Table of Contents



UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended March 31,September 30, 2023
or
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
Commission file number: 001-37980
DigitalBridge Group, Inc.
(Exact Name of Registrant as Specified in Its Charter)
Maryland 46-4591526
(State or Other Jurisdiction of
Incorporation or Organization)
 
(I.R.S. Employer
Identification No.)
750 Park of Commerce Drive, Suite 210
Boca Raton, Florida 33487
(Address of Principal Executive Offices, Including Zip Code)
(561) 570-4644
(Registrant’s Telephone Number, Including Area Code)

Securities registered pursuant to Section 12(b) of the Act:
Title of ClassTrading Symbol(s)Name of Each Exchange on Which Registered
Class A Common Stock, $0.04$0.01 par valueDBRGNew York Stock Exchange
Preferred Stock, 7.125% Series H Cumulative Redeemable, $0.01 par valueDBRG.PRHNew York Stock Exchange
Preferred Stock, 7.15% Series I Cumulative Redeemable, $0.01 par valueDBRG.PRINew York Stock Exchange
Preferred Stock, 7.125% Series J Cumulative Redeemable, $0.01 par valueDBRG.PRJNew York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes   No 
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes  No 


Table of Contents

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large Accelerated FilerAccelerated Filer
Non-Accelerated FilerSmaller Reporting Company
Emerging Growth Company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards pursuant to Section 13(a) of the Exchange Act. Yes     No  
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes No
As of April 28,October 27, 2023, 161,884,572163,244,425 shares of the Registrant's class A common stock and 166,494 shares of class B common stock were outstanding.


Table of Contents


DigitalBridge Group, Inc.
Form 10-Q
Table of Contents
PART I. FINANCIAL INFORMATIONPage
Item 1.
Item 2.
Item 3.
Item 4.
PART II. OTHER INFORMATION
Item 1.
Item 1A.
6880
Item 2.
Item 3.
Item 4.
6880
Item 5.
Item 6.


Table of Contents

PART I—FINANCIAL INFORMATION
Item 1. Financial Statements.
DigitalBridge Group, Inc.
Consolidated Balance Sheets
(In thousands, except per share data)
March 31, 2023 (unaudited)December 31, 2022September 30, 2023 (unaudited)December 31, 2022
AssetsAssetsAssets
Cash and cash equivalentsCash and cash equivalents$668,524 $918,254 Cash and cash equivalents$434,044 $918,254 
Restricted cashRestricted cash155,690 118,485 Restricted cash104,626 118,485 
Investments ($320,757 and $426,032 at fair value)1,226,952 1,242,001 
Investments ($276,457 and $426,032 at fair value)Investments ($276,457 and $426,032 at fair value)1,879,981 1,242,001 
Real estateReal estate5,964,807 5,921,298 Real estate3,050,577 5,921,298 
GoodwillGoodwill907,937 761,368 Goodwill466,092 761,368 
Deferred leasing costs and intangible assetsDeferred leasing costs and intangible assets1,098,520 1,092,167 Deferred leasing costs and intangible assets697,754 1,092,167 
Other assets ($0 and $11,793 at fair value)Other assets ($0 and $11,793 at fair value)642,451 654,050 Other assets ($0 and $11,793 at fair value)165,340 654,050 
Due from affiliatesDue from affiliates67,285 45,360 Due from affiliates69,695 45,360 
Assets held for dispositionAssets held for disposition11,263 275,520 Assets held for disposition3,982 275,520 
Total assetsTotal assets$10,743,429 $11,028,503 Total assets$6,872,091 $11,028,503 
LiabilitiesLiabilitiesLiabilities
Corporate debtCorporate debt$569,771 $568,912 Corporate debt$371,121 $568,912 
Non-recourse investment-level debtNon-recourse investment-level debt4,752,050 4,587,228 Non-recourse investment-level debt2,786,052 4,587,228 
Intangible liabilitiesIntangible liabilities28,441 29,824 Intangible liabilities20,833 29,824 
Other liabilities ($113,766 and $183,628 at fair value)1,133,568 1,272,096 
Other liabilities ($131,435 and $183,628 at fair value)Other liabilities ($131,435 and $183,628 at fair value)668,572 1,272,096 
Liabilities related to assets held for dispositionLiabilities related to assets held for disposition374 380 Liabilities related to assets held for disposition175 380 
Total liabilitiesTotal liabilities6,484,204 6,458,440 Total liabilities3,846,753 6,458,440 
Commitments and contingencies (Note 17)Commitments and contingencies (Note 17)Commitments and contingencies (Note 17)
Redeemable noncontrolling interestsRedeemable noncontrolling interests107,413 100,574 Redeemable noncontrolling interests27,178 100,574 
EquityEquityEquity
Stockholders’ equity:Stockholders’ equity:Stockholders’ equity:
Preferred stock, $0.01 par value per share; $827,711 and $827,779 liquidation preference; 250,000 shares authorized; 33,108 and 33,111 shares issued and outstanding800,303 800,355 
Common stock, $0.04 par value per share
Class A, 949,000 shares authorized; 161,834 and 159,763 shares issued and outstanding6,473 6,390 
Class B, 1,000 shares authorized; 166 shares issued and outstanding
Preferred stock, $0.01 par value per share; $821,899 and $827,779 liquidation preference; 250,000 shares authorized; 32,876 and 33,111 shares issued and outstandingPreferred stock, $0.01 par value per share; $821,899 and $827,779 liquidation preference; 250,000 shares authorized; 32,876 and 33,111 shares issued and outstanding794,670 800,355 
Common stock, $0.01 and $0.04 par value per shareCommon stock, $0.01 and $0.04 par value per share
Class A, 237,250 shares authorized; 163,264 and 159,763 shares issued and outstandingClass A, 237,250 shares authorized; 163,264 and 159,763 shares issued and outstanding1,632 6,390 
Class B, 250 shares authorized; 166 shares issued and outstandingClass B, 250 shares authorized; 166 shares issued and outstanding
Additional paid-in capitalAdditional paid-in capital7,823,722 7,818,068 Additional paid-in capital7,835,826 7,818,068 
Accumulated deficitAccumulated deficit(7,176,706)(6,962,613)Accumulated deficit(6,941,470)(6,962,613)
Accumulated other comprehensive income (loss)Accumulated other comprehensive income (loss)(1,478)(1,509)Accumulated other comprehensive income (loss)113 (1,509)
Total stockholders’ equityTotal stockholders’ equity1,452,321 1,660,698 Total stockholders’ equity1,690,773 1,660,698 
Noncontrolling interests in investment entities Noncontrolling interests in investment entities2,650,893 2,743,896  Noncontrolling interests in investment entities1,241,556 2,743,896 
Noncontrolling interests in Operating Company Noncontrolling interests in Operating Company48,598 64,895  Noncontrolling interests in Operating Company65,831 64,895 
Total equityTotal equity4,151,812 4,469,489 Total equity2,998,160 4,469,489 
Total liabilities, redeemable noncontrolling interests and equityTotal liabilities, redeemable noncontrolling interests and equity$10,743,429 $11,028,503 Total liabilities, redeemable noncontrolling interests and equity$6,872,091 $11,028,503 

The accompanying notes areform an integral part of the consolidated financial statements.
4

Table of Contents

DigitalBridge Group, Inc.
Supplemental Schedule to Consolidated Balance Sheets
(In thousands)
(Unaudited)
Investment ManagementOperatingCorporate and OtherInvestment ManagementOperatingCorporate and Other
March 31, 2023December 31, 2022March 31, 2023December 31, 2022March 31, 2023December 31, 2022September 30, 2023December 31, 2022September 30, 2023December 31, 2022September 30, 2023December 31, 2022
Assets (1)
Assets (1)
Assets (1)
Cash and cash equivalentsCash and cash equivalents$56,943 $39,563 $65,097 $65,975 $546,484 $812,716 Cash and cash equivalents$62,212 $39,563 $59,982 $65,975 $311,850 $812,716 
Restricted cashRestricted cash2,324 2,298 152,262 114,442 1,104 1,745 Restricted cash4,116 2,298 98,701 114,442 1,809 1,745 
Investments (Note 4)Investments (Note 4)345,826 395,327 6,804 4,638 874,322 842,036 Investments (Note 4)568,892 395,327 — 4,638 1,311,089 842,036 
Real estate (Note 5)Real estate (Note 5)— — 5,964,807 5,921,298 — — Real estate (Note 5)— — 3,050,577 5,921,298 — — 
Goodwill (Note 6)Goodwill (Note 6)444,817 298,248 463,120 463,120 — — Goodwill (Note 6)466,092 298,248 — 463,120 — — 
Deferred leasing costs and intangible assets (Note 6)Deferred leasing costs and intangible assets (Note 6)128,973 85,172 969,036 1,006,469 511 526 Deferred leasing costs and intangible assets (Note 6)110,287 85,172 586,987 1,006,469 480 526 
Other assets (Note 7)Other assets (Note 7)15,966 13,356 581,848 573,229 44,637 67,465 Other assets (Note 7)29,771 13,356 89,234 573,229 46,335 67,465 
Due from affiliates (Note 16)Due from affiliates (Note 16)61,455 41,458 — — 5,830 3,902 Due from affiliates (Note 16)67,424 41,458 — — 2,271 3,902 
$1,056,304 $875,422 $8,202,974 $8,149,171 $1,472,888 $1,728,390 
$1,308,794 $875,422 $3,885,481 $8,149,171 $1,673,834 $1,728,390 
Liabilities (1)
LiabilitiesLiabilities
Corporate debt (Note 8)Corporate debt (Note 8)$199,033 $198,677 $70,246 $70,120 $300,492 $300,115 Corporate debt (Note 8)$199,745 $198,677 $70,499 $70,120 $100,877 $300,115 
Non-recourse investment-level debt (Note 8)Non-recourse investment-level debt (Note 8)— — 4,751,701 4,586,765 349 463 Non-recourse investment-level debt (Note 8)— — 2,781,637 4,586,765 4,415 463 
Intangible liabilities (Note 6)Intangible liabilities (Note 6)— — 28,441 29,824 — — Intangible liabilities (Note 6)— — 20,833 29,824 — — 
Other liabilities (Note 7)Other liabilities (Note 7)218,712 342,696 721,319 725,236 193,537 204,164 Other liabilities (Note 7)369,772 342,696 118,977 725,236 179,823 204,164 
$417,745 $541,373 $5,571,707 $5,411,945 $494,378 $504,742 
$569,517 $541,373 $2,991,946 $5,411,945 $285,115 $504,742 
Redeemable noncontrolling interests (Note 10)
Redeemable noncontrolling interests (Note 10)
1,098 680 — — 106,315 99,894 
Redeemable noncontrolling interests (Note 10)
$909 $680 $— $— $26,269 $99,894 
Noncontrolling interests in investment entities (1)
Noncontrolling interests in investment entities (1)
151,985 136,668 2,369,836 2,463,559 127,770 113,390 
Noncontrolling interests in investment entities (1)
228,838 136,668 837,793 2,463,559 173,838 113,390 
__________
(1)    ExcludeExcludes amounts related to assets held for disposition.disposition in connection with discontinued operations.

The accompanying notes areform an integral part of the consolidated financial statements.
5

Table of Contents

DigitalBridge Group, Inc.
Consolidated Statements of Operations
(In thousands, except per share data)
(Unaudited)
 Three Months Ended March 31,
 20232022
Revenues
Fee income ($56,389 and $42,004 from affiliates)$59,126 $42,837 
Carried interest allocation (reversal)(54,756)(31,079)
Principal investment income (loss)3,562 6,454 
Property operating income230,927 202,511 
Other income ($1,253 and $3,379 from affiliates)11,301 12,111 
Total revenues250,160 232,834 
Expenses
Property operating expense97,126 84,003 
Interest expense67,196 44,030 
Investment expense5,751 9,565 
Transaction-related costs8,527 165 
Depreciation and amortization141,574 128,567 
Compensation expense—cash and equity-based74,650 65,542 
Compensation expense (reversal)—incentive fee and carried interest(36,831)(20,352)
Administrative expenses26,506 27,885 
Total expenses384,499 339,405 
Other gain (loss), net(142,745)(149,881)
Income (Loss) from continuing operations before income taxes(277,084)(256,452)
Income tax benefit (expense)(1,042)7,413 
Income (Loss) from continuing operations(278,126)(249,039)
Income (Loss) from discontinued operations(14,218)(94,645)
Net income (loss)(292,344)(343,684)
Net income (loss) attributable to noncontrolling interests:
Redeemable noncontrolling interests6,943 (11,220)
Investment entities(84,828)(63,045)
Operating Company(16,662)(22,862)
Net income (loss) attributable to DigitalBridge Group, Inc.(197,797)(246,557)
Preferred stock dividends14,676 15,759 
Net income (loss) attributable to common stockholders$(212,473)$(262,316)
Income (Loss) per share—basic
Income (Loss) from continuing operations per common share—basic$(1.25)$(1.27)
Net income (loss) attributable to common stockholders per common share—basic$(1.34)$(1.84)
Income (Loss) per share—diluted
Income (Loss) from continuing operations per common share—diluted$(1.25)$(1.27)
Net income (loss) attributable to common stockholders per common share—diluted$(1.34)$(1.84)
Weighted average number of shares
Basic158,446 142,485 
Diluted158,446 142,485 
Dividends declared per common share$0.01 $— 

 Three Months Ended September 30,Nine Months Ended September 30,
 2023202220232022
Revenues
Fee income ($63,496, $40,350, $183,112 and $125,757 from affiliates)$65,240 $41,263 $190,108 $128,418 
Carried interest allocation168,891 121,698 193,389 201,398 
Principal investment income17,943 11,531 51,914 34,429 
Property operating income214,058 244,336 679,738 681,098 
Other income ($1,210, $995, $3,839 and $5,693 from affiliates)10,948 11,024 37,024 33,975 
Total revenues477,080 429,852 1,152,173 1,079,318 
Expenses
Property operating expense94,481 105,987 289,838 287,280 
Interest expense49,894 53,032 173,112 143,450 
Investment expense5,728 9,510 16,732 26,262 
Transaction-related costs896 3,879 10,536 6,800 
Placement fees15 — 3,668 — 
Depreciation and amortization128,000 145,594 419,136 429,513 
Compensation expense—cash and equity-based74,714 65,544 232,356 183,878 
Compensation expense—incentive fee and carried interest allocation72,865 80,831 72,110 109,548 
Administrative expenses24,077 29,909 76,346 84,147 
Total expenses450,670 494,286 1,293,834 1,270,878 
Other gain (loss), net254,827 25,908 100,545 (170,229)
Income (loss) from continuing operations before income taxes281,237 (38,526)(41,116)(361,789)
Income tax benefit (expense)143 7,841 (4,168)17,772 
Income (loss) from continuing operations281,380 (30,685)(45,284)(344,017)
Income (loss) from discontinued operations(2,603)(90,302)(20,799)(188,735)
Net income (loss)278,777 (120,987)(66,083)(532,752)
Net income (loss) attributable to noncontrolling interests:
Redeemable noncontrolling interests132 (6,442)4,634 (31,989)
Investment entities(17,746)(60,623)(142,241)(152,770)
Operating Company19,918 (4,834)1,511 (30,786)
Net income (loss) attributable to DigitalBridge Group, Inc.276,473 (49,088)70,013 (317,207)
Preferred stock dividends14,645 15,283 43,996 46,801 
Preferred stock repurchases— (1,098)(927)(1,098)
Net income (loss) attributable to common stockholders$261,828 $(63,273)$26,944 $(362,910)
Income (loss) per share—basic
Income (loss) from continuing operations per common share—basic$1.61 $0.07 $0.29 $(1.33)
Net income (loss) attributable to common stockholders per common share—basic$1.60 $(0.39)$0.17 $(2.37)
Income (loss) per share—diluted
Income (Loss) from continuing operations per common share—diluted$1.49 $0.07 $0.28 $(1.33)
Net income (loss) attributable to common stockholders per common share—diluted$1.48 $(0.39)$0.16 $(2.37)
Weighted average number of shares
Basic160,564 162,398 159,600 153,028 
Diluted173,862 162,398 164,020 153,028 
Dividends declared per common share$0.01 $0.01 $0.03 $0.01 
The accompanying notes areform an integral part of the consolidated financial statements.
6

Table of Contents

DigitalBridge Group, Inc.
Supplemental Schedule to Consolidated Statements of Operations
(In thousands)
(Unaudited)
Investment ManagementOperatingCorporate and Other Investment ManagementOperatingCorporate and Other
Three Months Ended March 31,Three Months Ended March 31,Three Months Ended March 31,Three Months Ended September 30,Three Months Ended September 30,Three Months Ended September 30,
202320222023202220232022 202320222023202220232022
RevenuesRevenuesRevenues
Fee income (Note 14)Fee income (Note 14)$60,098 $43,637 $— $— $(972)$(800)Fee income (Note 14)$66,058 $42,039 $— $— $(818)$(776)
Carried interest allocation (reversal)(54,756)(31,079)— — — — 
Principal investment income (loss)318 17 — — 3,244 6,437 
Carried interest allocationCarried interest allocation168,891 121,698 — — — — 
Principal investment incomePrincipal investment income1,451 1,016 — — 16,492 10,515 
Property operating income (Note 5)Property operating income (Note 5)— — 230,927 202,511 — — Property operating income (Note 5)— — 214,058 225,323 — 19,013 
Other incomeOther income1,169 1,256 737 11 9,395 10,844 Other income1,255 1,914 319 64 9,374 9,046 
Total revenuesTotal revenues6,829 13,831 231,664 202,522 11,667 16,481 Total revenues237,655 166,667 214,377 225,387 25,048 37,798 
ExpensesExpensesExpenses
Property operating expenseProperty operating expense— — 97,126 84,003 — — Property operating expense— — 94,481 100,051 — 5,936 
Interest expenseInterest expense2,603 2,502 59,984 36,184 4,609 5,344 Interest expense2,651 2,953 45,305 40,770 1,938 9,309 
Investment expenseInvestment expense536 1,140 5,203 8,016 12 409 Investment expense409 1,711 5,084 5,288 235 2,511 
Transaction-related costsTransaction-related costs5,192 — — — 3,335 165 Transaction-related costs881 1,282 — — 15 2,597 
Placement feesPlacement fees15 — — — — — 
Depreciation and amortizationDepreciation and amortization6,409 5,276 134,699 122,891 466 400 Depreciation and amortization9,003 5,369 118,681 130,663 316 9,562 
Compensation expense—cash and equity-basedCompensation expense—cash and equity-based28,182 24,808 27,179 19,956 19,289 20,778 Compensation expense—cash and equity-based39,760 22,566 21,598 30,574 13,356 12,404 
Compensation expense (reversal)—incentive fee and carried interest(36,831)(20,352)— — — — 
Compensation expense—incentive fee and carried interest allocationCompensation expense—incentive fee and carried interest allocation72,865 80,831 — — — — 
Administrative expensesAdministrative expenses6,407 4,171 7,240 6,899 12,859 16,815 Administrative expenses9,410 4,517 7,525 7,400 7,142 17,992 
Total expensesTotal expenses12,498 17,545 331,431 277,949 40,570 43,911 Total expenses134,994 119,229 292,674 314,746 23,002 60,311 
Other gain (loss), netOther gain (loss), net3,082 (3,055)1,769 956 (147,596)(147,782)Other gain (loss), net(2,662)(110)(1,612)(4,418)259,101 30,436 
Income (Loss) from continuing operations before income taxes(2,587)(6,769)(97,998)(74,471)(176,499)(175,212)
Income (loss) from continuing operations before income taxesIncome (loss) from continuing operations before income taxes99,999 47,328 (79,909)(93,777)261,147 7,923 
Income tax benefit (expense)Income tax benefit (expense)(217)(2,374)56 330 (881)9,457 Income tax benefit (expense)15 (1,263)202 (74)9,099 
Income (Loss) from continuing operations(2,804)(9,143)(97,942)(74,141)(177,380)(165,755)
Income (loss) from continuing operationsIncome (loss) from continuing operations100,014 46,065 (79,707)(93,772)261,073 17,022 
Income (loss) from continuing operations attributable to noncontrolling interests:Income (loss) from continuing operations attributable to noncontrolling interests:Income (loss) from continuing operations attributable to noncontrolling interests:
Redeemable noncontrolling interestsRedeemable noncontrolling interests418 (3,266)— — 6,525 (7,954)Redeemable noncontrolling interests— 25 — — 132 (6,467)
Investment entitiesInvestment entities(857)2,349 (86,254)(60,196)1,766 977 Investment entities43,666 19,888 (68,743)(76,706)7,386 6,422 
Operating CompanyOperating Company(167)(624)(899)(1,121)(14,522)(14,007)Operating Company3,957 1,919 (773)(1,185)16,913 158 
Income (Loss) from continuing operations attributable to DigitalBridge Group, Inc.$(2,198)$(7,602)$(10,789)$(12,824)$(171,149)$(144,771)
Income (loss) from continuing operations attributable to DigitalBridge Group, Inc.Income (loss) from continuing operations attributable to DigitalBridge Group, Inc.$52,391 $24,233 $(10,191)$(15,881)$236,642 $16,909 

The accompanying notes areform an integral part of the consolidated financial statements.
7

Table of Contents

DigitalBridge Group, Inc.
Supplemental Schedule to Consolidated Statements of Comprehensive Income (Loss)Operations
(In thousands)
(Unaudited)
 Three Months Ended March 31,
 20232022
Net income (loss)$(292,344)$(343,684)
Changes in accumulated other comprehensive income (loss) related to:
Equity method investments318 
Available-for-sale debt securities— (6,373)
Foreign currency translation(231)(37,941)
Other comprehensive income (loss)87 (44,312)
Comprehensive income (loss)(292,257)(387,996)
Comprehensive income (loss) attributable to noncontrolling interests:
Redeemable noncontrolling interests6,943 (11,220)
Investment entities(84,793)(75,056)
Operating Company(16,643)(25,458)
Comprehensive income (loss) attributable to stockholders$(197,764)$(276,262)
 Investment ManagementOperatingCorporate and Other
Nine Months Ended September 30,Nine Months Ended September 30,Nine Months Ended September 30,
 202320222023202220232022
Revenues
Fee income (Note 14)$192,787 $130,789 $— $— $(2,679)$(2,371)
Carried interest allocation193,389 201,398 — — — — 
Principal investment income3,373 2,049 — — 48,541 32,380 
Property operating income (Note 5)— — 679,738 655,480 — 25,618 
Other income4,028 4,172 1,362 116 31,634 29,687 
Total revenues393,577 338,408 681,100 655,596 77,496 85,314 
Expenses
Property operating expense— — 289,838 278,798 — 8,482 
Interest expense7,883 8,240 156,574 114,187 8,655 21,023 
Investment expense1,136 3,110 15,245 18,791 351 4,361 
Transaction-related costs6,686 3,180 — — 3,850 3,620 
Placement fees3,668 — — — — — 
Depreciation and amortization26,451 16,020 391,589 399,371 1,096 14,122 
Compensation expense—cash and equity-based113,740 70,604 75,212 70,759 43,404 42,515 
Compensation expense—incentive fee and carried interest allocation72,110 109,548 — — — — 
Administrative expenses23,770 13,557 23,606 23,209 28,970 47,381 
Total expenses255,444 224,259 952,064 905,115 86,326 141,504 
Other gain (loss), net(3,188)(3,589)501 (3,996)103,232 (162,644)
Income (loss) from continuing operations before income taxes134,945 110,560 (270,463)(253,515)94,402 (218,834)
Income tax benefit (expense)(2,558)(5,643)(241)174 (1,369)23,241 
Income (loss) from continuing operations132,387 104,917 (270,704)(253,341)93,033 (195,593)
Income (loss) from continuing operations attributable to noncontrolling interests:
Redeemable noncontrolling interests229 (3,194)— — 4,405 (28,795)
Investment entities77,842 67,168 (236,724)(206,316)16,204 2,394 
Operating Company3,814 3,043 (2,491)(3,513)1,727 (17,166)
Income (loss) from continuing operations attributable to DigitalBridge Group, Inc.$50,502 $37,900 $(31,489)$(43,512)$70,697 $(152,026)

The accompanying notes areform an integral part of the consolidated financial statements.
8

Table of Contents
DigitalBridge Group, Inc.
Consolidated Statements of Comprehensive Income (Loss)
(In thousands)
(Unaudited)
 Three Months Ended September 30,Nine Months Ended September 30,
 2023202220232022
Net income (loss)$278,777 $(120,987)$(66,083)$(532,752)
Changes in accumulated other comprehensive income (loss) related to:
Equity method investments— (1,647)318 (4,333)
Available-for-sale debt securities— — — (6,373)
Foreign currency translation(2,046)(34,809)866 (97,090)
Net investment hedges— 10,932 — 17,916 
Other comprehensive income (loss)(2,046)(25,524)1,184 (89,880)
Comprehensive income (loss)276,731 (146,511)(64,899)(622,632)
Comprehensive income (loss) attributable to noncontrolling interests:
Redeemable noncontrolling interests132 (6,442)4,634 (31,989)
Investment entities(17,725)(80,210)(141,825)(192,140)
Operating Company19,825 (5,259)1,638 (34,733)
Comprehensive income (loss) attributable to stockholders$274,499 $(54,600)$70,654 $(363,770)

The accompanying notes form an integral part of the consolidated financial statements.
9

Table of Contents
DigitalBridge Group, Inc.
Consolidated Statements of Equity
(In thousands, except per share data)
(Unaudited)
Preferred StockCommon StockAdditional Paid-in CapitalAccumulated DeficitAccumulated Other Comprehensive Income (Loss)Total Stockholders’ EquityNoncontrolling Interests in Investment EntitiesNoncontrolling Interests in Operating CompanyTotal Equity Preferred StockCommon StockAdditional Paid-in CapitalAccumulated DeficitAccumulated Other Comprehensive Income (Loss)Total Stockholders’ EquityNoncontrolling Interests in Investment EntitiesNoncontrolling Interests in Operating CompanyTotal Equity
Balance at December 31, 2021Balance at December 31, 2021$854,232 $5,692 $7,820,807 $(6,576,180)$42,383 $2,146,934 $2,653,173 $112,283 $4,912,390 Balance at December 31, 2021$854,232 $5,692 $7,820,807 $(6,576,180)$42,383 $2,146,934 $2,653,173 $112,283 $4,912,390 
Net income (loss)Net income (loss)— — — (246,557)— (246,557)(63,045)(22,862)(332,464)Net income (loss)— — — (246,557)— (246,557)(63,045)(22,862)(332,464)
Other comprehensive income (loss)Other comprehensive income (loss)— — — — (29,705)(29,705)(12,011)(2,596)(44,312)Other comprehensive income (loss)— — — — (29,705)(29,705)(12,011)(2,596)(44,312)
Exchange of notes for common stock (Note 8)Exchange of notes for common stock (Note 8)— 256 177,562 — — 177,818 — — 177,818 Exchange of notes for common stock (Note 8)— 256 177,562 — — 177,818 — — 177,818 
Adjustment of redeemable noncontrolling interest and warrants to fair value (Note 10)Adjustment of redeemable noncontrolling interest and warrants to fair value (Note 10)— — (690,000)— — (690,000)— — (690,000)Adjustment of redeemable noncontrolling interest and warrants to fair value (Note 10)— — (690,000)— — (690,000)— — (690,000)
Deconsolidation of investment entitiesDeconsolidation of investment entities— — — — — — (176,856)— (176,856)Deconsolidation of investment entities— — — — — — (176,856)— (176,856)
Redemption of OP Units for class A common stockRedemption of OP Units for class A common stock— — — — — (2)— Redemption of OP Units for class A common stock— — — — — (2)— 
Equity based compensation— 50 14,286 — — 14,336 2,734 1,555 18,625 
Equity-based compensationEquity-based compensation— 50 14,286 — — 14,336 2,734 1,555 18,625 
Shares canceled for tax withholdings on vested equity awardsShares canceled for tax withholdings on vested equity awards— (17)(11,393)— — (11,410)— — (11,410)Shares canceled for tax withholdings on vested equity awards— (17)(11,393)— — (11,410)— — (11,410)
Acquisition of noncontrolling interestAcquisition of noncontrolling interest— — — — — — (32,076)— (32,076)Acquisition of noncontrolling interest— — — — — — (32,076)— (32,076)
Contributions from noncontrolling interestsContributions from noncontrolling interests— — — — — — 343,006 — 343,006 Contributions from noncontrolling interests— — — — — — 343,006 — 343,006 
Distributions to noncontrolling interestsDistributions to noncontrolling interests— — — — — — (26,018)— (26,018)Distributions to noncontrolling interests— — — — — — (26,018)— (26,018)
Preferred stock dividendsPreferred stock dividends— — — (15,760)— (15,760)— — (15,760)Preferred stock dividends— — — (15,760)— (15,760)— — (15,760)
Reallocation of equity (Notes 2 and 10)Reallocation of equity (Notes 2 and 10)— — 45,099 — 75 45,174 — (45,174)— Reallocation of equity (Notes 2 and 10)— — 45,099 — 75 45,174 — (45,174)— 
Balance at March 31, 2022Balance at March 31, 2022854,232 $5,981 $7,356,363 $(6,838,497)$12,753 $1,390,832 $2,688,907 $43,204 $4,122,943 Balance at March 31, 2022854,232 $5,981 $7,356,363 $(6,838,497)$12,753 $1,390,832 $2,688,907 $43,204 $4,122,943 
Net income (loss)Net income (loss)— — — (21,562)— (21,562)(29,102)(3,090)(53,754)
Other comprehensive income (loss)Other comprehensive income (loss)— — — — (11,346)(11,346)(7,772)(926)(20,044)
Adjustment of redeemable noncontrolling interest and warrants to fair value (Note 10)Adjustment of redeemable noncontrolling interest and warrants to fair value (Note 10)— — (35,026)— — (35,026)— — (35,026)
Shares issued for redemption of redeemable noncontrolling interest (Note 10)Shares issued for redemption of redeemable noncontrolling interest (Note 10)— 577 348,182 — — 348,759 — — 348,759 
Transaction costs incurred in connection with redemption of redeemable noncontrolling interestTransaction costs incurred in connection with redemption of redeemable noncontrolling interest— — (7,137)— — (7,137)— — (7,137)
Reclassification of carried interest allocated to redeemable noncontrolling interest to noncontrolling interest in investment entities (Note 10)Reclassification of carried interest allocated to redeemable noncontrolling interest to noncontrolling interest in investment entities (Note 10)— — — — — — 4,087 — 4,087 
Deconsolidation of investment entitiesDeconsolidation of investment entities— — — — — — 11,047 — 11,047 
Redemption of OP Units for class A common stockRedemption of OP Units for class A common stock— 335 — — 339 — (339)— 
Equity-based compensationEquity-based compensation— 7,508 — — 7,517 1,061 591 9,169 
Shares canceled for tax withholdings on vested equity awardsShares canceled for tax withholdings on vested equity awards— (7)(5,060)— — (5,067)— — (5,067)
Contributions from noncontrolling interestsContributions from noncontrolling interests— — — — — — 215,790 — 215,790 
Distributions to noncontrolling interestsDistributions to noncontrolling interests— — — — — — (13,490)— (13,490)
Preferred stock dividendsPreferred stock dividends— — — (15,758)— (15,758)— — (15,758)
Reallocation of equity (Notes 2 and 10)Reallocation of equity (Notes 2 and 10)— — (18,313)— 48 (18,265)— 18,265 — 
Balance at June 30, 2022Balance at June 30, 2022$854,232 $6,564 $7,646,852 $(6,875,817)$1,455 $1,633,286 $2,870,528 $57,705 $4,561,519 
The accompanying notes form an integral part of the consolidated financial statements.
910

Table of Contents

DigitalBridge Group, Inc.
Consolidated Statements of Equity (Continued)
(In thousands, except per share data)
(Unaudited)
Preferred StockCommon StockAdditional Paid-in CapitalAccumulated DeficitAccumulated Other Comprehensive Income (Loss)Total Stockholders’ EquityNoncontrolling Interests in Investment EntitiesNoncontrolling Interests in Operating CompanyTotal Equity Preferred StockCommon StockAdditional Paid-in CapitalAccumulated DeficitAccumulated Other Comprehensive Income (Loss)Total Stockholders’ EquityNoncontrolling Interests in Investment EntitiesNoncontrolling Interests in Operating CompanyTotal Equity
Balance at December 31, 2022$800,355 $6,397 $7,818,068 $(6,962,613)$(1,509)$1,660,698 $2,743,896 $64,895 $4,469,489 
Net income (loss)— — — (197,797)— (197,797)(84,828)(16,662)(299,287)
Other comprehensive income (loss)— — — — 33 33 35 19 87 
Balance at June 30, 2022Balance at June 30, 2022$854,232 $6,564 $7,646,852 $(6,875,817)$1,455 $1,633,286 $2,870,528 $57,705 $4,561,519 
Net lossNet loss— — — (49,088)— (49,088)(60,623)(4,834)(114,545)
Other comprehensive lossOther comprehensive loss— — — — (5,512)(5,512)(19,587)(425)(25,524)
Stock repurchases (Note 9)Stock repurchases (Note 9)(53,877)(38)(12,476)— — (66,391)— — (66,391)
DataBank recapitalization (Note 10)DataBank recapitalization (Note 10)— — 170,770 — — 170,770 (170,770)— — 
Common stock repurchases(52)— — — — (52)— — (52)
Equity based compensation— 99 10,930 — — 11,029 5,542 41 16,612 
Equity-based compensationEquity-based compensation— 9,867 — — 9,869 8,861 311 19,041 
Shares canceled for tax withholdings on vested equity awardsShares canceled for tax withholdings on vested equity awards— (16)(4,847)— — (4,863)— — (4,863)Shares canceled for tax withholdings on vested equity awards— (2)(1,533)— — (1,535)— — (1,535)
Cost of DataBank recapitalizationCost of DataBank recapitalization— — (8,749)— — (8,749)(21,247)— (29,996)
Contributions from noncontrolling interestsContributions from noncontrolling interests— — — — — — 29,684 — 29,684 Contributions from noncontrolling interests— — — — — — 1,502,454 — 1,502,454 
Distributions to noncontrolling interestsDistributions to noncontrolling interests— — — — — — (43,436)(126)(43,562)Distributions to noncontrolling interests— — — — — — (1,219,454)(127)(1,219,581)
Preferred stock dividendsPreferred stock dividends— — — (14,676)— (14,676)— — (14,676)Preferred stock dividends— — — (15,117)— (15,117)— — (15,117)
Common stock dividends declared ($0.01 per share)Common stock dividends declared ($0.01 per share)— — — (1,620)— (1,620)— — (1,620)Common stock dividends declared ($0.01 per share)— — — (1,636)— (1,636)— — (1,636)
Reallocation of equity (Notes 2 and 10)Reallocation of equity (Notes 2 and 10)— — (429)— (2)(431)— 431 — Reallocation of equity (Notes 2 and 10)— — (11,239)— (11,238)— 11,238 — 
Balance at March 31, 2023$800,303 $6,480 $7,823,722 $(7,176,706)$(1,478)$1,452,321 $2,650,893 $48,598 $4,151,812 
Balance at September 30, 2022Balance at September 30, 2022$800,355 $6,526 $7,793,492 $(6,941,658)$(4,056)$1,654,659 $2,890,162 $63,868 $4,608,689 

The accompanying notes areform an integral part of the consolidated financial statements.
1011

Table of Contents
DigitalBridge Group, Inc.
Consolidated Statements of Equity (Continued)
(In thousands, except per share data)
(Unaudited)
 Preferred StockCommon StockAdditional Paid-in CapitalAccumulated DeficitAccumulated Other Comprehensive Income (Loss)Total Stockholders’ EquityNoncontrolling Interests in Investment EntitiesNoncontrolling Interests in Operating CompanyTotal Equity
 
Balance at December 31, 2022$800,355 $6,397 $7,818,068 $(6,962,613)$(1,509)$1,660,698 $2,743,896 $64,895 $4,469,489 
Net income (loss)— — — (197,797)— (197,797)(84,828)(16,662)(299,287)
Other comprehensive income (loss)— — — — 33 33 35 19 87 
Preferred stock repurchases (Note 9)(52)— — — — (52)— — (52)
Equity-based compensation— 99 10,930 — — 11,029 5,542 41 16,612 
Shares canceled for tax withholdings on vested equity awards— (16)(4,847)— — (4,863)— — (4,863)
Contributions from noncontrolling interests— — — — — — 29,684 — 29,684 
Distributions to noncontrolling interests— — — — — — (43,436)(126)(43,562)
Preferred stock dividends— — — (14,676)— (14,676)— — (14,676)
Common stock dividends declared ($0.01 per share)— — — (1,620)— (1,620)— — (1,620)
Reallocation of equity (Notes 2 and 10)— — (429)— (2)(431)— 431 — 
Balance at March 31, 2023$800,303 $6,480 $7,823,722 $(7,176,706)$(1,478)$1,452,321 $2,650,893 $48,598 $4,151,812 
Net income (loss)— — — (8,663)— (8,663)(39,667)(1,745)(50,075)
Other comprehensive income (loss)— — — — 2,582 2,582 360 201 3,143 
Change in common stock par value (Note 9)— (4,862)4,862 — — — — — — 
Preferred stock repurchases (Note 9)(5,633)— 927 — — (4,706)— — (4,706)
Redemption of OP Units for class A common stock— 981 — — 984 — (984)— 
Equity-based compensation— 11 21,681 — — 21,692 4,232 41 25,965 
Shares canceled for tax withholdings on vested equity awards— (6)(5,348)— — (5,354)— — (5,354)
Contributions from noncontrolling interests— — — — — — 38,240 — 38,240 
Distributions to noncontrolling interests— — — — — — (13,608)(124)(13,732)
Preferred stock dividends— — — (14,660)— (14,660)— — (14,660)
Common stock dividends declared ($0.01 per share)— — — (1,622)— (1,622)— — (1,622)
Reallocation of equity (Notes 2 and 10)— — (385)— 18 (367)(844)1,211 — 
Balance at June 30, 2023$794,670 $1,626 $7,846,440 $(7,201,651)$1,122 $1,442,207 $2,639,606 $47,198 $4,129,011 

The accompanying notes form an integral part of the consolidated financial statements.
12

Table of Contents
DigitalBridge Group, Inc.
Consolidated Statements of Equity (Continued)
(In thousands, except per share data)
(Unaudited)
 Preferred StockCommon StockAdditional Paid-in CapitalAccumulated DeficitAccumulated Other Comprehensive Income (Loss)Total Stockholders’ EquityNoncontrolling Interests in Investment EntitiesNoncontrolling Interests in Operating CompanyTotal Equity
 
