Document and Entity Information
Document and Entity Information - shares | 3 Months Ended | |
Mar. 31, 2016 | May. 05, 2016 | |
Document and Entity Information | ||
Entity Registrant Name | ARBOR REALTY TRUST INC | |
Entity Central Index Key | 1,253,986 | |
Document Type | 10-Q | |
Document Period End Date | Mar. 31, 2016 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 51,381,405 | |
Document Fiscal Year Focus | 2,016 | |
Document Fiscal Period Focus | Q1 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Mar. 31, 2016 | Dec. 31, 2015 |
Assets: | ||
Cash and cash equivalents | $ 145,132,766 | $ 188,708,687 |
Restricted cash (includes $18,113,410 and $46,695,819 from consolidated VIEs, respectively) | 20,124,435 | 48,301,244 |
Loans and investments, net (includes $1,005,837,830 and $968,970,064 from consolidated VIEs, | 1,581,621,970 | 1,450,334,341 |
Available-for-sale securities, at fair value | 411,525 | 2,022,030 |
Investments in equity affiliates | 34,927,586 | 30,870,235 |
Real estate owned, net | 31,698,213 | 60,845,509 |
Real estate held-for-sale, net | 28,590,235 | 8,669,203 |
Due from related party (includes $36,451 and $36,451 from consolidated VIEs, respectively) | 435,552 | 8,082,265 |
Other assets (includes $7,109,833 and $6,969,201 from consolidated VIEs, respectively) | 29,478,178 | 29,558,430 |
Total assets | 1,872,420,460 | 1,827,391,944 |
Liabilities and Equity: | ||
Credit facilities and repurchase agreements | 183,926,292 | 136,252,135 |
Collateralized loan obligations (includes $759,734,287 and $758,899,661 from consolidated VIEs, | 759,734,287 | 758,899,661 |
Senior unsecured notes | 93,955,461 | 93,764,994 |
Junior subordinated notes to subsidiary trust issuing preferred securities | 157,305,257 | 157,117,130 |
Mortgage note payable - real estate owned | 27,155,000 | |
Mortgage note payable - real estate held-for-sale | 27,112,443 | |
Due to related party (includes $1,061,877 and $0 from consolidated VIEs, respectively) | 2,406,027 | 3,428,333 |
Due to borrowers | 42,020,339 | 34,629,595 |
Other liabilities (includes $1,240,211 and $1,224,193 from consolidated VIEs, respectively) | 44,605,843 | 51,054,321 |
Total liabilities | $ 1,311,065,949 | $ 1,262,301,169 |
Commitments and contingencies | ||
Equity: | ||
Preferred stock, cumulative, redeemable, $0.01 par value: 100,000,000 shares authorized; 8.25% Series A, $38,787,500 aggregate liquidation preference; 1,551,500 shares issued and outstanding; 7.75% Series B, $31,500,000 aggregate liquidation preference; 1,260,000 shares issued and outstanding; 8.50% Series C, $22,500,000 aggregate liquidation preference; 900,000 shares issued and outstanding | $ 89,295,905 | $ 89,295,905 |
Common stock, $0.01 par value: 500,000,000 shares authorized; 51,381,405 and 50,962,516 shares issued and outstanding, respectively | 513,814 | 509,625 |
Additional paid-in capital | 617,921,438 | 616,244,196 |
Accumulated deficit | (142,631,782) | (136,118,001) |
Accumulated other comprehensive loss | (3,744,864) | (4,840,950) |
Total equity | 561,354,511 | 565,090,775 |
Total liabilities and equity | $ 1,872,420,460 | $ 1,827,391,944 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2016 | Dec. 31, 2015 | |
Restricted cash | $ 20,124,435 | $ 48,301,244 |
Loans and investments, net | 1,581,621,970 | 1,450,334,341 |
Real estate owned, net | 31,698,213 | 60,845,509 |
Due from related party | 435,552 | 8,082,265 |
Other assets | 29,478,178 | 29,558,430 |
Collateralized loan obligations | 759,734,287 | 758,899,661 |
Due to related party | 2,406,027 | 3,428,333 |
Other liabilities | $ 44,605,843 | $ 51,054,321 |
Preferred stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Preferred stock, shares authorized (in shares) | 100,000,000 | 100,000,000 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, shares authorized (in shares) | 500,000,000 | 500,000,000 |
Common stock, shares issued (in shares) | 51,381,405 | 50,962,516 |
8.25% Series A preferred stock | ||
Preferred stock, dividend rate (as a percent) | 8.25% | 8.25% |
Preferred stock, aggregate liquidation preference | $ 38,787,500 | $ 38,787,500 |
Preferred stock, shares issued (in shares) | 1,551,500 | 1,551,500 |
Preferred stock, shares outstanding (in shares) | 1,551,500 | 1,551,500 |
7.75% Series B preferred stock | ||
Preferred stock, dividend rate (as a percent) | 7.75% | 7.75% |
Preferred stock, aggregate liquidation preference | $ 31,500,000 | $ 31,500,000 |
Preferred stock, shares issued (in shares) | 1,260,000 | 1,260,000 |
Preferred stock, shares outstanding (in shares) | 1,260,000 | 1,260,000 |
8.50% Series C preferred stock | ||
Preferred stock, dividend rate (as a percent) | 8.50% | 8.50% |
Preferred stock, aggregate liquidation preference | $ 22,500,000 | $ 22,500,000 |
Preferred stock, shares issued (in shares) | 900,000 | 900,000 |
Preferred stock, shares outstanding (in shares) | 900,000 | 900,000 |
Consolidated VIEs | ||
Restricted cash | $ 18,113,410 | $ 46,695,819 |
Loans and investments, net | 1,005,837,830 | 968,970,064 |
Due from related party | 36,451 | 36,451 |
Other assets | 7,109,833 | 6,969,201 |
Collateralized loan obligations | 759,734,287 | 758,899,661 |
Due to related party | 1,061,877 | 0 |
Other liabilities | $ 1,240,211 | $ 1,224,193 |
CONSOLIDATED STATEMENTS OF INCO
CONSOLIDATED STATEMENTS OF INCOME (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
CONSOLIDATED STATEMENTS OF INCOME (Unaudited) | ||
Interest income | $ 25,818,465 | $ 27,209,395 |
Interest expense | 12,748,613 | 13,927,367 |
Net interest income | 13,069,852 | 13,282,028 |
Other revenue: | ||
Property operating income | 5,331,532 | 8,450,343 |
Other income, net | 89,763 | 36,000 |
Total other revenue | 5,421,295 | 8,486,343 |
Other expenses: | ||
Employee compensation and benefits | 4,328,342 | 4,290,206 |
Selling and administrative | 2,655,476 | 2,897,810 |
Acquisition costs | 3,109,910 | |
Property operating expenses | 4,316,555 | 6,385,088 |
