Blackstone Mortgage Trust (BXMT) 8-K Blackstone Mortgage Trust Reports First Quarter 2020 Results

Blackstone Mortgage Trust, Inc.

April 28, 2020

First Quarter 2020 Results

Exhibit 99.2

Blackstone Mortgage Trust

1

BXMT Highlights

BXMT

benefits

from

the

deep

experience

of

Blackstone

Real

Estate,

which

is

the

largest

real

estate

private

equity

manager

in

the

world

with

a

proven

track

record

of

safeguarding

investments

through

market

cycles

over

28

years

BXMT

is

taking

a

proactive

and

prudent

approach

during

this

period

of

COVID-19

uncertainty

to

fortify

its

balance

sheet

and

enhance

its

strong

liquidity

position

to

navigate

through

the

possibility

of

an

elongated

economic

recovery

2022

Nearest corporate debt

maturity

Long duration

liabilities, with no

capital markets

mark-to-market

2.8x

Debt-to-Equity

Ratio

(b)

Strong Balance Sheet

63%

Origination

Loan-to-Value

(a)

Well-capitalized,

institutional sponsors

committed to protecting

their investments

100%

Performing Portfolio

Strong Credit

Note: All figures in this presentation as of March 31, 2020, unless otherwise indicated.

(a)

Includes

$692

million

of

Non-Consolidated

Senior

Interests

as

of

March

31,

2020

and

investment

exposure

to

the

$881

million

2018

Single

Asset

Securitization

through

an

$84

million

subordinate

risk retention interest.

(b)

Represents

(i)

total

outstanding

secured

debt

agreements,

secured

term

loans,

and

convertible

notes,

less

cash,

to

(ii)

total

equity.

(c)

Includes $387 million of cash and cash equivalents and $434 million of available borrowings under credit facilities as of April 24, 2020.

(d)

Represents assets with no asset-level debt that are, however, included in the Term Loan B collateral pool absent their sale or direct financing as permitted under the Term Loan B.

Robust resources to

address COVID-19

market volatility

$821M

Current

Liquidity

(c)

$1.6B

Unencumbered

assets

(d)

Strong Liquidity

Blackstone Mortgage Trust

2

100%

performing

senior

loan

portfolio

with

an

average

origination

LTV

(b)

of

63%

$18.0

billion

(b)

portfolio

secured

by

institutional

quality

real

estate

in

major

markets

1Q

net

funding

of

$433

million,

with

$1.0

billion

of

loan

fundings

and

$567

million

of

repayments

1Q

GAAP

loss

of

$(0.39)

per

share

(“EPS”)

and

Core

Earnings

(a)

per

share

of

$0.64;

book

value

per

share

(“BVPS”)

of

$26.92

1Q

EPS

and

BVPS

impacted

by

unrealized

loss

reserve

from

adoption

of

the

Current

Expected

Credit

Loss

(“CECL”)

accounting

standard;

no

loan

losses

or

impairments

97%

of

the

portfolio

(b)

is

floating

rate,

with

63%

of

the

portfolio

benefitting

from

active

LIBOR

(c)

floors

as

of

quarter

end

First Quarter 2020 Results

$13.1

billion

(d)

of

match-funded,

asset-level

financing;

2.8x

debt-to-equity

ratio

$3.7

billion

(d)

of

asset-level

financing

is

non-recourse,

non

mark-to-market,

including

$1.2

billion

of

CLO

notes

issued

in

1Q

Secured

$1.1

billion

of

asset-level

financing

in

1Q

on

pre

COVID-19

market

terms

(a)

See Appendix for a definition and reconciliation to GAAP net income.

(b)

Includes

$692

million

of

Non-Consolidated

Senior

Interests

as

of

March

31,

2020

and

investment

exposure

to

the

$881

million

2018

Single

Asset

Securitization

through

an

$84

million

subordinate

risk retention interest.

(c)

Includes USD LIBOR, GBP LIBOR, EURIBOR, BBSY, and CDOR.

(d)

Includes $797 million of securitized debt held by third-parties in the $881 million 2018 Single Asset Securitization, which is not consolidated on BXMT’s balance sheet.