Balance at June 30, 2023$794,670 $1,626 $7,846,440 $(7,201,651)$1,122 $1,442,207 $2,639,606 $47,198 $4,129,011 
Net income (loss)— — — 276,473 — 276,473 (17,746)19,918 278,645 
Other comprehensive income (loss)— — — — (1,974)(1,974)21 (93)(2,046)
DataBank recapitalization (Note 10)— — (14,791)— — (14,791)33,001 — 18,210 
DataBank deconsolidation (Note 10)— — — — 965 965 (1,427,435)— (1,426,470)
Equity-based compensation— 12 11,023 — — 11,035 3,934 41 15,010 
Shares canceled for tax withholdings on vested equity awards— (4)(7,955)— — (7,959)— — (7,959)
Contributions from noncontrolling interests— — — — — — 26,907 — 26,907 
Distributions to noncontrolling interests— — — — — — (16,732)(124)(16,856)
Preferred stock dividends— — — (14,660)— (14,660)— — (14,660)
Common stock dividends declared ($0.01 per share)— — — (1,632)— (1,632)— — (1,632)
Reallocation of equity (Notes 2 and 10)— — 1,109 — — 1,109 — (1,109)— 
Balance at September 30, 2023$794,670 $1,634 $7,835,826 $(6,941,470)$113 $1,690,773 $1,241,556 $65,831 $2,998,160 

The accompanying notes form an integral part of the consolidated financial statements.
13

Table of Contents
DigitalBridge Group, Inc.
Consolidated Statements of Cash Flows
(In thousands)
(Unaudited)
Three Months Ended March 31, Nine Months Ended September 30,
20232022 20232022
Cash Flows from Operating ActivitiesCash Flows from Operating ActivitiesCash Flows from Operating Activities
Net income (loss)Net income (loss)(292,344)(343,684)Net income (loss)$(66,083)$(532,752)
Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:
Paid-in-kind interest added to loan principal, net of interest received(544)(1,144)
Paid-in-kind interest added to loan principalPaid-in-kind interest added to loan principal(544)(4,887)
Straight-line rent incomeStraight-line rent income(1,944)(6,701)Straight-line rent income(6,020)(18,417)
Amortization of above- and below-market lease values, netAmortization of above- and below-market lease values, net245 (132)Amortization of above- and below-market lease values, net1,216 (58)
Amortization of deferred financing costs and debt discount and premium, netAmortization of deferred financing costs and debt discount and premium, net12,182 96,279 Amortization of deferred financing costs and debt discount and premium, net19,755 102,943 
Carried interest (allocation) reversal54,756 31,079 
Principal investment (income) loss(3,562)(6,454)
Unrealized carried interest allocationUnrealized carried interest allocation(165,462)(105,500)
Unrealized principal investment incomeUnrealized principal investment income(51,914)(34,429)
Other equity method (earnings) lossesOther equity method (earnings) losses10,609 (24,741)Other equity method (earnings) losses13,283 37,502 
Distributions of income from equity method investmentsDistributions of income from equity method investments557 — Distributions of income from equity method investments3,727 1,105 
Impairment of real estate and related intangibles and right-of-use asset— 23,802 
Impairment of real estate and intangible assetsImpairment of real estate and intangible assets— 35,985 
Depreciation and amortizationDepreciation and amortization141,574 130,906 Depreciation and amortization419,136 431,852 
Equity-based compensationEquity-based compensation16,612 18,719 Equity-based compensation57,587 47,119 
Deferred income tax (benefit) expenseDeferred income tax (benefit) expense881 (9,040)Deferred income tax (benefit) expense(868)(14,794)
Loss on extinguishment of debt— 133,173 
Loss on debt extinguishmentLoss on debt extinguishment— 133,173 
Other gain (loss), netOther gain (loss), net142,644 17,332 Other gain (loss), net(102,941)29,287 
Other adjustments, netOther adjustments, net182 (986)Other adjustments, net660 (494)
(Increase) decrease in other assets and due from affiliates(Increase) decrease in other assets and due from affiliates23,486 (4,186)(Increase) decrease in other assets and due from affiliates3,224 9,579 
Increase (decrease) in accrued and other liabilities and due to affiliatesIncrease (decrease) in accrued and other liabilities and due to affiliates(85,149)(52,965)Increase (decrease) in accrued and other liabilities and due to affiliates67,324 77,559 
Net cash provided by (used in) operating activitiesNet cash provided by (used in) operating activities20,185 1,257 Net cash provided by (used in) operating activities192,080 194,773 
Cash Flows from Investing ActivitiesCash Flows from Investing ActivitiesCash Flows from Investing Activities
Contributions to and acquisition of equity investmentsContributions to and acquisition of equity investments(140,998)(215,040)Contributions to and acquisition of equity investments(470,183)(445,039)
Return of capital from equity method investmentsReturn of capital from equity method investments52,259 11,829 Return of capital from equity method investments65,763 58,560 
Proceeds from sale of equity investmentsProceeds from sale of equity investments308,254 194,524 Proceeds from sale of equity investments636,687 483,833 
Acquisition of loans receivable and debt securitiesAcquisition of loans receivable and debt securities— (101,607)Acquisition of loans receivable and debt securities— (164,815)
Proceeds from paydown and maturity of debt securitiesProceeds from paydown and maturity of debt securities— 566 Proceeds from paydown and maturity of debt securities— 566 
Net disbursements on originated loansNet disbursements on originated loans— (205,507)Net disbursements on originated loans— (215,918)
Repayments of loans receivableRepayments of loans receivable— 15,845 Repayments of loans receivable6,804 23,956 
Proceeds from sales of loans receivable and debt securitiesProceeds from sales of loans receivable and debt securities— 126,644 Proceeds from sales of loans receivable and debt securities— 360,773 
Acquisition of and additions to real estate, related intangibles and leasing commissionsAcquisition of and additions to real estate, related intangibles and leasing commissions(162,918)(836,061)Acquisition of and additions to real estate, related intangibles and leasing commissions(613,109)(1,952,718)
Proceeds from sales of real estate, net of property level cash transferred to buyer— 96,660 
Proceeds from sales of real estate investment holding entitiesProceeds from sales of real estate investment holding entities— 96,660 
Cash and restricted cash assumed by buyer in sales of real estate investment holding entitiesCash and restricted cash assumed by buyer in sales of real estate investment holding entities— (189,453)Cash and restricted cash assumed by buyer in sales of real estate investment holding entities— (189,453)
Investment depositsInvestment deposits(5,704)326 Investment deposits(2,208)1,051 
Net receipts on settlement of derivatives3,401 — 
Net receipt (payment) on settlement of derivativesNet receipt (payment) on settlement of derivatives3,401 13,952 
Acquisition of InfraBridge, net of cash acquired (Note 3)Acquisition of InfraBridge, net of cash acquired (Note 3)(313,164)— Acquisition of InfraBridge, net of cash acquired (Note 3)(314,266)— 
Cash and restricted cash derecognized in DataBank deconsolidationCash and restricted cash derecognized in DataBank deconsolidation(102,448)— 
Proceeds from DataBank recapitalization, net of carried interest distributionProceeds from DataBank recapitalization, net of carried interest distribution21,487 — 
Other investing activities, netOther investing activities, net— (875)Other investing activities, net— (769)
Net cash provided by (used in) investing activitiesNet cash provided by (used in) investing activities(258,870)(1,102,149)Net cash provided by (used in) investing activities(768,072)(1,929,361)







1114

Table of Contents

DigitalBridge Group, Inc.
Consolidated Statements of Cash Flows (Continued)
(In thousands)
(Unaudited)
Three Months Ended March 31, Nine Months Ended September 30,
20232022 20232022
Cash Flows from Financing ActivitiesCash Flows from Financing ActivitiesCash Flows from Financing Activities
Dividends paid to preferred stockholdersDividends paid to preferred stockholders$(14,766)$(15,760)Dividends paid to preferred stockholders$(44,101)$(47,629)
Dividends paid to common stockholdersDividends paid to common stockholders(1,599)— Dividends paid to common stockholders(4,838)— 
Repurchases of common stockRepurchases of common stock— (8,008)
Repayments of corporate debt, including repurchase of senior notes— (14,237)
Borrowings from investment-level debt1,241,890 326,500 
Repayments of investment-level debt(1,060,239)(3,894)
Borrowings on corporate debtBorrowings on corporate debt— 290,000 
Repayments of corporate debt, including senior notesRepayments of corporate debt, including senior notes(200,000)(304,237)
Borrowings from investment level debtBorrowings from investment level debt1,722,443 724,582 
Repayments of investment level debtRepayments of investment level debt(1,194,542)(179,510)
Payment of deferred financing costs and prepayment penalties on investment level debtPayment of deferred financing costs and prepayment penalties on investment level debt(29,482)(6,999)Payment of deferred financing costs and prepayment penalties on investment level debt(38,029)(18,707)
Contributions from noncontrolling interestsContributions from noncontrolling interests29,684 353,156 Contributions from noncontrolling interests95,131 2,072,900 
Distributions to and redemptions of noncontrolling interestsDistributions to and redemptions of noncontrolling interests(43,839)(35,962)Distributions to and redemptions of noncontrolling interests(144,534)(1,684,752)
Payment of contingent consideration to Wafra (Note 10)(90,000)— 
Payment of contingent consideration to WafraPayment of contingent consideration to Wafra(90,000)— 
Repurchases of preferred stockRepurchases of preferred stock(4,758)(52,779)
Shares canceled for tax withholdings on vested equity awardsShares canceled for tax withholdings on vested equity awards(4,863)(11,410)Shares canceled for tax withholdings on vested equity awards(18,176)(18,012)
Acquisition of noncontrolling interestAcquisition of noncontrolling interest— (32,076)Acquisition of noncontrolling interest— (32,076)
Net cash provided by (used in) financing activitiesNet cash provided by (used in) financing activities26,786 559,318 Net cash provided by (used in) financing activities78,596 741,772 
Effect of exchange rates on cash, cash equivalents and restricted cashEffect of exchange rates on cash, cash equivalents and restricted cash(626)(651)Effect of exchange rates on cash, cash equivalents and restricted cash(673)(3,039)
Net increase (decrease) in cash, cash equivalents and restricted cashNet increase (decrease) in cash, cash equivalents and restricted cash(212,525)(542,225)Net increase (decrease) in cash, cash equivalents and restricted cash(498,069)(995,855)
Cash, cash equivalents and restricted cash—beginning of periodCash, cash equivalents and restricted cash—beginning of period1,036,739 1,766,245 Cash, cash equivalents and restricted cash—beginning of period1,036,739 1,766,245 
Cash, cash equivalents and restricted cash—end of periodCash, cash equivalents and restricted cash—end of period$824,214 $1,224,020 Cash, cash equivalents and restricted cash—end of period$538,670 $770,390 
Reconciliation of cash, cash equivalents and restricted cash to consolidated balance sheets
Three Months Ended March 31,Nine Months Ended September 30,
2023202220232022
Beginning of the periodBeginning of the periodBeginning of the period
Cash and cash equivalentsCash and cash equivalents$918,254 $1,602,102 Cash and cash equivalents$918,254 $1,602,102 
Restricted cashRestricted cash118,485 99,121 Restricted cash118,485 99,121 
Restricted cash included in assets held for dispositionRestricted cash included in assets held for disposition— 65,022 Restricted cash included in assets held for disposition— 65,022 
Total cash, cash equivalents and restricted cash, beginning of periodTotal cash, cash equivalents and restricted cash, beginning of period$1,036,739 $1,766,245 Total cash, cash equivalents and restricted cash, beginning of period$1,036,739 $1,766,245 
End of the periodEnd of the periodEnd of the period
Cash and cash equivalentsCash and cash equivalents$668,524 $1,117,688 Cash and cash equivalents$434,044 $636,366 
Restricted cashRestricted cash155,690 106,332 Restricted cash104,626 134,024 
Total cash, cash equivalents and restricted cash, end of periodTotal cash, cash equivalents and restricted cash, end of period$824,214 $1,224,020 Total cash, cash equivalents and restricted cash, end of period$538,670 $770,390 

The accompanying notes areform an integral part of the consolidated financial statements.
1215

Table of Contents

DigitalBridge Group, Inc.
Notes to Consolidated Financial Statements
March 31,September 30, 2023
(Unaudited)
1. Business and Organization
DigitalBridge Group, Inc. ("DBRG," and together with its consolidated subsidiaries, the "Company") is a leading global digital infrastructure investment manager. The Company deploys and manages capital on behalf of its investors and shareholders across the digital infrastructure ecosystem, including data centers, cell towers, fiber networks, small cells, and edge infrastructure. The Company's investment management platform is anchored by its flagship value-add digital infrastructure equity offerings, and has expanded to include offerings in core equity, credit and liquid securities.
In February 2023, the Company further expanded its investment offerings to encompass InfraBridge, a newly-acquired mid-market global infrastructure equity platform (Note 3).
In September 2023, the Company completed a recapitalization of its portfolio company, DataBank, an edge colocation data center business. As a result of an additional sell down of the Company's ownership interest in DataBank in the final closing of the recapitalization, the Company was determined to no longer hold a controlling financial interest in DataBank and deconsolidated DataBank upon completion of the recapitalization on September 14, 2023 (Note 10).
Organization
The Company operates as a taxable C Corporation commencing with the taxable year ended December 31, 2022, except for certain subsidiaries in the Operating segment that have elected to be taxed as real estate investment trusts for U.S. federal income tax purposes. The Company conducts all of its activities and holds substantially all of its assets and liabilities through its operating subsidiary, DigitalBridge Operating Company, LLC (the "Operating Company" or the "OP"). At March 31,September 30, 2023, the Company owned 93% of the OP, as its sole managing member. The remaining 7% is owned primarily by certain current and former employees of the Company as noncontrolling interests.
2. Summary of Significant Accounting Policies
The significant accounting policies of the Company are described below.
Basis of Presentation
The accompanying unaudited interim financial statements have been prepared in accordance with the instructions to Form 10-Q and Article 10 of Regulation S-X. Accordingly, they do not include all information and footnotes required by accounting principles generally accepted in the United States of America (“GAAP”) for complete financial statements. These statements reflect all normal and recurring adjustments which, in the opinion of management, are necessary to present fairly the financial position, results of operations and cash flows of the Company for the interim periods presented. However, the results of operations for the interim period presented are not necessarily indicative of the results that may be expected for the year ending December 31, 2023, or any other future period. These interim financial statements should be read in conjunction with the audited consolidated financial statements and notes thereto included in, or presented as exhibits to, the Company’s Annual Report on Form 10-K for the year ended December 31, 2022.
The accompanying consolidated financial statements include the accounts of the Company and its controlled subsidiaries. All significant intercompany accounts and transactions have been eliminated. The portions of equity, net income (loss) and other comprehensive income (loss) of consolidated subsidiaries that are not attributable to the parent are presented separately as amounts attributable to noncontrolling interests in the consolidated financial statements. Noncontrolling interests represent predominantly the majority ownership held by third party investors in the Company's Operating segment, carried interest allocation to certain senior executives of the Company (Note 16), and membership interests in the OP primarily held by certain current and former employees of the Company.
To the extent the Company consolidates a subsidiary that is subject to industry-specific guidance, such as investment company accounting applied by the Company's consolidated sponsored funds, the Company retains the industry-specific guidance applied by that subsidiary in its consolidated financial statements.
Supplemental Schedules to Consolidated Balance Sheets and Consolidated Statements of Operations
Beginning in 2023, the financial position and financial results of the Company's reportable segments of Investment Management and Operating, and its remaining investment activities and corporate level activities ("Corporate and Other") are presented in supplemental schedules to the consolidated balance sheets and consolidated statements of operations. The Company's reportable segments and Corporate and Other are described below under "—Segment Reporting."
16

Table of Contents
The disaggregated presentation in the supplemental schedules enhances transparency and provides meaningful information to investors in understanding the Company's consolidated financial statements, specifically:
13

Table of Contents

Segregation of the Investment Management segment allows for more clarity and visibility into the financial performance and financial position of the Company's core business; and
The Operating segment represents the consolidation of two data center portfolio companies for which the Company has direct co-investmentsco-investments. This is represented by the consolidation of two portfolio companies up to mid-September 2023, after which the DataBank portfolio company was deconsolidated. The Company's direct co-investment in the remaining portfolio company was 13% and 11%, respectively, at both March 31,September 30, 2023 and December 31, 2022.2022, while its ownership in DataBank was 11% at December 31, 2022 and through the final close of the recapitalization in mid-September 2023, thereafter the Company's remaining 9.87% interest in DataBank is presented within Corporate and Other (Note 10). Although the Operating segment makes up a majority of the balances and activities on a consolidated basis, DBRG's exposure and entitlement are limited to its 13% and 11%ownership interest in the two portfolio companies in the Operating segment. The liabilities of the Operating segment are obligations of the respective portfolio companies of the Operating segment and may only be settled using assets of these respectivethe portfolio companies.
The supplemental schedule to the consolidated balance sheets excludes assets and liabilities held for disposition that are related to discontinued operations, and stockholders' equity and noncontrolling interests in OP, whichas these equity items are not specifically attributable to reportable segments.
The supplemental scheduleschedules to the consolidated statements of operations present by reportable segment the results from continuing operations attributable to DBRG, excluding discontinued operations and results attributable to common stockholders. Additionally, fee income in the Investment Management segment is presented prior to elimination of fees earned from the Company's sponsored investment vehicles that are consolidated within the Operating segment and in Corporate and Other. The elimination of intercompany fees is presented in Corporate and Other.
Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates and assumptions.
Principles of Consolidation
The Company consolidates entities in which it has a controlling financial interest by first considering if an entity meets the definition of a variable interest entity ("VIE") for which the Company is deemed to be the primary beneficiary, or if the Company has the power to control an entity through a majority of voting interest or through other arrangements.
Variable Interest Entities—A VIE is an entity that either (i) lacks sufficient equity to finance its activities without additional subordinated financial support from other parties; (ii) whose equity holders lack the characteristics of a controlling financial interest; and/or (iii) is established with non-substantive voting rights. A VIE is consolidated by its primary beneficiary, which is defined as the party who has a controlling financial interest in the VIE through (a) power to direct the activities of the VIE that most significantly affect the VIE’s economic performance, and (b) obligation to absorb losses or right to receive benefits of the VIE that could be significant to the VIE. This assessment may involve subjectivity in the determination of which activities most significantly affect the VIE’s performance, and estimates about current and future fair value of the assets held by the VIE and financial performance of the VIE. In assessing its interests in the VIE, the Company also considers interests held by its related parties, including de facto agents. Additionally, the Company assesses whether it is a member of a related party group that collectively meets the power and benefits criteria and, if so, whether the Company is most closely associated with the VIE. In performing the related party analysis, the Company considers both qualitative and quantitative factors, including, but not limited to: the characteristics and size of its investment relative to the related party; the Company’s and the related party's ability to control or significantly influence key decisions of the VIE including consideration of involvement by de facto agents; the obligation or likelihood for the Company or the related party to fund operating losses of the VIE; and the similarity and significance of the VIE’s business activities to those of the Company and the related party. The determination of whether an entity is a VIE, and whether the Company is the primary beneficiary, may involve significant judgment, and depends upon facts and circumstances specific to an entity at the time of the assessment.
Voting Interest Entities—Unlike VIEs, voting interest entities have sufficient equity to finance their activities and equity investors exhibit the characteristics of a controlling financial interest through their voting rights. The Company consolidates such entities when it has the power to control these entities through ownership of a majority of the entities' voting interests or through other arrangements.
17

Table of Contents
At each reporting period, the Company reassesses whether changes in facts and circumstances cause a change in the status of an entity as a VIE or voting interest entity, and/or a change in the Company's consolidation assessment. Changes in consolidation status are applied prospectively. An entity may be consolidated as a result of this reassessment, in which case, the assets, liabilities and noncontrolling interests in the entity are recorded at fair value upon initial consolidation. Any existing equity interest held by the Company in the entity prior to the Company obtaining control will be remeasured at fair value, which may result in a gain or loss recognized upon initial consolidation. However, if the consolidation represents an asset acquisition of a voting interest entity, the Company's existing interest in the acquired assets, if any, is not remeasured to fair value but continues to be carried at historical cost. The Company may also
14

Table of Contents

deconsolidate a subsidiary as a result of this reassessment, which may result in a gain or loss recognized upon deconsolidation depending on the carrying values of deconsolidated assets and liabilities compared to the fair value of any interests retained.
Noncontrolling Interests
Redeemable Noncontrolling Interests—This represents noncontrolling interests in sponsored open-end funds in the liquid securities strategy that are consolidated by the Company. The limited partners of these funds have the ability to withdraw all or a portion of their interests from the funds in cash with advance notice.
Prior to full redemption in May 2022, there was also redeemable noncontrolling interests in the Company's investment management business, as discussed further in Note 10.
Redeemable noncontrolling interests is presented outside of permanent equity. Allocation of net income or loss to redeemable noncontrolling interests is based upon their ownership percentage during the period. The carrying amount of redeemable noncontrolling interests is adjusted to its redemption value at the end of each reporting period to an amount not less than its initial carrying value, except for amounts contingently redeemable which will be adjusted to redemption value only when redemption is probable. Such adjustments will be recognized in additional paid-in capital.
The redeemable noncontrolling interests in the Company's investment management business were redeemed in May 2022 (Note 10).
Noncontrolling Interests in Investment Entities—This represents predominantly the majority ownership held by third party investors in the Company's Operating segment and carried interest allocation to certain senior executives of the Company (Note 16). Excluding carried interests, allocation of net income or loss is generally based upon relative ownership interests.
Noncontrolling Interests in Operating Company—This represents membership interests in OP held primarily by certain current and former employees of the Company. Noncontrolling interests in OP are allocated a share of net income or loss in OP based upon their weighted average ownership interest in OP during the period. Noncontrolling interests in OP have the right to require OP to redeem part or all of such member’s membership units in OP ("OP Units") for cash based on the market value of an equivalent number of shares of class A common stock at the time of redemption, or at the Company's election as managing member of OP, through issuance of shares of class A common stock (registered or unregistered) on a one-for-one basis. At the end of each reporting period, noncontrolling interests in OP is adjusted to reflect their ownership percentage in OP at the end of the period, through a reallocation between controlling and noncontrolling interests in OP, as applicable.
Segment Reporting
The Company conducts its business through two reportable segments: (i) Investment Management; and (ii) Operating, the Company's direct co-investment in digital infrastructure assets held by its portfolio companies.
Investment Management —This segment represents the Company's global investment management platform, deploying and managing capital on behalf of a diverse base of global institutional investors. The Company's investment management platform is composed of a growing number of long-duration, private investment funds designed to provide institutional investors access to investments across different segments of the digital infrastructure ecosystem. In addition to its flagship value-add digital infrastructure equity offerings, the Company's investment offerings have expanded to include core equity, credit and liquid securities. The Company earns management fees based upon the assets or capital managed in investment vehicles, and may earn incentive fees and carried interest based upon the performance of such investment vehicles, subject to achievement of minimum return hurdles. The amount of incentive fees and carried interest recognized, a portion of which is allocated to employees and former employees, may be highly variable from period to period. Earnings from the Investment Management segment were attributed 31.5% to affiliates of Wafra, Inc. (collectively, "Wafra"), a private investment firm, prior to the Company's redemption of Wafra's interest in the investment management business at the end of May 2022 (as discussed further in Note(Note 10).
Operating—This segment is composed of balance sheet equity interests in digital infrastructure and real estate co-investmentportfolio companies, which generally earn rental income from providing use of digital asset space and/or capacity through
18

Table of Contents
leases, services and other agreements. The Company currently ownsowned interests in two portfolio companies: DataBank, an edge colocation data center business (DBRG ownership of 11% at March 31, 2023 and December 31, 2022); and Vantage SDC, a stabilized hyperscale data center business (DBRG ownership of 13% at March 31,September 30, 2023 and December 31, 2022), and DataBank, an edge colocation data center business (DBRG ownership of 11% at December 31, 2022 and through the final close of the recapitalization and deconsolidation in mid-September 2023; thereafter, the Company's remaining 9.87% interest in DataBank is presented within Corporate and Other) (Note 10). DataBank and Vantage SDC are portfolio companies managed by the Company under its Investment Management segment with respect to equity interests owned byfunded through third party capital.
The Company's remaining investment activities and corporate level activities are presented as Corporate and Other.
Other investment activities are composed of the Company's equity interests in: (i) digitalsponsored investment vehicles, the largest of which is inprimarily the DigitalBridge Partners ("DBP") flagship funds, InfraBridge funds and funds invested in DataBank, and seed investments in liquid securities
15

Table of Contents

and other potential new strategies; and (ii) remaining non-digital investments. Outside of its general partner interests, which are presented in the Investment Management segment, the Company's other equity interests in its sponsored and/or managed digital investment vehicles as general partner affiliate are considered to be incidental to its investment management business. The primary economics to the Company are represented by fee income and carried interest allocation as general partner and/or manager, rather than economics from its equity interest in the investment vehicles as a general partner affiliate or limited partner or equivalent. With respect to seed investments, these are not intended to be a long-term deployment of capital by the Company and are expected to be warehoused temporarily on the Company's balance sheet potentially until such time that sufficient third party capital has been raised from sponsored funds. At this time, the remainingRemaining non-digital investments are composed of a marketable equity security, and equity interest in a non-traded REIT that is not substantially available for immediate sale and are expected to be monetized over an extended period beyond the near term.(Note 11). These other investment activities generate largely principal investment income or lossesfrom sponsored funds, and to a lesser extent, revenues in the form of interest income or dividend income from warehoused investments and consolidated investment vehicles.vehicles and non-digital investments.
Corporate activities include corporate level cash and corresponding interest income, corporate level financing and related interest expense, corporate level transaction costs, costs in connection with unconsummated investments, income and expense related to cost reimbursement arrangements with affiliates, fixed assets for administrativecorporate use, compensation expense not directly attributable to reportable segments,the Investment Management segment, corporate level administrative and overhead costs, and adjustments to eliminate intercompany fees. Costs which are directly attributable, or otherwise can be subjected to a reasonable and systematic attribution, have been attributed to eachthe Investment Management segment.
For all periods presented prior to its deconsolidation on September 14, 2023 (Note 10), the consolidated results of operations of DataBank was included in the Operating segment as it represented the activities of a consolidated portfolio company that directly holds and operates digital infrastructure assets. The Operating segment continues to be a separate reporting segment that reflects the results of operations of Vantage SDC, the Company's remaining consolidated portfolio company. Subsequent to deconsolidation, the Company's retained interest in DataBank that is held through a sponsored investment vehicle is treated as an equity method investment for which the Company accounts only for its share of changes in the fair value of DataBank, and is presented in Corporate and Other, consistent with the treatment and presentation of the reportable segments.Company's interests as general partner affiliate in its other sponsored investment vehicles. Accordingly, the change in segment presentation as a result of deconsolidating DataBank does not represent a change in reporting segments and as a result, there is no change to prior period segment presentation as it relates to the Company's interest in DataBank.
The results of operations of the Company's reportable segments are presented in the supplemental scheduleschedules to the consolidated statements of operations and reconciled to the consolidated statements of operations as follows:
Three Months Ended March 31, 2023Three Months Ended March 31, 2022Three Months Ended September 30, 2023Three Months Ended September 30, 2022
(In thousands)(In thousands)Investment ManagementOperatingCorporate and OtherTotalInvestment ManagementOperatingCorporate and OtherTotal(In thousands)Investment ManagementOperatingCorporate and OtherTotalInvestment ManagementOperatingCorporate and OtherTotal
Income (Loss) from continuing operations attributable to DigitalBridge Group, Inc.$(2,198)$(10,789)$(171,149)$(184,136)$(7,602)$(12,824)$(144,771)$(165,197)
Income (Loss) from discontinued operations attributable to DigitalBridge Group, Inc.(13,661)(81,360)
Income (Loss) attributable to DigitalBridge Group, Inc.Income (Loss) attributable to DigitalBridge Group, Inc.
Continuing operationsContinuing operations$52,391 $(10,191)$236,642 $278,842 $24,233 $(15,881)$16,909 $25,261 
Discontinued operationsDiscontinued operations(2,369)(74,349)
Net income (loss) attributable to DigitalBridge Group, Inc.Net income (loss) attributable to DigitalBridge Group, Inc.$(197,797)$(246,557)Net income (loss) attributable to DigitalBridge Group, Inc.$276,473 $(49,088)
19

Table of Contents
Nine Months Ended September 30, 2023Nine Months Ended September 30, 2022
(In thousands)Investment ManagementOperatingCorporate and OtherTotalInvestment ManagementOperatingCorporate and OtherTotal
Income (Loss) attributable to DigitalBridge Group, Inc.
Continuing operations$50,502 $(31,489)$70,697 $89,710 $37,900 $(43,512)$(152,026)$(157,638)
Discontinued operations(19,697)(159,569)
Net income (loss) attributable to DigitalBridge Group, Inc.$70,013 $(317,207)
Business CombinationsAcquisitions
Definition of a Business—The Company evaluates each purchase transaction to determine whether the acquired assets meet the definition of a business. If substantially all of the fair value of gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets, then the set of transferred assets and activities is not a business. If not, for an acquisition to be considered a business, it would have to include an input and a substantive process that together significantly contribute to the ability to create outputs (i.e., there is a continuation of revenue before and after the transaction). A substantive process is not ancillary or minor, cannot be replaced without significant costs, effort or delay or is otherwise considered unique or scarce. To qualify as a business without outputs, the acquired assets would require an organized workforce with the necessary skills, knowledge and experience to perform a substantive process.
Asset Acquisitions—For acquisitions that are not deemed to be businesses, the assets acquired are recognized based on their cost to the Company as the acquirer and no gain or loss is recognized. The cost of assets acquired in a group is allocated to individual assets within the group based on their relative fair values and does not give rise to goodwill. Transaction costs related to acquisition of assets are included in the cost basis of the assets acquired.
Business Combinations—The Company accounts for acquisitions that qualify as business combinations by applying the acquisition method. Transaction costs related to acquisition of a business are expensed as incurred and excluded from the fair value of consideration transferred. The identifiable assets acquired, liabilities assumed and noncontrolling interests in an acquired entity are recognized and measured at their estimated fair values, except as discussed below. The excess of the consideration transferred over the values of identifiable assets acquired, liabilities assumed and noncontrolling interests in an acquired entity, net of fair value of any previously held interest in the acquired entity, is recorded as goodwill. Such valuations require management to make significant estimates and assumptions.
With respect to contract assets and contract liabilities acquired in a business combination, these are not accounted for under the fair value basis at the time of acquisition. Instead, the Company determines the value of these revenue
16

Table of Contents

contracts as if it had originated the acquired contracts by evaluating the associated performance obligations, transaction price and relative stand-alone selling price at the original contract inception date or subsequent modification dates.
The estimated fair values and allocation of consideration are subject to adjustments during the measurement period, not to exceed one year, based upon new information obtained about facts and circumstances that existed at time of acquisition.
Contingent Consideration—Contingent consideration is classified as a liability or equity, as applicable. Contingent consideration in connection with the acquisition of a business or a VIE is measured at fair value on acquisition date, and unless classified as equity, is remeasured at fair value each reporting period thereafter until the consideration is settled, with changes in fair value included in earnings. Contingent consideration in connection with the acquisition of assets (and that is not a VIE) is generally recognized when the liability is considered both probable and reasonably estimable, as part of the basis of the acquired assets.
Discontinued Operations
If the disposition of a component, being an operating or reportable segment, business unit, subsidiary or asset group, represents a strategic shift that has or will have a major effect on the Company’s operations and financial results, the operating profits or losses of the component when classified as held for sale, and the gain or loss upon disposition of the component, are presented as discontinued operations in the statements of operations.
A business or asset group acquired in connection with a business combination that meets the criteria to be accounted for as held for sale at the date of acquisition is reported as discontinued operations, regardless of whether it meets the strategic shift criterion.
In March 2023, the Company sold the entirety of its equity method investment in BrightSpire Capital, Inc. (NYSE: BRSP) of approximately 35.0 million shares for net proceeds totaling $201.6 million. The Company's investment in BRSP
20

Table of Contents
qualified as held for sale in March 2023 and its disposition represents a strategic shift that has major effects on the Company’s operations and financial results, meeting the criteria as discontinued operations as of March 2023. Accordingly, for all prior periods presented, the equity method investment in BRSP is presented as assets held for disposition on the consolidated balance sheets and equity method earnings (loss) from BRSP is presented as loss from discontinued operations on the consolidated statements of operations.
DiscontinuedIn 2023, discontinued operations in 2023 primarily reflect a $9.7 million impairment of BRSP shares prior to its disposition, and activities associated with equity investments excluded from the December 2021 bulk sale of the Company's non-digital investment portfolio.
In addition to the above equity investments, in 2022, discontinued operations in 2022 also included two months of operations of the Wellness Infrastructure business, along with other non-core assets held by a subsidiary, NRF Holdco, LLC ("NRF Holdco"), prior to the sale of all of the equity of NRF Holdco in February 2022. The sales price for 100% of the equity of NRF Holdco was $281 million, composed of $126 million cash and a $155 million unsecured promissory note. The promissory note, which is classifiedwas fully written down in March 2023, as held for investment and carried at fair value underdiscussed in Note 11. In 2022, the fair value option, matures five years from closing of the sale, accruing paid-in-kind ("PIK") interest at 5.35% per annum (Note 11). The disposition of NRF Holdco resulted in a write-off of unamortized deferred financing costs on the Wellness Infrastructure debt assumed by the buyer of $92.1 million and additional impairment loss based upon final carrying value of the Wellness Infrastructure net assets.
Loss from discontinued operations is summarized as follows.
Three Months Ended March 31,
(In thousands)20232022
Revenues$1,970 $80,281 
Expenses(5,770)(201,155)
Other gain (loss)(10,416)24,117 
Income tax benefit (expense)(2)2,112 
Income (Loss) from discontinued operations(14,218)(94,645)
Income (Loss) from discontinued operations attributable to noncontrolling interests:
Investment entities517 (6,175)
Operating Company(1,074)(7,110)
Income (Loss) from discontinued operations attributable to DigitalBridge Group, Inc.$(13,661)$(81,360)
17

Table of Contents

Three Months Ended September 30,Nine Months Ended September 30,
(In thousands)2023202220232022
Revenues$1,770 $6,375 $5,608 $88,658 
Expenses(4,325)(7,601)(12,684)(245,236)
Other gain (loss)(84)(80,544)(13,770)(29,733)
Income tax benefit (expense)36 (8,532)47 (2,424)
Income (Loss) from discontinued operations(2,603)(90,302)(20,799)(188,735)
Income (Loss) from discontinued operations attributable to noncontrolling interests:
Investment entities(55)(10,227)437 (16,016)
Operating Company(179)(5,726)(1,539)(13,150)
Income (Loss) from discontinued operations attributable to DigitalBridge Group, Inc.$(2,369)$(74,349)$(19,697)$(159,569)
Assets and Related Liabilities Held for Disposition
At March 31, 2023 and December 31, 2022, all assets and related liabilities held for disposition relate to discontinued operations. The Company initially measures assets classified as held for disposition at the lower of their carrying amounts or fair value less disposal costs. For bulk sale transactions, the unit of account is the disposal group, with any excess of the aggregate carrying value over estimated fair value less costs to sell allocated to the individual assets within the group.
At September 30, 2023 and December 31, 2022, all assets and related liabilities held for disposition relate to discontinued operations. Assets held for disposition of $11.3$4.0 million at March 31,September 30, 2023 consisted primarily of miscellaneous equity investments excluded from the December 2021 bulk sale of the Company's non-digital investment portfolio. Assetsinvestments. Additionally, at December 31, 2022, assets held for disposition of $275.5 million at December 31, 2022 also included the Company's shares in BRSP of $218.0 million that were sold in March 2023 and an equity method investment carried under the fair value option of $44.5 million prior to a sale of its underlying assets and a return of capital to the Company in January 2023.
Reclassifications
Reclassifications have been made in connection with discontinued operations, as discussed in "—Discontinued Operations." Additionally, the Company determined that principal investment income (loss) from its equity interest as general partner and general partner affiliate in its sponsored investment vehicles, and its entitlement to carried interest allocation, represent a core component of returns in its investment management business. Accordingly, beginning in 2023, principal investment income (loss) and carried interest allocation are presented within total revenues on the consolidated statements of operations. Prior periods have been reclassified to conform to current presentation.
Accounting Standards Adopted in 2023
Contractual Sale Restriction on Equity Securities
In June 2022, the Financial Accounting Standards Board issued Accounting Standards Update ("ASU") 2022-03, Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions, which amends Accounting Standards Codification ("ASC") Topic 820, Fair Value Measurement, to clarify that a contractual sale restriction that is entity-specific
21

Table of Contents
is not part of the unit of account of an equity security and is therefore not considered in measuring the fair value of an equity security, in which case, a discount should not be applied. The amendment further prohibits recognizing the contractual sale restriction as a separate unit of account, that is, as a contra asset or liability. Sale restrictions that are characteristics of the holder of an equity security include, but are not limited to, lock-up agreements, market stand-off agreements, or specific provisions in agreements between shareholders. In contrast, a legal restriction preventing a security from being sold on a national securities exchange or an over-the-counter market is a security-specific characteristic as the restriction would similarly apply to a market participant buyer in an assumed sale of the security. This guidance also applies to issuers of equity securities that are subject to contractual sale restrictions, for example, equity securities issued as consideration in a business combination. The ASU requires additional disclosures related to equity securities that are subject to contractual sale restrictions, specifically (1) the fair value of such equity securities, (2) the nature and remaining duration of the restrictions, and (3) any circumstances that could cause a lapse in restrictions. The ASU is effective January 1, 2024, with early adoption permitted in the interim periods. Transition is prospective with any fair value adjustments resulting from adoption recognized in earnings and the amount adjusted disclosed in the period of adoption.
For subsidiaries of the Company that are investment companies as defined in ASC Topic 946, Financial Services—Investment Companies, the ASU is applied prospectively to equity securities with contractual sale restrictions entered into or modified on or after the adoption date. For equity securities with contractual sale restrictions entered into or modified before the adoption date, the existing accounting policy continues to be applied until the restrictions expire or are modified, and if the existing accounting policy differs from the amended guidance, the additional disclosure requirements under the ASU would be applicable.
The Company early adopted the ASU on January 1, 2023. At the time of adoption, the Company and its investment company subsidiaries do not have equity securities subject to contractual sale restrictions.
18

Table of Contents

3. Acquisitions
Business Combination in 2023
InfraBridge
In February 2023, the Company acquired the global infrastructure equity investment management business of AMP Capital Investors International Holdings Limited, which was rebranded as InfraBridge at closing. Consideration for the acquisition consisted of a $313.2$314.3 million upfront cash consideration (net of cash assumed), subject to customary post-closing working capital adjustments, plus a contingent amount based upon achievement of future fundraising targets for InfraBridge's new global infrastructure funds. The estimated fair value of the contingent consideration is subject to remeasurement each reporting period, as discussed in Note 11.
Asset Acquisitions
22