Depreciation and amortization | 877,533 | 1,438,677 |
Provision for loan losses (net of recoveries) | (15,000) | 982,680 |
Management fee - related party | 2,700,000 | 2,675,000 |
Total other expenses | 17,972,816 | 18,669,461 |
"Income before gain on acceleration of deferred income, loss on termination of swaps, gain on sale of real estate and income from equity affiliates " | 518,331 | 3,098,910 |
Gain on acceleration of deferred income | 11,009,162 | |
Loss on termination of swaps | (4,289,450) | |
Gain on sale of real estate | 607,553 | 3,984,364 |
Income from equity affiliates | 1,897,442 | 3,095,913 |
Net income | 3,023,326 | 16,898,899 |
Preferred stock dividends | 1,888,430 | 1,888,430 |
Net income attributable to common stockholders | $ 1,134,896 | $ 15,010,469 |
Basic earnings per common share (in dollars per share) | $ 0.02 | $ 0.30 |
Diluted earnings per common share (in dollars per share) | 0.02 | 0.30 |
Dividends declared per common share (in dollars per share) | $ 0.15 | $ 0.13 |
Weighted average number of shares of common stock outstanding: | ||
Basic (in shares) | 51,045,219 | 50,544,575 |
Diluted (in shares) | 51,095,128 | 50,832,736 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME (Unaudited) | ||
Net income | $ 3,023,326 | $ 16,898,899 |
Unrealized (loss) gain on securities available-for-sale, at fair value | (58,789) | 58,789 |
Unrealized loss on derivative financial instruments, net | (209,789) | (741,571) |
Reclassification of net realized loss on derivatives designated as cash flow hedges into loss on termination of swaps | 4,285,995 | |
Reclassification of net realized loss on derivatives designated as cash flow hedges into earnings | 1,364,664 | 1,730,927 |
Comprehensive income | 4,119,412 | 22,233,039 |
Less: | ||
Preferred stock dividends | 1,888,430 | 1,888,430 |
Comprehensive income attributable to common stockholders | $ 2,230,982 | $ 20,344,609 |
CONSOLIDATED STATEMENT OF CHANG
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY (Unaudited) - 3 months ended Mar. 31, 2016 - USD ($) | Preferred Stock | Common Stock | Additional Paid-in Capital | Accumulated DeficitPrivate REIT preferred stock | Accumulated Deficit | Accumulated Other Comprehensive Loss | Private REIT preferred stock | Total |
Balance at Dec. 31, 2015 | $ 89,295,905 | $ 509,625 | $ 616,244,196 | $ (136,118,001) | $ (4,840,950) | $ 565,090,775 | ||
Balance (in shares) at Dec. 31, 2015 | 3,711,500 | 50,962,516 | ||||||
Increase (Decrease) in Stockholders' Equity | ||||||||
Stock-based compensation | $ 4,199 | 1,677,232 | 1,681,431 | |||||
Stock-based compensation (in shares) | 419,890 | |||||||
Forfeiture of unvested restricted stock | $ (10) | 10 | ||||||
Forfeiture of unvested restricted stock (in shares) | (1,001) | |||||||
Distributions - common stock | (7,644,227) | (7,644,227) | ||||||
Distributions - preferred stock | $ (4,450) | (1,888,430) | $ (4,450) | (1,888,430) | ||||
Net income | 3,023,326 | 3,023,326 | ||||||
Unrealized gain on securities available-for-sale | (58,789) | (58,789) | ||||||
Unrealized loss on derivative financial instruments, net | (209,789) | (209,789) | ||||||
Reclassification of net realized loss on derivatives designated as cash flow hedges into earnings | 1,364,664 | 1,364,664 | ||||||
Balance at Mar. 31, 2016 | $ 89,295,905 | $ 513,814 | $ 617,921,438 | $ (142,631,782) | $ (3,744,864) | $ 561,354,511 | ||
Balance (in shares) at Mar. 31, 2016 | 3,711,500 | 51,381,405 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Operating activities: | ||
Net income | $ 3,023,326 | $ 16,898,899 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||
Depreciation and amortization | 877,533 | 1,438,677 |
Stock-based compensation | 1,681,431 | 1,692,066 |
Gain on acceleration of deferred income | (11,009,162) | |
Loss on termination of swaps | 4,289,450 | |
Gain on sale of real estate | (607,553) | (3,984,364) |
Gain on sale of securities | (15,491) | |
Provision for loan losses (net of recoveries) | (15,000) | 982,680 |
Amortization and accretion of interest, fees and intangible assets, net | 852,174 | 1,527,715 |
Income from equity affiliates | (1,897,442) | (3,095,913) |
Changes in operating assets and liabilities | (61,383) | (6,468,321) |
Net cash provided by operating activities | 3,837,595 | 2,271,727 |
Investing activities: | ||
Loans and investments funded, originated and purchased, net | (283,857,810) | (329,471,068) |
Payoffs and paydowns of loans and investments | 159,039,238 | 174,980,791 |
Deferred fees | 2,842,917 | 1,450,479 |
Investment in real estate, net | (391,691) | (894,119) |
Contributions to equity affiliates | (2,448,122) | (13,259,007) |
Proceeds from sale of real estate, net | 9,347,975 | 18,482,352 |
Proceeds from sale of available-for-sale securities | 1,567,207 | |
Net cash used in investing activities | (113,900,286) | (148,710,572) |
Financing activities: | ||
Proceeds from repurchase agreements, credit facilities and notes payable | 105,388,934 | 409,849,941 |
Paydowns and payoffs of repurchase agreements, loan participations and credit facilities | (57,939,994) | (191,260,767) |
Proceeds from mortgage note payable - real estate owned | 27,155,000 | |
Paydowns and payoffs of mortgage note payable - real estate | (42,557) | (30,984,357) |
Proceeds from collateralized loan obligations | 219,000,000 | |
Payoffs and paydowns of collateralized debt obligations | (232,650,676) | |
Payoffs and paydowns of collateralized loan obligations | (177,000,000) | |
Change in restricted cash | 27,771,209 | 190,312,724 |
Payments on swaps and margin calls to counterparties | (290,000) | |
Receipts on swaps and returns of margin calls from counterparties | 930,000 | 1,270,000 |
Distributions paid on common stock | (7,644,227) | (6,562,050) |
Distributions paid on preferred stock | (1,888,430) | (1,888,430) |
Distributions paid on preferred stock of private REIT | (4,450) | (3,894) |