Portfolio

Composition

Portfolio

Composition

Earnings

Earnings

Capitalization

Capitalization

Blackstone Mortgage Trust

3

4Q '19 Book

Value Per Share

1Q Book Value

Accretion

1Q CECL Book

Value Impact

1Q '20 Book

Value per Share

Earnings

1Q

earnings

reflect

fully

performing

portfolio,

with

$11.4

billion

of

loans

benefitting

from

active

interest

rate

floors

CECL

reserve

reflects

macroeconomic

impact

of

COVID-19

on

overall

CRE

market;

no

loan

losses

or

impairments

(a)

See Appendix for a definition and reconciliation to GAAP net income.

(b)

CECL

book

value

impact

includes

$(0.13)

per

share

initial

CECL

reserve

recorded

as

an

opening

adjustment

to

retained

earnings

on

January

1,

2020,

and

$(0.90)

per

share

1Q

CECL

reserve

that

impacts GAAP net income and earnings per share.

Book

Value

Per

Share

(b)

1Q

Core

Earnings

Per

Share

(a)

$27.82

$26.92

$0.13

($1.03)

GAAP Earnings (Pre-CECL)

GAAP Earnings (Pre-CECL)

CECL Earnings Impact

CECL Earnings Impact

Earnings Per Share

Earnings Per Share

Hedging Income and Non-Cash                   

Expenses

Hedging Income and Non-Cash                   

Expenses

$0.51

($0.90)

$0.13

$(0.39)

CECL Earnings Impact

CECL Earnings Impact

$0.90

Core Earnings Per Share

Core Earnings Per Share

$0.64

($ in per share)

Blackstone Mortgage Trust

4

Portfolio Composition

$18.0

billion

portfolio,

(a)

comprising

133

loans

with

75%

of

collateral

in

gateway

markets

High

quality

senior

loan

portfolio

with

average

origination

LTV

(a)

of

63%

$1.3

billion

of

1Q

originations

across

9

loans

and

$240

million

of

fundings

under

previously

originated

loans

(a)

Includes

$692

million

of

Non-Consolidated

Senior

Interests

as

of

March

31,

2020

and

investment

exposure

to

the

$881

million

2018

Single

Asset

Securitization

through

an

$84

million

subordinate risk retention interest.

(b)

States that compose less than 1% of total loan portfolio excluded.

54%

17%

11%

5%

3%

2%

1%

7%

Condo

Self-Storage

Retail

Industrial

Office

Hospitality

Other

Multi

$18.0B

portfolio

IL

4%

OH

1%

MN

1%

NY

24%

FL

5%

GA

3%

DC

2%

TN

1%

1%

3%

NV

TX

CO

1%

CA

15%

HI

3%

VA

5%

ES

7%

1%

DEU

UK

11%

IR

7%

IT

BE

1%

1%

NL

1%

AU

2%

Major Market Focus

(a)(b)

Collateral Diversification

(a)

Blackstone Mortgage Trust

5

Capitalization

Asset-level

financing

generally

term-matched

with

no

near-term

maturities;

no

corporate

debt

maturities

until

2022

Closed

$1.5

billion

CLO

and

$1.1

billion

of

asset-level

financing

in

1Q

on

pre

COVID-19

market

terms

(a)

Includes $348 million of asset-specific financings as of March 31, 2020.

(b)

Includes

$2.3

billion

of

consolidated

securitized

debt

obligations

and

$797

million

of

securitized

debt

held

by

third-parties

in

the

$881

million

2018

Single

Asset

Securitization,

which

is

not

consolidated on BXMT’s balance sheet.

(c)

Represents $692 million of Non-Consolidated Senior Interests, which result from non-recourse sales of senior loan interests in loans BXMT originates. BXMT’s net investments in these loans are

reflected in the form of mezzanine or other subordinate loans on BXMT’s balance sheet.

(d)

Reflects maximum advance rate under credit facilities relative to the origination LTV of the collateral assets as of March 31, 2020.

(e)

Represents

(i)

total

outstanding

secured

debt

agreements,

secured

term

loans,

and

convertible

notes,

less

cash,

to

(ii)

total

equity.