Table of Contents
The following table summarizes the total consideration and allocation to assets acquired and liabilities assumed. The initial cash consideration was determined, in 2022
Vantage SDC Hyperscale Data Centers
In connection with the Company's acquisition of Vantage SDC in July 2020 and an additional data center in September 2021, the Company and its co-investors committed to acquire the future build-out of expansion capacity, along with lease-uppart, based upon estimated net working capital of the expanded capacityacquired entities at closing. The purchase price allocation is provisional and existing inventory,will be finalized through the costsone year measurement period. In the second and third quarters of which are borne by2023, certain adjustments were identified that affected the previous ownersprovisional accounting, as presented below. These were adjustments to net working capital and to the value of Vantage SDC. As of March 31, 2023, the remaining consideration for the incremental lease-up acquisitions is estimated to be approximately $185 million, of which $122 million is due by September 2024. Most, if not all,acquired interest in an InfraBridge fund based upon a revised net asset value ("NAV") of the costfund, applying new information about facts and circumstances that existed at the time of acquisition.
(In thousands)As Reported
At March 30, 2023
Measurement Period Adjustments
As Revised
At September 30, 2023
Consideration
Cash$364,338 $1,102 $365,440 
Estimated fair value of contingent consideration10,874 — 10,874 
$375,212 $376,314 
Assets acquired and liabilities assumed
Cash51,174 — 51,174 
Principal investments130,810 (18,500)112,310 
Intangible assets50,800 — 50,800 
Other assets27,682 8,517 36,199 
Deferred tax liabilities(10,198)— (10,198)
Other liabilities(21,625)(10,190)(31,815)
Fair value of net assets acquired228,643 208,470 
Goodwill146,569 21,275 167,844 
$375,212 $376,314 
Principal investments represent acquired interests in InfraBridge funds, valued at their most recent net asset value ("NAV") at closing.
The investment management intangible assets of InfraBridge were composed of the expansion capacity has been or isfollowing:
Management contracts are valued based upon estimated net cash flows expected to be funded by Vantage SDCgenerated from borrowings under its credit facilities and/or cash from operations. Pursuant to this arrangement, Vantage SDC had 15 new tenant leases related to a portionthe contracts, with remaining term of the expansion capacitycontracts ranging between 1 and 4 years, discounted at 8.0%.
Investor relationships represent the fair value of potential investment management fees, net of operating costs, to be generated from repeat InfraBridge investors in future sponsored vehicles, with a weighted average estimated useful life of 12 years, discounted at 14.0%.
Deferred tax liabilities were recognized for the book-to-tax basis difference of identifiable intangible assets acquired, net of deferred tax asset assumed.
Other assets acquired and liabilities assumed include management fee receivable and compensation payable associated with the pre-acquisition period, amounts due to InfraBridge funds and receivable from seller.
Goodwill is the value of the business acquired that commenced during 2022 for aggregate considerationis not already captured in identifiable assets, largely represented by the synergies from combining the capital raising resources of $161.3 million. AllDBRG and the mid-market infrastructure specialization of these payments were made to the previous ownersInfraBridge team.
23

Table of Vantage SDC and are treated as asset acquisitions. There were no new tenant leases that commenced in the first quarter of 2023.Contents
Asset Acquisitions
DataBank
Acquisitions by DataBank, prior to its deconsolidation in 2022September 2023 (Note 10), were as follows:
2023
A building in Dallas, Texas in May 2023, for purchase price of $151.0 million, funded by a combination of $121.0 million of debt and $40.8 million of equity, of which the Company's share was $8.2 million. In addition to the purchase price, the capital called was used to fund transaction costs, financing costs, and as working capital. A substantial portion of the acquired building was previously leased by DataBank as a co-location data center and corporate office. Upon termination of the DataBank lease concurrent with the acquisition, the associated ROU asset and lease liability were derecognized.
2022
Four colocation data centers in Houston, Texas in March 2022 for $678 million, funded by a combination of $262.5 million of debt and $415.5 million of equity, of which the Company's share was $88.7 million.
A data center each in Atlanta, Georgia in May 2022 for $10.9 million, and in Denver, Colorado in February 2022 that was previously leased by its zColo subsidiary for $17.6 million.
Vantage SDC Hyperscale Data Centers
In connection with the Company's acquisition of Vantage SDC in July 2020 and an additional data center in September 2021, the Company and its co-investors committed to acquire the future build-out of expansion capacity, along with lease-up of the expanded capacity and existing inventory, the costs of which are borne by the previous owners of Vantage SDC. As of September 30, 2023, the remaining consideration for the incremental lease-up acquisitions is estimated to be approximately $163 million, of which $122 million is due by September 2024. Most, if not all, of the cost of the expansion capacity has been or is expected to be funded by Vantage SDC from borrowings under its credit facilities, cash from operations and/or potential capital raise. Pursuant to this arrangement, Vantage SDC had one new tenant lease that commenced in 2023, and 15 new tenant leases that commenced in 2022 related to a portion of the expansion capacity for aggregate consideration of $31.6 million and $161.3 million, respectively. All of these payments were made to the previous owners of Vantage SDC and are treated as asset acquisitions.
Tower Assets
In June 2022, the Company acquired the mobile telecommunications tower business (“TowerCo”) of Telenet Group Holding NV (Euronext Brussels: TNET) for €740.1 million or $791.3 million (including transaction costs). In December 2022, our interest in the temporarily warehoused TowerCo investment was transferred to the Company's new sponsoredcore equity fund (Note 16) and TowerCo was deconsolidated. The TowerCo assets acquired had included owned tower sites, tower sites subject to third party leases that gave rise to right-of-use lease assets and corresponding lease liabilities, equipment, as well as customer relationships related primarily to a master lease agreement with Telenet as lessee. The acquisition had been funded through $326.1 million of debt, $278.1 million of equity from the Company, and $213.8 million in third party equity. In addition to the purchase price, the funds had been used to finance transaction costs, debt issuance costs, working capital and as operating cash. Prior to transfer, TowerCo was presented within Corporate and Other.
1924

Table of Contents

Allocation of Consideration Transferred
The following table summarizes the allocation of cash consideration and allocation to assets acquired, liabilities assumed and noncontrolling interests at acquisition. In an asset acquisition, the cost of assets acquired, which includes capitalized transaction costs, is allocated to individual assets within the group based on their relative fair values and does not give rise to goodwill.costs.With respect to business combinations, the estimated fair values and allocation of the consideration are subject to adjustments during the measurement period, not to exceed one year, based upon new information obtained about facts and circumstances that existed at time of acquisition.
Business CombinationAsset Acquisitions
20232022
(In thousands)InfraBridgeTowerCoAcquisitions by DataBankVantage SDC Expansion Capacity
Consideration
Cash$364,338 $791,254 $706,514 $161,302 
Estimated fair value of contingent consideration10,874 — — — 
375,212 791,254 706,514 161,302 
Assets acquired and liabilities assumed
Cash51,174 — — — 
Principal investments130,810 — — — 
Real estate— 363,121 627,474 140,140 
Intangible assets50,800 673,218 77,885 21,162 
Lease right-of-use ("ROU") and other assets27,682 234,462 3,994 — 
Deferred tax liabilities(10,198)(243,223)— — 
Intangible, lease and other liabilities(21,625)(236,324)(2,839)— 
Fair value of net assets acquired228,643 791,254 706,514 161,302 
Goodwill$146,569 $— $— $— 
Principal investments represent acquired interests in InfraBridge funds, valued at their most recent net asset value ("NAV").
20232022
(In thousands)Acquisition by DataBank
(prior to deconsolidation)
Vantage SDC Expansion CapacityTowerCoAcquisitions by DataBankVantage SDC Expansion Capacity
Purchase price allocation
Real estate$153,944 $26,578 $363,121 $627,474 $140,140 
Intangible assets1,993 5,070 673,218 77,885 21,162 
ROU and other assets— — 234,462 3,994 — 
Deferred tax liabilities— — (243,223)— — 
Intangible, lease and other liabilities(1,334)— (236,324)(2,839)— 
$154,603 $31,648 $791,254 $706,514 $161,302 
Real estate was valued based upon (i) current replacement cost for buildings in(in an as-vacant statestate) and improvements, estimated using construction cost guidelines;guidelines, or the income approach for a substantially leased building by discounting estimated future net operating income with terminal value determined using a terminal capitalization rate of 6.5% and applying a discount rate of 7.25%; (ii) current replacement cost for data center infrastructure by applying an estimated cost per kilowatt based upon current capacity of each location and also considering the associated indirect costs such as design, engineering, construction and installation; (iii) current replacement cost for towers in consideration of their remaining economic life; and (iv) recent comparable sales or current listings for land. Useful lives of real estate acquired range from 35 to 5055 years for buildings and improvements, 51 to 15 years for site improvements, 1 to 4 years for tenant improvements, 11 to 71 years for towers and related equipment, and 11 to 2030 years for data center infrastructure.
The investment management intangible assets of InfraBridge were composed of the following:
Management contracts are valued based upon estimated net cash flows expected to be generated from the contracts, with remaining term of the contracts ranging between 1 and 4 years, discounted at 8.0%.
Investor relationships represent the fair value of potential investment management fees, net of operating costs, to be generated from repeat InfraBridge investors in future sponsored vehicles, with a weighted average estimated useful life of 12 years, discounted at 14.0%.
Lease-related intangibles for real estate acquisitions were composed of the following:
In-place leases reflect the value of rental income forgone if the properties had been acquired vacant, and the leasing commissions, legal and marketing costs that would have been incurred to lease up the properties, discounted at rates between 4.75% and 6.8%7.25%, with remaining lease terms ranging between 1 and 15 years.
Above- and below-market leases represent the rent differential for the remaining lease term between contractual rents of acquired leases and market rents at the time of acquisition, discounted at rates between 6.0% and 11.25% with remaining lease terms ranging between 1 and 4 years.
Tenant relationships represent the estimated net cash flows attributable to the likelihood of lease renewal by an existing tenant relative to the cost of obtaining a new lease, taking into consideration the estimated time it would require to execute a new lease or backfill a vacant space, discounted at rates between 4.75% and 11.25%, with estimated useful lives between 5 and 15 years.
20

Table of Contents

Customer service contracts were valued based upon estimated net cash flows generated from the zColo customer service contracts that would have been forgone if such contracts were not in place, taking into consideration the time it would require to execute a new contract, with remaining term of the contracts ranging between 1 and 6 years.
Customer relationships for towers were valued as the estimated future cash flows to be generated over the life of the tenant relationships based upon rental rates, operating costs, expected renewal terms and attrition, discounted at 6.8%, with estimated useful lives between 19 and 45 years.
Deferred tax liabilities were recognized for the book-to-tax basis differences associated with the acquisitionsacquisition of InfraBridge and TowerCo, net of deferred tax assets assumed where applicable.TowerCo.
Other assets acquired and liabilities assumed include primarily lease ROU assets associated with leasehold ground space hosting tower communication sites, along with corresponding lease liabilities. Lease liabilities were measured based upon the present value of future lease payments over the lease term, discounted at the incremental borrowing rate of the respective acquiree entities. Included in the InfraBridge acquisition were also management fee receivable and compensation payable associated with the pre-acquisition period.
Goodwill is the value of the business acquired that is not already captured in identifiable assets, largely represented by the synergies from combining the capital raising resources of DBRG and the mid-market infrastructure specialization of the InfraBridge team.
2125

Table of Contents

4. Investments
The Company's equity and debt investments are represented by the following:
(In thousands)(In thousands)March 31, 2023December 31, 2022(In thousands)September 30, 2023December 31, 2022
Investment ManagementInvestment ManagementInvestment Management
Equity method investmentsEquity method investmentsEquity method investments
Principal investmentsPrincipal investments$54,626 $51,665 Principal investments$59,668 $51,665 
Carried interest allocationCarried interest allocation286,517 341,749 Carried interest allocation506,736 341,749 
341,143 393,414 566,404 393,414 
Other equity investmentOther equity investment4,683 1,913 Other equity investment2,488 1,913 
Total Investment ManagementTotal Investment Management345,826 395,327 Total Investment Management568,892 395,327 
OperatingOperatingOperating
Debt investments—loan receivableDebt investments—loan receivable6,804 4,638 Debt investments—loan receivable— 4,638 
Corporate and OtherCorporate and OtherCorporate and Other
Equity method investments—Principal investmentsEquity method investments—Principal investments512,649 358,846 Equity method investments—Principal investments990,289 358,846 
Equity investments of consolidated fundsEquity investments of consolidated funds211,758 185,845 Equity investments of consolidated funds178,176 185,845 
Other equity investmentsOther equity investments98,988 113,111 Other equity investments91,697 113,111 
Debt investmentsDebt investmentsDebt investments
CLO subordinated notesCLO subordinated notes50,927 50,927 CLO subordinated notes50,927 50,927 
Loan receivableLoan receivable— 133,307 Loan receivable— 133,307 
Total Corporate and OtherTotal Corporate and Other874,322 842,036 Total Corporate and Other1,311,089 842,036 
Total InvestmentsTotal Investments$1,226,952 $1,242,001 Total Investments$1,879,981 $1,242,001 
Equity Method Investments
Principal Investments
Principal investments totaling $567.3 million$1.05 billion at March 31,September 30, 2023 and $410.5 million at December 31, 2022 represent investments in the Company's sponsored investment vehicles, accounted for as equity method investments as the Company exerts significant influence in its role as general partner. The Company typically has a small percentage interest in its sponsored funds as general partner or special limited partner (presented in the Investment Management segment). The Company also has additional investment as general partner affiliate alongside the funds' limited partners, primarily with respect to the Company's flagship value-add funds, DigitalBridge Partners, LP ("DBP I") and DigitalBridge Partners II, LP ("DBP II"), and the InfraBridge funds and funds invested in DataBank (presented within Corporate and Other).
The Company's proportionate share of net income (loss) from investments in its sponsored investment vehicles, which includes unrealized gain (loss) from changes in fair value of the underlying fund investments, is recorded in principal investment income (loss) on the consolidated statements of operations.
Carried Interest Allocation
Carried interest allocation represents a disproportionate allocation of returns to the Company, as general partner or special limited partner (which may be paid to the special limited partner entity owned by the Company in place of the general partner entity), based upon the extent to which cumulative performance of a sponsored fund exceeds minimum return hurdles. Carried interest allocation generally arises when appreciation in value of the underlying investments of the fund exceeds the minimum return hurdles, after factoring in a return of invested capital and a return of certain costs of the fund pursuant to terms of the governing documents of the fund. The amount of carried interest allocation recognized is based upon the cumulative performance of the fund if it were liquidated as of the reporting date. Unrealized carried interest allocation is driven primarily by changes in fair value of the underlying investments of the fund, which may be affected by various factors, including but not limited to: the financial performance of the portfolio company, economic conditions, foreign exchange rates, comparable transactions in the market, and equity prices for publicly traded securities. For funds that have exceeded the minimum return hurdle but have not returned all capital to the limited partners, unrealized carried interest allocation may be subject to reversal over time as preferred returns continue to accrue on unreturned capital. Realization of carried interest allocation occurs upon disposition of all underlying investments of the fund, or in part with each disposition.
2226

Table of Contents

Generally, carried interest allocation is distributed upon profitable disposition of an investment if at the time of distribution, cumulative returns of the fund exceed minimum return hurdles. Depending on the final realized value of all investments at the end of the life of a fund (and, with respect to certain funds, periodically during the life of the fund), if it is determined that cumulative carried interest allocation distributed has exceeded the final carried interest allocation amount earned (or amount earned as of the calculation date), the Company is obligated to return the excess carried interest allocation received. Therefore, carried interest allocation distributed may be subject to clawback if decline in investment values results in cumulative performance of the fund falling below minimum return hurdles in the interim period. If it is determined that the Company has a clawback obligation, a liability would be established based upon a hypothetical liquidation of the net assets of the fund at reporting date. The actual determination and required payment of any clawback obligation would generally occur after final disposition of the investments of the fund or otherwise as set forth in the governing documents of the fund.
Carried interest allocation on the balance sheet date represents unrealized carried interest allocation in connection with sponsored funds that are currently in the early stage of their lifecycle. Carried interest allocation is presented gross of accrued carried interest compensation (Note 7).
Carried Interest Allocation Distributed
There was immaterialDuring the three and nine months ended September 30, 2023, carried interest allocationof $27.9 million and $28.4 million, respectively, were distributed and recognized in revenuescarried interest allocations, of which $0.8 million of the distributed carried interest in the first quarter of 2023. Nonine months ended September 30, 2023 was allocated to current and former employees and to Wafra (Note 10), and recorded as carried interest allocationcompensation, other loss, and amounts attributable to noncontrolling interests (Note 16).
During the three and nine months ended September 30, 2022, carried interest of $123.5 million (including $51.2 million that had been previously accrued) was distributed and recognized in carried interest allocations, of which $103.2 million of the first quarter of 2022.distributed carried interest (including $45.9 million that had been previously accrued) was allocated to current and former employees and to Wafra, and recorded as carried interest compensation and amounts attributable to noncontrolling interests.
Clawback Obligation
The Company did not have a liability for clawback obligations on carried interest allocation distributed to-date as of March 31,September 30, 2023 and December 31, 2022.
With respect to funds that have distributed carried interest, allocation, if in the event all of their investments are deemed to have no value, the likelihood of which is remote, carried interest allocation distributed of $75.6$180.9 million would be subject to clawback as of March 31,September 30, 2023, of which $58.9$116.5 million would be the responsibility of the employee and former employee recipients. For this purpose, a portion of the carried interest allocation is generally held back from these recipients at the time of distribution. The amount withheld resides in entities outside of the Company. Generally, the Company, through the OP, has guaranteed the clawback obligation of its subsidiaries that act as general partner or special limited partner of its respective sponsored funds, for the benefit of these funds and their limited partners.
Equity Investments of Consolidated Funds
The Company consolidates sponsored funds in which it has more than an insignificant equity interest in the fund as general partner, as discussed in Note 12. Equity investments of consolidated funds are composed of predominantly marketable equity securities held by funds in the liquid securities strategy, and an equity interestinterests held by a credit fund in a pooling entityentities that investsinvest in loan assets. Equity investments of consolidated funds are carried at fair value with changes in fair value recorded in other gain (loss) on the consolidated statements of operations.
Other Equity Investments
Other equity investments totaling $103.7$94.2 million at March 31,September 30, 2023 and $115.0 million at December 31, 2022 include investments warehoused potentially for future sponsored funds, a marketable equity security and investmentequity interest in a non-traded REIT (Note 11) (presented within Corporate and Other), as well as an investment in a managed account (presented in the Investment Management segment). These investments are generally carried at fair value or under the measurement alternative, which is at cost, adjusted for impairment and observable price changes. Dividends or other distributions from these investments are recorded in other income while changes in the value of these investments are recorded in other gain (loss) on the consolidated statements of operations.
2327

Table of Contents

Debt Investments
Debt investments are composed of subordinated notes in a third party collateralized loan obligation ("CLO") and at December 31, 2022, loans receivable. Interest income from debt investments are recorded in other income.
CLO Subordinated Notes
In the third quarter of 2022, bank syndicated loans that the Company previously warehoused were transferred into a third party warehouse entity at their acquisition price totaling $232.7 million, and securitized through the issuance of CLO securities. The corresponding warehouse facility of $172.5 million was concurrently repaid. The CLO is sponsored and managed by the third party. The Company acquired all of the subordinated notes of the CLO, which are classified as available-for-sale ("AFS") debt securities. The CLO has a stated legal final maturity of 2035.
The balance of the CLO subordinated notes is summarized as follows:
Amortized Cost without Allowance for Credit LossAllowance for Credit LossGross Cumulative UnrealizedAmortized Cost without Allowance for Credit LossAllowance for Credit LossGross Cumulative Unrealized
(in thousands)(in thousands)GainsLossesFair Value(in thousands)GainsLossesFair Value
At March 31, 2023 and December 31, 2022$50,927 $— $— $— $50,927 
At September 30, 2023 and December 31, 2022At September 30, 2023 and December 31, 2022$50,927 $— $— $— $50,927 
In estimating fair value of the CLO subordinated notes, the Company used a benchmarking approach by looking to the implied credit spreads derived from observed prices on recent comparable CLO issuances, in the first quarter of 2023, and also considering the current size and diversification of the CLO collateral pool, and projected return on the subordinated notes. Based upon these data points, the Company determined that the issued price of the subordinated notes in September 2022 was a reasonable representation of their fair value at March 31,September 30, 2023 and December 31, 2022, classified as Level 3 of the fair value hierarchy.
Loans Receivable
The Company elected fair value option for itsAt September 30, 2023, there was no outstanding balance on loans receivable. Activities in the loans receivable which consisted of two unsecured promissory notes, one in connection with the sale of NRF Holdco (Note 2) and one held by DataBank at March 31, 2023 and December 31, 2022. The DataBank loan receivable was fully repaid in April 2023. Changes in fair value and valuation methodologybalance is discussed further in Note 11.
Investment Commitments
Sponsored Funds—At March 31, 2023, the Company had unfunded commitments to its sponsored funds as general partner and general partner affiliate totaling $126.5 million, including commitments to a consolidated fund. Generally, the timing for funding of these commitments is not known and the commitments are callable on demand at any time prior to their respective expirations.
5. Real Estate
In September 2023, the Company deconsolidated DataBank. All real estate related amounts in 2023 below reflect the effect of the deconsolidation.
The following table summarizes the Company's real estate which is held for investment by subsidiaries in the Operating segment.
(In thousands)(In thousands)March 31, 2023December 31, 2022(In thousands)September 30, 2023December 31, 2022
LandLand$257,588 $257,588 Land$117,409 $257,588 
Buildings and improvementsBuildings and improvements1,738,190 1,573,605 Buildings and improvements923,308 1,573,605 
Data center infrastructureData center infrastructure4,510,678 4,427,150 Data center infrastructure2,450,515 4,427,150 
Construction in progressConstruction in progress283,146 395,393 Construction in progress25,155 395,393 
6,789,602 6,653,736 3,516,387 6,653,736 
Less: Accumulated depreciationLess: Accumulated depreciation(824,795)(732,438)Less: Accumulated depreciation(465,810)(732,438)
Real estate assets, netReal estate assets, net$5,964,807 $5,921,298 Real estate assets, net$3,050,577 $5,921,298 
Real Estate Depreciation
Depreciation of real estate held for investment was $92.4$86.2 million and $79.1$91.3 million for the three months ended March 31,September 30, 2023 and 2022, respectively.respectively, and $272.9 million and $257.7 million for the nine months ended September 30, 2023 and 2022.
2428

Table of Contents

Property Operating Income
Components of property operating income are as follows.
Three Months Ended March 31,Three Months Ended September 30,Nine Months Ended September 30,
(In thousands)(In thousands)20232022(In thousands)2023202220232022
Lease income:Lease income:Lease income:
Fixed lease incomeFixed lease income$177,420 $160,324 Fixed lease income$158,905 $195,701 $514,862 $537,213 
Variable lease incomeVariable lease income32,982 23,847 Variable lease income37,434 29,453 105,123 86,668 
210,402 184,171 196,339 225,154 619,985 623,881 
Data center service revenueData center service revenue20,525 18,340 Data center service revenue16,995 18,925 56,993 56,903 
Other property operating incomeOther property operating income724 257 2,760 314 
$230,927 $202,511 $214,058 $244,336 $679,738 $681,098 
For both the threenine months ended March 31,September 30, 2023 and 2022, property operating income from a single customer accounted for approximately 21% and 20%, respectively,14% of the Company's total revenues from continuing operations, or approximately 15% for both periods5% of the Company's share of total revenues from continuing operations, net of amounts attributable to noncontrolling interests in investment entities.
Commitment for Tenant Allowance
In connection with DataBank’s acquisition of a data center portfolio in March 2022 (Note 3), DataBank and the seller concurrently entered into a master lease agreement which provides that the seller leases from DataBank land acquired in the transaction. If the seller does not exercise its rights to early terminate the lease, the seller is obligated to develop a data center facility on a portion of the acquired land and DataBank is committed to provide the seller a tenant allowance of up to $37.5 million to finance the construction. In December 2022, the seller waived its right to terminate the lease with respect to the portion of the land subject to development. The seller will be responsible for undertaking the construction and any resulting overages. Title to the to-be constructed building, improvements and fixtures will be vested in the seller for the duration of the lease and transfers to DataBank thereafter. The timing of funding of DataBank’s commitment to the seller will be based on agreed upon milestones, with construction to be completed no later than January 1, 2026. DataBank expects to fund its commitment through future debt drawdowns. No amounts have been funded by DataBank to-date.
6. Goodwill, Deferred Leasing Costs and Other Intangibles
Goodwill
The following table presents changes in goodwill by reportable segment.
Three Months Ended March 31,Nine Months Ended September 30,
2023202220232022
(In thousands)(In thousands)
Investment Management (1)
OperatingTotal
Investment Management (1)
OperatingTotal(In thousands)
Investment Management (1)
OperatingTotal
Investment Management (1)
OperatingTotal
Beginning balanceBeginning balance$298,248 $463,120 $761,368 $298,248 $463,120 $761,368 Beginning balance$298,248 $463,120 $761,368 $298,248 $463,120 $761,368 
Business combination (Note 3)Business combination (Note 3)146,569 — 146,569 — — — Business combination (Note 3)167,844 — 167,844 — — — 
Deconsolidation (Note 10)Deconsolidation (Note 10)— (463,120)(463,120)— — — 
Ending balanceEnding balance$444,817 $463,120 $907,937 $298,248 $463,120 $761,368 Ending balance$466,092 $— $466,092 $298,248 $463,120 $761,368 
__________
(1)    Remaining goodwill deductible for income tax purposes was $119.7$114.4 million at March 31,September 30, 2023 and $122.4 million at December 31, 2022.
2529

Table of Contents

Deferred Leasing Costs, Other Intangible Assets and Intangible Liabilities
All 2023 amounts below reflect the effect of the deconsolidation of DataBank in September 2023, where applicable.
Deferred leasing costs and identifiable intangible assets and liabilities are as follows.
March 31, 2023December 31, 2022September 30, 2023December 31, 2022
(In thousands)(In thousands)
Carrying Amount (1)(2)
Accumulated Amortization(1)(2)
Net Carrying Amount(1)
Carrying Amount (1)
Accumulated Amortization(1)
Net Carrying Amount(1)
(In thousands)
Carrying Amount (1)(2)
Accumulated Amortization(1)(2)
Net Carrying Amount(1)
Carrying Amount (1)
Accumulated Amortization(1)
Net Carrying Amount(1)
Deferred Leasing Costs and Intangible AssetsDeferred Leasing Costs and Intangible AssetsDeferred Leasing Costs and Intangible Assets
Investment management intangibles (3)
Investment management intangibles (3)
$208,917 $(83,228)$125,689 $164,189 $(82,432)$81,757 
Investment management intangibles (3)
$202,215 $(94,953)$107,262 $164,189 $(82,432)$81,757 
Deferred leasing costs and lease-related intangible assets (4)
Deferred leasing costs and lease-related intangible assets (4)
1,242,281 (432,532)809,749 1,239,477 (397,975)841,502 
Deferred leasing costs and lease-related intangible assets (4)
817,983 (230,996)586,987 1,239,477 (397,975)841,502 
Customer relationships and service contracts (5)
Customer relationships and service contracts (5)
218,154 (67,037)151,117 218,154 (62,788)155,366 
Customer relationships and service contracts (5)
— — — 218,154 (62,788)155,366 
Trade namesTrade names24,100 (14,454)9,646 26,400 (15,656)10,744 Trade names4,300 (1,799)2,501 26,400 (15,656)10,744 
Other (6)
Other (6)
6,818 (4,499)2,319 6,818 (4,020)2,798 
Other (6)
1,519 (515)1,004 6,818 (4,020)2,798 
Total deferred leasing costs and intangible assetsTotal deferred leasing costs and intangible assets$1,700,270 $(601,750)$1,098,520 $1,655,038 $(562,871)$1,092,167 Total deferred leasing costs and intangible assets$1,026,017 $(328,263)$697,754 $1,655,038 $(562,871)$1,092,167 
Intangible LiabilitiesIntangible LiabilitiesIntangible Liabilities
Lease intangible liabilities (4)
Lease intangible liabilities (4)
$46,636 $(18,195)$28,441 $46,636 $(16,812)$29,824 
Lease intangible liabilities (4)
$26,716 $(5,883)$20,833 $46,636 $(16,812)$29,824 
__________
(1)    Amounts are presentedPresented net of impairments and write-offs, if any.
(2)    Current period amounts excludeExclude intangible assets and liabilities that were fully amortized in the preceding year.prior years.
(3)    Composed of investment management contracts and investor relationships.
(4)    Lease intangible assets are composed of in-place leases, above-market leases and tenant relationships. Lease-intangible liabilities are composed of below-market leases.
(5)    In connection with data center services provided in the colocation data center business.business which was deconsolidated in September 2023.
(6)    Represents primarily the value of an acquired domain name and assembled workforce in an asset acquisition.
Amortization of Intangible Assets and Liabilities
The following table summarizes amortization of deferred leasing costs and finite-lived intangible assets and intangible liabilities:
Three Months Ended March 31,Three Months Ended September 30,Nine Months Ended September 30,
(In thousands)(In thousands)20232022(In thousands)2023202220232022
Net increase (decrease) to rental income (1)
Net increase (decrease) to rental income (1)
$209 $(131)
Net increase (decrease) to rental income (1)
$383 $(3)$457 $172 
Amortization expenseAmortization expenseAmortization expense
Investment management intangiblesInvestment management intangibles$6,090 $5,055 Investment management intangibles$8,685 $5,066 $25,496 $15,176 
Deferred leasing costs and lease-related intangiblesDeferred leasing costs and lease-related intangibles32,843 33,707 Deferred leasing costs and lease-related intangibles25,120 34,834 92,488 118,941 
Customer relationships and service contractsCustomer relationships and service contracts4,249 4,914 Customer relationships and service contracts3,392 7,754 11,853 18,554 
Trade nameTrade name1,098 1,098 Trade name911 1,098 3,107 3,294 
OtherOther480 477 Other395 477 1,354 1,431 
$44,760 $45,251 $38,503 $49,229 $134,298 $157,396 
__________
(1)    Represents the net effect of amortizing above- and below-market leases.
The following table presents the future amortization of deferred leasing costs and finite-lived intangible assets and intangible liabilities excluding those related to assets and liabilities held for disposition..
Year Ending December 31,Year Ending December 31,
(In thousands)(In thousands)Remaining 202320242025202620272028 and thereafterTotal(In thousands)Remaining 202320242025202620272028 and thereafterTotal
Net increase (decrease) to rental incomeNet increase (decrease) to rental income$(869)$(1,838)$(1,740)$(1,691)$(1,016)$1,267 $(5,887)Net increase (decrease) to rental income$(447)$(1,759)$(1,875)$(1,301)$(1,049)$1,043 $(5,388)
Amortization expenseAmortization expense123,110 137,433 120,610 107,698 95,914 479,427 1,064,192 Amortization expense25,155 90,489 83,319 73,978 64,047 334,545 671,533 
2630

Table of Contents

7. Restricted Cash, Other Assets and Other Liabilities
All 2023 amounts in the tables below reflect the effect of the deconsolidation of DataBank in September 2023, where applicable.
Restricted Cash
Restricted cash represents principally cash reserves that are maintained pursuant to the governing agreements of the various securitized debt of the Company and subsidiaries in the Operating segment.
Other Assets
The following table summarizes the Company's other assets:assets.
(In thousands)(In thousands)March 31, 2023December 31, 2022(In thousands)September 30, 2023December 31, 2022
Straight-line rentsStraight-line rents$46,295 $42,721 Straight-line rents$52,470 $42,721 
Investment deposits and pending deal costsInvestment deposits and pending deal costs15,192 1,377 Investment deposits and pending deal costs310 1,377 
Derivative assetsDerivative assets— 11,793 Derivative assets— 11,793 
Prepaid taxes and deferred tax assets, netPrepaid taxes and deferred tax assets, net13,440 8,709 Prepaid taxes and deferred tax assets, net11,197 8,709 
Receivables from resolution of investmentReceivables from resolution of investment350 14,923 Receivables from resolution of investment350 14,923 
Operating lease right-of-use asset—corporate offices
Operating lease right-of-use asset—corporate offices
23,141 23,689 
Operating lease right-of-use asset—corporate offices
34,749 23,689 
Operating lease right-of-use asset—investment properties
Operating lease right-of-use asset—investment properties
307,304 305,760 
Operating lease right-of-use asset—investment properties
— 305,760 
Finance lease right-of-use asset—investment properties
Finance lease right-of-use asset—investment properties
117,349 120,261 
Finance lease right-of-use asset—investment properties
— 120,261 
Accounts receivable, net (1)
Accounts receivable, net (1)
59,366 66,059 
Accounts receivable, net (1)
30,438 66,059 
Prepaid expensesPrepaid expenses27,260 28,760 Prepaid expenses16,361 28,760 
Other assetsOther assets19,466 15,798 Other assets11,374 15,798 
Fixed assets, net (2)
Fixed assets, net (2)
13,288 14,200 
Fixed assets, net (2)
8,091 14,200 
Total other assetsTotal other assets$642,451 $654,050 Total other assets$165,340 $654,050 
__________
(1)    Includes primarily receivables from tenants in the Operating segment.
(2)    Net of accumulated depreciation of $15.1$8.4 million at March 31,September 30, 2023 and $17.9 million at December 31, 2022.


2731

Table of Contents

Other Liabilities
The following table summarizes the Company's other liabilities:
(In thousands)(In thousands)March 31, 2023December 31, 2022(In thousands)September 30, 2023December 31, 2022
Deferred investment management fees (1)
Deferred investment management fees (1)
$7,555 $6,264 
Deferred investment management fees (1)
$8,918 $6,264 
Other deferred income (2)
Other deferred income (2)
65,782 55,188 
Other deferred income (2)
36,174 55,188 
Interest payable—corporate debtInterest payable—corporate debt5,807 4,431 Interest payable—corporate debt1,181 4,431 
Interest payable—investment level debtInterest payable—investment level debt5,889 5,624 Interest payable—investment level debt3,420 5,624 
Dividends payable16,444 16,491 
Common and preferred stock dividends payableCommon and preferred stock dividends payable16,418 16,491 
Securities sold short—consolidated fundsSecurities sold short—consolidated funds45,628 40,928 Securities sold short—consolidated funds43,832 40,928 
Due to custodians—consolidated fundsDue to custodians—consolidated funds29,129 35,458 Due to custodians—consolidated funds9,548 35,458 
Current and deferred income tax liabilityCurrent and deferred income tax liability9,396 98 Current and deferred income tax liability7,304 98 
Contingent consideration payable—InfraBridge (Note 10)10,938 — 
Contingent consideration payable—InfraBridge (Note 11)Contingent consideration payable—InfraBridge (Note 11)11,203 — 
Contingent consideration payable—Wafra (Note 10)Contingent consideration payable—Wafra (Note 10)35,000 125,000 Contingent consideration payable—Wafra (Note 10)35,000 125,000 
Warrants issued to Wafra (Note 10)Warrants issued to Wafra (Note 10)22,200 17,700 Warrants issued to Wafra (Note 10)41,400 17,700 
Operating lease liability—corporate offices
Operating lease liability—corporate offices
39,535 40,497 
Operating lease liability—corporate offices
49,954 40,497 
Operating lease liability—investment properties
Operating lease liability—investment properties
287,150 282,433 
Operating lease liability—investment properties
— 282,433 
Finance lease liability—investment properties
Finance lease liability—investment properties
133,723 135,624 
Finance lease liability—investment properties
— 135,624 
Accrued compensationAccrued compensation41,086 52,031 Accrued compensation48,756 52,031 
Accrued incentive fee and carried interest compensationAccrued incentive fee and carried interest compensation134,078 171,086 Accrued incentive fee and carried interest compensation242,402 171,086 
Accrued real estate and other taxesAccrued real estate and other taxes15,886 21,580 Accrued real estate and other taxes6,569 21,580 
Payable for Vantage SDC expansion capacity (3)
Payable for Vantage SDC expansion capacity (3)
6,889 56,889 
Payable for Vantage SDC expansion capacity (3)
38,538 56,889 
Accounts payable and accrued expensesAccounts payable and accrued expenses219,414 185,900 Accounts payable and accrued expenses45,118 185,900 
Due to affiliates (Note 16)Due to affiliates (Note 16)860 12,451 Due to affiliates (Note 16)13,055 12,451 
Other liabilitiesOther liabilities1,179 6,423 Other liabilities9,782 6,423 
Other liabilitiesOther liabilities$1,133,568 $1,272,096 Other liabilities$668,572 $1,272,096 
__________
(1)    Deferred investment management fees are expected to be recognized as fee income over a weighted average period of 3.82.8 years as of at March 31,September 30, 2023 and 2.9 years as of December 31, 2022. Deferred investment management fees recognized as income of $1.4$1.5 million and $2.4$0.6 million in the three months ended March 31,September 30, 2023 and 2022, respectively, and $2.8 million and $3.1 million in the nine months ended September 30, 2023 and 2022, respectively, pertain to the deferred management fee balance at the beginning of each respective period.
(2)    Represents primarily prepaid rental income and upfront payment received for data center installation services in the Operating segment.
(3)    Represents deferred purchase consideration associated with a Vantage SDC add-on acquisition in 2021 that is to be paid upon future lease-up.
Deferred Income Taxes
The Company has significant deferred tax assets, related principally to capital loss carryforwards, outside basis difference in DBRG's interest in the OP, outside basis difference in investment in partnerships and net operating losses generated by a taxable U.S. subsidiary. As of March 31,September 30, 2023 and December 31, 2022, a full valuation allowance has been established as the realizability of these deferred tax assets did not meet the more-likely-than-not threshold. As a result, income tax expense for the three months ended March 31,in 2023 generally reflects the income tax effect of foreign subsidiaries.
28

Table of Contents

8. Debt
Corporate debtDebt—This is composed of a securitized financing facility and senior notes issued by DigitalBridge Group, Inc. or itsthe OP subsidiary and are recourse to the Company, as discussed further below. Corporate debt is presented within Corporate and Other, except that a portion of the securitized financing facility is allocated to the Investment Management and Operating segments consistent with the cash flows that service the debt and the underlying collateral that resides across the Company's various lines of business.
March 31, 2023December 31, 2022September 30, 2023December 31, 2022
(In thousands)(In thousands)Investment ManagementOperatingCorporate and OtherTotalInvestment ManagementOperatingCorporate and OtherTotal(In thousands)Investment ManagementOperatingCorporate and OtherTotalInvestment ManagementOperatingCorporate and OtherTotal
Corporate debtCorporate debtCorporate debt
Securitized financing facilitySecuritized financing facility$199,033 $70,246 $23,416 $292,695 $198,677 $70,120 $23,374 $292,171 Securitized financing facility$199,745 $70,499 $23,499 $293,743 $198,677 $70,120 $23,374 $292,171 
Convertible and exchangeable senior notesConvertible and exchangeable senior notes— — 277,076 277,076 — — 276,741 276,741 Convertible and exchangeable senior notes— — 77,378 77,378 — — 276,741 276,741 
$199,033 $70,246 $300,492 $569,771 $198,677 $70,120 $300,115 $568,912 $199,745 $70,499 $100,877 $371,121 $198,677 $70,120 $300,115 $568,912 
32

