively, including shares issued pursuant to the DRIP and unvested restricted shares. As of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014,~~2015, the Company had received total proceeds of ~~$714.2~~$755.5 million and ~~$384.2~~$755.5 million, respectively, ~~including~~excluding shares issued pursuant to the DRIP and share-based compensation.

On December 30, 2014, the Company filed with the Maryland State Department of Assessments and Taxation articles supplementary to its charter that reclassified 1,000 authorized but unissued shares of the Company’s common stock as shares of

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~~REALTY FINANCE TRUST, INC.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~September 30, 2015~~

~~(Unaudited)~~

convertible stock and set the terms of such convertible shares. The Company then issued 1,000 convertible shares to the Advisor for $1.00 per share. The convertible shares will automatically convert to shares of common stock upon the first occurrence of any of following triggering events (the "Triggering ~~Events"~~Event"): (i) the Company has paid total distributions on the then-outstanding shares of common stock in an amount equal to or in excess of the sum of the invested capital (as defined in the Company’s charter) plus an aggregate 6.0% cumulative, pre-tax, non-compounded, annual return on such invested capital, (ii) a listing of the Company’s shares of common stock on a national securities exchange ~~and~~or (iii) the termination of the Company’s advisory agreement under certain circumstances. In general, but with certain exceptions as outlined in the articles supplementary, each convertible share will convert into a number of common shares equal to 1/1000 of the quotient of (a) the conversion product (the product of 0.15 times the amount, if any, by which (i) the sum of the enterprise value as of the date of the Triggering Event plus total distributions paid to the Company’s stockholders through the date of the Triggering Event exceeds (ii) the sum of the Company's stockholders’ invested capital plus a 6.0% return as of the date of the Triggering Event) divided by (b) the quotient of the enterprise value divided by the number of shares of the Company’s common stock outstanding (on an as-converted basis) on the date of the Triggering Event. The conversion product will be reduced by the amounts payable pursuant to the annual subordinated performance fee as realized appreciation in the Company’s assets during the time that the Advisor or one of its affiliates acts as the Company’s advisor. As of March 31, 2016, the Triggering Event had not occurred.

In order to maintain its election to qualify as a REIT, the Company must currently distribute, at a minimum, an amount equal to 90% of its taxable income, without regard to the deduction for distributions paid and excluding net capital gains. The Company must distribute 100% of its taxable income (including net capital gains) to avoid paying corporate federal income taxes.

OnIn May ~~13,~~ 2013, the Company's board of directors ~~(the "Board")~~ authorized, and the Company declared, a distribution ~~which is calculated based~~payable on a monthly basis to stockholders of record on each day ~~during the applicable period in an amount~~at a rate equal to $~~0.00565068493~~$0.00565068493 per ~~day.~~day, which is equivalent to $2.0625 per annum, per share of common stock . In March 2016, the Company's board of directors ratified the existing distribution amount a change to the daily distribution amount equivalent to $2.0625 per annum and for calendar year 2016, affirmed a change to the daily distribution amount to $0.0056352459 per day per share of common stock, effective January 1, 2016, to accurately reflect that 2016 is a leap year. The Company's distributions are payable by the fifth day following each month end to stockholders of record at the close of business each day during the prior month. Distribution payments are dependent on the availability of funds. The Board may reduce the amount of distributions paid or suspend distribution payments at any time, and therefore, distributions payments are not assured. The Company distributed ~~$31.8~~$16.2 million during the ~~nine~~three months ended ~~September 30, 2015,~~ March 31, 2016,

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REALTY FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016

(Unaudited)

comprised of ~~$18.2~~$9.6 million in cash and ~~$13.6~~$6.6 million in shares of common stock issued under the DRIP. The Company distributed ~~$12.6~~$47.1 million during the year ended December 31, ~~2014,~~2015, comprised of ~~$7.6~~$26.9 million in cash and ~~$5.0~~$20.2 million in shares of common stock issued under the DRIP.

Share Repurchase Program

The Company did not sell any equity securities that were not registered under the Securities Act during the three months ended March 31, 2016.

The Company's Board unanimously approved an amended and restated share repurchase program (the “SRP”), which became effective on February 28, 2016. The SRP enables stockholders to sell their shares to the Company. Subject to certain conditions, stockholders that purchased shares of the Company's common stock or received their shares from us (directly or indirectly) through one or more non-cash transactions and have held their shares for a period of at least one year may request that the Company repurchase their shares of common stock so long as the repurchase otherwise complies with the provisions of Maryland law. Repurchase requests made following the death or qualifying disability of a stockholder will not be subject to any minimum holding period.

The repurchase price per share for requests other than for death or disability will be equal to the most-recent estimated net asset value per share of the Company's common stock calculated by the Company's Advisor and approved by the Company's board of directors in accordance with the Company's valuation guidelines, or estimated per-share NAV, multiplied by a percentage equal to (i) 92.5%, if the person seeking repurchase has held his or her shares for a period greater than one year and less than two years; (ii) 95%, if the person seeking repurchase has held his or her shares for a period greater than two years and less than three years; (iii) 97.5%, if the person seeking repurchase has held his or her shares for a period greater than three years and less than four years; or (iv) 100%, if the person seeking repurchase has held his or her shares for a period greater than four years. In the case of requests for death or disability, the repurchase price per share will be equal to the estimated per-share NAV at the time of repurchase.

Repurchases pursuant to the SRP, when requested, generally will be made semiannually (each six-month period ending June 30 or December 31, a “fiscal semester”). Repurchases for any fiscal semester will be limited to a maximum of 2.5% of the weighted average number of shares of common stock outstanding during the previous fiscal year, with a maximum for any fiscal year of 5.0% of the weighted average number of shares of common stock outstanding during the previous fiscal year. Funding for repurchases pursuant to the SRP for any given fiscal semester will be limited to proceeds received during that same fiscal semester through the issuance of common stock pursuant to any DRIP in effect from time to time, provided that the Board has the power, in its sole discretion, to determine the amount of shares repurchased during any fiscal semester as well as the amount of funds to be used for that purpose. Any repurchase requests received during such fiscal semester will be paid at a price based on the Company's estimated per share NAV applicable on the last day of such fiscal semester, as described above. Due to these limitations, the Company cannot guarantee that the Company will be able to accommodate all repurchase requests made during any fiscal semester or fiscal year. However, a stockholder may withdraw its request at any time or ask that the Company honors the request when funds are available. Pending repurchase requests will be honored on a pro rata basis. The Company will generally pay repurchase proceeds, less any applicable tax or other withholding required by law, by the 31st day following the end of the fiscal semester during which the repurchase request was made.

Calculations of the Company's estimated per-share NAV will occur periodically, at the discretion of the Board, provided that such calculations will be made at least annually. Following its calculation, the Company's estimated per-share NAV will be disclosed in a periodic report. The most recent calculation of the Company's estimated per-share NAV approved by the Board occurred on November 4, 2015 based on the Company's net asset value as of September 30, 2015 and was equal to $25.27.

When a stockholder requests redemption and the redemption is approved, the Company will reclassify such obligation from equity to a liability based on the settlement value of the obligation. Shares repurchased under the SRP will have the status of authorized but unissued shares.

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REALTY FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016

(Unaudited)

The following table reflects the number of shares repurchased under the SRP cumulatively through March 31, 2016:



	Number of Requests	Number of Shares Repurchased	Average Price per Share
Cumulative as of December 31, 2015	301	381,474	23.72
January 1 - January 31, 2016	—	—	—
February 1 - February 29, 2016	—	—	—
March 1 - March 31, 2016	—	—	—
Cumulative as of March 31, 2016	301	381,474	23.72

Note 8 - Commitments and Contingencies

Unfunded Commitments Under Commercial Mortgage Loans

As of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014,~~2015, the Company had the below unfunded commitments which will generally be funded to finance capital expenditures by the Company's borrowers.

Litigation and Regulatory Matters

In the ordinary course of business, the Company may become subject to litigation, claims and regulatory matters. The Company has no knowledge of material legal or regulatory proceedings pending or known to be contemplated against the Company at this time.

Note 9 - Related Party Transactions and Arrangements

As of March 31, 2016 and December 31, 2015, an entity wholly-owned by the Sponsor owned 8,888 shares of the Company’s outstanding common stock.

Realty Capital Securities, LLC (the "Former Dealer Manager") served as the dealer manager of the Company's Offering through December 31, 2015. American National Stock Transfer, LLC, a subsidiary of the parent company of the Former Dealer Manager ("ANST"), provided the Company with transfer agency services through February 2016. RCS Capital Corporation, the parent company of the Company's Former Dealer Manager and certain of its affiliates that provided the Company with services, filed for Chapter 11 bankruptcy protection in January 2016, prior to which it was also under common control with AR Global, the parent of the Company's Sponsor.

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REALTY FINANCE TRUST, INC.

NOTES TO ~~CONDENSED~~ CONSOLIDATED FINANCIAL STATEMENTS

~~September 30, 2015~~March 31, 2016

(Unaudited)

~~As of~~ ~~September 30, 2015~~ ~~and December 31, 2014, an entity wholly-owned by the Sponsor owned 8,888 shares of the Company’s outstanding common stock and the Advisor owned 1,000 shares of the Company's convertible stock.~~

Fees Paid in Connection with the Offering

The Former Dealer Manager ~~receives~~received fees and compensation in connection with the sale of the Company’s common stock in the Offering. The Former Dealer Manager ~~receives~~received a selling commission of up to ~~7.0%~~7% of the per share purchase price of the Company's offering proceeds before reallowance of commissions earned by soliciting dealers. In addition, the Former Dealer Manager ~~receives~~received up to ~~3.0%~~3% of the gross proceeds from the sale of shares, before reallowance to soliciting dealers, as a dealer manager fee. The Former Dealer Manager ~~may~~was permitted to reallow its dealer manager fee to such soliciting dealers. A soliciting dealer ~~may~~was permitted to elect to receive a fee equal to 7.5% of the gross proceeds from the sale of shares (not including selling commissions and dealer manager fees) by such soliciting dealer, with 2.5% thereof paid at the time of such sale and ~~1.0%~~1% thereof paid on each anniversary of the closing of such sale up to and including the fifth anniversary of the closing of such sale. If this option iswas elected, the dealer manager fee ~~will be~~was reduced to 2.5% of gross proceeds (not including selling commissions and ~~dealer manager fees).~~

~~The table below shows the fees incurred from the~~Former Dealer Manager associated with the Offering during the three and nine months ended September 30, 2015 and 2014, respectively, and the associated payable as of September 30, 2015 and December 31, 2014, respectively (in thousands):

Three Months Ended September 30, Nine Months Ended September 30, Payable as of
2015 2014 2015 2014 September 30, 2015 December 31, 2014
Total commissions and fees incurred from the Dealer Manager $ 9,932
$ 12,568
$ 30,700
$ 23,395
$ 240
$ 119
fees).

The ~~Advisor, its affiliates, entities under common control~~predecessor to AR Global is a party to a services agreement with ~~the Advisor and the Dealer Manager receive compensation and reimbursement for services relating to the Offering.~~

~~An affiliate of the Company,~~ RCS Advisory Services, LLC, ~~("RCS"~~a subsidiary of the parent company of the Former Dealer Manager (“RCS Advisory”), ~~is an entity under common control~~pursuant to which RCS Advisory and its affiliates provided the Company and certain other companies sponsored by AR Global with ~~the Sponsor. RCS performs legal,~~services (including, without limitation, transaction management, compliance, due diligence, event coordination and marketing services, ~~for the Company.~~among others) on a time and expenses incurred basis or at a flat rate based on services performed. The predecessor to AR Global instructed RCS Advisory to stop providing such services in November 2015 and no services have since been provided by RCS Advisory.