Payment of deferred financing costs | (83,715) | (5,491,908) |
Net cash provided by financing activities | 66,486,770 | 201,455,583 |
Net (decrease) increase in cash and cash equivalents | (43,575,921) | 55,016,738 |
Cash and cash equivalents at beginning of period | 188,708,687 | 50,417,745 |
Cash and cash equivalents at end of period | 145,132,766 | 105,434,483 |
Supplemental cash flow information: | ||
Cash used to pay interest | 11,097,134 | 12,091,253 |
Cash used for taxes | 60,887 | 215,331 |
Supplemental schedule of non-cash investing and financing activities: | ||
Investment transferred from real estate owned, net to real estate held-for-sale, net | 28,590,235 | |
Mortgage note payable - real estate owned transferred to real estate held-for-sale | 27,112,443 | |
8.25% Series A preferred stock | ||
Supplemental schedule of non-cash investing and financing activities: | ||
Distributions accrued on preferred stock | 266,664 | 266,664 |
7.75% Series B preferred stock | ||
Supplemental schedule of non-cash investing and financing activities: | ||
Distributions accrued on preferred stock | 203,438 | 203,438 |
8.50% Series C preferred stock | ||
Supplemental schedule of non-cash investing and financing activities: | ||
Distributions accrued on preferred stock | $ 159,375 | $ 159,375 |
CONSOLIDATED STATEMENTS OF CAS8
CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited) (Parenthetical) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2016 | Dec. 31, 2015 | |
8.25% Series A preferred stock | ||
Preferred stock, dividend rate (as a percent) | 8.25% | 8.25% |
7.75% Series B preferred stock | ||
Preferred stock, dividend rate (as a percent) | 7.75% | 7.75% |
8.50% Series C preferred stock | ||
Preferred stock, dividend rate (as a percent) | 8.50% | 8.50% |
Description of Business
Description of Business | 3 Months Ended |
Mar. 31, 2016 | |
Description of Business | |
Description of Business | Note 1 —Description of Business Arbor Realty Trust, Inc. is a Maryland corporation that was formed in 2003 to invest in a diversified portfolio of structured finance assets in the multifamily and commercial real estate markets, primarily consisting of bridge and mezzanine loans, including junior participating interests in first mortgages, preferred and direct equity. We may also directly acquire real property and invest in real estate-related notes and certain mortgage-related securities. We conduct substantially all of our operations through our operating partnership, Arbor Realty Limited Partnership (“ARLP”), and ARLP’s subsidiaries. We are externally managed and advised by Arbor Commercial Mortgage, LLC (“ACM” or our “Manager”). We organize and conduct our operations to qualify as a real estate investment trust (“REIT”) for federal income tax purposes. Proposed Acquisition of our Manager’s Agency Platform On February 25, 2016, we entered into an asset purchase agreement (“Purchase Agreement”) to acquire the agency platform (the “ACM Agency Business”) of our Manager for $250.0 million (the “Proposed Acquisition”). The purchase price is to be paid 50% in cash and 50% in units of limited partnership interest in ARLP which are redeemable for cash, or at our option, for shares of our common stock on a one-for-one basis (“OP Units”). The equity component of the purchase price consists of 19.23 million OP Units which was based on a stock price of $6.50 per share. Each of the OP Units will be paired with a share of our newly-designated special voting preferred stock which will entitle ACM to one vote per share on any matter submitted to a vote of our stockholders. The OP Units are entitled to receive distributions if and when our Board of Directors authorizes and declares common stock distributions. The purchase price is subject to potential adjustment based on changes in the value of ACM’s servicing portfolio being acquired on the closing date. ACM has offered the option, at the discretion of the special committee of our Board of Directors, to provide for up to $50.0 million of financing to satisfy a portion of the cash consideration to be paid by us. All ACM employees directly related to the ACM Agency Business (approximately 230 employees) will become our employees following the consummation of the Proposed Acquisition. The ACM Agency Business is comprised of its (i) underwriting, originating, selling and servicing multifamily mortgages under the Federal National Mortgage Association (“Fannie Mae”) delegated underwriting and servicing (“DUS”), U.S. Department of Housing and Urban Development (“HUD”)/Federal Housing Administration (“FHA”), Government National Mortgage Association (“GNMA”), Federal Home Loan Mortgage Corporation (“Freddie Mac”) and conduit/commercial mortgage-backed securities (“CMBS”) programs, and (ii) certain assets and liabilities primarily consisting of the mortgage servicing rights related to the agency servicing portfolio, agency loans held for sale, warehouse financing of agency loans held for sale and other assets and liabilities directly related to the ACM Agency Business. In addition, pursuant to the Purchase Agreement, ACM has provided a two year option for us to purchase the existing management agreement and fully internalize our management structure for $25.0 million (increasing to $27.0 million in the second year). The exercise of this option is at the discretion of the special committee of our Board of Directors, which has no obligation to exercise its option. The transaction contemplated pursuant to the Purchase Agreement will require certain government and government-sponsored enterprise (“GSE”) approvals as well as a vote of our stockholders and other third party approvals. To date, the Federal Trade Commission has granted us early termination of the mandatory waiting period for our Hart-Scott-Rodino filing, we filed our definitive proxy statement with the SEC and we have scheduled our special shareholder meeting to vote on the Proposed Acquisition for June 1, 2016. We are also pursuing the other approvals needed to close the Proposed Acquisition. This transaction is expected to close by the third quarter of 2016; however, there can be no assurances that this transaction will be completed during this period or at all. In connection with evaluating this potential transaction, we incurred advisory fees totaling $3.1 million during the three months ended March 31, 2016 and fees totaling $7.6 million to date. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 3 Months Ended |