Table of Contents
Investment-level debtDebt—This represents non-recourse debt, including: (i) investment level financing in the Operating segment, which excludes DataBank following deconsolidation in September 2023; and (ii) debt within consolidated funds and debt on warehoused investments, if any, in Corporate and Other.
The components that make up the carrying value of corporate and investment-level debt are as follows.
Corporate DebtCorporate Debt
(In thousands)(In thousands)Securitized Financing FacilityConvertible and Exchangeable Senior NotesTotalNon-Recourse Investment-Level Debt(In thousands)Securitized Financing FacilityConvertible and Exchangeable Senior NotesTotalNon-Recourse Investment-Level Debt
March 31, 2023
September 30, 2023September 30, 2023
Debt at amortized costDebt at amortized costDebt at amortized cost
PrincipalPrincipal$300,000 $278,422 $578,422 $4,871,528 Principal$300,000 $78,422 $378,422 $2,806,408 
Premium (discount), netPremium (discount), net— (1,175)(1,175)(47,922)Premium (discount), net— (933)(933)5,119 
Deferred financing costsDeferred financing costs(7,305)(171)(7,476)(71,556)Deferred financing costs(6,257)(111)(6,368)(25,475)
$292,695 $277,076 $569,771 $4,752,050 $293,743 $77,378 $371,121 $2,786,052 
December 31, 2022December 31, 2022December 31, 2022
Debt at amortized costDebt at amortized costDebt at amortized cost
PrincipalPrincipal$300,000 $278,422 $578,422 $4,634,235 Principal$300,000 $278,422 $578,422 $4,634,235 
Premium (discount), netPremium (discount), net— (1,293)(1,293)10,713 Premium (discount), net— (1,293)(1,293)10,713 
Deferred financing costsDeferred financing costs(7,829)(388)(8,217)(57,720)Deferred financing costs(7,829)(388)(8,217)(57,720)
$292,171 $276,741 $568,912 $4,587,228 $292,171 $276,741 $568,912 $4,587,228 
33

Table of Contents
The following table summarizes certain key terms of corporate and investment-level debt.
Fixed RateVariable RateTotal
($ in thousands)Outstanding Principal
Weighted Average Interest Rate (Per Annum)(1)
Weighted Average Years Remaining to Maturity(2)
Outstanding Principal
Weighted Average Interest Rate (Per Annum)(1)
Weighted Average Years Remaining to Maturity(2)
Outstanding Principal
Weighted Average Interest Rate (Per Annum)(1)
Weighted Average Years Remaining to Maturity(2)
March 31, 2023
Corporate debt
Recourse
Securitized financing facility(3)
$300,000 3.93 %3.5$— NA3.5$300,000 3.93 %3.5
Convertible and exchangeable senior notes278,422 5.21 %0.7— NANA278,422 5.21 %0.7
$578,422 $— $578,422 
Investment-Level Secured Debt
Non-recourse
Operating segment$4,508,428 3.09 %3.4$362,500 8.68 %0.8$4,870,928 3.51 %3.3
Corporate and Other—Consolidated fund— NANA600 6.40 %1.4600 6.40 %1.4
$4,508,428 $363,100 $4,871,528 
29

Table of Contents

Fixed RateVariable RateTotalFixed RateVariable RateTotal
($ in thousands)($ in thousands)Outstanding Principal
Weighted Average Interest Rate (Per Annum)(1)
Weighted Average Years Remaining to Maturity(2)
Outstanding Principal
Weighted Average Interest Rate (Per Annum)(1)
Weighted Average Years Remaining to Maturity(2)
Outstanding Principal
Weighted Average Interest Rate (Per Annum)(1)
Weighted Average Years Remaining to Maturity(2)
($ in thousands)Outstanding Principal
Weighted Average Interest Rate (Per Annum)(1)
Weighted Average Years Remaining to Maturity(2)
Outstanding Principal
Weighted Average Interest Rate (Per Annum)(1)
Weighted Average Years Remaining to Maturity(2)
Outstanding Principal
Weighted Average Interest Rate (Per Annum)(1)
Weighted Average Years Remaining to Maturity(2)
September 30, 2023September 30, 2023
Corporate debtCorporate debt
RecourseRecourse
Securitized financing facility(3)
Securitized financing facility(3)
$300,000 3.93 %3.0$— NA3.0$300,000 3.93 %3.0
Exchangeable senior notesExchangeable senior notes78,422 5.75 %1.8— NANA78,422 5.75 %1.8
$378,422 $— $378,422 
Investment-Level Secured DebtInvestment-Level Secured Debt
Non-recourseNon-recourse
Operating segmentOperating segment$2,801,748 2.84 %2.7$— NANA$2,801,748 2.84 %2.7
Corporate and Other—Consolidated fundCorporate and Other—Consolidated fund— NANA4,660 6.92 %0.94,660 6.92 %0.9
$2,801,748 $4,660 $2,806,408 
December 31, 2022December 31, 2022December 31, 2022
Corporate debtCorporate debtCorporate debt
RecourseRecourseRecourse
Securitized financing facility(3)
Securitized financing facility(3)
$300,000 3.93 %3.7$— NA3.7$300,000 3.93 %3.7
Securitized financing facility(3)
$300,000 3.93 %3.7$— NA3.7$300,000 3.93 %3.7
Convertible and exchangeable senior notesConvertible and exchangeable senior notes278,422 5.21 %0.9— NANA278,422 5.21 %0.9Convertible and exchangeable senior notes278,422 5.21 %0.9— NANA278,422 5.21 %0.9
$578,422 $— $578,422 $578,422 $— $578,422 
Investment-Level Secured DebtInvestment-Level Secured DebtInvestment-Level Secured Debt
Non-recourseNon-recourseNon-recourse
Operating segmentOperating segment$3,640,235 2.43 %3.1$993,500 8.41 %2.6$4,633,735 3.71 %3.0Operating segment$3,640,235 2.43 %3.1$993,500 8.41 %2.6$4,633,735 3.71 %3.0
Corporate and Other—Consolidated fundCorporate and Other—Consolidated fund— NANA500 5.96 %1.6500 5.96 %1.6Corporate and Other—Consolidated fund— NANA500 5.96 %1.6500 5.96 %1.6
$3,640,235 $994,000 $4,634,235 $3,640,235 $994,000 $4,634,235 
__________
(1)    Calculated based upon outstanding debt principal at balance sheet date. For variable rate debt, weighted average interest rate is calculated based upon the applicable index plus spread at balance sheet date.
(2)    Calculated based upon anticipated repayment dates for notes issued under securitization financing; otherwise based upon initial maturity dates, or extended maturity dates if extension criteria are met for extensions that are at the Company's option.
(3)    Represent obligations of special-purpose subsidiaries of the OP as co-issuers and certain other special-purpose subsidiaries of DBRG, and secured by assets of these special-purpose subsidiaries, as further described below. DBRG and the OP are not guarantors to the debt.
Corporate DebtSecuritized Financing Facility
In July 2021, special-purpose subsidiaries of the OP (the "Co-Issuers") issued Series 2021-1 Secured Fund Fee Revenue Notes, composed of: (i) $300 million aggregate principal amount of 3.933% Secured Fund Fee Revenue Notes, Series 2021-1, Class A-2 (the “Class A-2 Notes”); and (ii) up to $300 million (following a $100 million increase in April 2022) Secured Fund Fee Revenue Variable Funding Notes, Series 2021-1, Class A-1 (the “VFN” and, together with the Class A-2 Notes, the “Series 2021-1 Notes”). The VFN allow the Co-Issuers to borrow on a revolving basis. The Series 2021-1 Notes were issued under an Indenture dated July 2021, as amended in April 2022, that allows the Co-Issuers to issue additional series of notes in the future, subject to certain conditions. The Series 2021-1 Notes replaced the Company's previous corporate credit facility.
The Series 2021-1 Notes represent obligations of the Co-Issuers and certain other special-purpose subsidiaries of DBRG, and neither DBRG, the OP nor any of its other subsidiaries are liable for the obligations of the Co-Issuers. The Series 2021-1 Notes are secured by net investment management fees earned by subsidiaries of DBRG, equity interests in portfolio companies in the Operating segment and limited partnership interests in certain sponsored funds held by subsidiaries of DBRG, as collateral.
34

Table of Contents
The Class A-2 Notes bear interest at a rate of 3.933% per annum, payable quarterly. The VFN bear interest generally based upon 1-month Adjusted Term Secured Overnight Financing Rate or SOFR (prior to April 2022, 3-month LIBOR) or an alternate benchmark as set forth in the purchase agreement of the VFN plus 3%. Unused capacity under the VFN facility is subject to a commitment fee of 0.5% per annum. The final maturity date of the Class A-2 Notes is in September 2051, with an anticipated repayment date in September 2026. The anticipated repayment date of the VFN is in September 2024, subject to two one-year extensions at the option of the Co-Issuers. If the Series 2021-1 Notes are not repaid or refinanced prior to their anticipated repayment date, or such date is not extended for the VFN, interest will accrue at a higher rate and the Series 2021-1 Notes will begin to amortize quarterly.
The Series 2021-1 Notes may be optionally prepaid, in whole or in part, prior to their anticipated repayment dates. There is no prepayment penalty on the VFN. However, prepayment of the Class A-2 Notes will be subject to additional consideration based upon the difference between the present value of future payments of principal and interest and the outstanding principal of such Class A-2 Note that is being prepaid; or 1% of the outstanding principal of such Class A-2 Note that is being prepaid in connection with a disposition of collateral.
30

Table of Contents

The Indenture of the Series 2021-1 Notes contains various covenants, including financial covenants that require the maintenance of minimum thresholds for debt service coverage ratio and maximum loan-to-value ratio, as defined. As of the date of this filing, the Co-Issuers are in compliance with all of the financial covenants, and the full $300 million under the VFN is available to be drawn.
Corporate DebtConvertible and Exchangeable Senior Notes
Convertible and exchangeable senior notes (collectively, the senior notes) are composed of the following, each representing senior unsecured obligations of DigitalBridge Group, Inc. or a subsidiarythe OP as the respective issuers of the senior notes:
DescriptionDescriptionIssuance DateDue DateInterest Rate (per annum)Conversion or Exchange Price (per share of common stock)
Conversion or Exchange Ratio
(in shares)(1)
Conversion or Exchange Shares (in thousands)Earliest Redemption DateOutstanding PrincipalDescriptionIssuance DateDue DateInterest Rate (per annum)Conversion or Exchange Price (per share of common stock)
Conversion or Exchange Ratio
(in shares)(1)
Conversion or Exchange Shares (in thousands)Earliest Redemption DateOutstanding Principal
March 31, 2023December 31, 2022September 30, 2023December 31, 2022
Issued by DigitalBridge Group, Inc.Issued by DigitalBridge Group, Inc.Issued by DigitalBridge Group, Inc.
5.00% Convertible Senior Notes (2)
5.00% Convertible Senior Notes (2)
April 2013April 15, 20235.00 $63.02 15.8675 3,174 April 22, 2020$200,000 $200,000 
5.00% Convertible Senior Notes (2)
April 2013April 15, 20235.00 $63.02 15.8675 3,174 April 22, 2020$— $200,000 
Issued by DigitalBridge Operating Company, LLCIssued by DigitalBridge Operating Company, LLCIssued by DigitalBridge Operating Company, LLC
5.75% Exchangeable Senior Notes5.75% Exchangeable Senior NotesJuly 2020July 15, 20255.75 9.20 108.6956 8,524 July 21, 202378,422 78,422 5.75% Exchangeable Senior NotesJuly 2020July 15, 20255.75 9.20 108.6956 8,524 July 21, 202378,422 78,422 
$278,422 $278,422 $78,422 $278,422 
__________
(1)    The conversion or exchange rateratio for the senior notes is subject to periodic adjustments to reflect certain carried-forward adjustments relating to common stock splits, reverse stock splits, common stock adjustments in connection with spin-offs and cumulative cash dividends paid on the Company's common stock since the issuances of the respective senior notes. The conversion or exchange ratios are presented in shares of common stock per $1,000 principal of each senior note.
(2)    Fully repaid in April 2023.
The senior notes mature on their respective due dates, unless earlier redeemed, repurchased, converted or exchanged, as applicable.exchanged. The outstanding senior notes are convertible or exchangeable at any time by holders of such notes into shares of the Company’s common stock at the applicable conversion or exchange rate, which is subject to adjustment upon occurrence of certain events.
To the extent certain trading conditions of the Company’s common stock are met, the senior notes are redeemable by the applicable issuer thereof in whole or in part for cash at any time on or after their respective earliest redemption dates at a redemption price equal to 100% of the principal amount of such senior notes being redeemed, plus accrued and unpaid interest (if any) up to, but excluding, the redemption date.
In the event of certain change in control transactions, holders of the senior notes have the right to require the applicable issuer to purchase all or part of such holder's senior notes for cash in accordance with terms of the governing documents of the respective senior notes.
Exchange of Senior Notes For Common Stock and Cash
There were no exchange transactions in the three months ended March 31, 2023.
35

Table of Contents
In March 2022, DBRG and the OP completed separate privately negotiated exchange transactions with certain noteholders of the 5.75% exchangeable notes. The Company exchanged in aggregate $60.3 million of outstanding principal of the 5.75% exchangeable notes into 6,389,366 shares of the Company's class A common stock and paid $13.9 million of cash. The exchanges resulted in a debt extinguishment loss of $133.2 million, calculated as the excess of consideration paid over the carrying value of the notes exchanged, and recorded in other loss on the consolidated statement of operations. Consideration was measured at fair value based upon the closing price of the Company's class A
common stock on the date of the respective exchanges, and cash paid, net of transaction costs. The exchanges did not qualify as debt conversion and were treated as debt extinguishment as the Company issued less than the number of shares issuable under the stated exchange ratio of 108.696 shares per $1,000 of note principal exchanged.
Non-Recourse Investment-Level Secured Debt
These are investment level financing that are non-recourse to DBRG and are primarily secured by data center portfolios held by subsidiaries in the Operating segment.segment, which excludes DataBank following deconsolidation in September 2023. At March 31,September 30, 2023, the subsidiariesremaining subsidiary in the Operating segment werewas in compliance with the financial covenants underlying theirthe respective investment-level secured debt.
In 2023, subsidiaries in the Operating segment refinanced or raised additional debt, primarily through new securitization transactions, as follows. There were no securitization activities in 2022.
31

Table of Contents

In February 2023, DataBank issued $715 million of securitized notes at fixed rate coupon of 5.12% per annum (7.07% per annum effective rate as the notes were issued at a discount) with a 5-year anticipated repayment date. In April 2023,Separately, DataBank secured an additionala $350 million credit facility.facility that may be drawn over time and obtained $121.0 million financing for a data center acquisition (Note 3). Proceeds were also applied principally to refinance the data center assets of its zColo subsidiary and to repay the outstanding balance onof its variable funding notes.
In March 2023, Vantage SDC issued $370 million of securitized notes at a fixed rate coupon of 6.32% per annum with a 5-year anticipated repayment date. Proceeds were applied principally to repay previously issued securitized notes which had an anticipated repayment date in November 2023 and the outstanding balance onof its variable funding notes.
These refinancing transactions resulted in a net loss from debt extinguishment totaling $9.4$12.0 million, representing prepayment penalty and accelerated amortization of deferred financing costs, debt discount and premium, recorded in interest expense.
Future Minimum Principal Payments
The following table summarizes future scheduled minimum principal payments of debt at March 31,September 30, 2023. Future debt principal payments are presented based upon anticipated repayment dates for notes issued under securitization financing, or based upon initial maturity dates or extended maturity dates if extension criteria are met at March 31,September 30, 2023 for extensions that are at the option of the respective borrower entities.
The $200 million outstanding principal of the 5% convertible senior notes that was due in April 2023 was fully repaid at maturity.
(In thousands)(In thousands)Remaining 202320242025202620272028 and thereafterTotal(In thousands)Remaining 202320242025202620272028 and thereafterTotal
Corporate debtCorporate debtCorporate debt
Securitized financing facilitySecuritized financing facility$$$$300,000$$$300,000Securitized financing facility$$$$300,000$$$300,000
Convertible and exchangeable senior notes200,00078,422278,422
Exchangeable senior notesExchangeable senior notes78,42278,422
$200,000$$78,422$300,000$$$578,422$$$78,422$300,000$$$378,422
Non-recourse investment-level secured debtNon-recourse investment-level secured debtNon-recourse investment-level secured debt
Operating segmentOperating segment$102,985$863,253$700,000$1,519,690$600,000$1,085,000$4,870,928Operating segment$995$600,753$700,000$530,000$600,000$370,000$2,801,748
Corporate and Other—Consolidated fundCorporate and Other—Consolidated fund600600Corporate and Other—Consolidated fund4,6604,660
$102,985$863,853$700,000$1,519,690$600,000$1,085,000$4,871,528$995$605,413$700,000$530,000$600,000$370,000$2,806,408
3236

Table of Contents

9. Stockholders' Equity
The table below summarizes the share activities of the Company's preferred stock and common stock.
Number of SharesNumber of Shares
(In thousands)(In thousands)Preferred Stock
Class A
Common Stock
Class B
Common Stock
(In thousands)Preferred Stock
Class A
Common Stock
Class B
Common Stock
Shares outstanding at December 31, 2021Shares outstanding at December 31, 202135,340 142,144 166 Shares outstanding at December 31, 202135,340 142,144 166 
Stock repurchasesStock repurchases(2,229)(945)— 
Exchange of notes for class A common stockExchange of notes for class A common stock— 6,389 — Exchange of notes for class A common stock— 6,389 — 
Shares issued upon redemption of OP UnitsShares issued upon redemption of OP Units— 100 — 
Shares issued for redemption of redeemable noncontrolling interest (Note 10)Shares issued for redemption of redeemable noncontrolling interest (Note 10)— 14,435 — 
Equity awards issued, net of forfeituresEquity awards issued, net of forfeitures— 1,248 — Equity awards issued, net of forfeitures— 1,533 — 
Shares canceled for tax withholding on vested equity awardsShares canceled for tax withholding on vested equity awards— (411)— Shares canceled for tax withholding on vested equity awards— (681)— 
Shares outstanding at March 31, 202235,340 149,370 166 
Shares outstanding at September 30, 2022Shares outstanding at September 30, 202233,111 162,975 166 
Shares outstanding at December 31, 2022Shares outstanding at December 31, 202233,111 159,763 166 Shares outstanding at December 31, 202233,111 159,763 166 
Stock repurchasesStock repurchases(3)— — Stock repurchases(235)— — 
Shares issued upon redemption of OP UnitsShares issued upon redemption of OP Units— 253 — 
Equity awards issued, net of forfeituresEquity awards issued, net of forfeitures— 2,486 — Equity awards issued, net of forfeitures— 4,815 — 
Shares canceled for tax withholding on vested equity awardsShares canceled for tax withholding on vested equity awards— (415)— Shares canceled for tax withholding on vested equity awards— (1,567)— 
Shares outstanding at March 31, 202333,108 161,834 166 
Shares outstanding at September 30, 2023Shares outstanding at September 30, 202332,876 163,264 166 
Preferred Stock
In the event of a liquidation or dissolution of the Company, preferred stockholders have priority over common stockholders for payment of dividends and distribution of net assets.
The table below summarizes the preferred stock issued and outstanding at March 31,September 30, 2023:
DescriptionDescriptionDividend Rate Per AnnumInitial Issuance Date
Shares Outstanding
(in thousands)
Par Value
(in thousands)
Liquidation Preference
(in thousands)
Earliest Redemption DateDescriptionDividend Rate Per AnnumInitial Issuance Date
Shares Outstanding
(in thousands)
Par Value
(in thousands)
Liquidation Preference
(in thousands)
Earliest Redemption Date
Series HSeries H7.125 %April 20158,429 $84 $210,731 Currently redeemableSeries H7.125 %April 20158,395 $84 $209,870 Currently redeemable
Series ISeries I7.15 %June 201712,988 130 324,710 Currently redeemableSeries I7.15 %June 201712,867 129 321,668 Currently redeemable
Series JSeries J7.125 %September 201711,691 117 292,270 Currently redeemableSeries J7.125 %September 201711,614 116 290,361 Currently redeemable
33,108 $331 $827,711 32,876 $329 $821,899 
All series of preferred stock are at parity with respect to dividends and distributions, including distributions upon liquidation, dissolution or winding up of the Company. Dividends on Series H, I and J of preferred stock are payable quarterly in arrears in January, April, July and October.
Each series of preferred stock is redeemable on or after the earliest redemption date for that series at $25.00 per share plus accrued and unpaid dividends (whether or not declared) prorated to their redemption dates, exclusively at the Company’s option. The redemption period for each series of preferred stock is subject to the Company’s right under limited circumstances to redeem the preferred stock upon the occurrence of a change of control (as defined in the articles supplementary relating to each series of preferred stock).
Preferred stock generally does not have any voting rights, except if the Company fails to pay the preferred dividends for six or more quarterly periods (whether or not consecutive). Under such circumstances, the preferred stock will be entitled to vote, together as a single class with any other series of parity stock upon which like voting rights have been conferred and are exercisable, to elect two additional directors to the Company’s board of directors, until all unpaid dividends have been paid or declared and set aside for payment. In addition, certain changes to the terms of any series of preferred stock cannot be made without the affirmative vote of holders of at least two-thirds of the outstanding shares of each such series of preferred stock voting separately as a class for each series of preferred stock.
Common Stock
Except with respect to voting rights, class A common stock and class B common stock have the same rights and privileges and rank equally, share ratably in dividends and distributions, and are identical in all respects as to all matters. Class A common stock has one vote per share and class B common stock has thirty-six and one-half votes per share. This gives the holders of class B common stock a right to vote that reflects the aggregate outstanding non-voting
37

Table of Contents
economic interest in the Company (in the form of OP Units) attributable to class B common stock holders and therefore, does not provide any disproportionate voting rights. Class B common stock was issued as consideration in the Company's acquisition in April 2015 of the investment management business and operations of its former manager, which was previously controlled by the Company's former Executive Chairman. Each share of class B common stock shall convert automatically into one share of class A common stock if the former Executive Chairman or his beneficiaries directly or
33

Table of Contents

indirectly transfer beneficial ownership of class B common stock or OP Units held by them, other than to certain qualified transferees, which generally includes affiliates and employees. In addition, each holder of class B common stock has the right, at the holder’s option, to convert all or a portion of such holder’s class B common stock into an equal number of shares of class A common stock.
The Company reinstated quarterly common stock dividends at $0.01 per share beginning the third quarter of 2022, having previously suspended common stock dividends from the second quarter of 2020 through the second quarter of 2022.
Dividend Reinvestment and Direct Stock Purchase Plan
The Company's Dividend Reinvestment and Direct Stock Purchase Plan (the “DRIP Plan”) provides existing common stockholders and other investors the opportunity to purchase shares (or additional shares, as applicable) of the Company's class A common stock by reinvesting some or all of the cash dividends received on their shares of the Company's class A common stock or making optional cash purchases within specified parameters. The DRIP Plan involves the acquisition of the Company's class A common stock either in the open market, directly from the Company as newly issued common stock, or in privately negotiated transactions with third parties. To date, noNo shares of class A common stock have been acquired under the DRIP Plan in the form of new issuances in the last three years.
Reverse Stock Split
In August 2022, the Company effectuated a one-for-four reverse stock split of its outstanding shares of class A and class B common stock. At that time, tThehe number of authorized shares of common stock was not concurrently adjusted in connection with the reverseand par value of common stock split, however, the Company intendswas proportionately increased from $0.01 to seek$0.04 per share. Following stockholder approval to make a proportional change to in May 2023, the number of authorized shares of class A and class B common stock at its next annual meeting of stockholders.was proportionally decreased to Par237,250,000 shares and 250,000 shares, respectively and par value of common stock was proportionately increaseddecreased from $0.01$0.04 to $0.04 per share. Common stock share and$0.01 per share, information, including OP Units and stock award units as well as the Company's senior note conversion or exchange ratioresulting in common stock shares, have been revised for all periods presentedapproximately $4.9 million increase in this Quarterly Report on Form 10-Q to give effect to the reverse stock split.additional paid-in capital.
Stock Repurchases
Pursuant to a $200 million stock repurchase program announced in July 2022 during the three months ended March 31,that expired in June 2023:
In 2023, the Company repurchased 2,738235,223 shares in aggregate across Series H, I and J preferred stock for approximately $52,000, or a weighted average price of $18.89 per share. In April 2023, an additional 232,485 shares of preferred stock were repurchased for $4.7 million, or a weighted average price of $20.20$20.18 per share.
In 2022, the Company repurchased (i) 2,228,805 shares in aggregate across Series H, I and J preferred stock at a discount for $52.6 million, or a weighted average price of $23.62 per share; and (ii) 4,195,020 shares of class A common stock for $54.9 million, or a weighted average price of $13.09 per share. The stock repurchase program expires on June 30, 2023 and may be extended, modified, or discontinued at any time by the Company's Board of Directors.
The excess or deficit of the repurchase price over the carrying value of the preferred stock results in a decrease or increase to net income attributable to common stockholders, respectively.
3438

Table of Contents

Accumulated Other Comprehensive Income (Loss) ("AOCI")
The following tables present the changes in each component of AOCI attributable to stockholders and noncontrolling interests in investment entities, net of immaterial tax effect. AOCI attributable to noncontrolling interests in Operating Company is immaterial.
Changes in Components of AOCI—Stockholders
(In thousands)(In thousands)Company's Share in AOCI of Equity Method InvestmentsUnrealized Gain (Loss) on AFS Debt SecuritiesForeign Currency Translation Gain (Loss)Unrealized Gain (Loss) on Net Investment HedgesTotal(In thousands)Company's Share in AOCI of Equity Method InvestmentsUnrealized Gain (Loss) on AFS Debt SecuritiesForeign Currency Translation Gain (Loss)Unrealized Gain (Loss) on Net Investment HedgesTotal
AOCI at December 31, 2021AOCI at December 31, 2021$2,334 $5,861 $26,502 $7,686 $42,383 AOCI at December 31, 2021$2,334 $5,861 $26,502 $7,686 $42,383 
Other comprehensive income (loss) before reclassificationsOther comprehensive income (loss) before reclassifications217 — (3,131)25 (2,889)Other comprehensive income (loss) before reclassifications(3,790)— (36,281)24,477 (15,594)
Amounts reclassified from AOCIAmounts reclassified from AOCI(200)(5,861)(20,680)— (26,741)Amounts reclassified from AOCI(200)(5,861)(17,016)(7,768)(30,845)
AOCI at March 31, 2022$2,351 $— $2,691 $7,711 $12,753 
AOCI at September 30, 2022AOCI at September 30, 2022$(1,656)$— $(26,795)$24,395 $(4,056)
AOCI at December 31, 2022AOCI at December 31, 2022$(295)$— $(1,214)$— $(1,509)AOCI at December 31, 2022$(295)$— $(1,214)$— $(1,509)
Other comprehensive income (loss) before reclassificationsOther comprehensive income (loss) before reclassifications(1)— 787 — 786 Other comprehensive income (loss) before reclassifications(1)— 1,264 — 1,263 
Amounts reclassified from AOCIAmounts reclassified from AOCI296 — (1,051)— (755)Amounts reclassified from AOCI296 — (902)— (606)
AOCI at March 31, 2023$— $— $(1,478)$— $(1,478)
Deconsolidation of DataBank Deconsolidation of DataBank— — 965 — 965 
AOCI at September 30, 2023AOCI at September 30, 2023$— $— $113 $— $113 
Changes in Components of AOCI—Noncontrolling Interests in Investment Entities
(In thousands)Foreign Currency Translation Gain (Loss)
AOCI at December 31, 2021$11,057 
Other comprehensive lossincome (loss) before reclassifications(2,184)(29,551)
Amounts reclassified from AOCI(9,827)(9,819)
AOCI at March 31,September 30, 2022$(954)(28,313)
AOCI at December 31, 2022$(3,015)
Other comprehensive lossincome (loss) before reclassifications503 (1,666)
Amounts reclassified from AOCI(468)2,082 
Deconsolidation of DataBank2,550 
AOCI at March 31,September 30, 2023$(2,980)(49)
Reclassifications out of AOCI—Stockholders
Information about amounts reclassified out of AOCI attributable to stockholders by component is presented below. Such amounts are included in other gain (loss) in both continuing and discontinued operations on the consolidated statements of operations, as applicable, except for amounts related to equity method investments, which are included in equity method losses in discontinued operations.
(In thousands)(In thousands)Three Months Ended March 31,(In thousands)Three Months Ended September 30,Nine Months Ended September 30,
Component of AOCI reclassified into earningsComponent of AOCI reclassified into earnings20232022Component of AOCI reclassified into earnings2023202220232022
Relief of basis of AFS debt securitiesRelief of basis of AFS debt securities$— $5,861 Relief of basis of AFS debt securities$— $— $— $5,861 
Release of foreign currency cumulative translation adjustmentsRelease of foreign currency cumulative translation adjustments1,051 20,680 Release of foreign currency cumulative translation adjustments284 (3,664)902 17,016 
Realized gain on net investment hedgesRealized gain on net investment hedges— 7,768 — 7,768 
Deconsolidation of DataBankDeconsolidation of DataBank(965)(965)— 
Release of AOCI of equity method investmentsRelease of AOCI of equity method investments(296)200 Release of AOCI of equity method investments— — (296)200 
3539

Table of Contents

10. Noncontrolling Interests
Redeemable Noncontrolling Interests
The following table presents the activities in redeemable noncontrolling interests in the Company's investment management business prior tothrough its redemption in May 2022 as discussed below, and in open-end funds sponsored andin the liquid securities strategy consolidated by the Company.
Three Months Ended March 31,Nine Months Ended September 30,
(In thousands)(In thousands)20232022(In thousands)20232022
Redeemable noncontrolling interestsRedeemable noncontrolling interestsRedeemable noncontrolling interests
Balance at January 1Balance at January 1$100,574 $359,223 Balance at January 1$100,574 $359,223 
ContributionsContributions— 10,150 Contributions300 11,650 
Distributions paid and payable, including redemptions by limited partners in consolidated fundsDistributions paid and payable, including redemptions by limited partners in consolidated funds(104)(9,414)Distributions paid and payable, including redemptions by limited partners in consolidated funds(78,330)(20,119)
Net income (loss)Net income (loss)6,943 (11,220)Net income (loss)4,634 (31,989)
Adjustment of Wafra's interest to redemption value and warrants held by Wafra to fair valueAdjustment of Wafra's interest to redemption value and warrants held by Wafra to fair value— 690,000 Adjustment of Wafra's interest to redemption value and warrants held by Wafra to fair value— 725,026 
Redemption of Wafra's interestRedemption of Wafra's interest— (862,276)
Reclassification of warrants held by Wafra to liability in May 2022 (Note 7)Reclassification of warrants held by Wafra to liability in May 2022 (Note 7)— (81,400)
Reclassification of Wafra's carried interest allocation to noncontrolling interests in investment entities in May 2022Reclassification of Wafra's carried interest allocation to noncontrolling interests in investment entities in May 2022— (4,087)
Balance at March 31$107,413 $1,038,739 
Balance at September 30Balance at September 30$27,178 $96,028 
Redeemable Noncontrolling Interest in Investment Management
On May 23, 2022, the Company redeemed the 31.5% noncontrolling interest in its investment management business held by affiliates of Wafra Inc. (collectively, "Wafra"), a private investment firm, pursuant to a purchase and sale agreement ("PSA") entered into in April 2022.
In connection with Wafra's initial investment in the Company's investment management business in July 2020, Wafra had assumed directly and also indirectly through a participation interest $124.9 million of the Company's commitments to DBP I, and has a $125.0 million commitment to DBP II that has been partially funded to-date. These are the Company's flagship value-add equity infrastructure funds. Wafra had also agreed to make commitments to the Company's future funds and investment vehicles on a pro rata basis with the Company based on Wafra's percentage interest in the investment management business, subject to certain caps.
Pursuant to the PSA, Wafra’s entitlement to carried interest in DBP II was reduced from 12.6% to 7%, and with certain limited exceptions, Wafra sold or gave up its right to invest in, or receive carried interest from, future investment management products, but except as otherwise provided, retained its investment in and its allocation of carried interest from existing investment management products.
Consideration for the redemption of Wafra's interest consisted of: (i) an upfront payment of $388.5 million in cash and 14,435,399 shares of the Company's Class A common stock valued at $348.8 million based upon the closing price of the Company's class A common stock on May 23, 2022; and (ii) Wafra's right to earn a contingent amount up to $125 million if the Company raises fee earning equity under management (as defined in the PSA) up to $6 billion during the period from December 31, 2021 to December 31, 2023, payable in March 2023 for portion earned in 2022 and March 2024 for any remaining portion earned in 2023, with up to 50% payable in shares of the Company's Class A common stock at the Company's election. The Company paid Wafra in cash $90 million of the contingent amount in March 2023.
The carrying value of Wafra's redeemable noncontrolling interest was adjusted to fair value prior to redemption, initially based upon an estimate of consideration payable at March 31, 2022 when redemption was deemed to be probable, including the maximum potential contingent amount of $125 million. This adjustment resulted in an allocation from additional paid-in capital to redeemable noncontrolling interests on the consolidated balance sheet.
The unrealized carried interest earnings allocated to Wafra that was retained and no longer subject to redemption was reclassified in May 2022 to permanent equity, included in noncontrolling interests in investment entities.
Additionally, in July 2020, the Company had also issued Wafra five warrants to purchase up to an aggregate of 5% of the Company’s class A common stock (5% at the time of the transaction, on a fully-diluted, post-transaction basis), as described further in Note 11. In connection with the redemption, the terms of the warrants were amended, among other things, to provide for net cash settlement upon exercise of the warrants, at election of either the Company or Wafra, if such exercise would result in Wafra beneficially owning in excess of 9.8% of the issued and outstanding shares of the Company's class A common stock. Inclusion of the cash settlement feature changed the classification of the warrants from equity to liability. The warrants were remeasured to fair value prior to reclassification in May 2022, with the increase in
40

Table of Contents
value recorded in equity to reduce additional paid-in capital. Subsequent changes in fair value of the warrant liability is recorded in earnings.
36

Table of Contents

The Company's redemption of Wafra's interest in May 2022 also resulted in the assumption of $5.2 million of deferred tax asset that now accrues to the Company.
Noncontrolling Interests in Investment Entities
2022 DataBank Additional Investment in 2022
In January 2022, a shareholder of DataBank sold its equity interest to the Company and an existing investor, resulting in an additional $32.0 million investment by the Company in DataBank. Following this transaction and additional equity funded by the shareholders of DataBank in connection with its data center acquisition in March 2022 (Note 3), the Company's interest in DataBank increased from 20% to 21.8% (prior to recapitalizationthe 2022 and 2023 recapitalizations as discussed below).
2022 DataBank Recapitalization in 2022
The Company began a partial recapitalization of DataBank was partially recapitalized in the second half of 2022 through multiple sales of equity interest to new investors, totaling $2.0 billionresulting in cash. The Company's ownership interest in DataBank decreased from 21.8% (as noted above)net proceeds to 11.0%. Thethe Company received its share of proceeds from the sale ofapproximately $425.5 million, in the third and fourth quarters of 2022, including its share of carried interest, net of allocation to employees.employees and former employees of $20.1 million (the "2022 Recapitalization"). As a result of the 2022 Recapitalization, the Company's ownership decreased from 21.8% to 11.0% at December 31, 2022.
Upon completion of the 2022 Recapitalization, the Company reconsidered its consolidation assessment and concluded that it remained the primary beneficiary of the VIE through which it holds its interest in DataBank. As the transaction2022 Recapitalization involved a change in ownership of a consolidated subsidiary, it was accounted for as an equity transaction. The difference between the book value of the Company's interest and its ownership based upon the currentfair value of DataBank resulted in a reallocation from noncontrolling interests in investment entities to additional paid-in capital totaling $230.2 million in the third and fourth quarters of 2022.
The recapitalization2022 Recapitalization transaction triggered an accelerated vesting of certain profits interest units that had been issued by DataBank to its employees. As a result of the accelerated vesting, $10$10.0 million of additional equity based compensation was recorded in the third quarter of 2022 based upon DataBank's original grant date fair value of these awards, of which $7.8 million was attributable to noncontrolling interests in investment entities.
2023 DataBank Recapitalization and Deconsolidation
In September 2023, the Company completed the partial recapitalization of DataBank through additional sales of equity interest to new investors (the "2023 Recapitalization"), resulting in net proceeds to the Company of $49.4 million, including carried interest of $27.9 million. As a result of the 2023 Recapitalization, the Company's ownership interest in DataBank decreased from 11.0% to 9.87%.
Upon completion of the 2023 Recapitalization, the Company reconsidered its consolidation assessment and concluded that it no longer held a controlling financial interest in DataBank and was no longer the primary beneficiary of the VIE through which it holds its interest in DataBank. As a result, the Company derecognized the assets and liabilities of DataBank effective September 14, 2023, and accounts for its remaining investment in DataBank using the equity method. Accordingly, prior to September 14, 2023, the assets and liabilities and operating results of DataBank were included in the Company's consolidated financial statements and presented in the Operating segment, with the portion of DataBank's operating results attributable to third party investors presented as noncontrolling interests in investment entities. Subsequent to September 14, 2023, the Company's consolidated financial statements include only its equity investment and its share of changes in the fair value of DataBank, which are presented in Corporate and Other, consistent with the treatment and presentation of the Company's interests as general partner affiliate in its other sponsored investment vehicles (Note 4).
41

Table of Contents
The deconsolidation of DataBank resulted in the derecognition of the following assets, liabilities and noncontrolling interests in investment entities as of September 14, 2023:
(In thousands)September 14, 2023
Assets
Cash and cash equivalents$52,902 
Restricted cash49,546 
Real estate3,234,888 
Goodwill463,120 
Deferred leasing costs and intangible assets322,187 
Other assets461,223 
Assets held for disposition49,696 
$4,633,562 
Liabilities
Debt$2,309,596 
Intangible liabilities6,696 
Other liabilities718,211 
Liabilities related to assets held for disposition12,165 
$3,046,668 
Noncontrolling interests in investment entities$1,427,435 
In connection with the deconsolidation, the Company realized a $3.7 million gain from the sale of its equity interest in the 2023 Recapitalization, and remeasured its remaining 9.87% equity interest in DataBank at a fair value of $434.5 million (Note 4) based upon the pricing of the recapitalization, which resulted in an unrealized gain of $275.0 million. The total gain of $278.7 million was recorded in other gain (loss), net on the Company's consolidated statements of operations, and is presented in Corporate and Other.
Noncontrolling Interests in Operating Company
Certain current and former employees of the Company directly or indirectly own interests in OP, presented as noncontrolling interests in the Operating Company. Noncontrolling interests in OP have the right to require OP to redeem part or all of such member’s OP Units for cash based on the market value of an equivalent number of shares of class A common stock at the time of redemption, or at the Company's election as managing member of OP, through issuance of shares of class A common stock (registered or unregistered) on a one-for-one basis. At the end of each period, noncontrolling interests in OP is adjusted to reflect their ownership percentage in OP at the end of the period, through a reallocation between controlling and noncontrolling interests in OP.
Redemption of OP UnitsNo OP Units were redeemed in the three months ended March 31, 2023. The Company redeemed 100,220 OP Units during the year ended December 31,totaling 253,084 in 2023 and 100,220 in 2022 through the issuance of an equal number of shares of class A common stock on a one-for-one basis.
11. Fair Value
Recurring Fair Values
Financial assets and financial liabilities carried at fair value on a recurring basis include financial instruments for which the fair value option was elected, but exclude financial assets under the NAV practical expedient. Fair value is categorized into a three tier hierarchy that is prioritized based upon the level of transparency in inputs used in the valuation techniques, as follows.
Level 1—Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2—Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in non-active markets, or valuation techniques utilizing inputs that are derived principally from or corroborated by observable data directly or indirectly for substantially the full term of the financial instrument.
Level 3—At least one assumption or input is unobservable and it is significant to the fair value measurement, requiring significant management judgment or estimate.
42