~~An affiliate of the~~The Company was also party to a transfer agency agreement with American National Stock Transfer, LLC, ~~(the "Transfer Agent"~~a subsidiary of the parent company of the Former Dealer Manager (“ANST”), ~~is an entity under common control with the Sponsor. The Transfer Agent provides~~pursuant to which ANST provided the Company with transfer ~~agent, registrar~~agency services (including broker and stockholder servicing, transaction processing, year-end IRS reporting and other services), and supervisory ~~services.~~

~~An affiliate~~services overseeing the transfer agency services performed by a third-party transfer agent. AR Global received written notice from ANST on February 10, 2016 that it would wind down operations by the end of the month and would withdraw as the transfer agent effective February 29, 2016. Subsequently, effective February 26, 2016, the Company ~~SK Research, LLC ("SK Research")~~entered into a definitive agreement with DST Systems, Inc., ~~is an entity under common control~~a third-party and its previous provider of sub-transfer agency services, to provide the Company directly with ~~the Sponsor. SK Research provides broker-dealers~~transfer agency services (including broker and ~~financial advisors with the research, critical thinking~~stockholder servicing, transaction processing, year-end IRS reporting and ~~analytical resources necessary to evaluate the viability, utility and performance of investment programs.~~ other services).

The table below shows the compensation and reimbursement to the Advisor, its affiliates, ~~and~~ entities under common control with the Advisor and the Former Dealer Manager incurred for services relating to the Offering during the three ~~and nine~~ months ended ~~September 30,~~March 31, 2016 and 2015, ~~and 2014,~~ respectively, and the associated payable as of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014,~~2015, respectively (in thousands):

Three Months Ended September 30, Nine Months Ended September 30, Payable as of
2015 2014 2015 2014 September 30, 2015 December 31, 2014
Total compensation and reimbursement for services provided by the Advisor, its affiliates, entities under common control with the Advisor and the Dealer Manager $ 1,957
$ 466
$ 5,805
$ 1,277
$ 263
$ 1,725



	Three Months Ended March 31,				Payable as of
	2016		2015		March 31, 2016		December 31, 2015
Total commissions and fees incurred from the Former Dealer Manager	$	—	$	9,247	$	—	$	—

Total compensation and reimbursement for services provided by the Advisor, its affiliates, entities under common control with the Advisor and the Former Dealer Manager	$	—	$	1,962	$	472	$	480

The payables as of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014~~2015 in the table above are included in ~~"due~~"Due to ~~affiliate"~~affiliates" on the Company's ~~condensed~~ consolidated balance sheets. The fees incurred are recorded within additional paid in capital line in the consolidated balance sheets.

The Company is responsible for organizational and offering costs from the ongoing Offering, excluding commissions and ~~dealer manager~~Former Dealer Manager fees, up to a maximum of 2.0% of gross proceeds from its ongoing Offering of common stock, measured at the end of the Offering. Organizational and offering costs in excess of the 2.0% cap as of the end of the Offering are the Advisor's responsibility. As of ~~September 30,~~March 31, 2016 and December 31, 2015, organizational and offering costs exceeded ~~the~~ 2.0% of cap of gross proceeds received from the Offering by ~~$0.1 million.~~$0.8 million and $0.8 million, respectively which has been recorded in Additional Paid-In Capital of the Company's financial statements as the Advisor has not reimbursed the Company for these costs.

1416

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REALTY FINANCE TRUST, INC.

NOTES TO ~~CONDENSED~~ CONSOLIDATED FINANCIAL STATEMENTS

~~September 30, 2015~~March 31, 2016

(Unaudited)

Fees Paid in Connection with the Operations of the Company

The Advisor receives an acquisition fee of 1.0% of the principal amount funded by the Company to originate or acquire commercial mortgage loans and 1.0% of the anticipated net equity funded by the Company to acquire real estate securities. The Company reimburses the Advisor for expenses incurred by the Advisor on behalf of the Company related to selecting, evaluating, originating and acquiring investments in an amount up to 0.5% of the principal amount funded by the Company to originate or acquire commercial mortgage loans and up to 0.5% of the anticipated net equity funded by the Company to acquire real estate securities investments. In no event will the total of all acquisition fees and acquisition expenses exceed 4.5% of the principal amount funded with respect to the Company's total portfolio including subsequent fundings to investments in the Company's portfolio. During the ~~nine~~three months ended ~~September 30,~~March 31, 2016 and 2015, ~~and 2014,~~ acquisition fees of ~~$6.0~~$0.2 million and ~~$2.9~~$1.0 million, respectively, have been recognized in the ~~condensed~~Acquisition fees within the consolidated statement of operations. In addition, ~~over~~for the ~~same periods,~~three months ended March 31, 2015 the Company capitalized ~~$2.2~~$0.7 million, ~~and $0.9 million, respectively,~~ of acquisition expenses toin Commercial mortgage loans line within the Company's ~~condensed~~ consolidated balance sheets, which will be amortized over the life of each investment using the effective interest method. The Company did not capitalize any acquisitions expenses for the three months ended March 31, 2016.

The Company pays the Advisor, or its affiliates, a monthly asset management fee equal to one-twelfth of 0.75% of the cost of the Company's assets. Commencing on the NAV pricing date, the asset management fee ~~will be~~is based on the lower of the cost of the Company's assets and the fair value of the Company's assets (fair value will consist of the market value of each portfolio investment as determined by the Advisor in accordance with the Company's valuation guidelines). During the ~~nine~~three months ended ~~September 30,~~March 31, 2016 and 2015, ~~and 2014,~~ the Company incurred $2.4 million and ~~$0.0 million~~$0 in asset management fees, ~~respectively.~~respectively, which are recorded in Asset management and subordinated performance fee within the statement of operations. Prior to June 17, 2015, the amount of the asset management fee was reduced to the extent that funds from operations as defined by the National Association of Real Estate Investment Trusts ("FFO"), as adjusted, during the six month period ending on the last day of the calendar quarter immediately preceding the date such asset management fee was payable, was less than distributions declared during the same period. For purposes of this determination, FFO, as adjusted, is FFO adjusted to (i) include acquisition fees and acquisition expenses; (ii) include non-cash restricted stock grant amortization, if any; and (iii) impairments and loan loss reserves on investments, if any (including commercial mortgage loans and other debt investments). FFO, as adjusted, is not the same as FFO.

The Company will pay the Advisor, an annual subordinated performance fee calculated on the basis of total return to stockholders, payable monthly in arrears, such that for any year in which total return on stockholders’ capital exceeds 6.0% per annum, the Advisor will be entitled to 15.0% of the excess total return; provided that in no event will the annual subordinated performance fee payable to the Advisor exceed 10.0% of the aggregate total return for such year. This fee will be payable only upon the sale of assets, distributions or other ~~event~~events which ~~results~~result in the Company's return on stockholders’ capital exceeding 6.0% per annum. During the ~~nine~~three months ended ~~September 30,~~March 31, 2016 and 2015, ~~and 2014,~~ the Company incurred an annual subordinated performance fee of ~~$1.4~~$0.6 million and $0.4 million, ~~respectively.~~respectively, which are recorded in Asset management and subordinated performance fee within the statement of operations.

Effective June 1, 2013, the Company entered into an agreement with the Former Dealer Manager to provide strategic advisory services and investment banking services required in the ordinary course of the Company's business, such as performing financial analysis, evaluating publicly traded comparable companies and assisting in developing a portfolio composition strategy, a capitalization structure to optimize future liquidity options and structuring operations. The Company prepaid the cost of an one-time $0.9 million associated with this agreement and amortizes the cost over the estimated life of the Offering into ~~"Other expenses"~~Other expenses on the Company's ~~condensed~~ consolidated ~~statement~~statements of operations. ~~The~~For period ending December 31, 2015, the Company had approximately $6,000 of unamortized cost. There was no remaining unamortized cost ~~associated with this agreement is included in "Prepaid expenses~~as of March 31, 2016 and ~~other assets" on the Company's condensed consolidated balance sheet.~~these services are no longer being provided.

The table below depicts related party fees and reimbursements in connection with the operations of the Company for the three ~~and nine~~ months ended ~~September 30,~~March 31, 2016 and 2015 ~~and 2014~~ and the associated payable as of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014~~2015 (in ~~thousands):~~

Three Months Ended September 30, Nine Months Ended September 30, Payable as of
2015 2014 2015 2014 September 30, 2015 December 31, 2014
Acquisition fees and expenses ^(*)
$ 572
$ 2,657
$ 8,441
$ 4,349
$ 19
$ —
Advisory and investment banking fee 14
135
42
405
—
—
Asset management and subordinated performance fee 2,405
414
3,741
414
3,381
191
Total related party fees and reimbursements $ 2,991
$ 3,206
$ 12,224
$ 5,168
$ 3,400
$ 191

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REALTY FINANCE TRUST, INC.

NOTES TO ~~CONDENSED~~ CONSOLIDATED FINANCIAL STATEMENTS

~~September 30, 2015~~March 31, 2016

(Unaudited)

thousands):



	Three Months Ended March 31,					Payable as of
	2016			2015		March 31, 2016		December 31, 2015
Acquisition fees and expense and others ^(*)	$	157		$	1,781	$	—	$	55
Administrative services and expenses	816		—	—		187		—
Advisory and investment banking fee	6			14		—		—
Asset management and subordinated performance fee	3,010			362		3,683		3,792
Other related party expenses	26			21		61		—
Total related party fees and reimbursements	$	4,015		$	2,178	$	3,931	$	3,847

________________________

* Includes amortization of capitalized acquisition fees and expenses.

In order to improve operating cash flows and the ability to pay distributions from operating cash flows, the Advisor may elect to waive certain fees. Because the Advisor may waive certain fees, cash flows from operations that would have been paid to the Advisor may be available to pay distributions to stockholders. The fees that may be forgiven are not deferrals and accordingly, will not be paid to the Advisor. The Advisor has also permanently waived a portion of the acquisition fees and expenses earned on the acquisition of the Company's CMBS in the amount of $0.1 million ~~and $0.5 million~~ for the ~~nine~~three months ended ~~September 30, 2015~~March 31, 2015. The Company did not purchase any CMBS positions during the three months ended March 31, 2016 as such did not incur any acquisition fees and ~~2014, respectively.~~expenses for CMBS purchases.

Subject to the limitations outlined below, the Company will reimburse the Advisor's cost of providing administrative services and personnel costs in connection with other services during the operational stage, in addition to paying an asset management fee; however, the Company will not reimburse the Advisor for personnel costs in connection with services for which the Advisor receives acquisition fees or disposition fees. For the ~~nine~~three months ended ~~September 30, 2015 and 2014, no~~March 31, 2016, the Company reimbursed the Advisor $0.8 million of administrative costs ~~of the Advisor were reimbursed for any period~~ in connection with the operations of the Company. The Company did not incur such expense for the three months ended March 31, 2015.

The Advisor must pay any expenses in which the Company's ~~total~~ operating expenses as defined by North American Securities Administrators Association at the end of the four preceding fiscal quarters exceeds the greater of (i) 2.0% of average invested assets or (ii) 25.0% of net income ~~other than any additions to reserves~~ for depreciation, bad debt or other similar non-cash reserves and excluding any gain from the sale of assets for that period, unless a majority of the Company's independent directors determine the excess expenses were justified based on unusual and nonrecurring factors.