Credit Facilities

(a)

14 Credit Facilities

Corporate Debt

Term Loan and Convertible Notes

Corporate Obligations

Senior Loan

Interests

(c)

$9.4

$1.4

$0.7

$10.8

Securitized

Debt

(b)

$3.0

CLO and Single Asset Securitizations

2.8x

Debt-to-Equity Ratio

(e)

Senior Syndications

Financing

(Outstanding Balance)

($ in billions)

51%

Credit Facility

Look-Through LTV

(d)

Blackstone Mortgage Trust

6

Facilities

are

generally

term-matched,

with

no

significant

near-term

maturities

and

no

capital

markets

mark-to-market

provisions

No

margin

calls

to

date;

agreed

in

principle

with

multiple

lenders

to

create

further

flexibility

in

connection

with

deleveraging

(b)

100%

performing

portfolio

of

directly

originated

senior

loans

with

no

impairments

through

April;

no

securities

investments

(a)

Constructive

loan

modification

(b)

discussions

with

borrowers

most

affected

by

COVID-19

to

ensure

assets

are

well-positioned

to

sustain

period

of

disruption

Business Update

Current

liquidity

(c)

of

$821

million;

additional

liquidity

sources

include

$1.6

billion

of

unencumbered

assets

(d)

and

cash

flow

from

operations

Liquidity

available

to

address

credit

facility

deleveraging

and

loan

future

funding

Credit Facilities

Credit Facilities

Portfolio Credit

Portfolio Credit

Liquidity

Liquidity

(a)

Excludes securities retained in connection with securitization financings.

(b)

Certain loan

modifications

and

credit

facility

agreements

are

yet

to

be

executed

and

there

is

no

guarantee

that

they

will

be.

(c)

Includes $387 million of cash and cash equivalents and $434 million of available borrowings under credit facilities as of April 24, 2020.

(d)

Represents assets with no asset-level debt that are, however, included in the Term Loan B collateral pool absent their sale or direct financing as permitted under the Term Loan B.

Blackstone Mortgage Trust

7

Portfolio Credit

100%

performing

portfolio

with

no

defaults,

nonaccrual

loans,

or

impairments

Portfolio

is

100%

senior

loans

with

a

well-protected

average

origination

LTV

(a)

of

63%

All interest payments through April paid currently

Strong, well-capitalized institutional sponsors; 74% repeat borrowers

Borrowers

most

affected

by

COVID-19

generally

focused

on

investing

capital

and

stabilizing

operations

to

withstand

period

of

disruption

63% origination LTV

(a)

implies $10.4 billion of equity value for borrowers to protect

(a)

Includes

$692

million

of

Non-Consolidated

Senior

Interests

as

of

March

31,

2020

and

investment

exposure

to

the

$881

million

2018

Single

Asset

Securitization

through

an

$84

million

subordinate risk retention interest.

Blackstone Mortgage Trust

8

Credit Facilities

$9.0

billion

of

credit

facilities

from

14

relationship

lenders;

only

13%

secured

by

hospitality

assets

Credit facilities are backed by cross collateralized portfolios of diversified, high quality senior loans, with look-through LTV of

51%

(a)

to facility lenders

No capital markets mark-to-market provisions or securities financings of any type; no corporate debt maturities before 2022

(a)

Reflects maximum advance rate under credit facilities relative to the origination LTV of the collateral assets as of April 24, 2020.

(b)

Represents outstanding principal balance of credit facilities as of April 24, 2020.

(c)

Excludes $7 million per annum of scheduled amortization payments under the Term Loan B.

Credit Facility Financing

(b)

(Outstanding Balance)

$700

$403

$220

Corporate Debt Maturities

(c)

(Outstanding Balance)

($ in millions)

$1.2bn

$7.8bn

All Other

Collateral

87%

Hospitality

Collateral

13%

2020

2021

2022

2023

2024

2025

2026

Term Loan B

Convertible Notes

Blackstone Mortgage Trust

9

$821

million

of

liquidity,

up

from

$667

million

(b)

at

year

end

Payment

of

management

and

incentive

fees

in

stock

Liquidity

Focus

on

fortifying

balance

sheet

and

enhancing

strong

liquidity

position

to

manage

through

a

range

of

COVID-19

outcomes

Near-term

direct

liquidity

options

include

asset

sales/financings

and

operating

cash

flow,

augmented

by

repayments

($3.4

billion

of

final

maturities

through

2022)

(a)

and

capital

markets

access

($ in millions)

12/31/19

3/31/20

Current

Cash

Availability

Current Liquidity

(b)

(a)

Reflects final maturities of the outstanding loan portfolio as of April 24, 2020.