Mar. 31, 2016 | |
Summary of Significant Accounting Policies | |
Summary of Significant Accounting Policies | Note 2 — Summary of Significant Accounting Policies Basis of Presentation and Principles of Consolidation The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”), for interim financial statements and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, certain information and footnote disclosures normally included in the consolidated financial statements prepared under GAAP have been condensed or omitted. In the opinion of management, all adjustments considered necessary for a fair presentation of our financial position, results of operations and cash flows have been included and are of a normal and recurring nature. The operating results presented for interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the entire year. These consolidated financial statements should be read in conjunction with our consolidated financial statements and notes thereto included in our 2015 Annual Report, which was filed with the SEC. The accompanying unaudited consolidated financial statements include our financial statements, our wholly owned subsidiaries, and partnerships or other joint ventures in which we own a voting interest of greater than 50 percent, and variable interest entities (“VIEs”) of which we are the primary beneficiary. VIEs are defined as entities in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. A VIE is required to be consolidated by its primary beneficiary, which is the party that (i) has the power to control the activities that most significantly impact the VIE’s economic performance and (ii) has the obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. Current accounting guidance requires us to present a) assets of a consolidated VIE that can be used only to settle obligations of the consolidated VIE, and b) liabilities of a consolidated VIE for which creditors (or beneficial interest holders) do not have recourse to the general credit of the primary beneficiary. As a result of this guidance, we have separately disclosed parenthetically the assets and liabilities of our collateralized loan obligation (“CLO”) subsidiaries on our consolidated balance sheets. Entities in which we have significant influence are accounted for primarily under the equity method. As a REIT, we are generally not subject to federal income tax on our REIT—taxable income that we distribute to our stockholders, provided that we distribute at least 90% of our REIT—taxable income and meet certain other requirements. As of March 31, 2016 and 2015, we were in compliance with all REIT requirements and, therefore, have not provided for income tax expense for the three months ended March 31, 2016 and 2015. Certain of our assets that produce non-qualifying income are owned by our taxable REIT subsidiaries, the income of which is subject to federal and state income taxes. During the three months ended March 31, 2016 and 2015, we did not record any provision for income taxes for these taxable REIT subsidiaries as we expect any income to be offset by available federal and state net operating loss carryforwards. The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that could materially affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. Significant Accounting Policies As of March 31, 2016, our significant accounting policies, which are detailed in our 2015 Annual Report, have not changed materially. Recently Issued Accounting Pronouncements In March 2016, the Financial Accounting Standards Board (“FASB”) amended its guidance on stock compensation, which is intended to simplify several aspects of the accounting for share-based payment award transactions. The guidance is effective for the first quarter of 2017 and we are currently evaluating the impact it may have on our consolidated financial statements. In March 2016, the FASB amended its guidance on accounting for equity method investments. Among other things, the amended guidance eliminates the requirement that when an investment qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence, an investor must adjust the investment, results of operations, and retained earnings retroactively on a step-by-step basis as if the equity method had been in effect during all previous periods that the investment had been held. The guidance is effective for the first quarter of 2017 and we are currently evaluating the impact it may have on our consolidated financial statements. In February 2016, the FASB amended its guidance on accounting for leases that requires an entity to recognize balance sheet assets and liabilities for leases with terms of more than 12 months and also requires disclosure of key information about an entity’s leasing arrangements. The guidance is effective for the first quarter of 2019 with early adoption permitted. A modified retrospective approach is required. We are currently evaluating the impact this guidance may have on our consolidated financial statements. In January 2016, the FASB amended its guidance on the recognition and measurement of financial assets and liabilities. The amended guidance requires equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income. This update also, among other things, eliminates the requirement for an entity to disclose the methods and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost. The guidance is effective for the first quarter of 2018 and we are currently evaluating the impact it may have on our consolidated financial statements. In September 2015, the FASB amended its guidance on measurement-period adjustments arising from business combinations. The guidance was effective for the first quarter of 2016 and it did not have a material impact on our consolidated financial statements. In April 2015, the FASB amended its guidance on the balance sheet presentation of debt issuance costs. The guidance was effective for the first quarter of 2016. We early adopted this guidance in the fourth quarter of 2015 and it did not have a material effect on our consolidated financial statements. In February 2015, the FASB amended its guidance on the consolidation analysis of VIEs. The guidance was effective for the first quarter of 2016 and it did not have a material impact on our consolidated financial statements. |