The Advisor at its election may also contribute capital to enhance the Company’s cash position for working capital and distribution purposes. Any contributed capital amounts are not reimbursable to the Advisor. Further, any capital contributions are made without any corresponding issuance of common or preferred shares. The Advisor did not contribute capital to enhance the Company's cash position for working capital or distribution purposes during the nine months ended September 30, 2015 or 2014.such expense year.

Fees Paid in Connection with the Liquidation of Assets, or Listing of the Company's Common Stock or Termination of the Advisory Agreement

The Company will pay a disposition fee of 1.0% of the contract sales price of each commercial mortgage loan or other investment sold, including CMBS or CDOs issued by a subsidiary of the Company as part of a securitization transaction. The Company will not be obligated to pay a disposition fee upon the maturity, prepayment, workout, modification or extension of commercial real estate debt unless there is a corresponding fee paid by the borrower, in which case the disposition fee will be the lesser of (i) 1.0% of the principal amount of the debt prior to such transaction; or (ii) the amount of the fee paid by the borrower in connection with such transaction. If the Company takes ownership of a property as a result of a workout or foreclosure of a loan, it will pay a disposition fee upon the sale of such property.

On December 30, 2014, the Company issued 1,000 convertible shares to the Advisor for $1.00 per share. The convertible shares issued to the Advisor will automatically convert to shares of the Company’s common stock upon the first to occur of any of the Triggering Events described in Note 7.

During the ~~nine~~three months ended ~~September 30,~~March 31, 2016 and 2015, ~~and 2014,~~ no fees were paid in connection with the liquidation of assets, listing of the Company's common stock or termination of the advisory agreement.

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REALTY FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016

(Unaudited)

The Company has also established a restricted share plan for the benefit of employees, directors, employees of the Advisor and its affiliates.

Note 10 - Fair Value of Financial Instruments

GAAP establishes a hierarchy of valuation techniques based on the observability of inputs used in measuring financial instruments at fair values. GAAP establishes market-based or observable inputs as the preferred source of values, followed by valuation models using management assumptions in the absence of market inputs. The three levels of the hierarchy are described below:

Level I - Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date.

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~~REALTY FINANCE TRUST, INC.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~September 30, 2015~~

~~(Unaudited)~~

Level II - Inputs (other than quoted prices included in Level I) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life.

Level III - Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model.

The determination of where an asset or liability falls in the above hierarchy requires significant judgment and factors specific to the asset or liability. In instances where the determination of the fair value measurement is based on inputs from different levels of the fair value hierarchy, the level in the fair value hierarchy within which the entire fair value measurement falls is based on the lowest level input that is significant to the fair value measurement in its entirety. The Company evaluates its hierarchy disclosures each quarter and depending on various factors, it is possible that an asset or liability may be classified differently from quarter to quarter.

The Company has implemented valuation control processes to validate the fair value of the Company's financial instruments measured at fair value including those derived from pricing models. These control processes are designed to assure that the values used for financial reporting are based on observable inputs wherever possible. In the event that observable inputs are not available, the control processes are designed to assure that the valuation approach utilized is appropriate and consistently applied and the assumptions are reasonable.

CMBS are valued utilizing both observable and unobservable market inputs. These factors include projected future cash flows, ratings, subordination levels, vintage, remaining lives, credit issues, recent trades of similar real estate securities and the spreads used in the prior valuation. The Company obtains current market spread information where available and uses this information in evaluating and validating the market price of all real CMBS. Depending upon the significance of the fair value inputs used in determining these fair values, these real estate securities are classified in either Level II or Level III of the fair value hierarchy. As of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014,~~2015, the Company received broker quotes on each CMBS investment used in determining the fair ~~value. As of~~ ~~September 30, 2015~~value and ~~December 31, 2014, the Company's CMBS investments~~ have been classified as Level II due to the observable nature of many of the market inputs.

The following table presents the Company's financial instrument carried at fair value on a recurring basis in the ~~condensed~~ consolidated balance sheet by its level in the fair value hierarchy as of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014~~2015 (in thousands):

Total Level I Level II Level III
September 30, 2015
Real estate securities $ 100,959
$ —
$ 100,959
$ —
Repurchase agreements - commercial mortgage loans 376,090
—
376,090
—
Repurchase agreements - real estate securities 72,597
—
72,597
—
December 31, 2014

Real estate securities 50,234
—
50,234
—
Repurchase agreements - commercial mortgage loans 150,169
—
150,169
—
Repurchase agreements - real estate securities 26,269
—
26,269
—



	Total		Level I		Level II		Level III
March 31, 2016
Real estate securities	$	124,871	$	—	$	124,871	$	—
December 31, 2015
Real estate securities	130,754		—		130,754		—

A review of the fair value hierarchy classification is conducted on a quarterly basis. Changes in the type of inputs may result in a reclassification for certain assets. The Company's policy with respect to transfers between levels of the fair value hierarchy is to recognize transfers into and out of each level as of the beginning of the reporting period. There were no transfers between levels within fair value hierarchy during the ~~nine~~three months ended ~~September 30, 2015~~March 31, 2016 and ~~2014.~~2015. There are no financial instruments carried at fair value on a non-recurring basis as of March 31, 2016 and December 31, 2015.

The fair value of cash and cash equivalents and restricted cash are measured using observable quoted market prices, or Level I inputs. The fair value of short-term financial instruments, such as accrued interest receivable, prepaid expenses and

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REALTY FINANCE TRUST, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

March 31, 2016

(Unaudited)

other assets, accounts payable and accrued expenses, distributions payable, interest payable, borrowings under repurchase agreements and due to affiliate ~~are approximated by~~approximate their carrying value on the ~~condensed~~ consolidated balance sheets due to their short-term nature, and are measured using Level II inputs.

The fair values of the Company's commercial mortgage loans and collateralized loan obligations, which are not reported at fair value on the ~~condensed~~ consolidated balance sheets are reported below as of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014~~2015 (in thousands):

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~~REALTY FINANCE TRUST, INC.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~September 30, 2015~~

~~(Unaudited)~~

Level Carrying Value Fair Value
September 30, 2015 III $ 939,704
$ 1,063,976
December 31, 2014 III 457,454
474,932



		Level	Carrying Amount		Fair Value
March 31, 2016
Commercial mortgage loans	Asset	III	$	1,127,403	$	1,133,935
Collateralized loan obligation	Liability	II	287,320		289,080
December 31, 2015
Commercial mortgage loans	Asset	III	1,125,089		1,138,841
Collateralized loan obligation	Liability	II	287,229		289,733

The fair value of the commercial mortgage loans is estimated using a discounted cash flow analysis, based on the Advisor's experience with similar types of investments. The Company received broker quotes for each tranche of CLO to determine the fair value of the debt.

Note 11 - Offsetting Assets and Liabilities

The Company's ~~condensed~~ consolidated balance sheets used a gross presentation of repurchase ~~agreements.~~agreements and collateral pledged. The table below provides a gross presentation, the effects of offsetting and a net presentation of the Company's repurchase agreements within the scope of ASC 210-20, Balance Sheet—Offsetting, as of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014,~~2015, respectively (in thousands):

Gross Amounts Not Offset on the Balance Sheet
Repurchase Agreements Gross Amounts of Recognized Liabilities Gross Amounts Offset on the Balance Sheet Net Amount of Liabilities Presented on the Balance Sheet Financial Instruments Cash Collateral Pledged Net Amount
September 30, 2015
Commercial mortgage loans $ 376,090
$ —
$ 376,090
$ 527,071
$ —
$ —
Real estate securities 72,597
—
72,597
98,504
1,407
—
December 31, 2014
Commercial mortgage loans 150,169
—
150,169
301,704
—
—
Real estate securities 26,269
—
26,269
38,833
68
—



							Gross Amounts Not Offset on the Balance Sheet
Repurchase Agreements	Gross Amounts of Recognized Liabilities		Gross Amounts Offset on the Balance Sheet		Net Amount of Liabilities Presented on the Balance Sheet		Financial Instruments as Collateral Pledged		Cash Collateral Pledged		Net Amount
March 31, 2016
Commercial mortgage loans	$	243,583	$	—	$	243,583	$	377,231	$	5,000	$	—
Real estate securities ^(*)	120,449		—		120,449		179,628		1,498		—
December 31, 2015
Commercial mortgage loans	206,239		—		206,239		355,802		5,000		—
Real estate securities ^(*)	117,211		—		117,211		171,071		366		—

* Includes $56,044 and $56,044 Tranche C of RFT issued CLO held by the Company, which eliminates within the Repurchase agreement-real estate securities line of the consolidated balance sheets as of March 31, 2016 and December 31, 2015, respectively.

Note 12 - Segment Reporting

The Company conducts its business through the following segments:

The real estate debt business focuses on originating, acquiring and asset managing commercial real estate debt investments, including first mortgage loans, subordinate mortgages, mezzanine loans and participations in such loans.

The real estate securities business focuses on investing in and asset managing commercial real estate securities primarily consisting of CMBS and may include unsecured REIT debt, CDO notes and other securities.

1820

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REALTY FINANCE TRUST, INC.

NOTES TO ~~CONDENSED~~ CONSOLIDATED FINANCIAL STATEMENTS

~~September 30, 2015~~March 31, 2016

(Unaudited)

The following table represents the Company's operations by segment for the ~~nine~~three months ended ~~September 30,~~March 31, 2016 and 2015 ~~and 2014~~ (in thousands):

Nine Months Ended September 30, 2015 Total Real Estate Debt Real Estate Securities
Interest income $ 38,341
$ 36,303
$ 2,038
Interest expense 7,925
7,323
602
Net income 16,360
15,853
507
Total assets 1,064,412
961,455
102,957
Weighted average income earning assets 763,656
687,454
76,202
Weighted average asset yield 6.7 % 7.0 % 3.6 %
Average interest bearing liabilities 306,396
257,868
48,528
Average yield on liabilities 3.4 % 3.8 % 1.7 %
Net Interest Margin 3.3 % 3.2 % 1.9 %
Nine Months Ended September 30, 2014
Interest income 7,514
7,162
352
Interest expense 803
696
107
Net income (loss) 1,761
2,041
(280 )
Total assets 358,442
319,871
38,571
Weighted average income earning assets 153,312
135,163
18,149
Weighted average asset yield 6.5 % 7.1 % 2.6 %
Average interest bearing liabilities 38,690
29,899
8,791
Average yield on liabilities 2.8 % 3.1 % 1.6 %
Net Interest Margin 3.7 % 4.0 % 1.0 %



Three Months Ended March 31, 2016	Total		Real Estate Debt		Real Estate Securities
Interest income	$	20,291	$	18,676	$	1,615
Interest expense	4,768		4,091		677
Net income	9,420		9,059		361
Three Months Ended March 31, 2015
Interest income	9,605		9,196		409
Interest expense	1,933		1,804		129
Net income	4,632		4,546		86

The following table represents the Company's total assets by segment as of March 31, 2016 and December 31, 2015 (in thousands):



As of March 31, 2016	Total		Real Estate Debt		Real Estate Securities
Total Assets	$	1,312,738	$	1,186,001	$	126,737

As of December 31, 2015
Total Assets	1,282,484		1,150,858		131,626

For the purposes of the table above, any expenses ~~unallocable to~~not associated with a specific ~~segments~~segment have been allocated to the business segments using a percentage derived by using the sum of commercial mortgage loans, net and real estate securities, at fair value as the denominator and commercial mortgage loans, net and real estate securities, at fair value as the numerators.