(b)

Current cash is as of April 24, 2020. For comparability, cash as of March 31, 2020 is reduced by an $84 million dividends payable, which was paid on April 15, 2020, and cash as of December 31,

2019 is reduced by a dividends payable of $84 million, which was paid on January 15, 2020.

(c)

Represents assets with no asset-level debt that are, however, included in the Term Loan B collateral pool absent their sale or direct financing as permitted under the Term Loan B.

$667

$752

$821

Ongoing

cash

flow

from

operations

Direct Liquidity Sources

$1.6

billion

of

unencumbered

assets

(c)

Appendix

Blackstone Mortgage Trust

11

4Q '19 Loans

Outstanding

Fundings

Repayments

1Q '20 Loans

Outstanding

First Quarter 2020 Operating Results & Net Fundings

Net Fundings

(b)

($ in billions)

Operating Results

($ in millions)

(a)

Primarily represents the forward points earned on our foreign currency forward contracts, which reflect the interest rate differentials between the applicable base rate for our foreign currency

investments and USD LIBOR. These forward contracts effectively convert the rate exposure to USD LIBOR, resulting in additional interest income earned in U.S. dollar terms. These amounts are

not included in GAAP net income, but rather as a component of Other Comprehensive Income in our consolidated financial statements.

(b)

Excludes the impact of changes in foreign currency rates and related hedges for non-USD investments.

(c)

Includes $689 million of Non-Consolidated Senior Interests and investment exposure to the $930 million 2018 Single Asset Securitization through an $89 million subordinate risk retention interest.

(d)

Includes $692 million of Non-Consolidated Senior Interests and investment exposure to the $881 million 2018 Single Asset Securitization through an $84 million subordinate risk retention interest.

GAAP Net

Income

Adjustments

Core

Earnings

Interest Income

204.9

$  

$    —

204.9

$  

Interest Expense

(104.2)

0.6

(103.6)

Management and

Incentive Fees

(19.3)

—

(19.3)

General and Administrative

Expenses and Taxes

(3.3)

—

(3.3)

Increase in current

expected credit loss reserve

(122.7)

122.7

—

Non-Cash

Compensation

(8.7)

8.7

—

Hedging and Foreign

Currency Income, net

(a)

—

8.5

8.5

Net Income Attributable to

Non-controlling Interests

(0.1)

(0.6)

(0.7)

Total

(53.4)

$ 

139.9

$ 

86.5

$   

$0.64

Core Earnings per Share

$(0.39)

Net Loss per Share

$17.9

($0.6)

$1.0

$18.0

(c)

(d)

Blackstone Mortgage Trust

12

(a)

Date loan was originated or acquired by us, and the LTV as of such date. Origination dates are subsequently updated to reflect material loan modifications.

(b)

In certain instances, loans are financed through the non-recourse sale of a senior loan interest that is not included in the consolidated financial statements. As of

March 31, 2020, five loans in the portfolio have been financed with an aggregate $692 million of Non-Consolidated Senior Interests, which are included in the table above.

(c)

Portfolio excludes our $84 million subordinate risk retention interest in the $881 million 2018 Single Asset Securitization.

(d)

Maximum maturity assumes all extension options are exercised; however, floating rate loans generally may be repaid prior to their final maturity without penalty.

(e)

Consists of both floating and fixed rates. Coupon and all-in yield assume applicable floating benchmark rates for weighted-average calculation.