Table of Contents
Marketable Equity Securities
Marketable equity securities with long positions of $166.0$84.0 million at March 31,September 30, 2023 and $155.9 million at December 31, 2022, included within equity investments of Corporate and Other (Note 4), and short positions of $45.6$43.8 million at March 31,September 30, 2023 and $40.9 million at December 31, 2022, included in other liabilities (Note 7), consist of
37

Table of Contents

publicly traded equity securities held predominantly by sponsored liquid strategy funds consolidated by the Company. The equity securities of the consolidated funds comprise listed stocks primarily in the U.S. and to a lesser extent, in Europe, and primarily in the technology, media and telecommunications sectors. These marketable equity securities are valued based upon listed prices in active markets and classified as Level 1 of the fair value hierarchy.
Equity Investment of Consolidated Fund
A consolidated credit fund has equity interestinterests in pooling entities that hold a pooling entity,portfolio of loans, invested alongside other affiliated managed funds, that holds a portfolio of loans.credit funds. The fund's equity interestinterests in the pooling entityentities had a fair value of $62.5$107.0 million at March 31,September 30, 2023 and $46.8 million at December 31, 2022, classified as Level 3 of the fair value hierarchy. Fair value of the fund's equity interestinterests in the pooling entityentities is based upon its share of expected cash flows from the loan assets held by the pooling entity.entities. In estimating the fair value of itsthe underlying loans, the pooling entityentities considered the prevailing market yields at which a third party might expect to receive on equivalent loans with similar credit risk. Based upon thea comparison to market yields, it was determined that the transacted price onor par value of the loans held by the pooling entity approximateentities approximated their fair value at March 31,September 30, 2023 and at December 31, 2022.
Derivatives
The Company's derivative instruments generally consist of: (i) foreign currency put options, forward contracts and costless collars to hedge the foreign currency exposure of certain foreign-denominated investments or investments in foreign subsidiaries (in GBP and EUR), with notional amounts and termination dates based upon the anticipated return of capital from these investments; and (ii) interest rate caps and swaps to limit the exposure to changes in interest rates on various floating rate debt obligations (indexed to LIBORSOFR or Euribor). These derivative contracts may be designated as qualifying hedge accounting relationships, specifically as net investment hedges and cash flow hedges, respectively.
The derivative instruments are subject to master netting arrangements with counterparties that allow the Company to offset the settlement of derivative assets and liabilities in the same currency by instrument type or, in the event of default by the counterparty, to offset all derivative assets and liabilities with the same counterparty. Notwithstanding the conditions for right of offset may have been met, the Company presents derivative assets and liabilities with the same counterparty on a gross basis on the consolidated balance sheets.
The Company had no outstanding derivatives at March 31,September 30, 2023. At December 31, 2022, the fair value of derivative assets was $11.8 million, included in other assets, and there were no derivatives in a liability position. All derivative positions were non-designated hedges. DerivativeAt December 31, 2022, derivative notional amounts for foreign exchange contracts aggregated to the equivalent of $321.1 million at December 31, 2022,for foreign exchange contracts, and there were no outstanding interest rate contracts.
Realized and unrealized gains and losses on derivative instruments are recorded in other gain (loss) on the consolidated statement of operations as follows:
Three Months Ended March 31,Three Months Ended September 30,Nine Months Ended September 30,
(In thousands)(In thousands)20232022(In thousands)2023202220232022
Foreign currency contracts:Foreign currency contracts:Foreign currency contracts:
Realized gain transferred from AOCI to earningsRealized gain transferred from AOCI to earnings$— $8,367 $— $8,367 
Realized and unrealized gain in earnings on non-designated contracts (1)
Realized and unrealized gain in earnings on non-designated contracts (1)
$4,053 $1,510 
Realized and unrealized gain in earnings on non-designated contracts (1)
— (8,689)4,053 (3,619)
Interest rate contracts:Interest rate contracts:Interest rate contracts:
Realized and unrealized gain in earnings on non-designated contractsRealized and unrealized gain in earnings on non-designated contracts— 61 Realized and unrealized gain in earnings on non-designated contracts— 10,258 — 11,284 
__________
(1)    Amount in 2023 relatesInclude amount related to foreign currency contract entered into on behalf of a sponsored fund, which hashad no net impact to the Company's earnings, as discussed in Note 16.(Note 16).
The Company's foreign currency and interest rate contracts are generally traded over-the-counter, and are valued using a third-party service provider. Quotations on over-the-counter derivatives are not adjusted and are generally valued using observable inputs such as contractual cash flows, yield curve, foreign currency rates and credit spreads, and are classified as Level 2 of the fair value hierarchy. Although credit valuation adjustments, such as the risk of default, rely on Level 3 inputs, these inputs are not significant to the overall valuation of the derivatives. As a result, derivative valuations in their entirety are classified as Level 2 of the fair value hierarchy.
43

Table of Contents
Warrants
As discussed in Note 10, the Company had issued five warrants to Wafra in July 2020. Each warrant entitles Wafra to purchase up to 1,338,000 shares of the Company's class A common stock at staggered strike prices between $9.72 and $24.00 each, exercisable through July 17, 2026. No warrants have been exercised to-date.
38

Table of Contents

The warrants are carried at fair value effective May 2022 when they were reclassified from equity to liability, with subsequent changes in fair value recorded in other gain (loss) on the consolidated statements of operations. The warrants were valued at $22.2$41.4 million at March 31,September 30, 2023 and $17.7 million at December 31, 2022 using a Black-Scholes option pricing model, applying the following inputs: (a) estimated volatility for DBRG's class A common stock of 44.4%37.2% (40.8% at December 31, 2022); (b) closing stock price of DBRG's class A common stock on the last trading day of the quarter; (c) the strike price for each warrant; (d) remaining term to expiration of the warrants; and (e) risk free rate of 3.78%4.85% per annum (4.16% per annum at December 31, 2022), derived from the daily U.S. Treasury yield curve rates to correspond to the remaining term to expiration of the warrants. Fair value of the warrant liability, classified as Level 3 fair value, increased $4.5$23.7 million during the threenine months ended March 31,September 30, 2023.
Contingent Consideration
In connection with the acquisition of InfraBridge, contingent consideration is payable if prescribed fundraising targets for InfraBridge's new global infrastructure funds are met. In measuring the contingent consideration, the Company applied a probability-weighted approach to the likelihood of meeting various fundraising targets and discounted the estimated future contingent consideration payment at 4.9% to derive a present value amount. The contingent consideration of $10.9$11.2 million at March 31,September 30, 2023 is classified as Level 3 of the fair value hierarchy, with changesincrease in fair value of $0.3 million during the nine months ended September 30, 2023 recorded in other gain (loss).
Fair Value Option
Loans Receivable
LoansAt September 30, 2023, there was no outstanding balance on loans receivable, arewhich had been carried at fair value under the fair value option, whichoption. Previously, loans receivable consisted of two unsecured promissory notes, one in connection with the 2022 sale of the Company's Wellness Infrastructure business (Note 2) and one held by DataBank, presented within Corporate and Other and in the Operating segment, respectively. Both loans receivable have ahad bullet repayment of principal and accrue PIKaccrued paid-in-kind ("PIK") interest. Accrued interest forms part of the fairFair value of loans receivable and isincluded accrued interest, which was recorded in other income. Changesincome, while changes in fair value of loans receivable arewas recorded in other gain (loss).
At MarchDecember 31, 2023,2022, fair value of loans receivable was $6.8$137.9 million, ($137.9 million at December 31, 2022), with unpaid principal balance, inclusive of PIK interest, of $168.8$167.8 million, ($167.8 million at December 31, 2022), classified as Level 3 in the fair value hierarchy. AtIn March 31, 2023, the Wellness Infrastructure note was fully written down, taking into consideration an impending foreclosure of certain assets within the Wellness Infrastructure portfolio by its mezzanine lender. TheIn April 2023, the DataBank note was carried at par plus accrued PIK interest as it was fully repaid in April 2023.repaid. At December 31, 2022, loan fair values were based upon a discounted cash flow projection of principal and interest, which at the time of valuation, were expected to be collected, applying discount rates ofdiscounted at 10.0% and 10.5%.
3944

Table of Contents

Changes in Level 3 Fair Value
The following table presents changes in recurring Level 3 fair value assets held for investment. Realized and unrealized gains (losses) are included in other gain (loss).
Fair Value OptionEquity Investment of Consolidated FundFair Value OptionEquity Investment of Consolidated Fund
(In thousands)(In thousands)Loans Receivable(In thousands)Equity Investment of Consolidated Fund
Fair value at December 31, 2021Fair value at December 31, 2021$82,930 $— Fair value at December 31, 2021$82,930 $— 
Originations and drawdownsOriginations and drawdowns360,990 — Originations and drawdowns371,415 — 
Change in accrued interest and capitalization of paid-in-kind interestChange in accrued interest and capitalization of paid-in-kind interest4,491 — 
PaydownsPaydowns(112,500)— Paydowns(159,501)— 
Change in accrued interest and capitalization of paid-in-kind interest(650)— 
Transfer of warehoused loans to sponsored fundTransfer of warehoused loans to sponsored fund(83,083)— 
Consolidation of sponsored fundConsolidation of sponsored fund— 10,536 
Unrealized gain (loss) in earnings, netUnrealized gain (loss) in earnings, net(2,815)— Unrealized gain (loss) in earnings, net(41,863)673 
Fair value at March 31, 2022$327,955 $— 
Fair value at September 30, 2022Fair value at September 30, 2022$174,389 $11,209 
Net unrealized gain (loss) in earnings on instruments held at March 31, 2022$(2,815)$— 
Net unrealized gain (loss) in earnings on instruments held at September 30, 2022Net unrealized gain (loss) in earnings on instruments held at September 30, 2022$(38,649)$673 
Fair value at December 31, 2022Fair value at December 31, 2022$137,945 $46,770 Fair value at December 31, 2022$137,945 $46,770 
ContributionsContributions— 9,627 Contributions— 58,952 
Change in consolidated fund's share of equity investment (1)
Change in consolidated fund's share of equity investment (1)
— 6,125 
Change in consolidated fund's share of equity investment (1)
— 1,842 
Paydowns of underlying loan assets held by equity investment of consolidated fund— (25)
Change in accrued interest and capitalization of paid-in-kind interest545 — 
Unrealized gain (loss) in earnings, net (2)
(131,686)11 
Fair value at March 31, 2023$6,804 $62,508 
Capitalization of paid-in-kind interestCapitalization of paid-in-kind interest544 — 
Paydown of loan receivable or underlying loan assets held by equity investment of consolidated fundPaydown of loan receivable or underlying loan assets held by equity investment of consolidated fund(6,804)(2,344)
Unrealized and realized gain (loss) in earnings, netUnrealized and realized gain (loss) in earnings, net(131,685)1,812 
Fair value at September 30, 2023Fair value at September 30, 2023$— $107,032 
Net unrealized gain (loss) in earnings on instruments held at March 31, 2023$(131,686)$11 
Net unrealized gain (loss) in earnings on instruments held at September 30, 2023Net unrealized gain (loss) in earnings on instruments held at September 30, 2023$(133,307)$1,812 
__________
(1)    Represents reallocation of investment value when relative ownership of the pooling entity across its fund owners change following additional capital contributions.
(2)    With respect toequity investment of the consolidated fund, represents remeasurement of a foreign currency denominated loan asset held by the pooling entity of the consolidated fund.
Investment Carried at Fair Value Using Net Asset Value
The Company holds an investment in a non-traded healthcare REIT, valued at $34.5 million at March 31,September 30, 2023 and at December 31, 2022, presented within Corporate and Other in Note 4. The Company has no commitment for any further investment in the non-traded REIT in the future. The investment is valued based upon NAV beginning October 2021 when the investee, a healthcare real estate investor/manager, was acquired in conjunction with a merger of its co-sponsored non-traded REITs. The transaction diluted the Company's equity interest in the investee, which was previously accounted for as an equity method investment. Redemption of the Company's partnership interest in the non-traded healthcare REIT is restricted until the earliest of (1) the second anniversary of the issuance to the Company of such partnership units, (2) change in control of the general partner, and (3) initial public offering of the equity of the non-traded healthcare REIT, which may be subject to further restriction on redemption by the underwriters.
Nonrecurring Fair Values
The Company measures fair value of certain assets on a nonrecurring basis: (i) on the acquisition date for business combinations; and (ii) when events or changes in circumstances indicate that the carrying value of the assets may not be recoverable.recoverable; and (iii) upon deconsolidation of a subsidiary for any retained interest. Adjustments to fair value generally result from thean application of the lower of amortized cost or fair value accounting for assets held for disposition or otherwise, a write-down of asset values due to impairment.
Other than the assets and liabilities acquired in the InfraBridge business combination discussed in Note 3, thereThere were no assets held for investment carried at nonrecurring fair value at March 31,September 30, 2023 and December 31, 2022.
4045

Table of Contents

Fair Value of Financial Instruments Reported at Cost
Fair value of financial instruments reported at amortized cost, excluding those held for disposition, are presented below.
Fair Value MeasurementsCarrying Value Fair Value MeasurementsCarrying Value
(In thousands)(In thousands)Level 1Level 2Level 3Total(In thousands)Level 1Level 2Level 3Total
March 31, 2023
September 30, 2023September 30, 2023
LiabilitiesLiabilitiesLiabilities
Corporate debtCorporate debtCorporate debt
Secured fund fee revenue notesSecured fund fee revenue notes$— $250,547 $— $250,547 $292,695 Secured fund fee revenue notes$— $250,547 $— $250,547 $293,743 
Convertible and exchangeable senior notes325,098 — — 325,098 277,076 
Exchangeable senior notesExchangeable senior notes— 149,363 — 149,363 77,378 
Non-recourse investment-level debtNon-recourse investment-level debt— 4,134,916 363,488 4,498,404 4,752,050 Non-recourse investment-level debt— 2,542,596 4,415 2,547,011 2,786,052 
December 31, 2022December 31, 2022December 31, 2022
LiabilitiesLiabilitiesLiabilities
Corporate debtCorporate debtCorporate debt
Secured fund fee revenue notesSecured fund fee revenue notes$— $250,547 $— $250,547 $292,171 Secured fund fee revenue notes$— $250,547 $— $250,547 $292,171 
Convertible and exchangeable senior notesConvertible and exchangeable senior notes304,513 — — 304,513 276,741 Convertible and exchangeable senior notes304,513 — 304,513 276,741 
Non-recourse investment-level debtNon-recourse investment-level debt— 3,268,508 944,984 4,213,492 4,587,228 Non-recourse investment-level debt— 3,268,508 944,984 4,213,492 4,587,228 
Debt—Senior notes and secured fund fee revenue notes were valued using their last traded price. Fair value of investment-level debt were estimated by either discounting expected future cash outlays at interest rates available to the respective borrower subsidiaries for similar instruments, or forwith respect to securitized debt, based upon indicative bond prices quoted by brokers in the secondary market.
Other—The carrying values of cash and cash equivalents, accounts receivable, due from and to affiliates, interest payable and accounts payable generally approximate fair value due to their short term nature, and credit risk, if any, is negligible.
12. Variable Interest Entities
A VIE is an entity that lacks sufficient equity to finance its activities without additional subordinated financial support from other parties, or whose equity holders lack the characteristics of a controlling financial interest. The following discusses the Company's involvement with VIEs where the Company is the primary beneficiary and consolidates the VIEs or where the Company is not the primary beneficiary and does not consolidate the VIEs.
Operating Subsidiary
The Company's operating subsidiary, OP, is a limited liability company that has governing provisions that are the functional equivalent of a limited partnership. The Company holds the majority of membership interest in OP, acts as the managing member of OP and exercises full responsibility, discretion and control over the day-to-day management of OP. The noncontrolling interests in OP do not have substantive liquidation rights, substantive kick-out rights without cause, or substantive participating rights that could be exercised by a simple majority of noncontrolling interest members (including by such a member unilaterally). The absence of such rights, which represent voting rights in a limited partnership equivalent structure, would render OP to be a VIE. The Company, as managing member, has the power to direct the core activities of OP that most significantly affect OP's performance, and through its majority interest in OP, has both the right to receive benefits from and the obligation to absorb losses of OP. Accordingly, the Company is the primary beneficiary of OP and consolidates OP. As the Company conducts its business and holds its assets and liabilities through OP, the total assets and liabilities, earnings (losses), and cash flows of OP represent substantially all of the total consolidated assets and liabilities, earnings (losses), and cash flows of the Company.
Company-Sponsored Private Funds
The Company sponsors private funds and other investment vehicles as general partner for the purpose of providing investment management services in exchange for management fees and carried interest. These private funds are established as limited partnerships or equivalent structures. Limited partners of the private funds do not have either substantive liquidation rights, or substantive kick-out rights without cause, or substantive participating rights that could be exercised by a simple majority of limited partners or by a single limited partner. Accordingly, the absence of such rights, which represent voting rights in a limited partnership, results in the private funds being considered VIEs. The nature of the Company's involvement with its sponsored funds comprise fee arrangements and equity interests in its capacity as general partner and limitedgeneral partner
4146

Table of Contents

equity interests.affiliate. The fee arrangements are commensurate with the level of management services provided by the Company, and contain terms and conditions that are customary to similar at-market fee arrangements.
Consolidated Company-Sponsored Private Funds—The Company currently consolidates sponsored private funds in which it has more than an insignificant equity interest in the fund as general partner. As a result, the Company is considered to be acting in the capacity of a principal of the sponsored private fund and is therefore the primary beneficiary of the fund. The Company’s exposure is limited to the value of its outstanding investmentcapital account balance in the consolidated private funds of $112.6$157.5 million at March 31,September 30, 2023 and $94.7 million at December 31, 2022. The liabilities of the consolidated funds
may only be settled using assets of the consolidated funds, and the Company, as general partner, is not obligated to provide any financial support to the consolidated private funds. At September 30, 2023, the Company had unfunded equity commitment to a consolidated fund of $41.9 million.
The following table presents the assets and liabilities of the consolidated funds, which are presented within Corporate and Other in the supplemental schedule to the consolidated balance sheets.
(In thousands)(In thousands)March 31, 2023December 31, 2022(In thousands)September 30, 2023December 31, 2022
AssetsAssetsAssets
Cash and cash equivalentsCash and cash equivalents$82,906 $86,433 Cash and cash equivalents$70,122 $86,433 
Investments—marketable equity securities and equity interest in credit pooling entity (Note 11)211,758 185,845 
Investments—marketable equity securities and equity interests in credit pooling entities (Note 11)Investments—marketable equity securities and equity interests in credit pooling entities (Note 11)178,176 185,845 
Other assetsOther assets414 1,895 Other assets3,219 1,895 
$295,078 $274,173 $251,517 $274,173 
LiabilitiesLiabilitiesLiabilities
DebtDebt$350 $465 Debt$4,415 $465 
Other liabilitiesOther liabilitiesOther liabilities
Securities sold shortSecurities sold short45,629 40,928 Securities sold short43,831 40,928 
Due to custodianDue to custodian29,130 35,457 Due to custodian9,547 35,457 
OtherOther1,059 2,734 Other9,930 2,734 
$76,168 $79,584 $67,723 $79,584 
Unconsolidated Company-Sponsored Private Funds—The Company does not consolidate its sponsored private funds where it has insignificant direct equity interests or capital commitments toin these funds as general partner. The Company may invest alongside certain of its sponsored private funds through joint ventures between the Company and these funds, or the Company may have capital commitments to its sponsored private funds that are satisfied directly through the co-investment joint ventures as an affiliate of the general partner. In these instances, the co-investment joint ventures are consolidated by the Company. As the Company's direct equitysuch interests in its sponsored private funds as general partner absorb insignificant variability from the fund, the Company is considered to be acting in the capacity of an agent of these fundsthe fund and is therefore not the primary beneficiary of these funds. The Company accounts for its equity interests in unconsolidated sponsored private funds under the equity method. The Company's maximum exposure to loss is limited to the carrying valueoutstanding balance of its investment in the unconsolidated sponsored private funds totaling $853.8 million(Note 4) of $1.56 billion at March 31,September 30, 2023 and $752.3 million at December 31, 2022, included2022. The Company also has receivables from its unconsolidated funds for fee income and reimbursable or recoverable costs, as discussed in Note 16. At September 30, 2023, the Company's unfunded equity investments,commitments to its unconsolidated funds as general partner and $0.8 milliongeneral partner affiliate totaled $86.9 million. Generally, the timing for funding of these commitments is not known and the commitments are callable on demand at March 31, 2023 and $1.0 million at December 31, 2022, included within assets held for disposition.any time prior to their respective expirations.
4247

Table of Contents

13. Earnings per Share
The following table provides the basic and diluted earnings per common share computations.
Three Months Ended March 31, Three Months Ended September 30,Nine Months Ended September 30,
(In thousands, except per share data)(In thousands, except per share data)20232022(In thousands, except per share data)2023202220232022
Net income (loss) allocated to common stockholdersNet income (loss) allocated to common stockholdersNet income (loss) allocated to common stockholders
Income (Loss) from continuing operations attributable to DigitalBridge Group, Inc.Income (Loss) from continuing operations attributable to DigitalBridge Group, Inc.$(184,136)$(165,197)Income (Loss) from continuing operations attributable to DigitalBridge Group, Inc.$278,842 $25,261 $89,710 $(157,638)
Income (Loss) from discontinued operations attributable to DigitalBridge Group, Inc. Income (Loss) from discontinued operations attributable to DigitalBridge Group, Inc.(13,661)(81,360) Income (Loss) from discontinued operations attributable to DigitalBridge Group, Inc.(2,369)(74,349)(19,697)(159,569)
Net income (loss) attributable to DigitalBridge Group, Inc.Net income (loss) attributable to DigitalBridge Group, Inc.(197,797)(246,557)Net income (loss) attributable to DigitalBridge Group, Inc.276,473 (49,088)70,013 (317,207)
Preferred stock repurchases/redemptions (Note 9)Preferred stock repurchases/redemptions (Note 9)— 1,098 927 1,098 
Preferred dividendsPreferred dividends(14,676)(15,759)Preferred dividends(14,645)(15,283)(43,996)(46,801)
Net income (loss) attributable to common stockholdersNet income (loss) attributable to common stockholders(212,473)(262,316)Net income (loss) attributable to common stockholders261,828 (63,273)26,944 (362,910)
Net income (loss) allocated to participating securitiesNet income (loss) allocated to participating securities(31)— Net income (loss) allocated to participating securities(4,801)(17)(457)(17)
Net income (loss) allocated to common stockholders—basicNet income (loss) allocated to common stockholders—basic(212,504)(262,316)Net income (loss) allocated to common stockholders—basic257,027 (63,290)26,487 (362,927)
Interest expense attributable to convertible and exchangeable notes (1)
Interest expense attributable to convertible and exchangeable notes (1)
— — 
Interest expense attributable to convertible and exchangeable notes (1)
1,264 — — — 
Net income (loss) allocated to common stockholders—dilutedNet income (loss) allocated to common stockholders—diluted$(212,504)$(262,316)Net income (loss) allocated to common stockholders—diluted$258,291 $(63,290)$26,487 $(362,927)
Weighted average common shares outstandingWeighted average common shares outstandingWeighted average common shares outstanding
Weighted average number of common shares outstanding—basicWeighted average number of common shares outstanding—basic158,446 142,485 Weighted average number of common shares outstanding—basic160,564 162,398 159,600 153,028 
Weighted average effect of dilutive shares (1)(2)(3)
Weighted average effect of dilutive shares (1)(2)(3)
— — 
Weighted average effect of dilutive shares (1)(2)(3)
13,298 — 4,420 — 
Weighted average number of common shares outstanding—dilutedWeighted average number of common shares outstanding—diluted158,446 142,485 Weighted average number of common shares outstanding—diluted173,862 162,398 164,020 153,028 
Income (loss) per share—basicIncome (loss) per share—basicIncome (loss) per share—basic
Income (Loss) from continuing operationsIncome (Loss) from continuing operations$(1.25)$(1.27)Income (Loss) from continuing operations$1.61 $0.07 $0.29 $(1.33)
(Income (Loss) from discontinued operations(0.09)(0.57)
Income (Loss) from discontinued operationsIncome (Loss) from discontinued operations(0.01)(0.46)(0.12)(1.04)
Net income (loss) attributable to common stockholders per common share—basicNet income (loss) attributable to common stockholders per common share—basic$(1.34)$(1.84)Net income (loss) attributable to common stockholders per common share—basic$1.60 $(0.39)$0.17 $(2.37)
Income (loss) per share—dilutedIncome (loss) per share—dilutedIncome (loss) per share—diluted
Income (Loss) from continuing operationsIncome (Loss) from continuing operations$(1.25)$(1.27)Income (Loss) from continuing operations$1.49 $0.07 $0.28 $(1.33)
(Income (Loss) from discontinued operations(0.09)(0.57)
Income (Loss) from discontinued operationsIncome (Loss) from discontinued operations(0.01)(0.46)(0.12)(1.04)
Net income (loss) attributable to common stockholders per common share—dilutedNet income (loss) attributable to common stockholders per common share—diluted$(1.34)$(1.84)Net income (loss) attributable to common stockholders per common share—diluted$1.48 $(0.39)$0.16 $(2.37)
__________
(1)    With respect to the assumed conversion or exchange of the Company's outstanding senior notes, the following are excluded from the calculation of diluted earnings per share as their inclusion would be antidilutive: (a) for the three months ended March 31, 2023 andSeptember 30, 2022 only, the effect of adding back interest expense of $4.0 million and $4.811,698,000 of weighted average dilutive common share equivalents; and (b) for the nine months ended September 30, 2023 and 2022, the effect of adding back $6.9 million and $12.7 million of interest expense, respectively, and 11,697,6009,744,700 and 16,580,80013,307,000 of weighted average dilutive common share equivalents, respectively. Also excluded from the calculation of diluted earnings per share was $133.2 million of debt extinguishment loss (Note 8) for the threenine months ended March 31,September 30, 2022.
(2)    The calculation of diluted earnings per share excludes the effect of the following as their inclusion would be antidilutive: (a) class A common shares that are contingently issuable in relation to performance stock units (Note 15) with weighted average shares of 32,400 and 2,164,3001,076,000 for the three months ended March 31, 2023September 30, 2022; and, 2022, respectively;1,727,000 for the nine months ended September 30, 2022; and (b) class A common shares that are issuable to net settle the exercise of warrants (Note 10) with weighted average shares of 362,800957,600 and 2,937,6001,393,000 for the three months ended March 31,September 30, 2023 and 2022, respectively, and 569,600 and 2,174,000 for the nine months ended September 30, 2023 and 2022, respectively.
(3)    OP Units may be redeemed for registered or unregistered class A common stock on a one-for-one basis and are not dilutive. At March 31,September 30, 2023 and 2022, 12,628,90012,375,800 and 12,728,90012,628,900 of OP Units, respectively, were not included in the computation of diluted earnings per share in the respective periods presented.
48

Table of Contents
14. Fee Income
The following table presents the Company's fee income by type.
Three Months Ended March 31,Three Months Ended September 30,Nine Months Ended September 30,
(In thousands)(In thousands)20232022(In thousands)2023202220232022
Management feesManagement fees$57,158 $42,191 Management fees$65,236 $40,697 $187,138 $126,447 
Incentive feesIncentive fees869 — Incentive fees— — 1,040 — 
Other feesOther fees1,099 646 Other fees566 1,930 1,971 
Total fee incomeTotal fee income$59,126 $42,837 Total fee income$65,240 $41,263 $190,108 $128,418 
Management FeesThe Company earns management fees for providing investment management services to its sponsored private funds and other investment vehicles, portfolio companies and managed accounts. Management fees are calculated generally at contractual rates ranging from 0.2% per annum to 1.5% per annum of investors' committed capital during the commitment period of the vehicle,fund, and thereafter, contributed or invested capital;capital (subject to certain reductions for NAV write-downs); invested capital for co-investment vehicles; or net asset valueNAV for vehicles in the liquid securities strategy.
43

Table of Contents

Incentive Fees—The Company is entitled to incentive fees from sub-advisory accounts in its liquid securities strategy. Incentive fees are determined based upon the performance of the respective accounts, subject to the achievement of specified return thresholds in accordance with the terms set out in their respective governing agreements. A portion of the incentive fees earned by the Company is allocable to senior management, investment professionals,certain employees and certain otherformer employees, of the Company, included in carried interest and incentive fee compensation expense.
Other Fee Income—Other fees include primarily service fees for information technology, facilities and operational support provided to certain portfolio companies, and on a non-recurring basis, loan origination fees.fees from co-investors.
15. Equity-Based Compensation
The DigitalBridge Group, Inc. 2014 Omnibus Stock Incentive Plan (the "Equity Incentive Plan") provides for the grant of restricted stock, performance stock units ("PSUs"), Long Term Incentive Plan ("LTIP") units, restricted stock units ("RSUs"), deferred stock units ("DSUs"), options, warrants or rights to purchase shares of the Company's common stock, cash incentives and other equity-based awards to the Company's officers, directors (including non-employee directors), employees, co-employees, consultants or advisors of the Company or of any parent or subsidiary who provides services to the Company, but excluding employees of portfolio companies. Shares reserved for the issuance of awards under the Equity Incentive Plan are subject to equitable adjustment upon the occurrence of certain corporate events, provided that this number automatically increases each January 1st by 2% of the outstanding number of shares of the Company’s class A common stock on the immediately preceding December 31st. At March 31,September 30, 2023, an aggregate 24.5 million shares of the Company's class A common stock were reserved for the issuance of awards under the Equity Incentive Plan.
Restricted StockRestricted stock awards in the Company's class A common stock are granted to senior executives, directors and certain employees, generally subject to a service condition only, with annual time-based vesting in equal tranches over a three-year period. Restricted stock is entitled to dividends declared and paid on the Company's class A common stock and such dividends are not forfeitable prior to vesting of the award. Restricted stock awards are valued based on the Company's class A common stock price on grant date and equity-based compensation expense is recognized on a straight-line basis over the requisite service period.
Restricted Stock UnitsRSUs in the Company's class A common stock are subject to a performance condition. Vesting of performance-based RSUs occur upon achievement of certain Company-specific metrics over a performance measurement period that coincides with the recipients' term of service. Only vested RSUs are entitled to accrued dividends declared and paid on the Company's class A common stock during the time period the RSUs are outstanding. Fair value of RSUs are initially valued based onupon the Company's class A common stock price on grant date.date and not subsequently remeasured for equity-classified awards, while liability-classified awards are remeasured at fair value at the end of each reporting period until the award is fully vested. Equity-based compensation expense is recognized when it becomes probable that the performance condition will be met.A liability classified award that met its performance condition and became fully vested over the course of the year was settled in cash totaling $2.4 million and $3.3 million for the three and nine months ended September 30, 2023, respectively. There was no cash settlement of awards in 2022.
Performance Stock UnitsPSUs are granted to senior executives and certain employees, and are subject to both a service condition and a market condition. Following the end of the measurement period, the recipients of PSUs who remain employed will vest in, and be issued a number of shares of the Company's class A common stock, generally ranging from 0% to 200% of the number of PSUs granted and determined based upon the performance of the Company's
49

Table of Contents
class A common stock relative to that of a specified peer group over a three-year measurement period (such measurement metric the "total shareholder return"). In addition, recipients of PSUs whose employment is terminated after the first anniversary of their PSU grant are eligible to vest in a portion of the PSU award following the end of the measurement period based upon achievement of the total shareholder return metric applicable to the award. PSUs also contain dividend equivalent rights which entitle the recipients to a payment equal to the amount of dividends that would have been paid on the shares that are ultimately issued at the end of the measurement period.
Fair value of PSUs, including dividend equivalent rights, was determined using a Monte Carlo simulation under a risk-neutral premise, with the following assumptions:
2023 PSU Grants2022 PSU Grants2021 PSU Grants
Expected volatility of the Company's class A common stock (1)
41.3%32.4%35.4%
Expected annual dividend yield (2)
0.3%—%—%
Risk-free rate (per annum) (3)
3.8%2.0%0.3%
__________
(1)    Based upon the historical volatility of the Company's stock and those of a specified peer group.
(2)    Based upon the Company's expected annualized dividends. Expected dividend yield was zero for the March 2022 and 2021 PSU awards as common dividends were suspended beginning the second quarter of 2020 and reinstated in the third quarter 2022.
(3)    Based upon the continuously compounded zero-coupon U.S. Treasury yield for the term coinciding with the measurement period of the award as of valuation date.
44

Table of Contents

Fair value of PSU awards, excluding dividend equivalent rights, is recognized on a straight-line basis over their measurement period as compensation expense, and is not subject to reversal even if the market condition is not achieved. The dividend equivalent right is accounted for as a liability-classified award. The fair value of the dividend equivalent right is recognized as compensation expense on a straight-line basis over the measurement period, and is subject to adjustment to fair value at each reporting period.
LTIP UnitsLTIP units are units in the Operating Company that are designated as profits interests for federal income tax purposes. Unvested LTIP units that are subject to market conditions do not accrue distributions. Each vested LTIP unit is convertible, at the election of the holder (subject to capital account limitation), into one common OP Unit and upon conversion, subject to the redemption terms of OP Units (Note 9).
LTIP units issued have either (1) a service condition only, valued based upon the Company's class A common stock price on grant date; or (2) both a service condition and a market condition based upon the Company's class A common stock achieving a target price over a predetermined measurement period, subject to continuous employment to the time of vesting, and valued using a Monte Carlo simulation.
The following assumptions were applied in the Monte Carlo model under a risk-neutral premise:
2022 LTIP Grant
2019 LTIP Grant (1)
Expected volatility of the Company's class A common stock (2)
34.0%28.3%
Expected dividend yield (3)
0.0%8.1%
Risk-free rate (per annum) (4)
3.6%1.8%
__________
(1)    Represents 2.5 million LTIP units granted to the Company's Chief Executive Officer, Marc Ganzi, in connection with the Company's acquisition of Digital Bridge Holdings, LLC in July 2019, with vesting based upon achievement of the Company's class A common stock price closing at or above $40 over any 90 consecutive trading days prior to the fifth anniversary of the grant date.
(2)    Based upon historical volatility of the Company's stock and those of a specified peer group.
(3)    Based upon the Company's most recently issued dividend prior to grant date and closing price of the Company's class A common stock on grant date. Expected dividend yield was zero for the June 2022 award as common dividends were suspended beginning the second quarter of 2020 and reinstated in the third quarter of 2022.
(4)    Based upon the continuously compounded zero-coupon US Treasury yield for the term coinciding with the measurement period of the award as of valuation date.
Equity-based compensation cost on LTIP units is recognized on a straight-line basis either over (1) the service period for awards with a service condition only; or (2) the derived service period for awards with both a service condition and a market condition, irrespective of whether the market condition is satisfied. The derived service period is a service period that is inferred from the application of the simulation technique used in the valuation of the award, and represents the median of the terms in the simulation in which the market condition is satisfied.
Deferred Stock UnitsCertain non-employee directors may elect to defer the receipt of annual base fees and/or restricted stock awards, and in lieu, receive awards of DSUs. DSUs awarded in lieu of annual base fees are fully vested
50

Table of Contents
on their grant date, while DSUs awarded in lieu of restricted stock awards vest one year from their grant date. DSUs are entitled to a dividend equivalent, in the form of additional DSUs based on dividends declared and paid on the Company's class A common stock, subject to the same restrictions and vesting conditions, where applicable. Upon separation of service from the Company, vested DSUs will be settled in shares of the Company’s class A common stock. Fair value of DSUs are determined based on the price of the Company's class A common stock on grant date and recognized immediately if fully vested upon grant, or on a straight-line basis over the vesting period as equity based compensation expense and equity.
Equity-based compensation cost pursuant to DBRG's Equity Incentive Plan is included in the following line itemspresented on the consolidated statement of operations.operations, as follows. Separately, additional compensation expense was also recorded in 2022 in connection with the DataBank recapitalization transaction, as described in Note 10.
Three Months Ended March 31,
(In thousands)20232022
Compensation expense (including $0 and $37 expense related to dividend equivalent rights)$10,770 $8,979 
Administrative expense228 88 
$10,998 $9,067 
45

Table of Contents

Three Months Ended September 30,Nine Months Ended September 30,
(In thousands)2023202220232022
Compensation expense (including $0, $16, $0 and $229 expense related to dividend equivalent rights)$14,340 $7,824 $45,801 $24,971 
Administrative expense— — 228 122 
$14,340 $7,824 $46,029 $25,093 
Changes in unvested equity awards pursuant to DBRG's Equity Incentive Plan are summarized below.
Weighted Average
Grant Date Fair Value
Weighted Average
Grant Date Fair Value
Restricted Stock
LTIP Units (1)
DSUs
RSUs (2)
PSUs (3)
TotalPSUsAll Other AwardsRestricted Stock
LTIP Units (1)
DSUs
RSUs (2)
PSUs (3)
TotalPSUsAll Other Awards
Unvested shares and units at December 31, 2022Unvested shares and units at December 31, 20221,706,674 2,625,000 20,058 2,397,391 1,889,587 8,638,710 $17.84 $10.84 Unvested shares and units at December 31, 20221,706,674 2,625,000 20,058 2,397,391 1,889,587 8,638,710 $17.84 $10.84 
GrantedGranted1,865,483 — 6,457 — 397,262 2,269,202 13.36 11.75 Granted2,417,211 — 70,748 — 413,172 2,901,131 11.63 12.14 
VestedVested(532,399)— (6,439)(599,348)(635,926)(1,774,112)29.84 15.72 Vested(1,145,622)— (26,747)(1,798,044)(603,525)(3,573,938)26.92 13.82 
ForfeitedForfeited(822)— — — (424,065)(424,887)29.84 27.29 Forfeited(21,675)— — — (424,065)(445,740)26.92 13.79 
Unvested shares and units at March 31, 20233,038,936 2,625,000 20,076 1,798,043 1,226,858 8,708,913 6.02 10.33 
Unvested shares and units at September 30, 2023Unvested shares and units at September 30, 20232,956,588 2,625,000 64,059 599,347 1,275,169 7,520,163 8.51 9.93 
__________
(1)    Represents the number of LTIP units granted subject to vesting upon achievement of market condition. LTIP units that do not meet the market condition within the measurement period will be forfeited.
(2)    Represents the number of RSUs granted subject to vesting upon achievement of performance condition. RSUs that do not meet the performance condition at the end of the measurement period will be forfeited.
(3)    Number of PSUs granted does not reflect potential increases or decreases that could result from the final outcome of the total shareholder return measured at the end of the performance period. PSUs for which the total shareholder return was not met at the end of the performance period are forfeited.
Fair value of equity awards that vested, as shown above, determined based upon their respective fair values at vesting date, was $20.9$13.3 million and $33.4$4.2 million for the three months ended March 31,September 30, 2023 and 2022, respectively, and $47.5 million and $53.3 million for the nine months ended September 30, 2023 and 2022, respectively.
At March 31,September 30, 2023, aggregate unrecognized compensation cost for all unvested equity awards pursuant to DBRG's Equity Incentive Plan was $55.5$44.6 million, which is expected to be recognized over a weighted average period of 2.21.9 years. This excludes $18.8$6.3 million of unvested RSUs that are not currently probable of achieving their performance conditionscondition and have a remaining performance measurement period of 1.1 years.approximately one year.
16. Transactions with Affiliates
Affiliates include (i) private funds and other investment vehicles that the Company manages sponsors and/or sponsors,manages, and in which the Company may have an equity interest or co-invests with;interest; (ii) portfolio companies of sponsored funds; (iii) the Company's other equity investments in unconsolidated ventures;outside of sponsored funds; and (iii)(iv) directors senior executives and employees of the Company (collectively, "employees").
51