Note 13 - Subsequent Events

The Company has evaluated subsequent events through the filing of this Quarterly Report on Form 10-Q and determined that there have not been any events that have occurred that would require adjustments to disclosures in the ~~condensed~~ consolidated financial statements except for the following transactions:

~~Sales of Common Stock~~

As of October 31, 2015, the Company had 30,416,283 shares of common stock outstanding, including shares issued under the DRIP and unvested restricted shares and has raised total proceeds from the Offering as follows (in thousands):

Source of Capital Inception to September 30, 2015 October 1, 2015 to October 31, 2015 Total
Common stock $ 714,236
$ 42,227
$ 756,463

Distributions Paid

On ~~October~~April 1, ~~2015~~,2016, the Company paid a distribution of ~~$4.8~~$5.5 million to stockholders of record during the month of ~~September 2015~~.March 2016. The Company paid ~~$2.7~~$3.3 million of the distribution in cash, while ~~$2.0~~$2.2 million was used to purchase ~~85,971~~86,595 shares through the DRIP.

~~Commercial Mortgage Loans~~Formation of Special Committee

~~For the period from October 1, 2015 to October 31, 2015~~On May 6, 2016, the Company ~~has originated and acquired commercial mortgage loans~~announced that the Company’s Board, with the unanimous agreement of all directors, had recently formed a special committee, consisting exclusively of independent directors, to explore a potential strategic transaction with a ~~total par value of $162.7 million.~~

~~Financing~~

~~On October 19, 2015, two~~related party. The Board granted the special committee the exclusive authority to consider, review, evaluate and, if appropriate, negotiate a strategic transaction on behalf of the ~~Company's consolidated subsidiaries, RFT 2015-FL1 Issuer, Ltd. (the “Issuer”)~~Company. In addition, the Board granted the special committee the authority, when considering such strategic transaction, to solicit expressions of interest or other proposals for, and ~~RFT 2015-FL1 Co-Issuer, LLC (the “Co-Issuer”~~to consider, any alternative transactions. These transactions may include a possible sale or merger with one or more related or unrelated entities, listing the Company’s shares on a national exchange or the sale of assets.

The special committee has retained special legal counsel and ~~together with~~is in the ~~Issuer, the “Issuers”), issued notes with an aggregate principal amount~~process of ~~$350.2 million (the “Notes”), evidencing~~engaging a ~~commercial~~leading real estate ~~mortgage securitization, and sold such Notes~~investment banking group as financial advisor. To date, the special committee has not engaged in a

~~Table of Contents~~

~~REALTY FINANCE TRUST, INC.~~

~~NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS~~

~~September 30, 2015~~

~~(Unaudited)~~

private placement. A separate consolidated subsidiary of the Company purchased $56.0 million of the Notes. Simultaneously with the issuance of the Notes, the Issuer issued and sold preferred shares (the “Preferred Shares”) with an aggregate liquidation preference and notional amount equal to $78.1 million to a consolidated subsidiary of the Company.

The Notes were issued pursuant to an indenture (the “Indenture”), dated as of October 19, 2015 (the “Closing Date”), by and among the Issuers, Realty Finance Operating Partnership, L.P. (the “Advancing Agent”) and U.S. Bank, National Association (the “Trustee” and the “Note Administrator”).

~~Determination of Net Asset Value per Share~~

On November 4, 2015, the Company’s board of directors unanimously determined an estimated NAV per share of the Company’s common stock of $25.27 as of September 30, 2015. The estimated NAV per share is based upon the estimated value of the Company’s assets less the Company’s liabilities as of September 30, 2015. Duff & Phelps, LLC, an independent third-party real estate advisory firm, performed appraisals of the Company’s assets in accordance with the Company’s valuation guidelines. The Advisor calculated the estimated NAV per share, and the conflicts committee of the Company’s board of directors, which is comprised solely of the Company’s independent directors, approved and recommended to the board of directors the estimated NAV per share calculated by the Advisor. The valuation was performed in accordance with the provisions of Practice Guideline 2013-01, Valuations of Publicly Registered Non-Listed REITs, issued by the Investment Program Association in April 2013.

On November 4, 2015, the Company’s board of directors unanimously determined, effective as of the NAV pricing date, (i) to change the purchase price for shares issued in the Company’s primary offering to equal the estimated NAV per share plus applicable selling commissions and fees; (ii) to change the purchase price for shares issued pursuant to the DRIP to equal the estimated NAV per share; and (iii) to change the repurchase price of shares under the SRP to equal,any substantive discussions or be at a discount from, the estimated NAV per share. Accordingly, the Company (i) will offer shares in the primary offering at a purchase price of $28.08; (ii) will offer shares pursuant to the DRIP at a purchase price of $25.27; and (iii) will repurchase shares pursuant to the SRP at a repurchase price of $25.27, subject to discounts in certain circumstances and subjectnegotiations related to the terms ~~and conditions~~ of a transaction with this related party or any other party. In addition, there has not been any exchange of information or any entry into non-disclosure agreements with any party. There are no assurances that the ~~SRP.~~

~~Sponsor Transactions~~

On November 9, 2015, the Sponsor advised the Company that AR Capital and Apollo Global Management, LLC (NYSE: APO) (together with its consolidated subsidiaries, “Apollo”) have mutually agreed to terminate an agreement, dated asconsideration of ~~August 6, 2015, pursuant to which Apollo would have purchased a controlling interest~~any strategic alternative will result in a ~~newly formed company that would have owned a majority of~~transaction. The Company does not intend to comment on or disclose developments regarding the ~~ongoing asset management business of AR Capital. The termination has no effect on the Company’s current management team.~~

Also on November 9, 2015, RCS Capital Corporation (“RCS Capital”), the parent of the Dealer Manager and a company under common control with AR Capital, and Apollo announced that they have mutually agreed to amend an agreement (the “RCS Agreement”), dated as of August 6, 2015, pursuant to which RCS Capital will sell its wholesale distribution business, including the Dealer Manager, to an affiliate of Apollo. This transactionprocess unless it deems further disclosure is subject to customary closing conditions and regulatory approvals and is expected to close early in the first quarter of 2016. The Transfer Agent and RCS will remain as subsidiaries of RCS Capital and will continue to provide services to the Company.appropriate or required.

~~Table of Contents~~

Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations

The following discussion should be read in conjunction with the accompanying ~~condensed~~ consolidated financial statements of ~~the Company. the~~Realty Finance Trust, Inc. The notes thereto and other financial information included elsewhere in this Quarterly Report on Form 10-Q as well as our Annual Report on Form 10-K for the fiscal year ended December 31, ~~2014~~2015 filed with the U.S. Securities and Exchange Commission (the "SEC") on ~~April 24, 2015, as amended by the Form 10-K/A filed with the SEC on April 29, 2015.~~March 11, 2016.

As used herein, the terms "we," "our" and "us" refer to Realty Finance Trust, Inc., a Maryland corporation, and, as required by context, to Realty Finance Operating Partnership, L.P., a Delaware limited partnership, which we refer to as the "OP," and to its subsidiaries. We are externally managed by Realty Finance Advisors, LLC (our "Advisor"), a Delaware limited liability company.

The forward-looking statements contained in this Quarterly Report on Form 10-Q may include, but are not limited to, statements as to:

our use of the proceeds of the offering for sale of a maximum of 80.0 million shares of common stock, $0.01 par value per share, on a reasonable best efforts basis, pursuant to a registration statement on Form S-11 (the "Offering");

our business and investment strategy;

our ability to make investments in a timely manner or on acceptable terms;

current credit market conditions and our ability to obtain long-term financing for our investments in a timely manner and on terms that are consistent with what we project when we invest;

the effect of general market, real estate market, economic and political conditions, including the recent economic slowdown and dislocation in the global credit markets;

our ability to make scheduled payments on our debt obligations;

our ability to generate sufficient cash flows to make distributions to our stockholders;

our ability to generate sufficient debt and equity capital to fund additional investments;

our ability to refinance our existing financing arrangements;

the degree and nature of our competition;

the availability of qualified personnel;

our ability to maintain our qualification as a real estate investment trust ("REIT"); and

other factors set forth under the caption "Risk Factors" in our Annual Report on Form 10-K for the year ended December 31, ~~2014.~~2015.

In addition, words such as "anticipate," "believe," "expect" and "intend" indicate a forward-looking statement, although not all forward-looking statements include these words. The forward-looking statements contained in this Quarterly Report on Form 10-Q involve risks and uncertainties. Our actual results could differ materially from those implied or expressed in the forward-looking statements for any reason.

Our investors should not place undue reliance on these forward-looking statements. The forward-looking statements made in this Quarterly Report on Form 10-Q relate only to events as of the date on which the statements are made. We undertake no obligation to update any forward-looking statement to reflect events or circumstances occurring after the date of this Quarterly Report on Form 10-Q.

Overview

We were incorporated in Maryland on November 15, 2012 and ~~have conducted~~conduct our operations to qualify as a REIT for U.S. federal income tax purposes beginning with the taxable year ended December 31, 2013. On May 14, 2013, we commenced business operations after raising in excess of $2.0 million of equity, the amount require for us to release equity proceeds from escrow. We are in business to originate, acquire and manage a diversified portfolio of commercial real estate debt secured by properties located both within and outside of the United States. We also invest in commercial real estate securities. Commercial real estate debt investments may include first mortgage loans, subordinated mortgage loans, mezzanine loans and participations in such loans. Commercial real estate securities may include CMBS, senior unsecured debt of publicly traded REITs, debt or equity securities of other publicly traded real estate companies and CDOs. We have no direct employees. We have retained the Advisor to manage our affairs on a day-to-day basis. The Advisor is under common control with the parent of the Sponsor, and will receive compensation and fees for services related to the investment and management of our assets. The Advisor receives fees during the offering, acquisition, operational and liquidation stages.

Prior to January 2016, we were offering for sale a maximum of ~~80.0 million shares~~$2.0 billion of common stock, ~~$0.01~~$0.01 par value per share, on a reasonable best efforts basis, pursuant to a registration statement on Form S-11 filed with the SEC under the Securities Act of 1933, as amended (the "Securities Act"). The Offering also ~~covers~~covered the offer and sale of up to ~~16.8~~approximately $400.0 million in shares of common stock pursuant to a ~~distribution reinvestment plan ( the "DRIP")~~DRIP under which common stockholders may elect to have their distributions reinvested

in additional shares of common stock. ~~On May 14, 2013,~~Effective January 2016, we ~~commenced business operations after raising in excess of~~ ~~$2.0 million~~ ~~of equity in~~terminated the Offering, deregistered 4,069 unsold shares from the ~~amount required for us~~Offering and reallocated 49.7 million unsold shares from the Offering to ~~release equity proceeds from escrow.~~the DRIP offering.

Prior to the NAV ~~pricing date~~Pricing Date (as described below), we ~~have~~ offered shares of our common stock in the ~~primary offering~~Offering through Realty Capital Securities, LLC (the ~~"Dealer~~"Former Dealer Manager"), at a per share price of up to $25.00 per share (including the maximum allowed to be charged for commissions and fees, subject to certain discounts as described in our prospectus). Prior to the NAV pricing date, we ~~have~~ offered shares of our common stock pursuant to ~~our DRIP, at~~ a price equal to $23.75 per share, which is 95% of the primary offering price. As of close of business on November 10, 2015 (the “NAV pricing date”), pursuant to the net asset value (“NAV”) calculation described herein, we are offering shares of our common stock in the primary offering

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~~at a price of up to $28.08 per share, inclusive of applicable commissions and dealer manager fees, and through~~ the DRIP at a price equal to $25.27 per share, the NAV per share. As of September 30, 2015, the aggregate gross proceeds from the sale of common stock in the Offering was $714.2 million. Beginning with the NAV pricing date, the per share price ~~for shares in our primary offering and our DRIP will vary quarterly and will be equal to our per share NAV as~~ of ~~the end of the prior quarter, divided by the number of shares of our common stock outstanding as of such date, plus, in the case of its primary offering, applicable commissions and fees.~~$23.75.