Loans and Investments
Loans and Investments | 3 Months Ended |
Mar. 31, 2016 | |
Loans and Investments | |
Loans and Investments | Note 3 — Loans and Investments The following table sets forth the composition of our loan and investment portfolio: March 31, 2016 Percent of Total Loan Count Wtd. Avg. Pay Rate (1) Wtd. Avg. Remaining Months to Maturity Wtd. Avg. First Dollar LTV Ratio (2) Wtd. Avg. Last Dollar LTV Ratio (3) Bridge loans $ % % % % Mezzanine loans % % % % Junior participation loans % % % % Preferred equity investments % % % % % % % % Unearned revenue ) Allowance for loan losses ) Loans and investments, net $ December 31, 2015 Percent of Total Loan Count Wtd. Avg. Pay Rate (1) Wtd. Avg. Remaining Months to Maturity Wtd. Avg. First Dollar LTV Ratio (2) Wtd. Avg. Last Dollar LTV Ratio (3) Bridge loans $ % % % % Mezzanine loans % % % % Junior participation loans % % % % Preferred equity investments % % % % % % % % Unearned revenue ) Allowance for loan losses ) Loans and investments, net $ (1) “Weighted Average Pay Rate” is a weighted average, based on the unpaid principal balances of each loan in our portfolio, of the interest rate that is required to be paid monthly as stated in the individual loan agreements. Certain loans and investments that require an additional rate of interest “Accrual Rate” to be paid at the maturity are not included in the weighted average pay rate as shown in the table. (2) The “First Dollar LTV Ratio” is calculated by comparing the total of our senior most dollar and all senior lien positions within the capital stack to the fair value of the underlying collateral to determine the point at which we will absorb a total loss of our position. (3) The “Last Dollar LTV Ratio” is calculated by comparing the total of the carrying value of our loan and all senior lien positions within the capital stack to the fair value of the underlying collateral to determine the point at which we will initially absorb a loss. Concentration of Credit Risk We operate in one portfolio segment, commercial mortgage loans and investments. Commercial mortgage loans and investments can potentially subject us to concentrations of credit risk. We are subject to concentration risk in that, at March 31, 2016, the unpaid principal balance (“UPB”) related to 23 loans with five different borrowers represented 23% of total assets . At December 31, 2015, the UPB related to 22 loans with five different borrowers represented 22% of total assets . We measure our relative loss position for our mezzanine loans, junior participation loans, and preferred equity investments by determining the point where we will be exposed to losses based on our position in the capital stack as compared to the fair value of the underlying collateral. We determine our loss position on both a first dollar loan-to-value (“LTV”) and a last dollar LTV basis. We assign a credit risk rating to each loan and investment. Individual ratings range from one to five, with one being the lowest risk and five being the highest. Each credit risk rating has benchmark guidelines that pertain to debt-service coverage ratios, LTV ratios, borrower strength, asset quality, and funded cash reserves. Other factors such as guarantees, market strength, remaining loan term, and borrower equity are also reviewed and factored into determining the credit risk rating assigned to each loan. This metric provides a helpful snapshot of portfolio quality and credit risk. Given our asset management approach, however, the risk rating process does not result in differing levels of diligence contingent upon credit rating. That is because all portfolio assets are subject to the level of scrutiny and ongoing analysis consistent with that of a “high-risk” loan. Assets are subject to, at minimum, a thorough quarterly financial evaluation in which historical operating performance and forward-looking projections are reviewed. Generally speaking, given our typical loan and investment profile, a risk rating of three suggests that we expect the loan to make both principal and interest payments according to the contractual terms of the loan agreement, and is not considered impaired. A risk rating of four indicates we anticipate that the loan will require a modification of some kind. A risk rating of five indicates we expect the loan to underperform over its term, and there could be loss of interest and/or principal. Ratings of 3.5 and 4.5 generally indicate loans that have characteristics of both the immediately higher and lower classifications. Further, while the above are the primary guidelines used in determining a certain risk rating, subjective items such as borrower strength, condition of the market of the underlying collateral, additional collateral or other credit enhancements, or loan terms, may result in a rating that is higher or lower than might be indicated by any risk rating matrix. As a result of the loan review process at March 31, 2016 and December 31, 2015, we identified loans and investments that we consider higher-risk loans that had a carrying