Portfolio Details

($ in millions)

Origination

Total

Principal

Net Book

Maximum

Property

Loan Per

Origination

Loan Type

Date

(a)

Loan

(b)(c)

Balance

(c)

Value

Maturity

(d)

Location

Type

SQFT / Unit / Key

LTV

(a)(c)

Loan 1

Senior loan

8/14/2019

$  1,309

$  1,309

$  1,298

L + 2.50

%

L + 2.85

%

12/23/2024

Dublin - IE

Office

$451 / sqft

74 %

Loan 2

Senior loan

3/22/2018

962

962

959

L + 3.15

%

L + 3.37

%

3/15/2023

Diversified - Spain

Mixed-Use

n/a

71 %

Loan 3

Senior loan

5/11/2017

753

717

716

L + 3.40

%

L + 3.60

%

6/10/2023

Washington DC

Office

$351 / sqft

62 %

Loan 4

Senior loan

11/25/2019

724

616

615

L + 2.30

%

L + 2.75

%

12/9/2024

New York

Office

$882 / sqft

65 %

Loan 5

Senior loan

(b)

8/6/2015

459

459

84

5.75

%

5.77

%

10/29/2022

Diversified - EUR

Other

n/a

71 %

Loan 6

Senior loan

4/11/2018

355

345

345

L + 2.85

%

L + 3.02

%

5/1/2023

New York

Office

$437 / sqft

71 %

Loan 7

Senior loan

8/22/2018

363

341

339

L + 3.15

%

L + 3.49

%

8/9/2023

Maui

Hospitality

$442,661 /  key

61 %

Loan 8

Senior loan

10/23/2018

352

338

337

L + 3.40

%

L + 3.72

%

10/23/2021

New York

Mixed-Use

$572 / sqft

65 %

Loan 9

Senior loan

1/11/2019

298

298

295

L + 4.35

%

L + 4.70

%

1/11/2026

Diversified - UK

Other

$295 / sqft

66 %

Loan 10

Senior loan

11/30/2018

293

280

278

L + 2.85

%

L + 3.20

%

12/9/2023

New York

Hospitality

$299,941 /  key

73 %

Loan 11

Senior loan

2/27/2020

300

267

264

L + 2.70

%

L + 3.03

%

3/9/2025

New York

Mixed-Use

$837 / sqft

59 %

Loan 12

Senior loan

12/11/2018

310

249

247

L + 2.55

%

L + 2.96

%

12/9/2023

Chicago

Office

$210 / sqft

78 %

Loan 13

Senior loan

7/31/2018

285

248

246

L + 3.10

%

L + 3.54

%

8/9/2022

San Francisco

Office

$622 / sqft

50 %

Loan 14

Senior loan

11/30/2018

254

248

246

L + 2.80

%

L + 3.17

%

12/9/2023

San Francisco

Hospitality

$363,659 /  key

73 %

Loan 15

Senior loan

5/9/2018

243

233

232

L + 2.60

%

L + 3.03

%

5/9/2023

New York

Industrial

$66 / sqft

70 %

Loans 16 - 132

Senior loans

(b)

Various

14,807

10,253

9,862

L + 3.31

%

(e)

L + 3.67

%

(e)

Various

Various

Various

Various

62 %

CECL reserve

(113)

Total/Wtd. avg.

$  22,067

$  17,161

$  16,251

L + 3.22

%

(e)

L + 3.56

%

(e)

3.7 yrs

64 %

Cash

All-in

Coupon

Yield

Blackstone Mortgage Trust

13

Consolidated Balance Sheets

($ in thousands, except per share data)

March 31, 2020

December 31, 2019

Assets

Cash and cash equivalents

355,018

$                  

150,090

$                  

Loans receivable

16,363,608

16,164,801

Current expected credit loss reserve

(112,694)

—

Loans receivable, net

16,250,914

16,164,801

Other assets

152,157

236,980

Total assets

16,758,089

$             

16,551,871

$             

Liabilities and equity

Secured debt agreements, net

9,335,709

$               

10,054,930

$             

Securitized debt obligations, net

2,239,640

1,187,084

Secured term loans, net

734,695

736,142

Convertible notes, net

613,882

613,071

Other liabilities

159,736

175,963

Total liabilities

13,083,662

12,767,190

Commitments and contingencies

—

—

Equity

Class A common stock, $0.01 par value

1,354

1,350

Additional paid-in capital

4,378,851

4,370,014

Accumulated other comprehensive income (loss)

18,248

(16,233)

Accumulated deficit

(747,533)

(592,548)

Total Blackstone Mortgage Trust, Inc. stockholders' equity

3,650,920

3,762,583

Non-controlling interests

23,507

22,098

Total equity

3,674,427

3,784,681

Total liabilities and equity

16,758,089

$             

16,551,871

$             

Blackstone Mortgage Trust

14

Consolidated Statements of Operations

($ in thousands, except per share data)