On November 4, 2015, our board of directors unanimously determined an estimated NAV per share of our common stock of $25.27 as of September 30, 2015. The estimated NAV per share is based upon the estimated value of our assets less our liabilities as of September 30, 2015. The conflicts committee of the board of directors approved the engagement of Duff & Phelps, LLC, an independent third-party real estate advisory firm, who performed appraisals of our assets in accordance with our valuation guidelines. Our Advisor calculated the estimated NAV per share, and the conflicts committee of our board of directors, which is comprised solely of our independent directors, approved and recommended to our board of directors the estimated NAV per share calculated by our Advisor. The valuation was performed in accordance with the provisions of Practice Guideline 2013-01, Valuations of Publicly Registered Non-Listed REITs, issued by the Investment Program Association in April 2013.

OnAs of close of business on November 4,10, 2015 ~~our board of directors unanimously determined, effective as of the NAV~~(the “NAV pricing date, (i) to change the purchase price for shares issued in our primary offering to equal the estimated NAV per share plus applicable selling commissions and fees; (ii) to change the purchase price for shares issueddate”), pursuant to the DRIP to equal the estimated NAV per share; and (iii) to change the repurchase price of shares under our share repurchase program to equal, or be at a discount from, the estimated NAV per share. Accordingly,net asset value (“NAV”) calculation described herein, we ~~(i) will offer shares in the primary~~began offering at a purchase price of $28.08; (ii) will offer shares pursuant to our DRIP at a purchase price of $25.27; and (iii) will repurchase shares pursuant to our share repurchase program at a repurchase price of $25.27, subject to discounts in certain circumstances and subject to the terms and conditions of the SRP.

~~On December 30, 2014, we filed with the Maryland State Department of Assessments and Taxation articles supplementary to our charter that reclassified 1,000 authorized but unissued~~ shares of our common stock ~~as shares~~in the Offering at a price of ~~convertible stock~~up to $28.08 per share, inclusive of applicable commissions and ~~set~~Former Dealer Manager fees, and through the ~~terms of such convertible shares. We then issued 1,000 convertible shares~~DRIP at a price equal to $25.27 per share, the ~~Advisor for $1.00~~NAV per share. As noted above, we have terminated the Offering. The ~~convertible shares~~per share price for our DRIP offering will ~~automatically convert~~be equal to our per share NAV, divided by the number of shares of our common stock ~~upon the first occurrence~~outstanding as of any of the following triggering events (the "Triggering Event"): (i) we have paid total distributions on the then-outstanding shares of common stock in an amount equal to or in excess of the sum of the invested capital (as defined in our charter) plus an aggregate 6.0% cumulative, pre-tax, non-compounded, annual return on such ~~invested capital, (ii) a listing of our shares of common stock on a national securities exchange and (iii) the termination of our advisory agreement under certain circumstances.~~

We were formed to originate, acquire and manage a diversified portfolio of commercial real estate debt secured by properties located both within and outside of the United States. We may also invest in commercial real estate securities. Commercial real estate debt investments may include first mortgage loans, subordinated mortgage loans, mezzanine loans and participations in such loans. Commercial real estate securities may include commercial mortgage-backed securities ("CMBS"), senior unsecured debt of publicly traded REITs, debt or equity securities in other publicly traded real estate companies and collateralized debt obligations ("CDOs").date.

We have no ~~direct~~ employees. ~~We have~~Our Advisor has been retained ~~the Advisor~~by us to manage our affairs on a day-to-day basis. The ~~Dealer Manager serves as the dealer manager of the Offering. The~~ Advisor ~~and Dealer Manager are~~is under common control with AR Global, the parent of ~~the~~our Sponsor, as a result of which they are related parties, and each, ~~of them~~including our former dealer manager, Realty Capital Securities, LLC (the “Former Dealer Manager”), have received or will receive compensation, fees and ~~fees~~expense reimbursements for services related to the Offering, ~~and~~ the investment and management of our ~~assets.~~assets, our operations and our liquidation.

In May 6, 2016, we announced that our Board, with the unanimous agreement of all directors, had recently formed a special committee, consisting exclusively of independent directors, to explore a potential strategic transaction with a related party. The ~~Advisor~~Board granted the special committee the exclusive authority to consider, review, evaluate and, ~~Dealer Manager receive fees during~~if appropriate, negotiate a strategic transaction on behalf of us. In addition, the ~~offering, acquisition, operational~~Board granted the special committee the authority, when considering such strategic transaction, to solicit expressions of interest or other proposals for, and ~~liquidation stages.~~to consider, any alternative transactions. These transactions may include a possible sale or merger with one or more related or unrelated entities, listing the our shares on a national exchange or the sale of assets.

The special committee has retained special legal counsel and is in the process of engaging a leading real estate investment banking group as financial advisor. To date, the special committee has not engaged in any substantive discussions or negotiations related to the terms of a transaction with this related party or any other party. In addition, there has not been any exchange of information or any entry into non-disclosure agreements with any party. There are no assurances that the consideration of any strategic alternative will result in a transaction. We do not intend to comment on or disclose developments regarding the process unless we deem further disclosure is appropriate or required.

Significant Accounting Policies and Use of Estimates

A summary of our significant accounting policies is set forth in Note 2 - Summary of Significant Accounting Policies to our ~~condensed~~ consolidated financial statements included in this Quarterly Report on Form 10-Q. A full disclosure of our significant accounting polices is disclosed in our Annual Report on Form 10-K for the year ended December 31, ~~2014.~~2015.

Portfolio

As of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014,~~2015, our portfolio consisted of 6976 and 3877 loans (the "Loans") and 1316 and ~~eight~~16 investments in CMBS, respectively. The Loans had a total carrying value, net of reserve, of ~~$938.8~~$1,126.4 million and ~~$456.9~~$1,124.2 million, and our CMBS investments had a fair value of ~~$101.0~~$124.9 million and ~~$50.2~~$130.8 million as of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014,~~2015, respectively. ~~The increase in the size of~~For our ~~portfolio is due to investing capital received from the Offering and increased leverage arising from the Master Repurchase Agreements (“MRAs”) that~~loans, we ~~have entered into with JPMorgan Chase Bank, National Association (the “JPM Repo Facility”) and Barclays Bank PLC (the “Barclays Repo Facility”).We~~ currently estimate loss rates based on historical realized losses experienced in the industry and take into account current collateral and economic conditions affecting the probability or severity of losses when establishing the allowance for loan

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losses. We recorded a general allowance for loan losses as of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014~~2015 in the amount of ~~$0.9~~$1.1 million and ~~$0.6~~$0.9 million, respectively. There were no impaired or specifically reserved loans in the portfolio as of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014.~~2015.

As of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014,~~2015, our Loans had a weighted average coupon of ~~6.5%~~6.1% and ~~7.1%~~6.1%, and a weighted average life of ~~2.8~~2.5 and ~~3.2~~2.7 years, respectively. Our CMBS investments had a weighted average coupon of ~~4.0%~~4.8% and ~~3.3%~~4.7% and a remaining life of ~~2.1~~2.8 and ~~1.8~~3.2 years as of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014,~~2015, respectively. The following

charts summarize our portfolio as a percentage of par value, including CMBS, by the collateral type, geographical region and coupon rate type as of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014:~~2015:

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An investments region classification is defined according to the below map based on the location of investments' secured property. ~~The geographical region chart as of December 31, 2014 has been conformed to reflect current period presentation.~~

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The following charts show the par value by maturity year for the investments in our portfolio as of ~~September 30, 2015~~March 31, 2016 and December 31, ~~2014.~~2015.

The following table shows selected data from our commercial mortgage loans portfolio as of ~~September 30, 2015~~March 31, 2016 (in thousands):