value, before loan loss reserves, of $155.3 million and $154.7 million, respectively, and a weighted average last dollar LTV ratio of 94% for each period. A summary of the loan portfolio’s weighted average internal risk ratings and LTV ratios by asset class is as follows: March 31, 2016 Asset Class Unpaid Principal Balance Percentage of Portfolio Wtd. Avg. Internal Risk Rating Wtd. Avg. First Dollar LTV Ratio Wtd. Avg. Last Dollar LTV Ratio Multi-family $ % % % Office % % % Land % % % Hotel % % % Other % % % Total $ % % % December 31, 2015 Asset Class Unpaid Principal Balance Percentage of Portfolio Wtd. Avg. Internal Risk Rating Wtd. Avg. First Dollar LTV Ratio Wtd. Avg. Last Dollar LTV Ratio Multi-family $ % % % Office % % % Land % % % Hotel % % % Other % % % Total $ % % % Geographic Concentration Risk As of March 31, 2016, 30%, 16%, 14% and 11% of the outstanding balance of our loan and investment portfolio had underlying properties in New York, Florida, California and Texas, respectively. As of December 31, 2015, 34%, 14%, 14% and 12% of the outstanding balance of our loan and investment portfolio had underlying properties in New York, Florida, California and Texas, respectively. Impaired Loans and Allowance for Loan Losses We perform an evaluation of the loan portfolio quarterly to assess the performance of our loans and whether a reserve for impairment should be recorded. We consider a loan impaired when, based upon current information and events, it is probable that we will be unable to collect all amounts due for both principal and accrued interest according to the contractual terms of the loan agreement. During the three months ended March 31, 2016, we recorded a recovery of a previously recorded loan loss of less than $0.1 million. During the three months ended March 31, 2015, we recognized a provision for loan losses totaling $1.0 million. During the period, we also recorded net recoveries of previously recorded loan losses totaling less than $0.1 million, resulting in a provision for loan losses, net of recoveries totaling $1.0 million. The provision for loan losses recorded in the three months ended March 31, 2015 was comprised of two loans with an aggregate carrying value before reserves of $4.8 million. A summary of the changes in the allowance for loan losses is as follows: Three Months Ended March 31, 2016 2015 Allowance at beginning of the period $ $ Provision for loan losses — Charge-offs — — Recoveries of reserves ) ) Allowance at end of the period $ $ A summary of charge-offs and recoveries by asset class is as follows: Three Months Ended March 31, 2016 2015 Charge-offs: Hotel $ — $ — Office — — Multi-family — — Total $ — $ — Recoveries: Multi-family $ ) $ ) Total $ ) $ ) Net (Charge-offs) Recoveries $ $ Ratio of net (charge-offs) recoveries during the period to average loans and investments outstanding during the period % % There were no loans for which the fair value of the collateral securing the loan was less than the carrying value of the loan for which we had not recorded a provision for loan loss as of March 31, 2016 and 2015. We have six loans with a carrying value totaling $118.6 million at March 31 , 2016, which mature in September 2017, that are collateralized by a land development project. The loans do not carry a current pay rate of interest, but four of the loans with a carrying value totaling $97.2 million entitle us to a weighted average accrual rate of interest of 9.60%. We suspended the recording of the accrual rate of interest on these loans, as these loans were impaired and we deemed the collection of this interest to be doubtful. We have recorded cumulative allowances for loan losses of $49.1 million related to these loans as of March 31, 2016. The loans are subject to certain risks associated with a development project including, but not limited to, availability of construction financing, increases in projected construction costs, demand for the development’s outputs upon completion of the project, and litigation risk. Additionally, these loans were not classified as non-performing as the borrower is in compliance with all of the terms and conditions of the loans. A summary of our impaired loans by asset class is as follows: March 31, 2016 Three Months Ended March 31, 2016 Asset Class Unpaid Principal Balance Carrying Value (1) Allowance for Loan Losses Average Recorded Investment (2) Interest Income Recognized Multi-family $ $ $ $ $ Office Land — Hotel Commercial — Total $ $ $ $ $ December 31, 2015 Three Months Ended March 31, 2015 Asset Class Unpaid Principal Balance Carrying Value (1) Allowance for Loan Losses Average Recorded Investment (2) Interest Income Recognized Multi-family $ $ $ $ $ Office Land — Hotel Commercial — — Total $ $ $ $ $ (1) Represents the UPB of impaired loans less unearned revenue and other holdbacks and adjustments by asset class and was comprised of nine loans at both March 31, 2016 and December 31, 2015. (2) Represents an average of the beginning and ending UPB of each asset class. As of March 31, 2016, three fully reserved loans with loan loss reserves totaling $22.9 million were classified as non-performing. Income from non-performing loans is generally recognized on a cash basis only to the extent it is received. Full income recognition will resume when the loan becomes contractually current and performance has recommenced. As of December 31, 2015, three loans with an aggregate net carrying value of less than $0.1 million, net of related loan loss reserves on the loans of $22.9 million, were classified as non-performing. A summary of our non-performing loans by asset class is as follows: March 31, 2016 December 31, 2015 Asset Class Carrying Value Less Than 90 Days Past Due Greater Than 90 Days Past Due Carrying Value Less Than 90 Days Past Due Greater Than 90 Days Past Due Multi-family $ $ — $ $ $ — $ Office — — Commercial — — Total $ $ — $ $ $ — $ At March 31, 2016, we did not have any