Three Months Ended March 31,

2020

2019

Income from loans and other investments

Interest and related income

204,875

$           

224,759

$           

Less: Interest and related expenses

104,239

118,688

Income from loans and other investments, net

100,636

106,071

Other expenses

Management and incentive fees

19,277

19,790

General and administrative expenses

11,791

9,313

Total other expenses

31,068

29,103

Increase in current expected credit loss reserve

(122,702)

—

(Loss) income before income taxes

(53,134)

76,968

Income tax provision

149

101

Net (loss) income

(53,283)

$           

76,867

$             

Net income attributable to non-controlling interests

(67)

(302)

Net (loss) income attributable to Blackstone Mortgage Trust, Inc.

(53,350)

$           

76,565

$             

Per share information (basic and diluted)

Weighted-average shares of common stock outstanding

135,619,264

124,333,048

Net (loss) income per share of common stock

(0.39)

$               

0.62

$                 

Blackstone Mortgage Trust

15

Per Share Calculations

(Amounts in thousands, except per share data)

Three Months Ended

March 31, 2020

December 31, 2019

Net (loss) income

(a)

(53,350)

$                  

78,931

$                      

Weighted-average shares outstanding, basic and diluted

135,619

134,832

Earnings per share, basic and diluted

(0.39)

$                      

0.59

$                          

Three Months Ended

March 31, 2020

December 31, 2019

Stockholders' equity

3,650,920

$              

3,762,583

$                

Shares

Class A common stock

135,355

135,004

Deferred stock units

268

260

Total outstanding

135,623

135,264

Book value per share

26.92

$                      

27.82

$                          

Book Value

per Share

Earnings

per Share

(a)

Represents net (loss) income attributable to Blackstone Mortgage Trust, Inc.

(b)

Primarily represents the forward points earned on our foreign currency forward contracts, which reflect the interest rate differentials between the applicable base rate for our foreign

currency investments and USD LIBOR. These forward contracts effectively convert the rate exposure to USD LIBOR, resulting in additional interest income earned in U.S. dollar terms. These

amounts are not included in GAAP net income, but rather as a component of Other Comprehensive Income in our consolidated financial statements.

Three Months Ended

March 31, 2020

December 31, 2019

Net (loss) income

(a)

(53,350)

$                 

78,931

$                     

Increase in current expected credit loss reserve

122,702

–

Non-cash compensation expense

8,678

7,380

Hedging

and

foreign

currency

income,

net

(b)

8,467

4,767

Other items

596

68

Increase attributable to non-controlling interests

(561)

–

Core Earnings

86,532

$                   

91,146

$                     

Weighted-average shares outstanding, basic and diluted

135,619

134,832

Core Earnings per share, basic and diluted

0.64

$                       

0.68

$                           

Core Earnings

Reconciliation

Blackstone Mortgage Trust

16

Definitions

Core

Earnings:

Blackstone

Mortgage

Trust,

Inc.

(“BXMT”)

discloses

Core

Earnings

in

this

presentation.

Core

Earnings

is

a

financial

measure

that

is

calculated

and

presented

on

the

basis

of

methodologies

other

than

in

accordance

with

generally

accepted

accounting

principles

in

the

United

States

of

America

(“GAAP”).

Core

Earnings

is

a

non-GAAP

measure,

which

we

define

as

GAAP

net

income

(loss),

including

realized

gains

and

losses

not

otherwise

included

in

GAAP

net

income

(loss),

and

excluding

(i)

non-cash

equity

compensation

expense,

(ii)

depreciation

and

amortization,

(iii)

unrealized

gains

(losses),

(iv)

net

income

(loss)

attributable

to

our

legacy

portfolio,

and

(v)

certain

non-cash

items.

Core

Earnings

may

also

be

adjusted

from

time

to

time

to

exclude

one-time

events

pursuant

to

changes

in

GAAP

and

certain

other

non-cash

charges

as

determined

by

our

Manager,

subject

to

approval

by

a

majority

of

our

independent

directors.