Table of Contents
Amounts due from and due to affiliates consist of the following:
(In thousands)(In thousands)March 31, 2023December 31, 2022(In thousands)September 30, 2023December 31, 2022
Due from AffiliatesDue from AffiliatesDue from Affiliates
Investment vehicles, portfolio companies and unconsolidated ventures
Investment vehicles, portfolio companies and other equity investmentsInvestment vehicles, portfolio companies and other equity investments
Fee incomeFee income$58,076 $35,010 Fee income$58,376 $35,010 
Cost reimbursements and recoverable expensesCost reimbursements and recoverable expenses7,111 7,031 Cost reimbursements and recoverable expenses10,707 7,031 
OtherOther964 — Other612 — 
Employees and other affiliatesEmployees and other affiliates1,134 3,319 Employees and other affiliates— 3,319 
$67,285 $45,360 $69,695 $45,360 
Due to Affiliates (Note 7)
Due to Affiliates (Note 7)
Due to Affiliates (Note 7)
Investment vehicles—Derivative obligationInvestment vehicles—Derivative obligation$— $11,793 Investment vehicles—Derivative obligation$— $11,793 
Investment vehicles, employees and other affiliates860 658 
Investment vehicles—InfraBridge (Note 3)Investment vehicles—InfraBridge (Note 3)11,123 — 
Employees and other affiliatesEmployees and other affiliates1,932 658 
$860 $12,451 $13,055 $12,451 
Significant transactions with affiliates include the following:
Fee Income—Fee income earned from investment vehicles that the Company manages and/or sponsors, and may have an equity interest, or co-investment, are presented in Note 14. Substantially all fee income are from affiliates, except for management fees and incentive fee from sub-advisory accounts and generally, other fee income.
Cost Reimbursements and Recoverable Expenses—The Company receives reimbursements and recovers certain costs paid on behalf of investment vehicles sponsored by the Company, which include: (i) organization and offering costs related to the formation and capital raising of the investment vehicles up to specified thresholds; (ii) costs incurred in performing investment due diligence; and (iii) direct and indirect operating costs for managing the operations of certain investment vehicles.
46

Table of Contents

Such cost reimbursements and recoverable expenses, included in other income, totaled $1.3$1.2 million and $3.4$1.0 million for the three months ended March 31,September 30, 2023 and 2022, respectively, and $3.8 million and $5.7 million for the nine months ended September 30, 2023 and 2022, respectively.
Warehoused Investments—The Company may acquire and temporarily warehouse investments on behalf of prospective sponsored investment vehicles that are actively fundraising.fundraising (Note 4). The warehoused investments are transferred to the investment vehicle when sufficient third party capital, including debt, is raised. The Company is generally paid a fee by the investment vehicle, akin to an interest charge, typically calculated as a percentage of the acquisition price of the investment, to compensate the Company for its cost of holding the investment during the warehouse period. The terms of such arrangements may differ for each sponsored investment vehicle orand by investment.
Derivative Obligations of Sponsored Fund—In the third quarter of 2022, the Company, in its capacity as general partner and for the benefit of its sponsored fund, entered into foreign currency forward contracts to economically hedge the foreign currency exposure of an investment commitment of its sponsored fund (Note 11). The investment committee of the sponsored fund has ratified the fund's responsibility and obligation to assume all resulting liabilities and benefits from the foreign currency contracts effective from trade date through the novation of the contracts to the fund. The Company recorded a payable in due to affiliates to reflect the fund's obligation to assume the resulting asset from the foreign currency contracts; accordingly, there was no net effect to the Company's earnings resulting from these foreign currency contracts. Upon the novation of the contracts to the fund in January 2023, the Company de-recognized the derivative asset and the corresponding payable in due to affiliate.
Digital Real Estate Acquisitions—Marc Ganzi, Chief Executive Officer of the Company, and Ben Jenkins, President and Chief Investment Officer of the Company, were former owners of Digital Bridge Holdings, LLC ("DBH") prior to its merger into the Company in July 2019. Messrs. Ganzi and Jenkins had retained their equity investments and general partner interests in the portfolio companies of DBH, which include DataBank and Vantage.
As a result of the personal investments made by Messrs. Ganzi and Jenkins in DataBank and Vantage SDC prior to the Company’s acquisition of DBH, additional investments made by the Company in DataBank and Vantage SDC subsequent to their initial acquisitions may trigger future carried interest payments to Messrs. Ganzi and Jenkins upon the occurrence of future realization events. Such investments made by the Company include ongoing payments for the build-out of expansion capacity, including lease-up of the expanded capacity and existing inventory, in Vantage SDC (Note 3) and the acquisition of additional interest in DataBank from an existing investor in January 2022 (Note 10).
52

Table of Contents
Carried Interest Allocation from Sponsored Investment Vehicles—With respect to investment vehicles sponsored by the Company for which Messrs. Ganzi and Jenkins are invested in their capacity as former owners of DBH, and not in their capacity as employees of the Company, any carried interest entitlement attributed to such investments by Messrs. Ganzi and Jenkins as general partner are not subject to continuing vesting provisions and do not represent compensatory arrangements to the Company. Such carried interest allocation to Messrs. Ganzi and Jenkins that are unrealized or realizeddistributed but unpaid are included in noncontrolling interests on the balance sheet in the Investment Management segment, in the amount of $71.8$109.9 million at March 31,September 30, 2023 and $70.4 million at December 31, 2022. Carried interest allocated is recorded as net income attributable to noncontrolling interests in the Investment Management segment totaling $2.2$18.9 million and $0.8$13.8 million for the three months ended March 31,September 30, 2023 and 2022, respectively, and $40.3 million and $43.5 million for the nine months ended September 30, 2023 and 2022 respectively. Additionally, in connection with the DataBank recapitalization (Note 10) in the second half of 2022, Messrs. Ganzi and Jenkins received realizeddistributed carried interest in the form of equity interest in vehicles that invest in DataBank, of which $86.1 million in aggregate iswas not deemed a compensatory arrangement. Such equity interest represent noncontrollingownership interests in DataBank. A portion of such equity interest was sold by Messrs. Ganzi and Jenkins in connection with the recapitalization transaction.
Investment in Managed Investment Vehicles—Subject to the Company's related party policies and procedures, senior management, investment professionals and certain other employees may invest on a discretionary basis in investment vehicles sponsored by the Company, either directly in the vehicle or indirectly through the Company's general partner entity. These investments are generally not subject to management fees or carried interest, but otherwise bear their proportionate share of other operating expenses of the investment vehicles. Such investments in consolidated investment vehicles and general partner entities totaled $18.3$21.0 million at March 31,September 30, 2023 and $17.7 million at December 31, 2022, reflected in redeemable noncontrolling interests and noncontrolling interests on the balance sheet. Theirsheet in the Investment Management segment. The employees' share of net income (loss) was $0.6$1.4 million and $0.4 million for the three months ended March 31,September 30, 2023 and immaterial2022, respectively, and $3.5 million and $0.1 million for the threenine months ended March 31, 2022.September 30, 2023 and 2022, respectively. Such amounts are reflected in net income (loss) attributable to noncontrolling interests on the consolidated statement of operations in the Investment Management segment and exclude their share of carried interest allocation, which is reflected in compensation expense (reversal)—expense—incentive fee and carried interest.interest allocation.
Aircraft—Pursuant to Mr. Ganzi’s employment agreement, as amended, the Company has agreed to reimburse Mr. Ganzi for certain variable operational costs of business travel on a chartered or private jet (including any aircraft that Mr. Ganzi may partially or fully own), provided that the Company will not reimburse the allocable share (based on the number of passengers) of variable operational costs for any passenger on such flight who is not traveling on Company business. Additionally, the Company has also agreed to reimburse Mr. Ganzi for certain defined fixed costs of any aircraft owned by
47

Table of Contents

Mr. Ganzi. The fixed cost reimbursements will be made based on an allocable portion of an aircraft’s annual budgeted fixed cash operating costs, based on the number of hours the aircraft will be used for business purposes. At least once a year, the Company will reconcile the budgeted fixed operating costs with the actual fixed operating costs of the aircraft, and the Company or Mr. Ganzi, as applicable, will make a payment for any difference. The Company reimbursed Mr. Ganzi $1.8$1.7 million and $0.2$0.7 million for the three months ended March 31,September 30, 2023 and 2022, respectively, and $4.3 million and $1.8 million for the nine months ended September 30, 2023 and 2022 respectively.
Advancement of Expenses—Effective April 1, 2021, Thomas J. Barrack stepped down as Executive Chairman of the Company and in July 2021, resigned as a member of the Company's Board of Directors. In October 2021, the Company entered into an Agreement Regarding Advancement of Certain Expenses ("Advancement Agreement") with Mr. Barrack, which is generally consistent with the Company’s obligations and Mr. Barrack’s rights regarding advancement of expenses under the terms of a January 2017 Indemnification Agreement between the Company and Mr. Barrack, and under the Company’s Bylaws. The Advancement Agreement (a) memorializes the parties’ disagreement as to the Company’s obligations and Mr. Barrack’s rights under the earlier Indemnification Agreement and the Company's Bylaws, and (b) obligates Mr. Barrack to reimburse the Company for such advanced expenses under certain circumstances. Pursuant to the Advancement Agreement, the Company expensed $0.3$7.5 million and $5.6 $17.2 million in the three and nine months ended March 31, 2023 andSeptember 30, 2022, respectively, with immaterial expenses in 2023. The Company believes it has met all of its financial obligations under the Advancement Agreement and $33.5 million since inception of the arrangement in 2021.does not expect to make any further advances to Mr. Barrack thereunder.
53

Table of Contents
17. Commitments and Contingencies
Litigation
The Company may be involved in litigation in the ordinary course of business. As of March 31,September 30, 2023, the Company was not involved in any legal proceedings that are expected to have a material adverse effect on the Company’s results of operations, financial position or liquidity.
18. Supplemental Disclosure of Cash Flow Information
Three Months Ended March 31,Nine Months Ended September 30,
(In thousands)(In thousands)20232022(In thousands)20232022
Supplemental Disclosure of Cash Flow InformationSupplemental Disclosure of Cash Flow InformationSupplemental Disclosure of Cash Flow Information
Cash paid for interest, net of amounts capitalized of $595 and $78$53,375 $70,065 
Cash paid for interest, net of amounts capitalized of $5,433 and $1,674Cash paid for interest, net of amounts capitalized of $5,433 and $1,674$155,304 $163,646 
Cash received (paid) for income taxesCash received (paid) for income taxes1,463 (328)Cash received (paid) for income taxes969 5,782 
Operating lease paymentsOperating lease payments15,246 15,650 Operating lease payments46,615 50,584 
Finance lease paymentsFinance lease payments3,961 3,916 Finance lease payments11,918 11,750 
Supplemental Disclosure of Cash Flows from Discontinued OperationsSupplemental Disclosure of Cash Flows from Discontinued OperationsSupplemental Disclosure of Cash Flows from Discontinued Operations
Net cash provided by (used in) operating activities of discontinued operationsNet cash provided by (used in) operating activities of discontinued operations$95 $(5,488)Net cash provided by (used in) operating activities of discontinued operations$(4,930)$(16,038)
Net cash provided by (used in) investing activities of discontinued operationsNet cash provided by (used in) investing activities of discontinued operations253,875 (86,387)Net cash provided by (used in) investing activities of discontinued operations259,446 (12,915)
Net cash provided by (used in) financing activities of discontinued operationsNet cash provided by (used in) financing activities of discontinued operations(28,956)(12,653)Net cash provided by (used in) financing activities of discontinued operations(28,956)(12,503)
Supplemental Disclosure of Noncash Investing and Financing ActivitiesSupplemental Disclosure of Noncash Investing and Financing ActivitiesSupplemental Disclosure of Noncash Investing and Financing Activities
Dividends and distributions payableDividends and distributions payable$16,444 $15,759 Dividends and distributions payable$16,418 $16,527 
Improvements in operating real estate included in other liabilities39,351 9,910 
Payables for improvements in operating real estate and acquired lease intangiblesPayables for improvements in operating real estate and acquired lease intangibles33,456 108,468 
Receivables from asset salesReceivables from asset sales2,282 14,009 Receivables from asset sales2,091 12,373 
Operating lease right-of-use assets and lease liabilities established11,693 1,498 
Operating lease ROU assets and lease liabilities establishedOperating lease ROU assets and lease liabilities established29,050 16,840 
Finance lease ROU assets and lease liabilities establishedFinance lease ROU assets and lease liabilities established21,475 — 
Contingent consideration for acquisition of InfraBridgeContingent consideration for acquisition of InfraBridge10,874 — Contingent consideration for acquisition of InfraBridge10,874 — 
Preferred stock repurchase payable52 — 
Exchange of notes into shares of Class A common stock— 60,317 
ROU asset and lease liability derecognized upon purchase of leased real estate (Note 3)ROU asset and lease liability derecognized upon purchase of leased real estate (Note 3)3,120 — 
Redemption of redeemable noncontrolling interest for common stockRedemption of redeemable noncontrolling interest for common stock— 348,759 
Seller Note received in sale of NRF Holdco equity— 154,992 
Seller note received in sale of NRF Holdco equity (Note 2)Seller note received in sale of NRF Holdco equity (Note 2)— 154,992 
Loan receivable relieved in exchange for equity investment acquiredLoan receivable relieved in exchange for equity investment acquired— 20,676 
Redemption of OP Units for common stockRedemption of OP Units for common stock— Redemption of OP Units for common stock984 341 
Assets disposed in sale of equity of investment entities— 3,420,783 
Liabilities disposed in sale of equity of investment entities— 3,144,700 
Assets disposed or deconsolidated in sale of equity of investment entities (1)
Assets disposed or deconsolidated in sale of equity of investment entities (1)
4,633,562 3,420,783 
Liabilities disposed or deconsolidated in sale of equity of investment entities (1)
Liabilities disposed or deconsolidated in sale of equity of investment entities (1)
3,046,668 3,144,700 
Noncontrolling interests of investment entities sold or deconsolidated (1)
— 215,777 
Noncontrolling interests of investment entities sold and deconsolidated (1)
Noncontrolling interests of investment entities sold and deconsolidated (1)
1,427,435 204,730 
Exchange of notes for class A common sharesExchange of notes for class A common shares— 60,317 
__________
(1)    Represents deconsolidation of noncontrolling interests uponDataBank in September 2023 and sale of the Company's equity interestsWellness Infrastructure business in investment entities (NoteFebruary 2022 (Notes 10 and 2).

19. Subsequent Events
Other than as disclosed elsewhere, noNo subsequent events have occurred that would require recognition in the consolidated financial statements or disclosure in the accompanying notes.
4854

Table of Contents

FORWARD-LOOKING STATEMENTS
Some of the statements contained in this Quarterly Report on Form 10-Q (this "Quarterly Report") constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), and we intend such statements to be covered by the safe harbor provisions contained therein. Forward-looking statements relate to expectations, beliefs, projections, future plans and strategies, anticipated events or trends and similar expressions concerning matters that are not historical facts. In some cases, you can identify forward-looking statements by the use of forward-looking terminology such as “may,” “will,” “should,” “expects,” “intends,” “plans,” “anticipates,” “believes,” “estimates,” “predicts,” or “potential” or the negative of these words and phrases or similar words or phrases which are predictions of or indicate future events or trends and which do not relate solely to historical matters. You can also identify forward-looking statements by discussions of strategy, plans or intentions.
The forward-looking statements contained in this Quarterly Report reflect our current views about future events and are subject to numerous known and unknown risks, uncertainties, assumptions and changes in circumstances that may cause our actual results to differ significantly from those expressed in any forward-looking statement. The following factors, among others, could cause actual results and future events to differ materially from those set forth or contemplated in the forward-looking statements:
our ability to grow our business by raising capital for our funds and the companies that we manage;
our position as an investor and investment manager of digital infrastructure and our ability to manage any related conflicts of interest;
adverse changes in general economic and political conditions, including those resulting from supply chain difficulties, inflation, interest rate increases, a potential economic slowdown or a recession;
our exposure to business risks in Europe, Asia and other foreign markets;
our ability to obtain and maintain financing arrangements, including securitizations, on favorable or comparable terms or at all;
the ability of our managed companies to attract and retain key customers and to provide reliable services without disruption;
the reliance of our managed companies on third-party suppliers for power, network connectivity and certain other services;
our ability to increase assets under management ("AUM") and expand our existing and new investment strategies;
our ability to integrate and maintain consistent standards and controls, including our ability to manage our acquisitions in the digital infrastructure and investment management industries effectively;
our business and investment strategy, including the ability of the businesses in which we have significant investments to execute their business strategies;
performance of our investments relative to our expectations and the impact on our actual return on invested equity, as well as the cash provided by these investments and available for distribution;
our ability to deploy capital into new investments consistent with our investment management strategies;
the availability of, and competition for, attractive investment opportunities and the earnings profile of such new investments;
our ability to achieve any of the anticipated benefits of certain joint ventures, including any ability for such ventures to create and/or distribute new investment products;
our expected hold period for our assets and the impact of any changes in our expectations on the carrying value of such assets;
the general volatility of the securities markets in which we participate;
the market value of our assets;
interest rate mismatches between our assets and any borrowings used to fund such assets;
effects of hedging instruments on our assets;
4955

Table of Contents

the impact of economic conditions on third parties on which we rely;
the impact of any security incident or deficiency affecting our systems or network or the system and network of any of our managed companies or service providers;
any litigation and contractual claims against us and our affiliates, including potential settlement and litigation of such claims;
our levels of leverage;
the impact of legislative, regulatory and competitive changes, including those related to privacy and data protection;
the impact of our transition from a real estate investment trust ("REIT") to a taxable C corporation for tax purposes, and the related liability for corporate and other taxes;
whether we will be able to utilize existing tax attributes to offset taxable income to the extent contemplated;
our ability to maintain our exemption from registration as an investment company under the Investment Company Act of 1940, as amended (the “1940 Act”);amended;
changes in our board of directors or management team, and availability of qualified personnel;
our ability to make or maintain distributions to our stockholders; and
our understanding of and ability to successfully navigate the competitive landscape in which we and our managed companies operate.
While forward-looking statements reflect our good faith beliefs, assumptions and expectations, they are not guarantees of future performance. Furthermore, we disclaim any obligation to publicly update or revise any forward-looking statement to reflect changes in underlying assumptions or factors, of new information, data or methods, future events or other changes. Moreover, because we operate in a very competitive and rapidly changing environment, new risk factors are likely to emerge from time to time. We caution investors not to place undue reliance on these forward-looking statements and urge you to carefully review the disclosures we make concerning risks in Part I, Item 1A. "Risk Factors" in our Annual Report on Form 10-K for the fiscal year ended December 31, 2022 and in Part I, Item 2. “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Quarterly Report. Readers of this Quarterly Report should also read our other periodic filings made with the Securities and Exchange Commission (the "SEC") and other publicly filed documents for further discussion regarding such factors.
Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations.
The following discussion should be read in conjunction with our unaudited consolidated financial statements and accompanying notes thereto, which are included in Item 1 of this Quarterly Report, as well as information contained in our Annual Report on Form 10-K for the year ended December 31, 2022, which is accessible on the SEC's website at www.sec.gov.
In this Quarterly Report, unless specifically stated otherwise or the context indicates otherwise, the terms " the "Company," "DBRG," "we," "our" and "us" refer to DigitalBridge Group, Inc. and its consolidated subsidiaries. References to the “Operating Partnership,” our “Operating Company” and the “OP” refer to DigitalBridge Operating Company, LLC, a Delaware limited liability company and the operating company of the Company, and its consolidated subsidiaries.
Our Organization
We are a leading global digital infrastructure investment manager, deploying and managing capital across the digital ecosystem, including data centers, cell towers, fiber networks, small cells, and edge infrastructure. Our diverse global investor base includes public and private pensions, sovereign wealth funds, asset managers, insurance companies, and endowments. At March 31,September 30, 2023, we had $69$75 billion of AUM,assets under management ("AUM"), composed of assets managed on behalf of our limited partnerspartners/investors of investment vehicles we manage, and separately, our shareholders.
We are headquartered in Boca Raton, Florida, with key offices in New York, Los Angeles, London, Luxembourg and Singapore, and have approximately 300 employees.
5056

Table of Contents

We operate as a taxable C Corporation, except for certain subsidiaries in the Operating segment that have elected to be taxed as real estate investment trusts. We conduct substantially all of our activities and hold substantially all of our assets and liabilities through our Operating Company. At March 31,September 30, 2023, we owned 93% of the Operating Company as its sole managing member.
Our Business
The Company conducts its business through two reportable segments: (i) Investment Management; and (ii) Operating, the Company's direct co-investment in digital infrastructure assets held by its portfolio companies.
Investment Management—This segment represents the Company's global investment management platform, deploying and managing capital on behalf of a diverse base of global institutional investors. The Company's investment management platform is composed of a growing number of long-duration, private investment funds designed to provide institutional investors access to investments across different segments of the digital infrastructure ecosystem. In addition to its flagship value-add digital infrastructure equity offerings, the Company's investment offerings have expanded to include core equity, credit and liquid securities. The Company earns management fees based upon the assets or capital managed in investment vehicles, and may earn incentive fees and carried interest based upon the performance of such investment vehicles, subject to achievement of minimum return hurdles. The amount of incentive fees and carried interest recognized, a portion of which is allocated to employees and former employees, may be highly variable from period to period. Through the end of May 2022, earnings from the Investment Management segment were attributed 31.5% to Wafra, a private investment firm, prior to the Company's redemption of Wafra's interest in the investment management business.
Operating—This segment is composed of balance sheet equity interests in digital infrastructure and real estate co-investmentportfolio companies, which generally earn rental income from providing use of digital asset space and/or capacity through leases, services and other agreements. The Company currently ownsowned interests in two portfolio companies: DataBank, an edge colocation data center business (DBRG ownership of 11% at March 31, 2023 and December 31, 2022); and Vantage SDC, a stabilized hyperscale data center business (DBRG ownership of 13% at March 31,September 30, 2023 and December 31, 2022), and DataBank, an edge colocation data center business (DBRG ownership of 11% at December 31, 2022 and through the final close of the recapitalization and deconsolidation in mid-September 2023; thereafter, the Company's remaining 9.87% interest in DataBank is presented within Corporate and Other) (Note 10 to the consolidated financial statements). DataBank and Vantage SDC are portfolio companies managed by the Company under its Investment Management segment with respect to equity interests owned byfunded through third party capital.
Our Investment Management Platform
Our investment management platform is anchored by our value-add funds within the DigitalBridge Partners ("DBP") infrastructure equity offerings. In providing institutional investors access to investments across different segments of the digital infrastructure ecosystem, our investment offerings have expanded to include core equity, credit and liquid securities.
Our DBP series of funds focus on value-add digital infrastructure, investing in and building businesses across the digital infrastructure sector.
Core Equity invests in digital infrastructure businesses and assets with long-duration cash flow profiles, primarily in more developed geographies.
DigitalBridge Credit is our private credit strategy that delivers credit solutions to corporate borrowers in the digital infrastructure sector globally through credit financing products such as first and second lien term loans, mezzanine debt, preferred equity and construction/delay-draw loans, among other products.
Our Liquid Strategies are fundamental long-only and long-short public equities strategies with well-defined mandates, leveraging the network and intellectual capital of our platform to build liquid portfolios of high quality, undervalued businesses across digital infrastructure, real estate, and technology, media, and telecom.
InfraBridge is focused on mid-market investments in the digital infrastructure and related sectors of transportation and logistics, and energy transition.
57

Table of Contents
Significant Developments
The following summarizes significant developments that affected our business and results of operations in the first quarter of 2023 and through the date of this filing.
Financing
$200We repaid $200 million of convertible5.00% senior notes was repaid upon maturity in April 2023 withusing cash on hand, which reducesreducing our leverage and outstanding corporate debt to $378 million.
51

Tablemillion, with savings of Contents$10 million in annual financing costs.

Investment Management Segment
We have raised approximately $5.4 billion of capital to-date in 2023, primarily $2.2 billion for DigitalBridge Partners III, LP ("DBP III"), the third series in our flagship value-add strategy, and syndications through various co-investment vehicles. DBP III will begin accruing fee income following its first closing on November 1, 2023.
In February 2023, we completed our previously announced acquisition of InfraBridge for $313.2$314 million upfront cash consideration (net of cash assumed), subject to customary post-closing working capital adjustments, plus potential contingent payments based upon future fundraising for InfraBridge's third and fourth flagship funds under the Global Infrastructure Fund ("GIF") series. The acquisition comprises InfraBridge's investment management platform and fund sponsor investments.
The acquisition further scales our investment management business. InfraBridge’s global infrastructure equity platform will be a strategic fit alongside our value-add equity franchise, enhancing our capabilities in the mid-market segment. The acquisition added $5.1 billion in fee earning equity under management ("FEEUM"), comprising primarily GIF II and GIF I investment funds.
Operating
The recapitalization of DataBank, which commenced in August 2022 and completed in September 2023, resulted in the sale of a portion of DataBank's equity interest to new investors totaling $2.2 billion. The Company's ownership interest in DataBank decreased from 21.8% to 11.0% as of November 2022 and decreased further to 9.87% in September 2023. The Company received its share of net proceeds from the sale totaling $475 million ($425 million in 2022 and $49 million in 2023), including its share of carried interest, net of allocation to employees and former employees, totaling $48 million ($20 million in 2022 and $28 million in 2023).
The recapitalization implied a pre-transaction net equity value of our ownership in DataBank of $905 million, reflecting a 2.0x multiple of invested capital since our initial investment in DataBank in December 2019. The incremental third party capital raised through the recapitalization also translated into additional fee income in our Investment Management segment.
The completion of the recapitalization on September 14, 2023 resulted in a deconsolidation of DataBank.
The deconsolidation deleveraged the Company's balance sheet by removing $4.6 billion of assets, $3.0 billion of liabilities and $1.4 billion of noncontrolling interests, representing DataBank's balance sheet as of mid-September 2023. In connection with the deconsolidation, the Company realized a $3.7 million gain from the sale of its equity interest in the final closing of the recapitalization, and remeasured its remaining 9.87% equity interest in DataBank at a fair value of $434 million which resulted in an unrealized gain of $275 million. The total gain of $279 million, along with the Company's remaining equity interest in DataBank, are presented within Corporate and Other.
In 2023, DataBank's operating results were included in the Company's Operating segment through the date of completion of the recapitalization on September 14, 2023. Following deconsolidation on that date, the Company's consolidated financial statements no longer include the operating results and assets and liabilities of DataBank in their entirety and instead reflect only the Company’s interest in DataBank. The Company's share of future changes in the fair value of DataBank will be reflected in principal investment income within Corporate and Other, consistent with the accounting treatment of the Company's general partner interests in other sponsored funds.
Other
Our investment in BrightSpire Capital, Inc. (NYSE: BRSP), which was our largest remaining non-digital investment, was fully disposed in the first quarter ofMarch 2023 for approximately $202 million in net proceeds.
A non-cash charge of $133 million in fair value write-down was recorded in March 2023 on an unsecured promissory note from the 2022 sale of our Wellness Infrastructure business. This resulted from an impending foreclosure of certain assets within the Wellness Infrastructure portfolio by its mezzanine lender.
58

Table of Contents
Operating Metrics
Assets Under Management and Fee Earning Equity Under Management
Below is a summary ofWe present below our AUM and FEEUM.FEEUM, which are key operating metrics in the alternative investment management industry. Our calculation of AUM and FEEUM may differ from other investment managers, and as a result, may not be directly comparable to similar measures presented by other investment managers.
TypeProductsDescriptionMarch 31, 2023December 31, 2022
Assets under Management (1)
$69.3$52.8
Fee Earning Equity under Management (2)    
Institutional FundsDBP infrastructure equityEarns management fees and potential for carried interest or incentive fees$11.2$11.2
InfraBridge Global Infrastructure Funds4.4
Core Equity, DigitalBridge Credit and Liquid Strategies2.22.0
Other Investment VehiclesDigitalBridge co-invest vehiclesEarns management fees, business service fees from portfolio companies, and potential for carried interest7.06.5
InfraBridge co-invest vehicles0.7
Digital infrastructure held by portfolio companies2.22.5
$27.7$22.2
Assets Under Management
__________
(1)    AUM represents the total capital for which we provide investment management services. AUM is generally composed of (a) third party capital managed capital for whichby the Company and its affiliates, provide investment management services, including assets for which the Company maycapital that is not yet fee earning, or may not charge managementsubject to fees and/or performance allocations;carried interest; and (b) assets invested using the Company's own balance sheet capital and managed on behalf of the Company's shareholders.shareholders (composed of the Company's fund investments as GP affiliate, warehoused investments, and the Company's interest in portfolio companies consolidated in the Operating segment). Third party AUM is based upon the cost basis of managed investments as reported by each underlying vehicleinvested capital as of the reporting date, including capital funded through third party financing, and may include uncalledcommitted capital commitments.for funds in their commitment stage. Balance sheet AUM is based upon the undepreciated carrying value of the Company's balance sheet investments as of the reporting date. Thedate (on an undepreciated basis as it relates to the Company's calculation of AUM may differ from other investment managers, and as a result, may not be comparable to similar measures presentedinterest in portfolio companies consolidated in the Operating segment).
Fee Earning Equity Under Management
FEEUM represents the total capital managed by other investment managers.
(2)    FEEUM is equity for which the Company and its affiliates provide investment management services and derivewhich earns management fees and/or incentives.incentive fees or carried interest. FEEUM is generally represents the basis used to derive fees, which may be based upon committed capital, invested equity, stockholders’ equity,capital, net asset value ("NAV") or fairgross asset value ("GAV"), pursuant to the terms of each underlying investment management agreement.
Presented below are total AUM and FEEUM by product:
(In billions)September 30, 2023December 31, 2022
Assets Under Management$74.6$52.8
Fee Earning Equity Under Management
DBP infrastructure equity$11.3$11.2
InfraBridge Global Infrastructure5.1
Core Equity, Credit and Liquid Strategies2.62.0
Co-invest vehicles8.56.5
Separately capitalized portfolio companies2.42.5
$29.9$22.2
The Company's calculationfollowing table summarizes changes in FEEUM:
Nine Months Ended
September 30, 2023
(In billions)
Fee Earning Equity Under Management
Balance at January 1$22.2 
Inflows (1)
8.5 
Outflows (2)
(0.9)
Market activity and other (3)
0.1 
Balance at September 30$29.9 
________
(1)    Inflows include closing on new capital raised where fees are earned on committed capital, deployment of capital where fees are earned on invested capital, new subscriptions where fees are based on NAV, other changes in invested capital such as the effect of recapitalization and syndication, and FEEUM may differ from otheracquired investment managers, and as a result, mayvehicles ($5.1 billion from InfraBridge in 2023). Excludes capital raised in 2023 for which fees have not be comparable to similar measures presented by other investment managers.been activated totaling $1.5 billion.
(2)    Outflows include redemptions and withdrawals in Liquid Strategies, realizations where fees are based on invested capital, other changes in invested capital such as the effect of recapitalization and syndication, change in fee basis from committed to invested capital and expiration of fee paying capital.
(3)    Market activity and other include changes in investment value based on NAV or GAV, and the effect of foreign exchange rates.
FEEUM increased by $5.5$7.7 billion or 25%35% to $27.7$29.9 billion at March 31,September 30, 2023, reflectingdriven by the addition of $5.1 billion of InfraBridge FEEUM, and new capital raised, primarily through co-investment vehicles. The subsequent first closing of DBP III in co-investment structures.

November 2023 further contributed an additional $2.2 billion increase to FEEUM.
5259

Table of Contents
Fund Performance Metrics
Certain performance metrics for our key investment funds from inception through September 30, 2023 are presented in the table below. Excluded are funds with less than one year of performance history as of September 30, 2023, funds and separately managed accounts in the liquid strategy, co-investment vehicles and separately capitalized portfolio companies. The historical performance of these funds is not indicative of their future performance nor indicative of the performance of our other existing investment vehicles or of any of our future funds. An investment in DigitalBridge Group, Inc. is not an investment in any of our funds and these fund performance metrics are not indicative of the performance of DigitalBridge Group, Inc.
($ in millions)
Inception date (2)
Commitments
Invested Capital (3)
Available Capital (4)
Investment ValueMOIC
Fund (1)
TotalUnfundedUnrealized
Realized (5)
Total (6)
Gross (7)
Net (8)
Value-Add
DigitalBridge Partners, LPMar-2018$4,059$494$4,584$494$5,991$1,139$7,130 1.6x 1.4x
DigitalBridge Partners II, LPNov-2020$8,286$974$7,681$979$8,340$662$9,002 1.2x 1.1x
InfraBridge
Global Infrastructure Fund I, LPMar-2015$1,411$406$1,479$406$1,125$1,055$2,1801.5x1.3x
Global Infrastructure Fund II, LPJan-2018$3,382$106$2,993$106$2,773$64$2,8370.9x0.9x
__________
(1)    Listed herein are main fund vehicles. Performance metrics are presented in aggregate for main fund vehicle, its parallel vehicles and alternative investment vehicles.
(2)    First close date of the fund. InfraBridge funds were acquired in Feb-2023.
(3)    Invested capital represents the original cost and subsequent fundings to investments. Invested capital includes financing costs and investment related expenses which are capitalized. With respect to Infrabridge funds, such costs are expensed during the period and excluded from their determination of invested capital.
(4)    Available capital includes recallable capital.
(5)    Realized value represents proceeds from dispositions that have closed and all earnings from both realized and unrealized investments, including interest, dividend and ticking fees.
(6)    Total value is the sum of unrealized fair value and realized value of investments.
(7)    Total investment gross multiple of invested capital (MOIC) is calculated as unrealized fair value and realized value of investments divided by invested capital, without giving effect to allocation of expenses and general partner carried interest. Excludes capital attributable to the general partner, general partner affiliate and any other capital that is not subject to fees and/or carried interest. Gross MOIC is calculated at the fund level and does not reflect gross MOIC at the individual investor level.
(8)    Total investment net MOIC is calculated as unrealized fair value and realized value of investments divided by invested capital, after giving effect to allocation of management fee expense, other fund expenses and general partner carried interest (both distributed and unrealized carried interest). Excludes capital attributable to the general partner, general partner affiliate and any other capital that is not subject to fees and/or carried interest. Net MOIC is calculated at the fund level and does not reflect net MOIC at the individual investor level.