Interest Rate ⁽¹⁾

Loan to Value ⁽²⁾

Interest Rate ⁽¹⁾

Loan to Value ⁽²⁾

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Loan Type	Par Value	Carrying Value	Interest Rate ⁽¹⁾	Effective Yield	Loan to Value ⁽²⁾	Property Type	Par Value	Interest Rate ⁽¹⁾	Effective Yield	Loan to Value ⁽²⁾
Senior 29						Retail	9,450	1M LIBOR + 4.90%	5.5%	69.2%
Senior 30						Industrial	33,655	1M LIBOR + 4.00%	4.5%	65.0%
Senior 31	26,500	26,471	4.75% + 1M LIBOR	5.0%	67.4%	Mixed Use	45,100	1M LIBOR + 5.50%	6.2%	72.6%
Senior 32	18,350	18,162	4.75% + 1M LIBOR	5.3%	55.0%	Multifamily	8,850	1M LIBOR + 4.70%	5.4%	68.8%
Senior 33	8,500	8,427	4.65% + 1M LIBOR	5.2%	70.8%	Office	24,500	1M LIBOR + 4.60%	5.3%	65.0%
Senior 34	18,250	18,127	4.25% + 1M LIBOR	4.7%	68.0%	Mixed Use	7,984	1M LIBOR + 4.75%	5.4%	78.3%
Senior 35	17,560	17,481	4.20% + 1M LIBOR	4.6%	76.4%	Hospitality	16,800	1M LIBOR + 4.90%	5.5%	74.0%
Senior 36	10,350	10,275	5.50% + 1M LIBOR	6.0%	69.9%	Office	35,000	1M LIBOR + 5.00%	5.5%	79.0%
Senior 37	11,250	11,177	5.30% + 1M LIBOR	5.8%	73.5%	Office	6,262	1M LIBOR + 4.90%	5.4%	80.0%
Senior 38	45,100	44,812	5.50% + 1M LIBOR	6.0%	72.6%	Retail	11,800	1M LIBOR + 4.75%	5.4%	79.4%
Senior 39	7,500	7,428	5.00% + 1M LIBOR	5.6%	59.0%	Retail	13,500	1M LIBOR + 5.00%	5.7%	78.0%
Senior 40	4,725	4,678	5.50% + 1M LIBOR	6.1%	72.0%	Retail	11,482	1M LIBOR + 4.50%	5.1%	74.8%
Senior 41	39,200	38,897	4.25% + 1M LIBOR	4.7%	77.0%	Multifamily	18,075	1M LIBOR + 4.50%	5.1%	75.0%
Senior 42	18,075	18,008	4.50% + 1M LIBOR	4.9%	75.0%	Mixed Use	31,250	1M LIBOR + 4.50%	5.1%	75.0%
Senior 43						Multifamily	24,394	1M LIBOR + 4.25%	5.0%	79.7%
Senior 44						Office	9,572	1M LIBOR + 5.50%	6.3%	75.0%
Senior 45						Multifamily	28,406	1M LIBOR + 3.85%	4.2%	76.8%
Senior 46						Multifamily	10,785	1M LIBOR + 3.95%	4.3%	77.5%
Senior 47						Multifamily	12,009	1M LIBOR + 3.95%	4.3%	78.2%
Senior 48						Multifamily	5,800	1M LIBOR + 4.05%	4.4%	80.0%
Senior 49						Office	28,000	1M LIBOR + 4.25%	4.8%	73.3%
Senior 50						Multifamily	14,037	1M LIBOR + 5.00%	5.7%	76.7%
Senior 51						Retail	26,500	1M LIBOR + 4.75%	5.2%	67.4%
Senior 52						Multifamily	10,680	1M LIBOR + 4.75%	5.3%	75.0%
Mezzanine 1	6,300	4,171	5.46%	12.7%	76.7%	Mixed Use	7,000	1M LIBOR + 10.50%	11.1%	84.0%
Mezzanine 2	5,000	5,035	9.00%	8.7%	73.9%	Office	5,000	11.00%	10.8%	63.6%
Mezzanine 3	9,000	9,036	11.00% + 3M LIBOR	10.9%	77.9%	Hospitality	3,000	11.00%	10.8%	81.8%
Mezzanine 4	5,000	5,067	11.00%	10.8%	63.6%	Hospitality	11,000	1M LIBOR + 7.05%	7.5%	70.0%
Mezzanine 5	4,000	4,054	12.00%	11.7%	74.5%	Office	22,777	1M LIBOR + 7.25%	7.3%	76.0%
Mezzanine 6	3,000	3,016	11.00%	10.8%	81.8%	Office	7,000	12.00%	11.9%	78.3%
Mezzanine 7	11,000	11,013	7.05% + 1M LIBOR	7.0%	70.0%	Hospitality	12,000	1M LIBOR + 9.00%	9.2%	74.2%
Mezzanine 8	7,000	7,027	12.00%	11.9%	78.3%	Retail	1,963	13.00%	12.9%	85.0%
Mezzanine 9	10,000	10,010	8.00% + 1M LIBOR	8.0%	80.0%	Office	5,100	3M LIBOR + 10.00%	10.6%	79.5%
Mezzanine 10	1,963	1,972	13.00%	12.9%	85.0%	Hospitality	45,000	1M LIBOR + 10.00%	10.4%	75.0%
Mezzanine 11	3,480	3,496	9.50%	9.4%	84.5%	Multifamily	5,000	9.00%	8.7%	73.9%
Mezzanine 12	7,000	6,977	10.50% + 1M LIBOR	11.0%	84.0%	Multifamily	3,480	9.50%	9.4%	84.5%
Mezzanine 13	35,000	35,068	8.40% + 1M LIBOR	8.3%	70.1%	Office	10,000	1M LIBOR + 8.00%	8.3%	80.0%
Mezzanine 14	5,000	5,012	7.50% + 1M LIBOR	7.4%	71.0%	Multifamily	4,000	12.00%	11.8%	74.5%
Mezzanine 15	12,000	12,032	9.00% + 1M LIBOR	8.9%	74.2%	Office	10,000	10.00%	10.9%	79.0%
Mezzanine 16	25,042	25,127	7.25% + 1M LIBOR	7.0%	76.0%	Office	10,000	1M LIBOR + 10.75%	15.5%	80.0%
Mezzanine 17	9,000	9,038	10.50%	10.4%	85.0%	Hospitality	7,140	10.00%	11.5%	73.9%
Mezzanine 18	5,100	5,102	10.00% + 3M LIBOR	10.3%	79.5%	Hospitality	$3,900	10.00%	11.5%	73.9%
Mezzanine 19	10,000	9,480	10.00%	10.9%	79.0%	Hospitality	$12,510	10.00%	11.5%	73.9%
Mezzanine 20	15,000	13,922	11.00%	10.9%	80.0%	Hospitality	$8,050	10.00%	11.5%	73.9%
Mezzanine 21	45,000	45,001	10.00% + 1M LIBOR	10.2%	75.0%	Office	$9,000	10.50%	10.4%	85.0%
Mezzanine 22	12,350	12,350	10.00% + 1M LIBOR	10.2%	74.0%	Hospitality	$6,253	5.46%	13.5%	76.7%
Mezzanine 23	7,140	6,533	10.00%	7.2%	71.9%	Hospitality	$12,350	1M LIBOR + 10.00%	10.4%	74.0%
Mezzanine 24	3,900	3,568	10.00%	11.5%	73.9%
Mezzanine 25	12,510	11,447	10.00%	11.5%	73.9%
Mezzanine 26	8,050	7,366	10.00%	11.5%	73.9%
Subordinated 1	10,000	10,000	11.00%	11.0%	50.1%
Total/Weighted Average	$949,276	$939,704		6.7%	72.9%
Subordinate 1						Retail	$10,000	11.00%	11.0%	50.1%
							$1,136,193		6.4%	73.1%

⁽¹⁾ Our floating rate loan agreements contain the contractual obligation for the borrower to maintain an interest rate cap to protect against rising interest rates. In a simple interest rate cap, the borrower pays a premium for a notional principal amount based on a capped interest rate (the "cap rate"). When the floating rate exceeds the cap rate, the borrower receives a payment from the cap counterparty

equal to the difference between the floating rate and the cap rate on the same notional principal amount for a specified period of time. When interest rates rise, the value of an interest rate cap will increase, thereby reducing the borrower's exposure to rising interest rates.

⁽²⁾ Loan to value percentage is from metrics at origination.

Results of Operations

Comparison of the Three Months Ended ~~September 30,~~March 31, ~~2015~~2016 to the Three Months Ended ~~September 30, 2014~~March 31, 2015

We conduct our business through the following segments:

Net interest income is generated on our interest-earning assets less related interest-bearing liabilities and is recorded as part of our real estate debt and real estate securities segments.

Interest income for the three months ended September 30, 2015 and 2014 totaled $16.3 million and $4.6 million, respectively. The main driver in the increase in interest income was the increase in the size of our portfolio due to investing capital raised through the Offering. As of September 30, 2015, our Loans had a total carrying value of $939.7 million and our CMBS investments had a fair value of $101.0 million, while as of September 30, 2014, the Loans had a total carrying value of $313.5 million and our CMBS investments had a fair value of $38.6 million However, the increase in interest income from the increase in the size of the portfolio was partially offset by the decrease in yield on our investments. During the three months ended September 30, 2015 the yield on the interest-earning assets decreased by 44 basis points compared to the three months ended September 30, 2014. We anticipate interest income will continue to grow as we continue to invest capital raised through the Offering and through increased leverage.

~~Interest Expense~~

Interest expense for the three months ended September 30, 2015 increased to $3.5 million compared to $0.7 million for the three months ended September 30, 2014, primarily due to the increase in borrowings. During the three months ended September 30, 2015 and 2014, we had average borrowings outstanding of $414.6 million and $70.1 million, respectively. The increase in interest expense arising from higher average borrowing is partially offset by a decrease in yield of 71 basis point on interest-bearing liabilities during the three months ended September 30, 2015 compared to the three months ended September 30, 2014. The decrease in yield was primarily due to borrowing more on our repurchase agreements for senior loans compared to mezzanine loans. We anticipate continued utilization of leverage as we grow the portfolio during the Offering and as additional sources of leverage become available.

The following table presents the average balance of interest-earning assets less related interest-bearing liabilities, associated interest income and expense and corresponding yield earned and incurred for the three months ended ~~September 30,~~March 31, 2016 and 2015 ~~and 2014~~ (dollars in thousands):


	Three Months Ended September 30,														Three Months Ended March 31,
	2015							2014							2016							2015
	Average Carrying Value⁽¹⁾			Interest Income/Expense⁽²⁾		WA Yield/Financing Cost⁽³⁾⁽⁴⁾		Average Carrying Value⁽¹⁾			Interest Income/Expense⁽²⁾		WA Yield/Financing Cost⁽³⁾⁽⁴⁾		Average Carrying Value⁽¹⁾			Interest Income/Expense⁽²⁾		WA Yield/Financing Cost⁽³⁾⁽⁴⁾		Average Carrying Value⁽¹⁾			Interest Income/Expense⁽²⁾		WA Yield/Financing Cost⁽³⁾⁽⁴⁾
Interest-earning assets:
Real estate debt	$	866,295		$	15,285	7.1	%	$	227,453		$	4,352	7.7	%	$	1,132,923		$	18,667	6.6	%	$	508,613		$	9,196	7.2	%
Real estate securities	97,910			967		4.0	%	26,540			206		3.1	%	132,010			1,615		4.9	%	54,495			409		3.0	%
Total	964,205			16,252		6.7	%	253,993			4,558		7.2	%	1,264,933			20,282		6.4	%	563,108			9,605		6.8	%
Interest-bearing liabilities:
Repurchase Agreements - Loans	349,497			3,175		3.6	%	52,496			647		4.9	%	231,185			1,983		3.4	%	166,238			1,804		4.3	%
Repurchase Agreements - Securities	65,054			294		1.8	%	17,582			64		1.5	%	123,513			677		2.2	%	32,002			129		1.6	%
Collateralized loan obligations															288,106			2,108		2.9	%	—			—		—	%
Total	414,551			3,469		3.3	%	70,078			711		4.1	%	642,804			4,768		3.0	%	198,240			1,933		3.9	%
Net interest income/spread				12,783		3.4	%				$	3,847	3.1	%				15,514		3.4	%				$	7,672	2.9	%
Average stockholders' equity	559,978							185,078
Debt to equity ratio⁽⁵⁾	74.0		%					37.9		%
Weighted average return on equity⁽⁶⁾						9.2	%						8.4	%
Average leverage %⁽⁵⁾															50.8		%					35.2		%
Weighted average levered yield⁽⁶⁾																				8.1	%						7.8	%

⁽¹⁾ Based on amortized cost for real estate debt and real estate securities and principal amount for repurchase agreements. ~~All amounts~~Amounts are calculated based on ~~quarterly averages.~~

⁽²⁾ ~~Includes the effect of amortization of premium or accretion of discount and deferred fees.~~

⁽³⁾ ~~Calculated as interest income or expense divided by average carrying value.~~

⁽⁴⁾ ~~Annualized.~~

⁽⁵⁾ ~~Calculated by dividing average interest-bearing liabilities by average stockholders' equity.~~

⁽⁶⁾ ~~Calculated by taking the sum of (i) the net interest spread multiplied by the debt to equity ratio and (ii) the interest-earning assets.~~

~~Expenses from Operations~~

~~Expenses from operations~~daily averages for ~~the~~ three months ended ~~September 30,~~March 31, 2016 and December 31, 2015, ~~and 2014 were made up of the following (in thousands):~~

Three Months Ended September 30,
2015 2014
Asset management and subordinated performance fee $ 2,405
$ 414
Acquisition fees and expenses 1,777
1,772
Professional fees 659
371
Other expenses 439
132
Loan loss provision 78
174
Total expenses from operations $ 5,358
$ 2,863

Our expenses from operations were primarily related to asset management and subordinated performance fees. During the three months ended September 30, 2015 and September 30, 2014, we incurred $2.4 million and $0.4 million of asset management and subordinated performance fees, respectively, an increase of $2.0 million.

~~Comparison of the Nine Months Ended September 30,2015 to the Nine Months Ended September 30, 2014~~

~~Interest income for the nine months ended September 30, 2015 and 2014 totaled $38.3 million and $7.5 million,~~ respectively. The main driver for the increase in interest income was the increase in the size of our portfolio due to investing capital raised through the Offering and increased leverage. As of September 30, 2015 the Loans had a total carrying value of $939.7 million and our CMBS investments had a fair value of $101.0 million, while as of September 30, 2014, the Loans had a total carrying value of $313.5 million and our CMBS investments had a fair value of $38.6 million. During the nine months ended September 30, 2015 the yield on the interest-earning assets increased by 16 basis points compared to the nine months ended September 30, 2014. We anticipate interest income will continue to grow as we continue to invest capital raised through the Offering.