During

the

three

months

ended

March

31,

2020,

we

recorded

a

$122.7

million

increase

in

current

expected

credit

loss

reserve,

which

has

been

excluded

from

Core

Earnings

consistent

with

other

unrealized

gains

(losses)

pursuant

to

our

existing

policy

for

reporting

Core

Earnings

and

the

terms

of

the

management

agreement

between

our

Manager

and

us.

We

believe

that

Core

Earnings

provides

meaningful

information

to

consider

in

addition

to

our

net

income

and

cash

flow

from

operating

activities

determined

in

accordance

with

GAAP.

This

adjusted

measure

helps

us

to

evaluate

our

performance

excluding

the

effects

of

certain

transactions

and

GAAP

adjustments

that

we

believe

are

not

necessarily

indicative

of

our

current

loan

portfolio

and

operations.

Although,

according

to

the

management

agreement

between

our

Manager

and

us,

or

our

Management

Agreement,

we

calculate

the

incentive

and

base

management

fees

due

to

our

Manager

using

Core

Earnings

before

our

incentive

fee

expense,

we

report

Core

Earnings

after

incentive

fee

expense,

as

we

believe

this

is

a

more

meaningful

presentation

of

the

economic

performance

of

our

class

A

common

stock.

Core

Earnings

does

not

represent

net

income

or

cash

generated

from

operating

activities

and

should

not

be

considered

as

an

alternative

to

GAAP

net

income,

or

an

indication

of

our

GAAP

cash

flows

from

operations,

a

measure

of

our

liquidity,

or

an

indication

of

funds

available

for

our

cash

needs.

In

addition,

our

methodology

for

calculating

Core

Earnings

may

differ

from

the

methodologies

employed

by

other

companies

to

calculate

the

same

or

similar

supplemental

performance

measures,

and

accordingly,

our

reported

Core

Earnings

may

not

be

comparable

to

the

Core

Earnings

reported

by

other

companies.

Non-Consolidated

Senior

Interests:

Senior

interests

in

loans

originated

and

syndicated

to

third

parties.

These

non-recourse

loan

participations,

which

are

excluded

from

the

GAAP

balance

sheet,

constitute

additional

financing

capacity

and

are

included

in

discussions

of

the

loan

portfolio.

Blackstone Mortgage Trust

17

Forward-Looking Statements

This

presentation

may

contain

forward-looking

statements

within

the

meaning

of

Section

27A

of

the

Securities

Act

of

1933,

as

amended,

and

Section

21E

of

the

Securities

Exchange

Act

of

1934,

as

amended,

which

reflect

BXMT’s

current

views

with

respect

to,

among

other

things,

its

operations

and

financial

performance

and

the

potential

impact

of

the

COVID-19

pandemic.

You

can

identify

these

forward-looking

statements

by

the

use

of

words

such

as

“outlook,”

“objective,”

“indicator,”

“believes,”

“expects,”

“potential,”

“continues,”

“may,”

“will,”

“should,”

“seeks,”

“predicts,”

“intends,”

“plans,”

“estimates,”

“anticipates”

or

the

negative

version

of

these

words

or

other

comparable

words.

Such

forward-looking

statements

are

subject

to

various

risks

and

uncertainties.

Accordingly,

there

are

or

will

be

important

factors

that

could

cause

actual

outcomes

or

results

to

differ

materially

from

those

indicated

in

these

statements.

BXMT

believes

these

factors

include

but

are

not

limited

to

those

described

under

the

section

entitled

“Risk

Factors”

in

its

Annual

Report

on

Form

10-K

for

the

fiscal

year

ended

December

31,

2019

and

its

Quarterly

Report

on

Form

10-Q

for

the

fiscal

quarter

ended

March

31,

2020,

as

such

factors

may

be

further

updated

from

time

to

time

in

its

periodic

filings

with

the

Securities

and

Exchange

Commission

(“SEC”)

which

are

accessible

on

the

SEC’s

website

at

www.sec.gov.

These

factors

should

not

be

construed

as

exhaustive

and

should

be

read

in

conjunction

with

the

other

cautionary

statements

that

are

included

in

this

presentation

and

in

the

filings.

BXMT

assumes

no

obligation

to

update

or

supplement

forward-looking

statements

that

become

untrue

because

of

subsequent

events

or

circumstances.