60

Table of Contents
Results of Operations
The following table summarizes our consolidated results from continuing operations by reportable segment.
Three Months Ended March 31,Three Months Ended September 30,Nine Months Ended September 30,
(In thousands)(In thousands)20232022Change(In thousands)20232022Change20232022Change
Total revenuesTotal revenuesTotal revenues
Investment ManagementInvestment Management$6,829 $13,831 $(7,002)Investment Management$237,655 $166,667 $70,988 $393,577 $338,408 $55,169 
OperatingOperating231,664 202,522 29,142 Operating214,377 225,387 (11,010)681,100 655,596 25,504 
Corporate and OtherCorporate and Other11,667 16,481 (4,814)Corporate and Other25,048 37,798 (12,750)77,496 85,314 (7,818)
$250,160 $232,834 17,326 $477,080 $429,852 47,228 $1,152,173 $1,079,318 72,855 
Income (Loss) from continuing operationsIncome (Loss) from continuing operationsIncome (Loss) from continuing operations
Investment ManagementInvestment Management$(2,804)$(9,143)$6,339 Investment Management$100,014 $46,065 $53,949 $132,387 $104,917 $27,470 
OperatingOperating(97,942)(74,141)(23,801)Operating(79,707)(93,772)14,065 (270,704)(253,341)(17,363)
Corporate and OtherCorporate and Other(177,380)(165,755)(11,625)Corporate and Other261,073 17,022 244,051 93,033 (195,593)288,626 
$(278,126)$(249,039)(29,087)$281,380 $(30,685)312,065 $(45,284)$(344,017)298,733 
Income (Loss) from continuing operations attributable to DigitalBridge Group, Inc.Income (Loss) from continuing operations attributable to DigitalBridge Group, Inc.Income (Loss) from continuing operations attributable to DigitalBridge Group, Inc.
Investment ManagementInvestment Management$(2,198)$(7,602)$5,404 Investment Management$52,391 $24,233 $28,158 $50,502 $37,900 $12,602 
OperatingOperating(10,789)(12,824)2,035 Operating(10,191)(15,881)5,690 (31,489)(43,512)12,023 
Corporate and OtherCorporate and Other(171,149)(144,771)(26,378)Corporate and Other236,642 16,909 219,733 70,697 (152,026)222,723 
$(184,136)$(165,197)(18,939)$278,842 $25,261 253,581 $89,710 $(157,638)247,348 
Revenues
Total revenues increased $47.2 million or 11% in the quarter-to-date comparison and $72.9 million or 7% to $250.2 million.in the year-to-date comparison.
Investment Management—Revenues were 51%$71.0 million or 42.6% higher at $237.7 million in the quarter-to-date comparison, and $55.2 million or 16% higher at $393.6 million in the year-to-date comparison, attributed to fee income and gross carried interest (before management allocation).
(a) Fee income contributed:
$24.0 million of the increase at $66.1 million in the quarter-to-date comparison; and
$62.0 million of the increase at $192.8 million in the year-to-date comparison.
The increase in fee income is attributed to additional capital raised since October 2022 that has started accruing income for both periods under comparison, and InfraBridge funds acquired in February 2023.
(b) Gross carried interest (before management allocation) was:
$47.2 million higher in the quarter-to-date comparison at $168.9 million in 2023 from $121.7 million in 2022 (of which distributions were $27.9 million in 2023 and $123.5 million in 2022); but
$8.0 million lower in the year-to-date comparison at $6.8$193.4 million due to significant variabilityin 2023 from $201.4 million in 2022 (of which distributions were $28.4 million in 2023 and $123.5 million in 2022).
Distributed carried interest arose from the first liquidation of investment by DBP I in 2022 and the DataBank recapitalization in 2022 and 2023. In terms of unrealized carried interest.interest, the higher amounts in 2023 hadwas driven by DBP funds and a larger netDataBank investment that was not subject to recapitalization. In comparison, 2022 included a reversal of unrealized carried interest (2023: $55.2 million and 2022: $31.1 million before management allocation), driven by DBP II. As DBP II is still in the early stagefor some of its lifecycle, the carried interest reversal is a function of continuing accrual of preferred returns over time at a higher rate than fair value increases on its underlying investments in the first quarters of 2023 and 2022. Excluding gross unrealized carried interest, revenues would have been $62.1 million in 2023 and $44.9 million in 2022 or a 38% increase. Fee income was $16.3 million or 38% higher, attributable largely to two months of management fees from InfraBridge funds, and additional capital raises during 2022.
Supplemental performance measures of the Investment Management segment are presented under "—Non-GAAP Measures."these funds.
Operating—Revenues werein the quarter-to-date comparison decreased due to the deconsolidation of DataBank in mid-September 2023. However, in the year-to-date comparison, the effect of deconsolidation was more than offset by higher in 2023, resulting fromrevenues contributed by data center acquisitions in the DataBank portfolio and additional lease-up of expanded capacity in Vantage SDC during 2022.
Corporate and Other—Revenues represent largely our share of earnings from our general partner affiliate investments in the DBP and InfraBridge funds, and additionally, income from warehoused investments if any.in 2022. Revenues were lower in 2023 as ourdue to the sale of warehoused credit investments were transferred to our new credit fund duringsponsored funds and to a third party sponsored CLO in the second half of 2022.2022, partially offset by fair value increases in fund investments.
61

Table of Contents
Income (Loss) from continuing operations attributable to DigitalBridge Group, Inc.
Income (Loss) from continuing operations attributable to DBRG was $184.1$278.8 million in 2023 and $25.3 million in 2022 in the quarter-to-date period, and $89.7 million in 2023 with a 11% increaseloss of $157.6 million in net loss.2022 in the year-to-date period.
Investment Management—Net lossIn 2023, net income increased $28.2 million to $52.4 million in the quarter-to-date comparison and $12.6 million to $50.5 million in the year-to-date comparison.
The higher 2023 results were driven by an increase in carried interest of $31.6 million in the quarter-to-date period and $21.4 million in the year-to-date period, representing the OP's share, partially offset by higher operating costs attributed to the Investment Management segment in 2023 in line with the growth in business. Additionally, the higher net income in the year-to-date comparison was partially offset by $3.7 million of placement fees and $3.5 million of higher transaction costs, primarily for the InfraBridge acquisition in 2023. The amounts quoted herein are prior to allocating 7% of income (loss) to OP noncontrolling interest to arrive at amounts attributable to DBRG was $2.2 million, a 71% decrease in net loss. The net loss in both periods resulted from a reversalDBRG.
Supplemental performance measures of unrealized carried interest as noted above. Excluding DBRG's share of unrealized carried interest net of allocation to management and Wafra, there would have been positive net income attributable to DBRG of $14.4 million in 2023 and $2.1 million in 2022, a $12.3 million increase. This increase is contributed largely by two months of net income from InfraBridge and full attribution of net income to DBRG following the redemption of Wafra's 31.5% interest in Investment Management in May 2022.segment are presented under "—Non-GAAP Measures."
Operating—The Operating segment generally records a net loss, taking into account the effects of real estate depreciation and intangible asset amortization. Our share of net loss reflects a 13% ownership in Vantage SDC and our interest in DataBank, which in 2022, decreased from 22% to 13% as of MarchSeptember 2022, and was at 11% in 2023 prior to 11% as of Marchdeconsolidation in September 2023.
Corporate and Other—Net loss generally reflects corporate level costs that have not been allocatedBoth periods in 2023 reflected a $278.7 million gain recognized in connection with the recapitalization and deconsolidation of DataBank in September 2023, of which $3.7 million was realized and $275 million unrealized as of September 30, 2023 (Note 10 to our reportable segments, primarily interest expense on senior notes and compensation and administrative expenses. Alsothe consolidated financial statements). Additionally, included arewithin the effects of fair value changes on investments carried at fair value, including our share of
53

Table of Contents

earnings from our fund investments. The significant net loss in both periods, however, reflect large non-cash charges: (i)2023 year-to-date period was a $133 million fair value write-down in 2023 onof an unsecured promissory note fromrelated to the 2022 sale of our Wellness Infrastructure business; and (ii)business in February 2022 (Note 11 to the consolidated financial statements). In comparison, the 2022 year-to-date period included a $133 million debt extinguishment loss in connection with an early exchange of our 5.75% exchangeable notes in 2022 (refer to Note(Note 8 to the consolidated financial statements). The amounts quoted herein are prior to allocating 7% of income (loss) to OP noncontrolling interest to arrive at amounts attributable to DBRG.
62

Table of Contents
A more detailed discussion of key components of revenue and income (loss) from continuing operations follows.
 Three Months Ended March 31,
(In thousands)20232022Change
Revenues
Fee income$59,126 $42,837 $16,289 
Carried interest allocation (reversal)(54,756)(31,079)(23,677)
Principal investment income (loss)3,562 6,454 (2,892)
Property operating income230,927 202,511 28,416 
Other income11,301 12,111 (810)
Total revenues250,160 232,834 17,326 
Expenses
Property operating expense97,126 84,003 13,123 
Interest expense67,196 44,030 23,166 
Investment expense5,751 9,565 (3,814)
Transaction-related costs8,527 165 8,362 
Depreciation and amortization141,574 128,567 13,007 
Compensation expense—cash and equity-based74,650 65,542 9,108 
Compensation expense (reversal)—incentive fee and carried interest(36,831)(20,352)(16,479)
Administrative expenses26,506 27,885 (1,379)
Total expenses384,499 339,405 45,094 
Other gain (loss), net(142,745)(149,881)7,136 
Income (Loss) before income taxes(277,084)(256,452)(20,632)
Income tax benefit (expense)(1,042)7,413 (8,455)
Income (Loss) from continuing operations(278,126)(249,039)(29,087)
Income (Loss) from discontinued operations(14,218)(94,645)80,427 
Net income (loss)(292,344)(343,684)51,340 
Net income (loss) attributable to noncontrolling interests:
Redeemable noncontrolling interests6,943 (11,220)18,163 
Investment entities(84,828)(63,045)(21,783)
Operating Company(16,662)(22,862)6,200 
Net income (loss) attributable to DigitalBridge Group, Inc.(197,797)(246,557)48,760 
Preferred stock dividends14,676 15,759 (1,083)
Net income (loss) attributable to common stockholders$(212,473)$(262,316)49,843 


 Three Months Ended September 30,Nine Months Ended September 30,
(In thousands)20232022Change20232022Change
Revenues
Fee income$65,240 $41,263 $23,977 $190,108 $128,418 $61,690 
Carried interest allocation168,891 121,698 47,193 193,389 201,398 (8,009)
Principal investment income17,943 11,531 6,412 51,914 34,429 17,485 
Property operating income214,058 244,336 (30,278)679,738 681,098 (1,360)
Other income10,948 11,024 (76)37,024 33,975 3,049 
Total revenues477,080 429,852 47,228 1,152,173 1,079,318 72,855 
Expenses
Property operating expense94,481 105,987 (11,506)289,838 287,280 2,558 
Interest expense49,894 53,032 (3,138)173,112 143,450 29,662 
Investment expense5,728 9,510 (3,782)16,732 26,262 (9,530)
Transaction-related costs896 3,879 (2,983)10,536 6,800 3,736 
Placement fees15 — 15 3,668 — 3,668 
Depreciation and amortization128,000 145,594 (17,594)419,136 429,513 (10,377)
Compensation expense—cash and equity-based74,714 65,544 9,170 232,356 183,878 48,478 
Compensation expense—incentive fee and carried interest allocation72,865 80,831 (7,966)72,110 109,548 (37,438)
Administrative expenses24,077 29,909 (5,832)76,346 84,147 (7,801)
Total expenses450,670 494,286 (43,616)1,293,834 1,270,878 22,956 
Other gain (loss), net254,827 25,908 228,919 100,545 (170,229)270,774 
Income (Loss) before income taxes281,237 (38,526)319,763 (41,116)(361,789)320,673 
Income tax benefit (expense)143 7,841 (7,698)(4,168)17,772 (21,940)
Income (Loss) from continuing operations281,380 (30,685)312,065 (45,284)(344,017)298,733 
Income (Loss) from discontinued operations(2,603)(90,302)87,699 (20,799)(188,735)167,936 
Net income (loss)278,777 (120,987)399,764 (66,083)(532,752)466,669 
Net income (loss) attributable to noncontrolling interests:
Redeemable noncontrolling interests132 (6,442)6,574 4,634 (31,989)36,623 
Investment entities(17,746)(60,623)42,877 (142,241)(152,770)10,529 
Operating Company19,918 (4,834)24,752 1,511 (30,786)32,297 
Net income (loss) attributable to DigitalBridge Group, Inc.276,473 (49,088)325,561 70,013 (317,207)387,220 
Preferred stock repurchases— (1,098)1,098 (927)(1,098)171 
Preferred stock dividends14,645 15,283 (638)43,996 46,801 (2,805)
Net income (loss) attributable to common stockholders$261,828 $(63,273)325,101 $26,944 $(362,910)389,854 
5463

Table of Contents

Fee Income
Three Months Ended March 31,Three Months Ended September 30,Nine Months Ended September 30,
(In thousands)(In thousands)20232022Change(In thousands)20232022Change20232022Change
Management feesManagement fees$57,158 $42,191 $14,967 Management fees$65,236 $40,697 $24,539 $187,138 $126,447 $60,691 
Incentive feesIncentive fees869 — 869 Incentive fees— — — 1,040 — 1,040 
Other fee incomeOther fee income1,099 646 453 Other fee income566 (562)1,930 1,971 (41)
$59,126 $42,837 16,289 $65,240 $41,263 23,977 $190,108 $128,418 61,690 
Fee income was $16.3increased $24.0 million or 38% higher58% in 2023, primarilythe quarter-to-date comparison and $61.7 million or 48% in the year-to-date comparison. The increase was driven by two months of management fees from InfraBridge beginning February 2023, adding $14.2 million in the quarter-to-date period and management fees$40.8 million in the year-to-date period, as well as from capital raised duringsince October 2022 including the DataBank recapitalization andwhere fees have been activated, primarily from co-investment vehicles, our new core equity fund.fund, and the DataBank recapitalization. Additionally, there were incentive fees earned in 2023 from a sub-advisory account in Liquid Strategies.were attributed to our liquid securities strategy.
Carried Interest Allocation (Reversal)
Three Months Ended March 31,Three Months Ended September 30,Nine Months Ended September 30,
(In thousands)(In thousands)20232022Change(In thousands)20232022Change20232022Change
Carried interest allocation (reversal)
Realized$476 $— $476 
Carried interest allocationCarried interest allocation
DistributedDistributed$27,927 $123,498 $(95,571)$28,403 $123,498 $(95,095)
UnrealizedUnrealized(55,232)(31,079)(24,153)Unrealized140,964 (1,800)142,764 164,986 77,900 87,086 
$(54,756)$(31,079)(23,677)$168,891 $121,698 47,193 $193,389 $201,398 (8,009)
Carried interest allocation (reversal) represents gross carried interest from our general partner interests in sponsored investment vehicles prior to allocations to management and Wafra. There was a higher net reversal of unrealized carried interest in 2023 compared to 2022, driven by DBP II. As DBP II is still in the early stage of its lifecycle, the carried interest reversal is a function of continuing accrual of preferred returns over time at a higher rate than fair value increases on its underlying investments in the first quarter of 2023 and 2022. Unrealized carried interest is subject to adjustments each period, including reversals, based upon the cumulative performance of the underlying investments of these vehicles that are measured at fair value, until such time as the carried interest is realized.distributed.
Our share of netDistributed carried interest reversal after allocations to managementarose from the DataBank recapitalization in the third quarter of 2023 ($27.9 million) and Wafra was $16.6 million2022 ($72.3 million), and additionally, the first liquidation of investment by DBP I in the third quarter of 2022 ($51.2 million). In terms of unrealized carried interest, the higher amounts in 2023 was driven by DBP funds and $9.7 million in 2022.a DataBank investment that was not subject to recapitalization. In comparison, 2022 included a reversal of unrealized carried interest for some of these funds.
Principal Investment Income (Loss)
Principal investment income decreased $2.9 million to $3.6represents the Company's proportionate share of net income (loss) from investments in its sponsored investment vehicles, which includes unrealized gain (loss) from changes in fair value of the underlying fund investments. Principal investment income increased $6.4 million in 2023. Thisthe quarter-to-date comparison to $17.9 million and $17.5 million in the year-to-date comparison to $51.9 million. The increase was driven by lower earnings from our equity interests in DBP I and DBP II, with the earnings representing unrealized fair value increasesappreciation on the underlying fund investments, primarily the DBP funds, and additionally, in the year-to-date comparison, the InfraBridge funds.
64

Table of these funds.Contents
Property Operating Income and Expense
Three Months Ended March 31,Three Months Ended September 30,Nine Months Ended September 30,
(In thousands)(In thousands)20232022Change(In thousands)20232022Change20232022Change
Property operating incomeProperty operating incomeProperty operating income
Operating segmentOperating segmentOperating segment
Lease incomeLease income$210,402 $184,171 $26,231 Lease income$196,339 $206,141 $(9,802)$619,985 $598,263 $21,722 
Data center service revenueData center service revenue20,525 18,340 2,185 Data center service revenue16,995 18,925 (1,930)56,993 56,903 90 
Other property operating incomeOther property operating income724 257 467 2,760 314 2,446 
214,058 225,323 (11,265)679,738 655,480 24,258 
OtherOther
Lease incomeLease income— 19,013 (19,013)— 25,618 (25,618)
230,927 202,511 28,416 $214,058 $244,336 (30,278)$679,738 $681,098 (1,360)
Property operating expenseProperty operating expenseProperty operating expense
Operating segmentOperating segment$97,126 $84,003 $13,123 Operating segment$94,481 $100,051 $(5,570)$289,838 $278,798 $11,040 
OtherOther— 5,936 (5,936)— 8,482 (8,482)
$94,481 $105,987 (11,506)$289,838 $287,280 2,558 
Operating Segment
Property operating income and expense areexpenses were lower in the quarter-to-date comparison, reflecting the effects of deconsolidating DataBank in mid-September 2023. Absent the deconsolidation and assuming a full month of activity in September 2023 for DataBank, total property operating income and expenses in the Operating segment would have increased approximately 8% and 7%, respectively, in the quarter-to-date comparison.
In the year-to-date comparison, property operating income and expenses were higher in 2023, reflecting operating results fromas a result of additional acquisitions throughout 2022. These include2022, including DataBank's acquisition of four data centers in March 2022, and within the Vantage SDC portfolio, additional lease-up of expanded capacity and existing inventory throughoutinventory. This increase was partially offset by higher lease termination fees of $5.8 million quarter-to-date and $5.0 million year-to-date recognized in property operating income, primarily from the Vantage SDC portfolio, and the effects of deconsolidating DataBank in mid-September 2023.
At September 30, 2023, the Operating segment portfolio was composed of 10 data centers in the U.S. and three in Canada, following the deconsolidation of DataBank.
September 30, 2023December 31, 2022
Operating segment (1)
Number of data centers
Owned1335
Leasehold49
1384
(In thousands, except %)
Max Critical I.T. Square Feet or Total Rentable Square Feet7772,405
Leased Square Feet7521,888
% Utilization Rate (% Leased)97%78%
__________
(1)    Amounts at September 30, 2023 reflect remaining operations in the Operating segment after deconsolidation of DataBank.
Other
This represents property operating income and expense from a tower portfolio, acquired in June 2022 as a warehoused investment and transferred to our core equity fund in December 2022.
Other Income
Other income decreased $0.1 million in the quarter-to-date comparison to $10.9 million, but increased $3.0 million in the year-to-date comparison to $37.0 million.
Key drivers are higher interest income from money market deposits and beginning in 2023, from our subordinated notes in a collateralized loan obligation (increase totaling $3.5 million quarter-to-date and $16.6 million year-to-date) and dividend income from our consolidated credit fund (increased $2.0 million quarter-to-date and $5.5 million year-to-date). However, these amounts were partially offset by interest income in 2022 from warehoused investments that were
55
65

Table of Contents

At March 31, 2023, the Operating segment portfolio includes 74 data centers in the U.S., three in Canada, one in the U.K., and five in France.
March 31, 2023December 31, 2022
Operating segment
Number of data centers
Owned3535
Leasehold (1)
4849
8384
(In thousands, except %)
Max Critical I.T. Square Feet or Total Rentable Square Feet2,4052,405
Leased Square Feet1,9131,888
% Utilization Rate (% Leased)80%78%
__________
(1)    Lease expired and not renewed in the first quarter of 2023.
On a same store basis, property operating income and expense also increased in 2023, driven by the Vantage SDC portfolio, attributable to increase in leased square footage from lease-up of expanded capacity and existing inventory.
Other Income
Other income was $0.8 million lower at $11.3 million in 2023. 2022 had included interest income from warehoused credit investments that were transferred to our new credit fund during the second half of 2022 while thereand amounts previously accrued on our Wellness Infrastructure promissory note that was higher dividend incomewritten off in the first quarter of 2023 (totaling $8.3 million quarter-to-date and interest income from money market deposits$20.2 million year-to-date in 2023.2022).
Interest Expense
Three Months Ended March 31,Three Months Ended September 30,Nine Months Ended September 30,
(In thousands)(In thousands)20232022Change(In thousands)20232022Change20232022Change
Interest expenseInterest expenseInterest expense
Corporate debtCorporate debt$7,790 $8,306 (516)Corporate debt$5,133 $8,295 $(3,162)$18,471 $24,645 $(6,174)
Non-recourse investment-level debtNon-recourse investment-level debt59,406 35,724 23,682 Non-recourse investment-level debt44,761 44,737 24 154,641 118,805 35,836 
$67,196 $44,030 23,166 $49,894 $53,032 (3,138)$173,112 $143,450 29,662 
Corporate Debt—Interest expense decreased $3.2 million in the quarter-to-date comparison and $6.2 million in the year-to-date comparison driven by repayment of our 5.00% convertible notes in April 2023 (decreased $2.7 million quarter-to-date and $5.0 million year-to-date) and to a lesser extent, lower interest expense on our securitized debt with a lower outstanding balance on the VFN in 2023 (decreased $0.5 million for both quarter-to-date and year-to-date). Additionally, in 2023, driven bythe year-to-date period, the early exchange of our 5.75% exchangeable notes for common stock in March 2022 which resultedcontributed a $0.7 million decrease in the extinguishment of higher cost corporate debt.interest expense.
Non-Recourse Investment-Level Debt—TheInterest expense was consistent in the quarter-to-date comparison but increased $35.8 million in the year-to-date comparison. Interest expense on investment-level debt in the Operating segment increased $4.6 million quarter-to-date and $42.5 million year-to-date, reflecting higher outstanding debt balance and higher interest rates on new debt in 2023, partially offset by the deconsolidation of DataBank in mid-September 2023. Included in the year-to-date increase is also the net effect of $23.7 million was driven primarily by: (i) write-off ofwriting off unamortized deferred financing costs and debt premium on DataBank's refinanced debt; (ii) higherdebt in the first half of 2023 totaling $13.8 million. The increase in interest expense in the Operating segment was partially offset by interest expense on outstanding debt balance attributed toin 2022 in connection with the financing for new acquisitionsof warehoused tower assets and credit investments (totaling $4.3 million quarter-to-date and $6.7 million year-to-date), all of which were repaid in 2022; (iii) higher ratesthe second half of 2022, and additionally in 2023the quarter-to-date period, a decrease in interest expense ($0.3 million) on Vantage SDC's new securitization and on DataBank's variable rate debt.lower outstanding debt balance of our consolidated credit fund.
Investment Expense
Investment expense decreased $3.8 million in the quarter-to-date comparison to $5.8$5.7 million and $9.5 million in 2023. The decrease is attributable largelythe year-to-date comparison to $16.7 million. 2022 had included additional expenses, primarily: (i) third party costs attributed to our warehoused tower assets that were transferred to our core equity fund in December 2022 ($1.2 million quarter-to-date and $1.7 million year-to-date in 2022); (ii) transition services that ended in the second quarter of 2022 related to DataBank's acquisition of zColo ($1.0 million year-to-date in 2022); (iii) higher compensatory expense recognized in the first quarter of 2022 in connection with equity awards granted to the management team of Vantage Data Centers Holdings, LLC ("Vantage") who performsperform the day-to-day operations of Vantage SDC ($1.9 million higher year-to-date 2022); and (iv) higher costs incurred in 2022 that are reimbursable by our managed investment vehicles.
Transaction-Related Costs
In the quarter-to-date comparison, transaction-related costs were $3.0 million lower at $0.9 million, largely due to costs incurred in connection with transition services for DataBank's acquisitionunconsummated investments in 2022. In the year-to-date comparison, transaction-related costs were $3.7 million higher at $10.5 million, driven by the InfraBridge acquisition.
Placement Fees
Placement fees of zColo.
Transaction-Related Costs
Transaction-related costs was $8.5$3.7 million in 2023 were incurred in connection with fundraising for DBP III and $0.2 million in 2022, with the increase driven by the acquisition of InfraBridge.co-investment vehicles.
Depreciation and Amortization
IncreaseDepreciation and amortization expense decreased $17.6 million in the quarter-to-date comparison and $10.4 million in the year-to-date comparison. Depreciation and amortization expense in the Operating segment decreased $11.9 million quarter-to-date and $7.8 million year-to-date, driven by the combined effects of deconsolidating DataBank in mid-September 2023, and higher amortization of lease intangibles from lease terminations in 2022 and expiration of short term leases at DataBank, partially offset by additional expenses related to data center acquisitions and improvements placed in service. Additionally, the sale of warehoused tower assets acquired in June 2022 to our core equity fund in December 2022 also contributed to a decrease in depreciation and amortization can be attributed to intangible assets acquired through the InfraBridge acquisition in February 2023expenses ($8.4 million quarter-to-date and DataBank's four new data centers acquired in March 2022.
5666

Table of Contents

$11.3 million year-to-date). These decreases were partially offset by amortization expense on InfraBridge intangible assets acquired in February 2023 ($4.1 million quarter-to-date and $11.1 million year-to-date).
Compensation Expense
Three Months Ended March 31,Three Months Ended September 30,Nine Months Ended September 30,
(In thousands)(In thousands)20232022Change(In thousands)20232022Change20232022Change
Cash and equity-based compensationCash and equity-based compensationCash and equity-based compensation
Cash compensation and benefitsCash compensation and benefits$36,701 $36,607 $94 Cash compensation and benefits$38,776 $27,146 $11,630 $111,343 $88,148 $23,195 
Equity-based compensationEquity-based compensation10,770 8,979 1,791 Equity-based compensation14,340 7,824 6,516 45,801 24,971 20,830 
47,471 45,586 1,885 53,116 34,970 18,146 157,144 113,119 44,025 
Operating segmentOperating segmentOperating segment
Cash and equity-based compensationCash and equity-based compensation27,179 19,956 7,223 Cash and equity-based compensation21,598 30,574 (8,976)75,212 70,759 4,453 
$74,650 $65,542 9,108 $74,714 $65,544 9,170 $232,356 $183,878 48,478 
Incentive and carried interest compensation (reversal)$(36,831)$(20,352)$(16,479)
Incentive and carried interest compensation allocationIncentive and carried interest compensation allocation$72,865 $80,831 $(7,966)$72,110 $109,548 $(37,438)
Cash and equity-based compensation—Compensation expense, excludingExcluding the Operating segment, compensation expense increased $1.9 million to $47.5$18.1 million in 2023.the quarter-to-date comparison and $44.0 million in the year-to-date comparison. Equity-based compensation expense was higher in 2023, attributed todriven by performance-based awards that met their target in 2023 (increased $1.9 million quarter-to-date and $14.7 million year-to-date), awards granted in 2023 with shortened vesting periods for previously modified awards(increased $3.1 million in both quarter-to-date and a performance-basedyear-to-date), and the effect of award that met its targetmodifications in 2023. These increases werethe fourth quarter of 2022 (increased $3.6 million year-to-date), partially offset by profits interests that fully vestedfull vesting in 2022. In terms2022 of an LTIP grant and awards in connection with sale of the Wellness Infrastructure business in February 2022 (decrease totaling $3.4 million year-to-date). There was also an increase in cash compensation the additional expensein 2023, attributed largely to InfraBridge was mostly offset($7.2 million quarter-to-date and $19.3 million year-to-date, of which $1.8 million and $4.8 million, respectively, represent deferred bonus amounts funded by lowerthe seller in the InfraBridge acquisition) and higher severance costs and bonus accrual in 2023.retention costs.
HigherIn the Operating segment, the third quarter of 2022 had included $10.1 million of equity-based compensation due to an accelerated vesting of profits interest units issued by DataBank that was triggered by the first closing of the DataBank recapitalization. Excluding the acceleration, compensation expense increased $1.1 million in the quarter-to-date comparison and $14.6 million in the year-to-date comparison. The higher compensation expense in the Operating segment is2023 can be attributed to new stock awards and higher headcount at DataBank. In the quarter-to-date comparison, the increase was partially offset by the effect of deconsolidating DataBank in mid-September 2023.
Incentive and carried interest compensation (reversal)—allocation—ConsistentThe third quarter of 2022 had included $57.3 million of carried interest compensation expense that was fully recognized in connection with the reversalfirst closing of the DataBank recapitalization. No further compensation expense was recognized in subsequent closings of the DataBank recapitalization. Excluding the expense associated with the recapitalization, incentive and carried interest (as discussed in "—Carried Interest Allocation (Reversal)" above), there was also a larger reversalcompensation increased $49.5 million in the associated compensation expense,quarter-to-date comparison and $16.9 million in the year-to-date comparison, driven by carried interest from the DBP II.funds quarter-to-date and in both periods under comparison, carried interest from the DataBank investment that was not subject to recapitalization.
Administrative Expenses
Three Months Ended March 31,Three Months Ended September 30,Nine Months Ended September 30,
(In thousands)(In thousands)20232022Change(In thousands)20232022Change20232022Change
Administrative expensesAdministrative expenses$19,266 $20,986 $(1,720)Administrative expenses$16,552 $22,509 $(5,957)$52,740 $60,938 $(8,198)
Administrative expensesOperating segment
Administrative expensesOperating segment
7,240 6,899 341 
Administrative expensesOperating segment
7,525 7,400 125 23,606 23,209 397 
$26,506 $27,885 (1,379)$24,077 $29,909 (5,832)$76,346 $84,147 (7,801)
Excluding the Operating segment,Total administrative expenses decreased $1.7 million to $19.3$5.8 million in 2023,the quarter-to-date comparison and $7.8 million in the year-to-date comparison, driven by lower legal costs. Administrative expensesAdditionally, in the Operating segmentyear-to-date period, the decrease in legal costs ($17.3 million) were largely consistent year-over-year.partially offset by increases in other administrative costs such as other third-party professional services and travel-related expenses (totaling $5.9 million).
67

Table of Contents
Other Gain (Loss), Net
Other lossIn the quarter-to-date comparison, other gain was $142.7$254.8 million in 2023 compared to $149.9and $25.9 million in 2022. The year-to-date comparison had other gain of $100.5 million in 2023 and other loss of $170.2 million in 2022.
Other lossBoth periods under comparison had the following significant items:
In September 2023, $278.7 million of gain recognized in connection with the deconsolidation of DataBank, of which $3.7 million was realized and $275.0 million unrealized (Note 10 to the consolidated financial statements);
In March 2023, was driven by decreases in investment values, primarily $133.3$133 million fair value write-down on an unsecured promissory note from the 2022 sale of our Wellness Infrastructure business, taking into consideration an impending foreclosure of certain assets within the Wellness Infrastructure portfolio by its mezzanine lender.business; and
In March 2022, the losses were driven by a non-cash$133 million debt extinguishment loss of $133.2 million in connection with an early exchange of our 5.75% exchangeable notes (refernotes.
Excluding these significant one-off events, quarter-to-date period would have recorded a loss of $23.9 million in 2023 compared to Note 8toa gain of $26.8 million in 2022, and year-to-date period would have recorded losses of $44.9 million in 2023 and $36.2 million in 2022.
Other loss of $23.9 million in the consolidated financial statements), andthird quarter of 2023 reflected primarily an increase in the liability fair value decrease in previously warehoused loansof warrants issued to Wafra of $12.4 million and innet loss on marketable equity securities of $9.7 million, including those held by our consolidated liquid funds. In contrast, other gain of $26.8 million in the third quarter of 2022 was driven by a decrease in the warrant liability fair value of $32.4 million and net gain on non-designated derivatives of $9.9 million in connection with our warehoused investments, partially offset by net loss of $8.9 million on marketable equity securities held largely by our consolidated liquid funds, and additionally, unrealized foreign exchange losses.
In the year-to-date period, other loss increased $8.7 million to $44.9 million in 2023, driven by an increase in the warrant liability fair value of $81.1 million and net write-down in value of warehoused investments of $13.2 million, largely offset by net gain of $63.4 million on marketable equity securities, including those held by our consolidated liquid funds, net gains on non-designated derivatives in 2022 of offsetting fair value changes on short positions.$16.0 million in connection with our warehoused investments, and additionally, decrease in unrealized foreign exchange losses.
Income Tax Benefit (Expense)
ThereIn 2023, income tax benefit of $0.1 million was anrecorded quarter-to-date and income tax expense of $1.0$4.2 million in 2023 and anyear-to-date. In 2022, income tax benefit was recorded in both periods of $7.4$7.8 million in 2022.quarter-to-date and $17.8 million year-to-date.
Income tax expense in 2023 generallyprimarily reflects the income tax effect of foreign subsidiaries.subsidiaries, largely the InfraBridge investment management business. The net income tax benefit in the third quarter of 2023 resulted from deferred tax benefit associated with an InfraBridge subsidiary. The Company has otherwise established a full valuation allowance on the deferred tax assets of its taxable U.S. entities, resulting in no U.S. income tax provision for these subsidiaries in 2023.2023, outside of the Operating segment.
Income tax benefit in 2022 can be attributed primarily to deferred tax benefit on net operating losses of a subsidiary. A valuation allowance was subsequently established against this deferred tax asset in the fourth quarter of 2022.
57

Table of Contents

Income (Loss) from Discontinued Operations
Three Months Ended March 31,Three Months Ended September 30,Nine Months Ended September 30,
(In thousands)(In thousands)20232022Change(In thousands)20232022Change20232022Change
Income (Loss) from discontinued operationsIncome (Loss) from discontinued operations$(14,218)$(94,645)$80,427 Income (Loss) from discontinued operations$(2,603)$(90,302)$87,699 $(20,799)$(188,735)$167,936 
Income (Loss) from discontinued operations attributable to noncontrolling interests:Income (Loss) from discontinued operations attributable to noncontrolling interests:Income (Loss) from discontinued operations attributable to noncontrolling interests:
Investment entitiesInvestment entities517 (6,175)6,692 Investment entities(55)(10,227)10,172 437 (16,016)16,453 
Operating CompanyOperating Company(1,074)(7,110)6,036 Operating Company(179)(5,726)5,547 (1,539)(13,150)11,611 
Income (Loss) from discontinued operations attributable to DigitalBridge Group, Inc.Income (Loss) from discontinued operations attributable to DigitalBridge Group, Inc.$(13,661)$(81,360)67,699 Income (Loss) from discontinued operations attributable to DigitalBridge Group, Inc.$(2,369)$(74,349)71,980 $(19,697)$(159,569)139,872 
Loss from discontinued operations in 2023 reflect largelywas immaterial quarter-to-date, and in the year-to-date period, included $9.7 million impairment of BRSP shares prior to disposition in March 2023.2023, as well as unrealized losses on various remaining investments and legal costs associated with discontinued businesses and investments.
68

Table of Contents
Loss from discontinued operations in 2022 was driven byincluded $59.6 million of impairment on BRSP shares and losses incurred in connection with dispositions as well as fair value decreases on various remaining investments in the disposition ofquarter-to-date period. Additionally, the year-to-date loss also included the Wellness Infrastructure business that was disposed in February 2022, specifically,in particular, a $92.1 million write-off of unamortized deferred financing costs on the Wellness Infrastructure debt assumed by the buyer and $35 million impairment loss based upon final carrying value of the Wellness Infrastructure net assets upon disposition.disposition, partially offset by our share of BRSP earnings prior to disposition of $19.4 million.
Non-GAAP Supplemental Financial Measures
We currently conduct our business through two reportable segments: (i) Investment Management; and (ii) Operating, our direct co-investment in digital infrastructure assets held by our portfolio companies. In order to enhance a full understanding of our business, we present certain non-GAAP measures that allow for comparability with companies that operate in each of these two reportable segments. We report the following non-GAAP financial measures attributable to the Operating Company: Distributable Earnings (“DE”) and Adjusted Earnings before Interest, Taxes, Depreciation and Amortization (“Adjusted EBITDA”) on a Company-wide basis, and specific to our Investment Management segment, Fee Related Earnings (“FRE”) and FRE before the effects of new investment strategies, as represented by Investment Management Adjusted EBITDA. DE and FRE are the most common metrics utilized in the investment management sector, which represents our core business, while presenting Adjusted EBITDA allows for some measure of comparability against companies that hold digital infrastructure assets similar to assets in our Operating segment.
We believe these non-GAAP financial measures attributable supplement and enhance the overall understanding of our underlying financial performance and trends, and facilitate comparison among current, past and future periods and to the Operating Company.
other companies in similar lines of business. We use these non-GAAP financial measures in evaluating the Company’s ongoing business performance and in making operating decisions. For the same reasons, we believe these non-GAAP measures are useful to the Company’s investors and analysts.
As we evaluate profitability based upon continuing operations, these non-GAAP measures exclude results from discontinued operations.
These non-GAAP financial measures should not be considered alternativesas a supplement to and not an alternative or in lieu of GAAP net income or loss(loss) as indicatorsmeasures of operating performance, or to cash flows from operating activities as measures of liquidity, nor as indicators of the availability of funds for our cash needs, including funds available to make distributions.liquidity. Our calculation of these non-GAAP measures may differ from methodologies utilized by other companies for similarly titled performance measures and, as a result, may not be directlyfully comparable to those calculated by other companies in similar lines of business.our peers.
Results of our non-GAAP measures attributable to the Operating Company were as follows:
Three Months Ended March 31,Three Months Ended September 30,
(In thousands)(In thousands)20232022(In thousands)20232022
Attributable to Operating Company:Attributable to Operating Company:Attributable to Operating Company:
Distributable EarningsDistributable Earnings$(3,365)$(5,064)Distributable Earnings$35,048 $32,335 
Adjusted EBITDAAdjusted EBITDA25,626 20,494 Adjusted EBITDA33,591 29,097 
Investment Management FREInvestment Management FRE34,512 16,989 Investment Management FRE29,202 21,498 
Distributable Earnings
Distributable EarningsDE generally represents the net realized earnings of the Company and is an indicative measure used by the Company to assess ongoing operating performance and in making decisions related to distributions and reinvestments. Accordingly, we believe DE provides investors and analysts transparency into the measure of performance used by the Company in its decision making.
DE reflects the ongoing operating performance of the Company’s core business by generally excluding non-cash expenses, income (loss) items that are unrealized and items that may not be indicative of core operating results. This allows the Company, and its investors and analysts to assess its operating results on a more comparable basis period-over-period.
DE is calculated as an after-tax measure that differs from GAAP net income or loss(loss) from continuing operations as a result of the following adjustments including adjustment for our share of similar items recognized by our equity method investments, where applicable:to net income (loss): transaction-related costs; restructuring charges (primarily severance and retention costs)charges; other gain (loss); realized and unrealized gains or losses, except realized gains or losses related to digital assets, including fund investments, in Corporate and Other;principal investment income (loss); non-cash depreciation, amortization and impairment charges; interest expense on finance leases; debt prepayment penalties and amortization of deferred financing costs, debt premiums and discounts; our share of unrealized carried interest allocation, net of associated compensation expense; non-cash equity-based compensation costs; effect ofpreferred stock redemption gain (loss); straight-line adjustment to lease income and expense; impairmentinterest expense on finance
69

Table of equity investments directly attributableContents
leases in the Operating segment, amortization of above and below market leases in the Operating segment; straight-line adjustment to decreaselease income and expense in value of depreciable real estate held by the investee;Operating segment, non-revenue enhancing capital expenditures necessary to maintain operating real estate;estate in the Operating segment; and income tax effect on certain of the foregoing adjustments. Income taxes included
Transaction-related costs are incurred in connection with acquisitions and include costs of unconsummated transactions, while restructuring charges are related primarily to severance and retention costs. These costs, along with other gain (loss) amounts, are excluded from DE reflect the benefitas they are related to discrete items, are not considered part of deductions arisingour ongoing operating cost structure, and are not reflective of our core operating performance.
Other items excluded from certain expensesDE are generally non-cash in nature, including income (loss) items that are unrealized, or otherwise do not represent current or future cash obligations such as amortization of deferred financing costs and straight-line lease adjustment. These items are excluded from DE as they do not contribute to the measurement of DE as a net realized earnings measure that is used in decision making related to distributions and reinvestments.
Generally, the income tax effect associated with income and expense items excluded from the calculation of DE such as equity-based compensation, asare similarly excluded from DE. However, where the resulting income tax liability or benefit arising from these deductions doexcluded items increase or decrease actual income tax paid or payable by the Company in any one period.period, the income tax effect of these items are included in DE (for example, equity-based compensation).
WeIn connection with our Operating segment, non-revenue enhancing capital expenditures are excluded as these are not recurring capital expenditures and are not incurred to maintain and extend the useful life of operating digital assets that support the generation of revenues.
The items we have excluded from DE are generally consistent with the exclusions made by our peers, which we believe that DE is a meaningful supplemental measure as it reflects the ongoing operating performance of our core business by generally excluding items that are non-core in nature, and allows for better comparability to the DE presented by our operating results to be more comparable period-over-period and relative to other companies in similar lines of business.
58