~~Interest Expense~~

Interest expense for the nine months ended September 30, 2015 increased to $7.9 million compared to $0.8 million for the nine months ended September 30, 2014, primarily due to the increase in borrowings. During the nine months ended September 30, 2015 and 2014, we had average borrowings outstanding of $306.4 million and $38.7 million, respectively. In addition, interest expense increased due to the 68 basis point increase in the yield on interest-bearing liabilities during the nine months ended September 30, 2015 compared to the nine months ended September 30, 2014. The increase in yield was primarily due to borrowing more on our repurchase agreements for Loans, including our mezzanine Loans which have a borrowing spread of LIBOR plus 4.50%. We anticipate continued utilization of leverage as we grow the portfolio during the Offering and as additional sources of leverage become available.

The following table presents the average balance of interest-earning assets less related interest-bearing liabilities, associated interest income and expense and corresponding yield earned and incurred for the nine months ended September 30, 2015 and 2014 (dollars in thousands):

Nine Months Ended September 30,
2015 2014

Average Carrying Value⁽¹⁾

Interest Income/Expense⁽²⁾

WA Yield/Financing Cost⁽³⁾⁽⁴⁾

Average Carrying Value⁽¹⁾

Interest Income/Expense⁽²⁾

WA Yield/Financing Cost⁽³⁾⁽⁴⁾
Interest-earning assets:
Real estate debt $ 687,454
$ 36,303
7.0 % $ 135,163
$ 7,162
7.1 %
Real estate securities 76,202
2,038
3.6 % 18,149
352
2.6 %
Total 763,656
38,341
6.7 % 153,312
7,514
6.5 %
Interest-bearing liabilities:
Repurchase Agreements - Loans 257,868
7,323
3.8 % 29,899
696
3.1 %
Repurchase Agreements - Securities 48,528
602
1.7 % 8,791
107
1.6 %
Total 306,396
7,925
3.4 % 38,690
803
2.8 %
Net interest income/spread $ 30,416
3.3 % $ 6,711
3.7 %
Average stockholders' equity 465,739
114,498

Debt to equity ratio⁽⁵⁾
65.8 % 33.8 %
Weighted average return on equity⁽⁶⁾
8.8 % 7.8 %

~~________________________~~

⁽¹⁾ ~~Based on amortized cost for real estate debt and real estate securities and principal amount for repurchase agreements. All amounts are calculated based on quarterly averages.~~

⁽²⁾ Includes the effect of amortization of premium or accretion of discount and deferred fees.

⁽³⁾ Calculated as interest income or expense divided by average carrying value.

⁽⁴⁾ Annualized.

⁽⁵⁾ Calculated by dividing total average interest-bearing liabilities by total average ~~stockholders' equity.~~interest-earning assets.

⁽⁶⁾ Calculated by taking the sum of (i) the net interest spread multiplied by the ~~debt to equity ratio~~average leverage and (ii) the interest-earning assets.

The primary driver for increased interest income during the three months ended March 31, 2016 compared to the same period in 2015 was the increase in the size of our portfolio resulting from the investment of the capital raised in the Offering into real estate debt. As of March 31, 2016, our Loans had a total carrying value of $1,127.4 million and our CMBS investments had a fair value of $124.9 million, while as of March 31, 2015, the Loans had a total carrying value of $559.1 million and our CMBS investments had a fair value of $58.4 million. This increase was partially offset by a decrease in yield on our investments by 40 basis points quarter over quarter, primarily due to a shift in the composition of the portfolio predominately to lower yielding senior loans over the course of 2015.

Interest expense for the three months ended March 31, 2016 was $2.9 million higher than for the three months ended March 31, 2015, primarily due to an increase in average borrowings outstanding of more than $444 million period over period. The increase was partially offset by a 90 basis points decrease in rates on interest-bearing liabilities primarily due to borrowing more on our lower interest repurchase agreements for senior loans compared to higher cost borrowings.

Expenses from Operations

Expenses from operations for the ~~nine~~three months ended ~~September 30,~~March 31, 2016 and 2015 ~~and 2014~~ were made up of the following (in thousands):

~~Our~~For the three months ended March 31, 2016, expenses from operations were primarily related to asset management and subordinated performance fees. During the three months ended March 31, 2016 and March 31, 2015, we incurred $3.0 million and $0.4 million of asset management and subordinated performance fees, respectively, an increase of $2.6 million. Additionally, we have incurred $0.8 million of administrative service expenses for three months ended March 31, 2016, we did not have these expenses for the three months ended March 31, 2015. For the three months ended March 31, 2015, our expenses from operations were primarily related to acquisition fees ~~which~~and professional fees of $2.4 million.

Liquidity and Capital Resources

Our principal demands for cash will ~~continue to trend parallel with~~be acquisition costs, including the ~~rate~~purchase price of any investments we originate or acquire, the payment of our ~~originations~~operating and ~~acquisitions. During~~administrative expenses, continuing debt service obligations and distributions to our stockholders. Prior to January 2016, we generally funded our investments from the ~~nine months ended~~net proceeds of the Offering. We can acquire our assets with cash or debt, but we also may acquire assets free and clear of indebtedness by paying the entire purchase price for the asset in cash or in OP units. We currently believe that we have sufficient liquidity and capital resources available for the acquisition of additional investments, repayments on borrowings and the payment of cash dividends, although given the termination of our Offering we expect our new investments to decrease significantly in 2016 unless we are able to raise additional equity capital.

Loan Repo Facilities

We entered into the JPM Repo Facility with JPMorgan Chase Bank, National Association (the "JPM Facility"). The JPM Repo Facility provides up to $150.0 million in advances, subject to adjustment, which we expect to use to finance the acquisition or origination of eligible loans, including first mortgage loans, junior mortgage loans, mezzanine loans and participation interests therein. Advances under the JPM Repo Facility accrue interest at per annum rates equal to the sum of (i) the applicable LIBOR index rate plus (ii) a margin of between 2.25% to 4.50%, depending on the attributes of the purchased assets. The initial maturity date of the JPM Repo Facility is June 18, 2016, with a one-year extension at our option, which may be exercised upon the satisfaction of certain conditions. As of March 31, 2016 and December 31, 2015, there was $121.7 million and $84.3 million of principal outstanding on the JPM Repo Facility, respectively.

We entered into the Barclays Repo Facility with Barclays Bank PLC ("Barclays Repo Facility"). The Barclays Repo Facility provides up to $150.0 million in advances, subject to adjustment, which we expect to use to finance the acquisition or origination of eligible loans, including first mortgage loans and senior notes and participation interests therein. We entered into an amendment of the Barclays Repo Facility, dated as of May 12, 2016 (the “Barclays Amendment”), after giving effect to the Barclays Amendment, advances under the Barclays Repo Facility accrue interest at per annum rates equal to the sum of (i) the applicable LIBOR index rate plus (ii) a margin of between 2.50% to 3.00%, depending on the attributes of the purchased assets. Pursuant to the Barclays Amendment, the maturity date of the Barclays Repo Facility was extended to September ~~30,~~6, 2016. There are two six-month extensions remaining under the Barclays Repo Facility, which may be granted by lender in its sole

discretion upon the satisfaction of certain conditions. As of March 31, 2016 and December 31, 2015, we ~~originated~~had $121.9 million and ~~acquired Loans~~$121.9 million outstanding under the Barclays Repo Facility, respectively.

The JPM Repo Facility and ~~CMBS with~~the Barclays Repo Facility generally provide that in the event of a ~~par~~decrease in the value of ~~$587.0 million, and in conjunction with these transactions we expensed $6.0 million of acquisition fees compared to~~our collateral, the ~~nine months ended September 30, 2014 during which we originated and acquired loans and CMBS with a par~~lenders can demand additional collateral. Should the value of ~~$316.4 million and expensed $2.9 million. Another driver~~our collateral decrease, whether as a result of ~~the increase in expenses during the nine months ended September 30, 2015 compared to September 30, 2014, was~~deteriorating credit quality, an increase in ~~professional fees. During~~credit market spreads or otherwise, resulting margin calls may cause an adverse change in our liquidity position.

CMBS Master Repurchase Agreements ("MRAs")

We entered into various MRAs that allow us to sell real estate securities while providing a fixed repurchase price for the ~~nine~~same real estate securities in the future. The repurchase contracts on each security under an MRA generally mature in 30 to 90 days and terms are adjusted for current market rates as necessary. As of March 31, 2016 and December 31, 2015, we entered into six MRAs, of which three were in use, described below (in thousands):



	Amount						Weighted Average
Counterparty	Outstanding		Accrued Interest		Collateral Pledged		Interest Rate		Days to Maturity
As of March 31, 2016
J.P. Morgan Securities LLC (*)	$	90,897	$	159	$	137,487	2.25	%	1
Citigroup Global Markets, Inc.	26,177		81		34,559		2.32	%	44
Wells Fargo Securities, LLC	3,375		3		4,500		1.79	%	13
Total/Weighted Average	$	120,449	$	243	$	176,546	2.25	%	11

As of December 31, 2015
J.P. Morgan Securities LLC (*)	$	86,898	$	108	$	130,618	2.03	%	8
Citigroup Global Markets, Inc.	26,619		71		35,528		2.00	%	45
Wells Fargo Securities, LLC	3,694		3		4,925		1.67	%	13
Total/Weighted Average	$	117,211	$	182	$	171,071	2.01	%	17

^(*)Collateral includes $52,962 and $56,044 of Tranche C of RFT issued CLO to JPM. The investment in Tranche C of the CLO eliminates on the consolidated balance sheets as of March 31, 2016 and December 31, 2015, respectively.

We expect to use additional debt financing as a source of capital. Under our charter, the maximum amount of our total indebtedness shall not exceed 300% of our total ‘‘net assets’’ (as defined by the NASAA REIT Guidelines) as of the date of any borrowing, which is generally expected to be 75% of the cost of our investments; however, we may exceed that limit if approved by a majority of our independent directors and disclosed to stockholders in our next quarterly report following such borrowing along with justification for exceeding such limit. This charter limitation, however, does not apply to individual real estate assets or investments. At the date of acquisition of each asset, we anticipate that the cost of investment for such asset will be substantially similar to its fair market value, which will enable us to satisfy our requirements under the North American Securities Administrators ("NASAA") Statement of Policy regarding REITs (the "REIT Guidelines"). However, subsequent events, including changes in the fair market value of our assets, could result in our exceeding these limits. We anticipate that adequate cash will be generated from operations to fund our operating and administrative expenses, continuing debt service obligations and the payment of distributions.

In addition to our current mix of financing sources, we may also access additional forms of financings, including credit facilities, securitizations and public and private, secured and unsecured debt issuances by us or our subsidiaries.

Recently, the Commercial Mortgage Securitization market has experienced a period of widening credit spreads and limited liquidity. This trend could negatively impact our ability to execute an additional CLO to refinance our existing indebtedness. We continue to monitor the credit markets to determine the best time to create another CLO financing vehicle. Additionally, this period of widening credit spreads and limited liquidity has affected the fair market value of the CMBS securities we hold in position.