Table of Contents

peers.
Adjusted EBITDA
Adjusted EBITDA representsis a supplemental measure derived from DE adjusted to excludeand generally presents the following items attributableCompany’s core operating performance on a pre-tax basis, based upon recurring revenues and independent of our capital structure and leverage.
We view Adjusted EBITDA as particularly helpful in evaluating the relative contribution of our Operating segment, absent the effects of leverage, as the consolidated portfolio companies in the Operating segment have higher leverage relative to the Operating Company: interest expense as included in DE, income tax benefit or expense as included in DE, preferred stock dividends, principal investment income or loss as included in DE, placement fee expense, our share of incentive fees and realized carried interest allocation or reversal net of associated compensation expense or reversal, certain investment costs forCompany’s own capital raising that are not reimbursable by our sponsored funds, and capital expenditures as deducted in DE.structure.
We believe that Adjusted EBITDA is a meaningful supplementaluseful to investors as an indicative measure of performance because it presents the Company’s operating performance independent of its capital structure, leverageprofitability that is recurring and non-cash items, whichsustainable and allows for better comparability against entities with differentof the Company’s performance relative to its peers independent of capital structuresstructure and income tax rates.leverage. However, because Adjusted EBITDA is calculated without the effects of certain recurring cash charges, including interest expense, preferred stock dividends, income taxes, capital expenditures or other recurring cash requirements, its usefulness as a performance measure may be limited.
Adjusted EBITDA is calculated as DE adjusted to generally exclude the following items attributable to the Operating Company that are included in DE: interest expense as included in DE and income tax benefit (expense) as included in DE consistent with an EBITDA measure, preferred stock dividends, placement fee expense, our share of incentive fees and distributed carried interest net of associated compensation expense, and capital expenditures in the Operating segment as deducted in DE.
Items excluded from Adjusted EBITDA include preferred stock dividends as Adjusted EBITDA removes the effects to earnings associated with the Company's capital structure, and placement fees as they are inconsistent in amount and frequency depending upon timing of fundraising for our funds. Additionally, Adjusted EBITDA excludes incentive fees and distributed carried interest net of associated compensation expense to be consistent with the FRE measure for our Investment Management segment, as discussed further below.
70

Table of Contents
Distributable Earnings and Adjusted EBITDA Reconciliation
Three Months Ended September 30,
(In thousands)20232022
Net income (loss) attributable to common stockholders$261,828 $(63,273)
Net income (loss) attributable to noncontrolling interests in Operating Company19,918 (4,834)
Net income (loss) attributable to Operating Company281,746 (68,107)
Transaction-related and restructuring charges7,522 23,249 
Other (gain) loss, net(254,737)(9,880)
Unrealized principal investment income(17,943)2,669 
Unrealized carried interest allocation, net of associated expense allocation(68,099)(1,228)
Equity-based compensation cost18,621 18,619 
Depreciation and amortization expense128,156 146,810 
Straight-line adjustment to lease (income) and expense, net(2,169)(8,895)
Amortization of acquired above-market and (below-market) leases, net(141)80 
Non-revenue enhancing capital expenditures(11,396)(10,992)
Finance lease interest expense, debt prepayment penalties and amortization of deferred financing costs, debt premiums and discounts3,745 5,627 
Adjustments attributable to noncontrolling interests in investment entities (1)
(52,496)(136,338)
DE of discontinued operations (2)
2,239 70,721 
Distributable Earnings, after tax—attributable to Operating Company35,048 32,335 
Adjustments attributable to Operating Company:
Interest expense included in DE9,524 16,348 
Income tax (benefit) expense included in DE37 (7,839)
Preferred stock dividends14,645 15,283 
Principal investment income included in DE— (9,303)
Placement fees15 — 
Distributed incentive fee and carried interest, net of associated expense allocation(27,927)(20,258)
Non-revenue enhancing capital expenditures deducted from DE2,249 2,531 
Adjusted EBITDA—attributable to Operating Company$33,591 $29,097 
Three Months Ended March 31,
(In thousands)20232022
Net income (loss) attributable to common stockholders$(212,473)$(262,316)
Net income (loss) attributable to noncontrolling interests in Operating Company(16,662)(22,862)
Net income (loss) attributable to Operating Company(229,135)(285,178)
Transaction-related and restructuring charges18,391 24,668 
Other (gain) loss, net (excluding realized gain or loss related to digital assets and fund investments in Corporate and Other)141,229 130,224 
Unrealized carried interest (allocation) reversal, net of associated compensation (expense) reversal18,240 13,078 
Equity-based compensation expense16,339 18,720 
Depreciation and amortization141,220 130,597 
Straight-line rent (revenue) and expense, net(1,727)(2,548)
Amortization of acquired above-market and (below-market) leases, net26 (248)
Impairment loss— 23,802 
Non-revenue enhancing capital expenditures(8,564)(1,372)
Finance lease interest expense, debt prepayment penalties and amortization of deferred financing costs, debt premiums and discounts15,523 98,465 
Income tax effect on certain of the foregoing adjustments— (589)
Adjustments attributable to noncontrolling interests in investment entities (1)
(118,563)(132,237)
DE of discontinued operations (2)
3,656 (22,446)
Distributable Earnings, after tax—attributable to Operating Company(3,365)(5,064)
Adjustments attributable to Operating Company:
Interest expense included in DE12,549 13,280 
Income tax (benefit) expense included in DE1,092 (6,849)
Preferred stock dividends14,676 15,759 
Principal investment (income) loss included in DE(277)(58)
Realized carried interest (allocation) reversal, net of associated compensation (expense) reversal(243)1,172 
Non-revenue enhancing capital expenditures deducted from DE1,194 2,023 
Non pro-rata allocation of (income) loss to noncontrolling interests— 231 
Adjusted EBITDA—attributable to Operating Company$25,626 $20,494 
__________
(1)    Noncontrolling interests' share of adjustments pertain largely to depreciation and amortization; interest expense on finance leases, debt prepayment penalties and amortization of deferred financing costs, debt premiums and discounts; unrealized carried interest (allocation) reversal,allocation, net of associated compensation (expense) reversal;expense allocation; and non-revenue enhancing capital expenditures.
(2)    Equity method earnings (loss) from BRSP, which qualified as discontinued operations in March 2023, is included in DE of discontinued operations for all periods presented.
Investment Management FRE and Investment Management Adjusted EBITDA
Investment Management FRE is calculatedpresented as recurring fee income and other income inclusive of cost reimbursementsInvestment Management Adjusted EBITDA, further adjusted to exclude FRE associated with administrative expenses, and net of compensation expense (excluding equity-based compensation, and incentive and carried interest compensation expense or reversal) and administrative expense (excluding placement fees and straight-line rent expense). new investment strategies, as discussed below.
Investment Management FRE is used to assess the extent to
59

Table of Contents

which direct base compensation and core operating expenses are covered by recurring fee revenues in thea stabilized investment management business. We believe that Investment Management FRE is a useful supplemental performance measure because it may provide additional insight into the profitability of the overall investment management business.
Investment Management FRE is measured as recurring fee income that is not subject to future realization events and other income (inclusive of cost reimbursements associated with administrative expenses), net of the following: compensation expense (excluding non-cash equity-based compensation, and incentive and carried interest compensation expense), administrative expense (excluding placement fee expense and straight-line adjustment to lease expense) and FRE associated with new investment strategies.
In reconciling Investment Management FRE to GAAP net income (loss), adjustments are made to first arrive at Investment Management Adjusted EBITDA, forwhich generally excludes the following: our share of incentive fees and carried interest net of associated compensation expense; unrealized principal investment income (loss); other gain (loss); transaction-related and restructuring charges; non-cash equity-based compensation costs; straight-line adjustment to lease expense; placement fee expense; investment expense; and in line with an EBITDA measure, non-cash depreciation and amortization expense, interest expense, and income tax benefit (expense).
Consistent with an FRE measure, Investment Management segment, adjustedAdjusted EBITDA excludes incentive fees and carried interest net of associated compensation expense, as these are not recurring fee income and are subject to reflectvariability given that they are performance-based and/or dependent upon future realization events.
71

Table of Contents
In calculating Investment Management FRE which reflects the Company’s Investment Management segment as a stabilized business, by excludingInvestment Management Adjusted EBITDA is further adjusted to exclude Start-Up FRE. Start-Up FRE is FRE associated with new investment strategies that have 1) not yet held a first close raising FEEUM; or 2) not yet achieved break-even Adjusted EBITDA only for investment products that may be terminated solely at the Company’s discretion, collectively referred to as “Start-up FRE.”discretion. The Company evaluates new investment strategies on a regular basis and excludes Start-UpStart- Up FRE from Investment Management FRE until such time as a new strategy is determined to form part of the Company’s core investment management business.
We believe that Investment Management FRE and Investment Management Adjusted EBITDA are useful measures to investors as they reflect the Company’s profitability based upon recurring fee streams that are not subject to future realization events, and without the effects of income taxes, leverage, non-cash expenses, income (loss) items that are unrealized and other items that may not be indicative of core operating results. This allows for better comparability of the profitability of the Company’s investment management business on a recurring and sustainable basis.
Investment Management FRE Reconciliation
Three Months Ended March 31,
(In thousands)20232022
Net income (loss)—Investment Management$(2,804)$(9,143)
Interest expense, net of interest income2,411 2,500 
Investment expense, net of reimbursement51 138 
Depreciation and amortization6,409 5,276 
Equity-based compensation3,898 3,191 
Incentive fee and carried interest (allocation) reversal, net of associated compensation (expense) reversal17,056 10,767 
Straight-line rent expense77 159 
Transaction-related and restructuring charges9,682 3,942 
Principal investment (income) loss(318)(17)
Other (gain) loss, net(3,082)3,055 
Income tax (benefit) expense217 2,374 
Investment Management Adjusted EBITDA33,597 22,242 
Start-up FRE915 2,362 
Investment Management FRE34,512 24,604 
Attributable to redeemable noncontrolling interests (1)
— (7,615)
Investment Management FRE—attributable to Operating Company$34,512 $16,989 
__________
(1)    Wafra's interest in the investment management business was redeemed in May 2022.
Three Months Ended September 30,
(In thousands)20232022
Net income (loss)—Investment Management$100,014 $46,065 
Interest expense, net of interest income2,128 2,906 
Investment expense, net of reimbursement97 230 
Depreciation and amortization expense9,003 5,369 
Equity-based compensation cost7,218 2,654 
Incentive fee and carried interest allocation, net of associated expense allocation(96,026)(40,867)
Straight-line rent expense511 68 
Placement fees15 — 
Transaction-related and restructuring charges3,891 2,317 
Unrealized principal investment income(1,451)(1,016)
Other (gain) loss, net2,662 110 
Income tax (benefit) expense(15)1,263 
Investment Management Adjusted EBITDA28,047 19,099 
Start-up FRE1,155 2,399 
Investment Management FRE—attributable to Operating Company$29,202 $21,498 
Liquidity and Capital Resources
We regularly evaluate our liquidity position, debt obligations, and anticipated cash needs to fund our business and operations based upon our projected financial performance. Our evaluation of future liquidity requirements is regularly reviewed and updated for changes in internal projections, economic conditions, competitive landscape and other factors as applicable.
Liquidity Needs and Sources of Liquidity
Our primary liquidity needs are to fund:
our general partner and general partner affiliate commitments to our investment vehicles;
acquisitions of target investment management businesses;
our general partner and co-investment commitments to our investment vehicles;
warehouse investments pending the raising of third party capital for future investment vehicles;
principal and interest payments on our debt;
our operations, including compensation, administrative and overhead costs;
obligation for lease payments, principally leasehold data centersdividends to our preferred and corporate offices;common stockholders;
our liability for corporate and other taxes;
obligation for lease payments, principally corporate offices and leasehold data centers;
development, construction and capital expenditures on our operating real estate; and
dividends to our preferred and common stockholders.
Our primary sources of liquidity are:
cash on hand;
60

Table of Contents

fees received from our investment management business, including the Company'sour share of realizeddistributed net incentive fees orand carried interest;
72

Table of Contents
cash flow generated from our investments, both from operations and return of capital;
availability under our Variable Funding Notes ("VFN");
issuance of additional term notes under our corporate securitization;
third party co-investors in our consolidated investments and/or businesses;
proceeds from full or partial realization of investments;
investment-level financing; and
proceeds from public or private equity and debt offerings.
Overview
At March 31,September 30, 2023, our liquidity position was approximately $749$530 million, composed of corporate unrestricted cash and including the full $300 million availability under our VFN. In April 2023, our liquidity position decreased by $200 million following the repayment of our convertible notes upon maturity, which further deleveraged our balance sheet.
We believe we have sufficient cash on hand, and anticipated cash generated from operating activities and external financing sources, to meet our short term and long term capital requirements.
While we have sufficient liquidity to meet our operational needs, we continue to evaluate alternatives to manage our capital structure and market opportunities to strengthen our liquidity and to provide further operational and strategic flexibility.
Significant Liquidity and Capital Activities in 2023
Sources of Funds
$49 million net proceeds from the September 2023 recapitalization of DataBank
$202 million in net proceeds from full disposition of our BRSP shares in the first quarter of 2023.March 2023
Uses of Funds
Acquisition of InfraBridge in February 2023 for $313$314 million, net of cash assumed
$200 million repayment of our convertible senior notes upon maturity in April 2023
$90 million contingent earnout payment to Wafra in March 2023.
Liquidity Needs and Capital Activities
Stock Repurchases
In July 2022, our Board of Directors authorized a $200 million stock repurchase program which expires in June 2023, but may be extended, modified, or discontinued at any time by our Board of Directors. In 2023 through April, $4.7 million of preferred stock was repurchased. $87.7 million repurchase capacity remains available under the program.
Dividends
Common Stock—The payment of common stock dividends and determination of the amount thereof is at the discretion of our Board of Directors. The Company reinstated quarterly common stock dividends at $0.01 per share beginning the third quarter of 2022, having previously suspended common stock dividends from the second quarter of 2020 through the second quarter of 2022. A dividend of $0.01 per share of common stock was declared in February 2023 and paid in April 2023.
Preferred Stock—Following additional preferred stock repurchases in April 2023, weWe have outstanding preferred stock totaling $822 million, bearing a weighted average dividend rate of 7.135% per annum, with aggregate dividend payments of $14.7 million per quarter.
61

Table of Contents

Contractual Obligations, Commitments and Contingencies
Debt ObligationObligations
As of the date of this filing, our corporate debt is composed of a securitized financing facility and exchangeable senior notes issued by the OP, all of which are recourse to the Company, as described in Note 8 to the consolidated financial statements. $200 million of convertible senior notes were fully repaid upon maturity in April 2023.
($ in thousands)($ in thousands)Outstanding PrincipalInterest Rate
(Per Annum)
Maturity or Anticipated Repayment Date($ in thousands)Outstanding PrincipalInterest Rate
(Per Annum)
Maturity or Anticipated Repayment DateYears Remaining to Maturity
Corporate debt:Corporate debt:Corporate debt:
Securitized financing facility—fixed rateSecuritized financing facility—fixed rate$300,000 3.93 %September 2026Securitized financing facility—fixed rate$300,000 3.93 %September 20263.0
Exchangeable senior notes—fixed rateExchangeable senior notes—fixed rate78,422 5.75 July 2025Exchangeable senior notes—fixed rate78,422 5.75 July 20251.8
$378,422 $378,422 
Investment-level secured debt is non-recourse to DBRG and serviced through operating and/or investing cash generated by the respective borrower subsidiaries in the Operating segment and by our consolidated fund. Corporate-level cash is not applied to service investment-level debt.
73

Table of Contents
Investment Commitments
Fund Commitments—As general partner, we typically have minimum capital commitments to our sponsored funds. With respect to our flagship value-add funds, DBP I and DBP II,fund series, and InfraBridge GIF I and GIF II funds, we have made additional capital commitments as a general partner affiliate alongside our limited partner investors. Our fund capital investments further align our interests to our investors. As of March 31, 2023,the date of filing, we have unfunded commitments totaling $126$245 million to our sponsored funds.funds, including DBP III which had its first closing on November 1, 2023. Generally, the timing for funding of these commitments is not known and the commitments are callable on demand at any time prior to their respective expirations.
Contingent Consideration
Wafra Redemption—In connection with the May 2022 redemption of Wafra's interest in our investment management business, additional contingent consideration is payable based upon future capital raise thresholds, with up to 50% payable in shares of our class A common stock at our election. Depending upon cumulative capital raised through 2023, up to $35 million of the remaining contingent consideration may become payable in March 2024.
InfraBridge Acquisition—In connection with the InfraBridge acquisition in February 2023, additional contingent consideration of up to $129 million may become payable based upon achievement of future fundraising targets for InfraBridge'sthe third and fourth flagship InfraBridge funds. The current estimated fair value of the contingent consideration is $11 million.
Warehoused Investments
We temporarily warehouse investments on behalf of prospective sponsored investment vehicles that are actively fundraising. The warehoused investments are transferred to the investment vehicle if and when sufficient third party capital, including debt, is raised. Generally, the timing of future warehousing activities is not known. Nevertheless, investment warehousing is undertaken only if it is determined that we determine that there will behave sufficient liquidity through the anticipated warehousing period.
At March 31,September 30, 2023, we had $38warehoused investments aggregate to $50 million of warehoused equity investments.at cost.
Carried Interest Clawback
Depending on the final realized value of all investments at the end of the life of a fund (and, with respect to certain funds, periodically during the life of the fund), if it is determined that cumulative carried interest distributions have exceeded the final carried interest amount earned (or amount earned as of the calculation date), we are obligated to return the excess carried interest received. Therefore, carried interest distributions may be subject to clawback if decline in investment values results in cumulative performance of the fund falling below minimum return hurdles in the interim period. If it is determined that the Company has a clawback obligation, a liability would be established based upon a hypothetical liquidation of the net assets of the fund at reporting date. The actual determination and required payment of any clawback obligation would generally occur after final disposition of the investments of the fund or otherwise as set forth in the governing documents of the fund.
If the related carried interest distributions received by the Company are subject to clawback, the previously distributed carried interest would be similarly subject to clawback from employees. The Company generally withholds a portion of the distribution of carried interest to employees to satisfy their potential clawback obligation.
62

Table of Contents

At March 31,September 30, 2023, the Company has no liability for clawback obligations on distributed carried interest.
Lease Obligations
At March 31,September 30, 2023, we had $39.5$50.0 million of operating lease obligations on our corporate offices, which are funded through corporate operating cash. The lease obligation amount represents fixed lease payments, excluding any contingent or other variable lease payments, and factor in lease renewal or termination options only if it is reasonably certain that such options would be exercised.
Separately, finance and operating lease obligations on leasehold data centers in the Operating segment are satisfied through operating cash generated by the respective investment properties.
Sources of Liquidity
Debt Funding
As of the date of this filing, we have $378 million of outstanding principal on our corporate debt, as discussed above under "—Debt Obligation."
74

Table of Contents
Our securitized financing facility is subject to various covenants, including financial covenants that require the maintenance of minimum thresholds for debt service coverage ratio and maximum loan-to-value ratio, as defined. As of the date of this filing, we are in compliance with all of the financial covenants, and the full $300 million is available to be drawn on our VFN.
Our securitized financing facility allows for the issuance of additional term notes in the future to supplement our liquidity. The decision to enter into a particular financing arrangement is made after consideration of various factors including future cash needs, current sources of liquidity, demand for the Company’s debt or equity, and prevailing interest rates.
Cash From Operations
Fee-Related Earnings—We generate FRE from our Investment Management segment, generally encompassing recurring fee income net of associated compensation and administrative expenses. Following the redemption of Wafra's 31.5% interest in our investment management business in May 2022, 100% of Investment Management FRE is attributable to us. Management fee income is generally a predictable and stable revenue stream. Our ability to generate new management fee streams through establishing new investment vehicles and raising investor capital depends on general market conditions and availability of attractive investment opportunities as well as availability of debt capital.
Incentive Fees—Incentive fees, net of employee allocations, are earned based upon the financial performance of a vehicle above a specified return threshold, which is largely driven by appreciation in value of underlying investments. Incentive fees are recognized as fee income when they are no longer probable of significant reversal. As investment fair values and changes thereof could be affected by various factors, including market and economic conditions, incentive fees are by nature less predictable in amount and timing.
Carried Interest Distributions—Carried interest is distributed generally upon profitable disposition of an investment if at the time of distribution, cumulative returns of the fund exceed minimum return hurdles. Carried interest distributions are recognized in earnings net of clawback obligations, if any. The amount and timing of carried interest distributions received may vary substantially from period to period depending upon the occurrence and size of investments realized by our sponsored funds.
Investments—Our investments generate cash through income distributions and return of our invested capital.
Asset Monetization
We periodically monetize our investments through opportunistic asset sales or to recycle capital from non-core assets. In the first quarter ofMarch 2023, our BRSP shares were fully disposed for net proceeds of $202 million.
We have other marketable equity securities that are available for future monetization, with our share valued at approximately $17$12.8 million at March 31,September 30, 2023.
Public Offerings
We may offer and sell various types of securities from time to time at our discretion based upon our needs and depending upon market conditions and available pricing.
63

Table of Contents

Consolidated Cash Flows
The following table summarizes the activities from our consolidated statements of cash flows, including discontinued operations.
Three Months Ended March 31,Nine Months Ended September 30,
(In thousands)(In thousands)20232022(In thousands)20232022
Cash, cash equivalents and restricted cash—beginning of periodCash, cash equivalents and restricted cash—beginning of period$1,036,739 $1,766,245 Cash, cash equivalents and restricted cash—beginning of period$1,036,739 $1,766,245 
Net cash provided by (used in):Net cash provided by (used in):Net cash provided by (used in):
Operating activitiesOperating activities20,185 1,257 Operating activities192,080 194,773 
Investing activitiesInvesting activities(258,870)(1,102,149)Investing activities(768,072)(1,929,361)
Financing activitiesFinancing activities26,786 559,318 Financing activities78,596 741,772 
Effect of exchange rates on cash, cash equivalents and restricted cashEffect of exchange rates on cash, cash equivalents and restricted cash(626)(651)Effect of exchange rates on cash, cash equivalents and restricted cash(673)(3,039)
Cash, cash equivalents and restricted cash—end of periodCash, cash equivalents and restricted cash—end of period$824,214 $1,224,020 Cash, cash equivalents and restricted cash—end of period$538,670 $770,390 
75

Table of Contents
Operating Activities
Cash inflows from operating activities are generated primarily through fee income, including incentive fees, and distributions of our share of net carried interest from our investment management business, property operating income from our real estate investments, interest received from loans receivable during the warehousing period, and distributions of earnings received from equity investments. This is partially offset by payment of operating expenses, including property management and operations, investment transaction-related costs, as well as compensation and general administrative costs.
Our operating activities generated net cash inflows of $20.2$192.1 million in 2023 and $1.3$194.8 million in 2022.
Investing Activities
Investing activities include primarily cash outlays for business combination, acquisition of real estate, origination or acquisition of warehoused loans and disbursement on subsequent drawdowns, and new equity investments and subsequent capital contributions. These are partially offset by repayments, sales and transfers of warehoused loans receivable,investments, distributions of capital received from equity investments, and proceeds from sale of real estate and equity investments.
Our investing activities generated net cash outflows of $258.9$768.1 million in 2023 and $1.9 billion in 2022. Cash outlays in 2023 can be attributed primarily to a business combination,the acquisition of InfraBridge and deconsolidation of DataBank, partially offset by the sale of equity investments, and $1.1 billion inBRSP shares. 2022 cash outlays were driven by real estatethe acquisitions of TowerCo and data centers in the Operating segment.
DataBank recapitalization and deconsolidation—In 2023, we received proceeds of $21.5 million, net of carried interest distribution, from the recapitalization of DataBank. Following the recapitalization, DataBank was deconsolidated, effective September 14, 2023, resulting in the derecognition of $102.4 million of cash and restricted cash (Note 10).
Business combination—In 2023, we paid $313.2$314.3 million (net of cash assumed) for the acquisition of InfraBridge.
Equity investmentsOur equityEquity investments generated net cash inflows in both years.
In 2023, our equity investments recorded net cash inflows of $219.5$232.3 million, attributed primarily to $201.6 million from the sale of our BRSP shares. Other activities pertain to the acquisitions and dispositions of marketable equity securities by our consolidated liquid funds, andshares, return of capital from a non-digital equity investment following a final sale of its underlying assets.assets, and investing activities of our consolidated liquid funds which hold marketable equity securities. These cash inflows were partially offset by funding of our fund commitments.
2022 saw net cash inflows of $8.7$97.4 million, largely representing the trading activities in marketable equity securities by our consolidated liquid funds, and a return of capital from the first sale of investment by DBP I, partially offset by additional contributions to our digital funds.
Real estate investments—Real estate investing activities generated net cash outflows in both years.
Net cash outflows in 2023 was $162.9$613.1 million, attributed to DataBank's data center acquisition in Dallas and capital expenditures in our data center portfolio, including payments for build-out of expansion capacity and lease-up within the Vantage SDC portfolio.
2022 saw net cash outflows of $739.4 million,$1.9 billion, attributed primarily to the acquisition of TowerCo and, to a lesser extent, to DataBank's Houston portfolio acquisition, of five data centers, data center capital expenditures, and payments for build-out of expansion capacity and lease-up within the Vantage SDC portfolio. Also contributing to the cash outflows was cash assumed by the buyer in the sale of real estate investment holding entities in our Wellness Infrastructure business. All of these outflows were partially offset by proceeds received from our Wellness Infrastructure sale.
Debt investments—Our debt investments generated minimal net cash outflowsinflows in 2023 and 2022.
Having relinquished all of our warehoused debt investments in 2022, while there were nothe only cash activitiesactivity with respect to debt investments in 2023.
64

Table2023 was the full repayment of Contents

a loan held by DataBank of $6.8 million.
In 2022, net cash outflows of $164.1inflows was relatively immaterial at $4.6 million were driven by origination and acquisition of loans that were warehoused for future investment vehicles, partially offset by a loan syndication. Theseas we had largely transferred our acquired or originated warehoused loans were subsequently transferred to our sponsored credit fund and to a third party sponsored collateralized loan obligation ("CLO") in the second half of 2022..
Financing Activities
We may draw upon our securitized financing facility to finance our operating activities, as well as have the ability to raise capital in the public markets through issuances of preferred stock, common stock and private placement notes. Accordingly, we incur cash outlays primarily for payments on our corporate debt, and dividends to our preferred
76

Table of Contents
stockholders and common stockholders (common dividends were reinstated beginning the third quarter of 2022).stockholders. Separately, subsidiaries in the Operating segment, including DataBank prior to its deconsolidation in September 2023, finance their investing activities largely through investment-level secured debt and incur cash outlays for debt servicing and distributions to their third party investors who represent noncontrolling interests.
Financing activities generated net cash inflows in both years.
In 2023, the net cash inflows of $26.8$78.6 million represent largelyprimarily $489.9 million of additional investment-level debt raised by subsidiaries in the Operating segment, through their refinancing activities, partiallylargely offset by a $90.0repayment of our $200 million 5.00% convertible senior notes, $90 million contingent consideration payment to Wafra.Wafra, $78.3 million distributed for capital redeemed by a noncontrolling interest in a consolidated liquid fund, and income distribution to noncontrolling interests in Vantage SDC.
The financing net cash inflows of $559.3$741.8 million in 2022 werewas driven by financing for the acquisition of TowerCo and the DataBank data center acquisition through a term loanloans and capital contributions from noncontrolling interests. Other investment-level financinginterests totaling $1.1 billion. Additionally, cash inflows included amounts drawn onour share of proceeds recorded in equity of $302.8 million from sale a portion of our interest in our DataBank subsidiary in connection with the partial recapitalization in August 2022 that was treated as an equity transaction (Note 10). The cash inflows were partially offset by $388.5 million of cash paid to redeem Wafra's interest in our investment management business. Financing cash outflows also included repayment of our warehouse facilitiescredit facility of $172.5 million with proceeds from a transfer of the warehoused loans to finance acquisition of loans that were intended to be securitized. In the third quarter of 2022, these loans were transferred into a third party CLO, and the corresponding warehouse facilities were repaid.paydowns on amortizing debt in our Operating segment. Other notable cash outflows included preferred and common stock repurchases totaling $60.8 million and distributions to various controlling interests.
Guarantees and Off-Balance Sheet Arrangements
We have no guarantees or off-balance sheet arrangements that we believe are reasonable likely to have a material effect on our financial condition.
Critical Accounting Policies and Estimates
Our financial statements are prepared in accordance with GAAP, which requires the use of estimates and
assumptions that involve the exercise of judgment and that affect the reported amounts of assets, liabilities, and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Our critical accounting policies and estimates are integral to understanding and evaluating our reported financial results as they require subjective or complex management judgments, resulting from the need to make estimates about the effect of matters that are inherently uncertain and unpredictable.
There have been no changes to our critical accounting policies or those of our unconsolidated joint ventures since the filing of our Annual Report on Form 10-K for the year ended December 31, 2022.
With respect to all critical estimates, we have established policies and control procedures which seek to ensure that estimates and assumptions are appropriately governed and applied consistently from period to period. We believe that all of the decisions and assessments applied were reasonable at the time made, based upon information available to us at that time. Due to the inherently judgmental nature of the various projections and assumptions used, and unpredictability of economic and market conditions, actual results may differ from estimates, and changes in estimates and assumptions could have a material effect on our financial statements in the future.
Recent Accounting Updates
The effects of accounting standards adopted in 2023 and the potential effects of accounting standards to be adopted in the future are described in Note 2 to our consolidated financial statements in Item 1 of this Quarterly Report.
Item 3. Quantitative and Qualitative Disclosures About Market Risk
Market risk represents the risk of financial loss from adverse movement in market prices. The primary sources of market risk are interest rates, foreign currency rates, equity prices and commodity prices.
65

Table of Contents

Our business is exposed primarily to the effect of market risk on our fee income and net carried interest allocation, foreign currency risk on non-U.S. investment management business and foreign denominated warehoused investments (if any), interest rate risk on our VFN and other variable rate debt financing warehoused investments (if any), and, equity price risk on marketable equity securities of consolidated funds.
77

Table of Contents
Separately, the Operating segment is exposed to interest rate risk on variable rate debt, foreign currency risk on its non-U.S. business and commodity price risk.
Market Risk Effect on Fee Income and Net Carried Interest Allocation
Management Fees—To the extent management fees are based upon fair value of the underlying investments of our managed investment vehicles, an increase or decrease in fair value will directly affect our management fee income. Generally, our management fee income is calculated based upon investors' committed capital during the commitment period of the vehicle, and thereafter, contributed or invested capital during the investing and liquidating periods. To a lesser extent, management fees are based upon the net asset value of vehicles in our Liquid Strategies, measured at fair value. At March 31,September 30, 2023, our Liquid Strategies make up 4% of our $28$30 billion FEEUM. Accordingly, most of our management fee income will not be directly affected by changes in investment fair values.
Incentive Fees and Carried Interest—Incentive fees and carried interest, net of management allocations, are earned based upon the financial performance of a vehicle above a specified return threshold, which is largely driven by appreciation in value of underlying investments. Carried interest is subject to reversal until such time it is realized,distributed, which generally occurs upon disposition of all underlying investments of an investment vehicle, or in part with each disposition. The extent of the effect of fair value changes to the amount of incentive fees and carried interest earned will depend upon the cumulative performance of an investment vehicle relative to its return threshold, the performance measurement period used to calculate incentives and carried interest, and the stage of the vehicle's lifecycle. Investment fair values in turn could be affected by various factors, including but not limited to, the financial performance of the portfolio company, economic conditions, foreign exchange rates, comparable transactions in the market, and equity prices for publicly traded securities. Therefore, fair value changes are unpredictable and the effect on incentive fee and carried interest varies across different investment vehicles.
Foreign Currency Risk
As of March 31,September 30, 2023, we have limited direct foreign currency exposure from our foreign operations and foreign currency denominated investments warehoused on the balance sheet for future sponsored vehicles. Changes in foreign currency rates can adversely affect earnings and the value of our foreign currency denominated investments, including investments in our foreign subsidiaries.
We have exposure to foreign currency risk from the operations of our foreign subsidiaries to the extent these subsidiaries do not transact in U.S. dollars. Generally, this is limited to our recently acquired InfraBridge advisor subsidiary which receives fee income predominantly in U.S. dollars but incur operating costs in Pound Sterling ("GBP").
Our foreign currency denominated investments, which are temporarily warehoused on the balance sheet, are held by our U.S. subsidiaries. At March 31, 2023    , ourOur foreign currency exposure is limited to only one AUD equity investment (A$(cost of investment at AUD 35 million).
Operating segment—For the substantial majority of subsidiaries in Canada that operate hyperscale data centers, the U.S. dollar is largely used as the transactional currency, in which case, there is generally very limited foreign currency exposure. Foreign subsidiaries that operate six colocation data centers in the U.K. and France do not transact in U.S. dollars but make up only a small percentage of the overall Operating segment, which in turn is substantially owned by third party investors. Accordingly, our exposure to foreign currency risk from the operations of foreign subsidiaries in the Operating segment is limited as of March 31, 2023.
Interest Rate Risk
Instruments bearing variable interest rates include debt obligations, which are subject to interest rate fluctuations that will affect future cash flows, specifically interest expense.
Corporate debt—Our corporate debt exposure to variable interest rates is limited to our VFN revolver, which had no outstanding amountsamount as of March 31,September 30, 2023.
Investment-level debt—Investment level financing, which totals $4.9$2.8 billion, consists primarilypredominantly of fixed rate securitized notes issued by subsidiariesthe Vantage SDC subsidiary in the Operating segment, Vantage SDC and DataBank.segment. Of this amount, $0.4 billiononly $4.7 million or 7%0.2% is composed of variable rate debt at March 31, 2023. Investment level variable rate debtSeptember 30, 2023, which is indexed primarily to either 1-month LIBOR or Term SOFR. As subsidiariesAdditionally, as the Company's subsidiary in the Operating segment areis substantially (87%) owned by third party investors, the resulting
66

Table of Contents

increase in interest expense from higher interest rates will be attributed predominantly to noncontrolling interests, with a minimal share of that effect attributed to DBRG. Based uponTherefore the outstanding principaleffect to DBRG of increases in interest rates on investment level variable rate debt at March 31, 2023, a hypothetical 100 basis point increase in interest rates would increase annualized interest expense by $3.6 million on a consolidated basis or $0.4 million after attribution to noncontrolling interests.the Operating segment is not material.
Equity Price Risk
At March 31,September 30, 2023, we had $166$84 million of long positions and $46$44 million of short positions in marketable equity securities, held predominantly by our consolidated sponsored liquid funds. Realized and unrealized gains and losses from
78

Table of Contents
marketable equity securities are recorded in other gain (loss) on the consolidated statement of operations. Market prices for publicly traded equity securities may fluctuate due to a myriad of factors, including but not limited to, financial performance of the investee, industry conditions, economic and political environment, trade volume, and general sentiments in the equity markets. Therefore the level of volatility and price fluctuations are unpredictable. Our funds constantly rebalance their investment portfolio to take advantage of market opportunities and to manage risk. Additionally, one of our funds employs a long/short equity strategy, taking long positions that serve as collateral for short positions, which in combination, reduces its market risk exposure. The effect of equity price decreases to earnings attributable to our shareholders is further reduced as our consolidated liquid funds are substantially owned by third party capital, which represent noncontrolling interests.
Commodity Price Risk
Operating segment—Certain operating costs in the data center portfolio in the Operating segment are subject to price fluctuations caused by volatility of underlying commodity prices, primarily electricity used in our data center operations. The cost of electricity is closely monitored at all locations and power utility contracts may be entered into to purchase electricity at fixed prices in certain locations in the U.S., with such contracts generally representing less than forecasted usage. The building of new data centers and expansion of existing data centers will also subject the Operating segment to commodity price risk with respect to building materials such as steel and copper. Additionally, the lead time to procure data center equipment is substantial and procurement delays could increase construction cost and delay revenue generation.
Item 4. Controls and Procedures.
Evaluation of Disclosure Controls and Procedures
We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) of the Exchange Act) that are designed to ensure that information required to be disclosed in our reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time period specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives.
As required by Rule 13a-15(b) of the Exchange Act, we have evaluated, under the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, the effectiveness of our disclosure controls and procedures. Based upon our evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective at March 31,September 30, 2023.
Changes in Internal Control over Financial Reporting
There have been no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) of the Exchange Act) during the quarter ended March 31,September 30, 2023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.
6779

Table of Contents

PART II—OTHER INFORMATION
Item 1.  Legal Proceedings.
The Company may be involved in litigation and claims in the ordinary course of business. As of March 31,September 30, 2023, the Company was not involved in any material legal proceedings.
Item 1A. Risk Factors.
There have been no material changes from the risk factors previously disclosed in response to "Part I—Item 1A. Risk Factors" of our Annual Report on Form 10-K for the year ended December 31, 2022, which is available on the SEC’s website at www.sec.gov.
Item 2.     Unregistered Sales of Equity Securities and Use of Proceeds.
Purchases of Equity Securities by Issuer and Affiliated Purchasers
Pursuant to a stock repurchase program authorized by our board of directors and announced in July 2022, the Company may repurchase up to $200 million of its outstanding shares of class A common stock and/or preferred stock through various methods, including open market repurchases, negotiated block transactions, accelerated share repurchases, open market solicitations and Rule 10b5-1 plans. The stock repurchase program expires on June 30, 2023 and may be extended, modified, or discontinued at any time.
The following table presents information related to purchases of the Company's Series H, I and J preferred stock during the quarter ended March 31, 2023:
PeriodTotal Number of Shares PurchasedWeighted Average Price Paid Per ShareTotal Number of Shares
Purchased as Part of
Publicly Announced
Program
Maximum Approximate
Dollar Value that May
Yet Be Purchased
Under the Program
($ in thousands)
January 1 through January 31, 2023— $— — $92,430 
February 1 through February 28, 2023— — — 92,430 
March 1 through March 31, 20232,738 18.89 2,738 92,378 
Total (1)
2,738 $18.89 2,738 $92,378 
_______
(1)    Represent stock purchases pursuant to the repurchase program described above.None.
Item 3.     Defaults Upon Senior Securities.
None.
Item 4. Mine Safety Disclosures.
Not applicable.
Item 5. Other Information.
None.Rule 10b5-1 Trading Plans
68
During the quarter ended September 30, 2023, none of the Company’s directors or executive officers adopted or terminated any contract, instruction or written plan for the purchase or sale of Company securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement.”

Table of Contents

Item 6. Exhibits.
Exhibit NumberDescription
3.1
3.2
10.1*
31.1*
31.2*
32.1*
32.2*
101.INS**XBRL Instance Document
101.SCHInline XBRL Taxonomy Extension Schema
101.CALInline XBRL Taxonomy Extension Calculation Linkbase
101.LABInline XBRL Taxonomy Extension Label Linkbase
101.PREInline XBRL Taxonomy Extension Presentation Linkbase
101.DEFInline XBRL Taxonomy Extension Definition Linkbase
104**Cover Page Interactive Data File
__________
†      Denotes a management contract or compensatory plan contract or arrangement.
* Filed herewith.
** The document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.


80

Table of Contents

SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
Dated: May 5,November 3, 2023
DigitalBridge Group, Inc.
By: /s/ Marc C. Ganzi
 Marc C. Ganzi
 Chief Executive Officer
(Principal Executive Officer)
By: /s/ Jacky Wu
 Jacky Wu
 Chief Financial Officer (Principal Financial Officer and Principal Accounting Officer)
By:/s/ Sonia Kim
Sonia Kim
Chief Accounting Officer (Principal Accounting Officer)