In May 13, 2013, our board of directors authorized, and we declared, a distribution payable on a monthly basis to stockholders of record on each day at a rate equal to $0.00565068493 per day, which is equivalent to $2.0625 per annum, per share of common stock. In March 2016, our board of directors ratified the existing distribution amount equivalent to $2.0625 per annum, and, for calendar year 2016, affirmed a change to the daily distribution amount to$0.0056352459 per day per share of common stock, effective January 1, 2016, to accurately reflect that 2016 is a leap year. The distribution will be payable by

the fifth day following the end of each month to stockholders of record at the close of business each day during the prior month.

The below table shows the distributions paid on shares outstanding during the three months ended ~~September 30,~~March 31, 2016 and three months ended March 31, 2015 ~~we incurred $1.6~~(in thousands):



Three Months Ended March 31, 2016 Payment Date	Amount Paid in Cash		Amount Issued under DRIP
January 4, 2016	$	3,225	$	2,324
February 2, 2016	3,337		2,159
March 2, 2016	3,057		2,099
Total	$	9,619	$	6,582



Three Months Ended March 31, 2015 Payment Date	Amount Paid in Cash		Amount Issued under DRIP
January 2, 2015	$	1,512	$	1,109
February 2, 2015	1,618		1,182
March 2, 2015	1,567		1,154
Total	$	4,697	$	3,445

The following table shows the sources for the payment of distributions to common stockholders for the periods presented(in thousands):



	Three Months Ended March 31,
	2016				2015
Distributions:
Cash distributions paid	$	9,619			$	4,697
Distributions reinvested	6,582				3,445
Total distributions	$	16,201			$	8,142
Source of distribution coverage:
Cash flows provided by operations	$	9,619	59.4	%	$	4,697	57.7	%
Proceeds from issuance of common stock	—		—	%	—		—	%
Common stock issued under DRIP	6,582		40.6	%	3,445		42.3	%
Total sources of distributions	$	16,201	100.0	%	$	8,142	100.0	%
Cash flows provided by operations (GAAP)	$	10,088			$	5,258
Net income (GAAP)	$	9,420			$	4,632

The following table compares cumulative distributions paid to cumulative net income (in accordance with GAAP) for the period from November 15, 2012 (date of inception) through March 31, 2016 (in thousands):



	For the Period from November 15, 2012 (date of inception) to March 31, 2016
Distributions paid:
Common stockholders in cash	$	44,446
Common stockholders pursuant to DRIP / offering proceeds	31,959
Total distributions paid	$	76,405
Reconciliation of net income:
Net interest income	$	76,661
Gain on sale	112
Acquisition fees	(12,459		)
Other operating expenses	(24,460		)
Net income	$	39,854
Cash flows provided by operations	$	38,982

Cash Flows for the Three Months Ended March 31, 2016

Net cash provided by operating activities for the three months endedMarch 31, 2016 was $10.1 million. Cash inflows were primarily driven by net income of $9.4 million.



Maryland		46-1406086
(State or Other Jurisdiction of Incorporation or Organization)		(I.R.S. Employer Identification No.)

405 Park Avenue, 14th Floor New York, New York		10022
(Address of Principal Executive Office)		(Zip Code)



Large accelerated filer o	Accelerated filer o
Non-accelerated filer o	Smaller reporting company x



	Page
PART I
Item 1. ~~Condensed~~ Consolidated Financial Statements and Notes (unaudited)	1
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations	2122
Item 3. Quantitative and Qualitative Disclosures about Market Risk	38
Item 4. Controls and Procedures	3938
PART II
Item 1. Legal Proceedings	4039
Item 1A. Risk Factors	4039
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds	4039
Item 3. Defaults Upon Senior Securities	4140
Item 4. Mine Safety Disclosures	4140
Item 5. Other Information	4140
Item 6. Exhibits	4241
Signatures	4342


	September 30, 2015				December 31, 2014				March 31, 2016				December 31, 2015
Loan Type	Par Value		Percentage		Par Value		Percentage		Par Value		Percentage		Par Value		Percentage
Office	$	238,787	25.2	%	$	217,480	47.1	%	$	312,957	27.5	%	$	307,876	27.2	%
Multifamily									302,436		26.6	%	305,129		26.9	%
Hospitality	205,985		21.7	%	74,566		16.2	%	172,086		15.1	%	171,752		15.1	%
Multifamily	185,833		19.6	%	22,957		5.0	%
Retail	158,784		16.7	%	45,513		9.9	%	159,476		14.0	%	158,784		14.0	%
Mixed Use	141,637		14.9	%	100,699		21.8	%	136,925		12.1	%	138,798		12.2	%
Industrial	18,250		1.9	%	—		—	%	52,313		4.7	%	52,107		4.6	%
	$	949,276	100.0	%	$	461,215	100.0	%	$	1,136,193	100.0	%	$	1,134,446	100.0	%


	Nine Months Ended September 30, 2015			Year Ended December 31, 2014			Three Months Ended March 31, 2016			Three Months Ended March 31, 2015
Beginning balance	$	456,884		$	30,832
Balance at Beginning of Year							$	1,124,201		$	456,884
Acquisitions and originations	526,919			429,941			9,697			116,434
Dispositions	—			(3,580		)	—			—
Principal repayments	(45,542		)	(136		)	(7,949		)	(14,321		)
Discount accretion and premium amortization*	873			397			566			205
Provision for loan losses	(302		)	(570		)	(165		)	(144		)
Ending balance	$	938,832		$	456,884
Balance at End of Period							$	1,126,350		$	559,058



¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934


⁽¹⁾	Includes $426,447 and $426,155 of loans pledged as collateral on collateralized loan obligations ("CLO"), a variable interest entity ("VIE") as of March 31, 2016 and December 31, 2015, respectively.


⁽²⁾	Includes $1,076 and $1,048 of interest receivable for loans pledged as collateral on CLO, a VIE as of March 31, 2016 and December 31, 2015, respectively.


⁽³⁾	Includes $530 and $513 of interest payable for loans pledged as collateral on CLO, a VIE as of March 31, 2016 and December 31, 2015, respectively.


Funding Expiration	September 30, 2015		December 31, 2014		March 31, 2016		December 31, 2015
2015	$	—	$	3,450
2016	890		26,701		$	468	$	890
2017	23,523		20,810		13,052		16,072
2018	80,307		7,169		99,079		104,428
2019	13,775		1,240		16,032		16,939
2020	—		4,175		—		—
	$	118,495	$	63,545
2021					—		—
Total					$	128,631	$	138,329



Source of Capital	Inception to September 30, 2015		October 1, 2015 to October 31, 2015		Total
Common stock	$	714,236	$	42,227	$	756,463



Nine Months Ended September 30, 2015 Payment Date	Amount Paid in Cash		Amount Issued under DRIP
January 2, 2015	$	1,512	$	1,109
February 2, 2015	1,618		1,182
March 2, 2015	1,568		1,153
April 1, 2015	1,873		1,395
May 1, 2015	1,972		1,478
June 1, 2015	2,216		1,657
July 1, 2015	2,283		1,737
August 3, 2015	2,510		1,907
September 1, 2015	2,663		2,025
Total	$	18,215	$	13,643



Year Ended December 31, 2014 Payment Date	Amount Paid in Cash		Amount Issued under DRIP
January 2, 2014	$	141	$	74
February 3, 2014	171		85
March 3, 2014	213		106
April 1, 2014	305		163
May 1, 2014	353		206
June 2, 2014	452		282
July 2, 2014	571		356
August 2, 2014	759		485
September 2, 2014	951		628
October 2, 2014	1,073		736
November 2, 2014	1,249		905
December 1, 2014	1,354		1,001
Total	$	7,592	$	5,027


	Estimated Percentage Change in Interest Income Net of Interest Expense				Estimated Percentage Change in Interest Income Net of Interest Expense
Change in Interest Rates	September 30, 2015		December 31, 2014		March 31, 2016		December 31, 2015
(-) 25 Basis Points	(0.53	)%	(0.47	)%	(2.20	)%	(0.53	)%
Base Interest Rate	—	%	—	%	—	%	—	%
(+) 50 Basis Points	4.52	%	4.61	%	4.41	%	4.52	%
(+) 100 Basis Points	9.17	%	9.22	%	8.81	%	9.17	%



	As of September 30, 2015
Selling commissions and dealer manager fees	$	66,595
Other offering expenses	14,003
Total offering expenses	$	80,598



	Number of Requests	Number of Shares Repurchased ⁽¹⁾	Average Price per Share
Cumulative repurchases as of December 31, 2014	10	20,755	$	24.01
January 1 - January 31, 2015	—	—	—
February 1 - February 28, 2015	—	—	—
March 1 - March 31, 2015	7	5,752	24.97
April 1 - April 30, 2015	—	—	—
May 1 - May 31, 2015	—	—	—
June 1 - June 30, 2015	23	47,293	24.23
July 1 - July 31, 2015	—	—	$	—
August 1 - August 31, 2015	—	—	$	—
September 1 - September 30, 2015	24	33,392	$	23.99
Cumulative repurchases as of September 30, 2015	64	107,192	$	24.15



Exhibit No.		Description
~~10.1~~⁽¹⁾ 10.1*		Indenture, dated October 19, 2015, by and among RFT 2015-FL1 Issuer Ltd., as issuer, RFT 2015-FL1 Co-Issuer LLC, as co-issuer, Realty Finance Operating Partnership L.P., as advancing agent, and U.S. Bank National Association, as trustee, note administrator, paying agent, calculation agent, transfer agent, custodian, securities intermediary, backup advancing agent and notes registrar.
~~10.12~~⁽²⁾		First Amendment ~~No. 2~~ to Master Repurchase Agreement and First Amendment to Fee Letter, dated as of ~~September 28, 2015, between~~May 12, 2016, by and among Barclays Bank PLC, RFT ~~JPM~~BB Loan, LLC and ~~JPMorgan Chase Bank, National Association.~~
Realty Finance Trust, Inc. 21⁽²⁾		~~Subsidiaries of the Registrant.~~
31.1*		Certification of the Principal Executive Officer of the Company pursuant to Securities Exchange Act Rule 13a - 14(a) or 15(d) - 14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2*		Certification of the Principal Financial Officer of the Company pursuant to Securities Exchange Act Rule 13a - 14(a) or 15(d) - 14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32*		Written statements of the Principal Executive Officer and Principal Financial Officer of the Company pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
99.1*		Amended and Restated Share Repurchase Program dated January 28, 2016.
101*		XBRL (eXtensible Business Reporting Language). The following materials from Realty Finance Trust, Inc.’s Quarterly Report on Form 10-Q for the three months ended September 30, 2015, formatted in XBRL: (i) the ~~Condensed Consolidated~~consolidated Balance Sheets, (ii) the ~~Condensed Consolidated~~consolidated Statements of Operations, (iii) the ~~Condensed Consolidated~~consolidated Statements of Comprehensive Income, (iv) the ~~Condensed Consolidated~~consolidated Statement of Changes in Stockholders' Equity, (v) the ~~Condensed Consolidated~~consolidated Statements of Cash Flows and (vi) the Notes to the ~~Condensed Consolidated~~consolidated Financial Statements.



	REALTY FINANCE TRUST, INC.

Dated: ~~November 10, 2015~~May 13, 2016	By: /s/ Peter M. Budko Name: Peter M. Budko Title: Chief Executive Officer and Interim President (Principal Executive Officer)

Dated: ~~November 10, 2015~~May 13, 2016	By: /s/ ~~Donald R. Ramon~~Nicholas Radesca Name: ~~Donald R. Ramon~~Nicholas Radesca Title: Chief Financial Officer, Secretary and Treasurer (Principal Financial Officer and Principal Accounting Officer)