loans contractually past due 90 days or more that are still accruing interest. A summary of loan modifications, refinancings and/or extensions by asset class that we considered to be troubled debt restructurings were as follows: Three Months Ended March 31, 2016 Three Months Ended March 31, 2015 Asset Class Number of Loans Original Unpaid Principal Balance Original Rate of Interest Extended Unpaid Principal Balance Extended Weighted Average Rate of Interest Number of Loans Original Unpaid Principal Balance Original Weighted Average Rate of Interest Extended Unpaid Principal Balance Extended Weighted Average Rate of Interest Multifamily $ % $ % $ % $ % There were no loans in which we considered the modifications to be troubled debt restructurings that were subsequently considered non-performing as of March 31, 2016 and 2015 and no additional loans were considered to be impaired due to our troubled debt restructuring analysis for the three months ended March 31, 2016 and 2015. These loans were modified to increase the total recovery of the combined principal and interest from the loan. Given the transitional nature of some of our real estate loans, we may require funds to be placed into an interest reserve, based on contractual requirements, to cover debt service costs. As of March 31, 2016, we had total interest reserves of $16.1 million on 59 loans with an aggregate UPB of $787.8 million. |
Securities
Securities | 3 Months Ended |
Mar. 31, 2016 | |
Securities | |
Securities | Note 4 — Securities The following is a summary of our securities classified as available-for-sale at March 31, 2016: Amortized Cumulative Unrealized Carrying Value / Estimated Cost Gain Fair Value 2,939,465 common shares of CV Holdings, Inc. $ $ $ The following is a summary of our securities classified as available-for-sale at December 31, 2015: Face Amortized Cumulative Unrealized Carrying Value / Estimated Value Cost Gain Fair Value Federal Home Loan Mortgage Corporation $ $ $ — $ 2,939,465 common shares of CV Holdings, Inc. — $ Total available-for-sale securities $ $ $ $ In the fourth quarter of 2015, we purchased a federal home loan mortgage corporation security at a premium for $1.6 million. This security bore interest at a fixed rate of 3.241% with a scheduled maturity in 2024. We sold this security in January 2016 for $1.6 million and recognized a gain of less than $0.1 million. Available-for-sale securities are carried at their estimated fair value with unrealized gains and losses reported in accumulated other comprehensive loss. |
Investments in Equity Affiliate
Investments in Equity Affiliates | 3 Months Ended |
Mar. 31, 2016 | |
Investments in Equity Affiliates | |
Investments in Equity Affiliates | Note 5 — Investments in Equity Affiliates The following is a summary of our investments in equity affiliates: Investments in Equity Affiliates at UPB of Loans to Equity Affiliates at Equity Affiliates March 31, 2016 December 31, 2015 March 31, 2016 Arbor Residential Investor LLC $ $ $ — West Shore Café Lightstone Value Plus REIT L.P. — Issuers of Junior Subordinated Notes — JT Prime — East River Portfolio Lexford Portfolio — Ritz-Carlton Club — — — Total $ $ $ We account for all investments in equity affiliates under the equity method. Arbor Residential Investor LLC (“ARI”) — In the first quarter of 2015, we invested $9.6 million for 50% of our Manager’s indirect interest in a joint venture with a third party that was formed to invest in a residential mortgage banking business. As a result of this transaction, we had an initial indirect interest of 22.5% in the mortgage banking business, which is subject to dilution upon attaining certain profit hurdles of the business. During the three months ended March 31, 2016 and 2015, we recorded $1.6 million and $3.1 million, respectively, to income from equity affiliates in our consolidated statements of income related to this investment. In 2015, we also invested $9.7 million into a joint venture through ARI, in which we own a 50% non-controlling interest that invests in non-qualified residential mortgages purchased from the mortgage banking business’s origination platform. We also funded $2.4 million of additional mortgage purchases during the three months ended March 31, 2016, for a total investment of $12.1 million as of March 31, 2016. During the three months ended March 31, 2016 and 2015, we recorded income and a loss of less than $0.1 million, respectively, to income from equity affiliates in our consolidated statements of income related to this investment. The summarized statements of operations for our individually significant investment in ARI are as follows: Three Months Ended March 31, Statements of Operations: 2016 2015 Revenue: Total revenues $ $ Total expenses Net income $ $ Arbor’s share of income $ $ |
Real Estate Owned and Held-For-
Real Estate Owned and Held-For-Sale | 3 Months Ended |
Mar. 31, 2016 | |
Real Estate Owned and Held-For-Sale | |
Real Estate Owned and Held-For-Sale | Note 6 — Real Estate Owned and Held-For-Sale Our real estate assets were comprised of three multifamily properties (the “Multifamily Portfolio”), one hotel property (the “Hotel Portfolio”) and an office building at March 31, 2016 and three multifamily properties, two hotel properties and an office building at December 31, 2015. Real Estate Owned March 31, 2016 December 31, 2015 Hotel Portfolio Office Building Total Multifamily Portfolio Hotel Portfolio Office Building Total Land $ $ $ $ $ $ $ Building and intangible assets Less: accumulated depreciation and amortization ) ) ) ) ) ) ) Real estate owned, net $ $ $ $ $ $ $ As of December 31, 2015, our Multifamily Portfolio had a weighted average occupancy rate of approximately 94%. For the three months ended March 31, 2016 and 2015, our Hotel Portfolio had a weighted average occupancy rate of approximately 66% and 63%, respectively, a weighted average daily rate of approximately $97 and $103, respectively, and a weighted average revenue per available room of approximately $65 and $64, respectively. The operation of a hotel property is seasonal with the majority of revenues earned in the first two quarters of the calendar year. Our real estate assets had restricted cash balances totaling $2.0 million and $1.6 million as of March 31, 2016 and December 31, 2015, respectively, due to escrow requirements. Real Estate Held-For-Sale In the first quarter of 2016, w e sold a property in the Hotel Portfolio for $9.7 million and recognized a gain of $0.6 million. We also reclassified the three remaining properties in the Multifamily Portfolio with an aggregate carrying value of $28.6 million and an aggregate debt balance of $27.1 million as held-for-sale due to a proposed sale that was completed in April 2016. The properties were sold for $41.0 million and we expect to recognize a total gain of approximately $11.0 million. A portion of the proceeds from this sale were used to pay off the outstanding debt on these properties. See Note 7 — “Debt Obligations” for further details. In the first quarter of 2015, we sold a property in our Multifamily Portfolio as well as a property in the Hotel Portfolio classified as held-for-sale for a total of $18.8 million and recognized a gain of $4.0 million. As of March 31, 2016, our Multifamily Portfolio had a weighted average occupancy rate of approximately 97%. The results of operations for properties classified as held-for-sale are summarized as follows: Three Months Ended March 31, 2016 2015 Revenue: Property operating income $ $ Expenses: Property operating expense Depreciation Net income (loss) $ $ ) |
Debt Obligations
Debt Obligations | 3 Months Ended |
Mar. 31, 2016 | |
Debt Obligations | |
Debt Obligations | Note 7 — Debt Obligations We utilize various forms of short-term and long-term financing agreements to finance certain of our loans and investments. Borrowings underlying these arrangements are primarily secured by a significant amount of our loans and investments. Credit Facilities and Repurchase Agreements The following table outlines borrowings under our credit facilities and repurchase agreements: March 31, 2016 December 31, 2015 Debt Debt Collateral Weighted Debt Debt Collateral Weighted Principal Carrying Carrying Average Principal Carrying Carrying Average Balance Value Value Note Rate Value Value Value Note Rate $150 million warehouse repurchase facility $ $ $ % $ $ $ % $100 million warehousing credit facility % % $75 million warehousing credit facility % % $75 million warehousing credit facility % — — — — $50 million warehousing credit facility % % $16.5 million term credit facility % % Total $ $ $ % $ $ $ % At March 31, 2016 and December 31, 2015, the weighted average interest rate for our credit facilities and repurchase agreements was 2.65% and 2.69%, respectively. Including certain fees and costs, such as structuring, commitment, non-use and warehousing fees, the weighted average interest rate was 3.18% and 3.42% at March 31, 2016 and December 31, 2015, respectively. There were no interest rate swaps on these facilities at March 31, 2016 and December 31, 2015. We have a $150.0 million warehouse repurchase facility with a financial institution initially used to finance a significant portion of the unwind of two of our collateralized debt obligation (“CDO”) vehicles in the first quarter of 2015. See “Collateralized Debt Obligations” below. The facility bears interest at a rate of 212.5 basis points over LIBOR on senior mortgage loans, 350.0 basis points over LIBOR on junior mortgage loans, and matures in January 2017 with a one-year extension option. If the estimated market value of the loans financed in this facility decrease, we may be required to pay down borrowings under this facility. Debt carrying value is net of $0.5 million and $0.7 million of deferred financing fees at March 31, 2016 and December 31, 2015, respectively. We have a $100.0 million warehouse facility with a financial institution to finance first mortgage loans on multifamily properties that bore interest at a rate of 225 basis points over LIBOR and was to mature in April 2015. In May 2015, we amended the facility decreasing the rate of interest to 215 basis points over LIBOR and extended the maturity to May 2017 with a one-year extension option, subject to certain conditions. The facility has a maximum advance rate of 75% and also has a compensating balance requirement of $50.0 million to be maintained by us and our affiliates. Debt carrying value is net of $0.2 million and $0.3 million of deferred financing fees at March 31, 2016 and December 31, 2015, respectively We have a $75.0 million warehouse facility with a financial institution to finance first mortgage loans on multifamily properties that bore interest at a rate of 225 basis points over LIBOR and was to mature in June 2015. In June 2015, we amended the facility, extending the maturity to June 2016, decreasing the rate of interest to 212.5 basis points over LIBOR, and added a new $25.0 million sublimit to finance healthcare related loans. The healthcare related loans will have an interest rate ranging from 225 basis points to 250 basis points over LIBOR depending on the type of healthcare facility financed. The facility has a maximum advance rate of 75%. Debt carrying value is net of $0.1 million of deferred financing fees at March 31, 2016 and December 31, 2015, respectively. We have another $75.0 million warehouse facility with a financial institution to finance first mortgage loans on multifamily and commercial properties that bears interest at a rate of 200 basis points over LIBOR and was to mature in April 2016. In April 2016, the facility was extended to June 2016. The facility has a maximum advance rate of 70% or 75%, depending on the property type. Debt carrying value is net of less than $0.1 million of deferred financing fees at both March 31, 2016 and December 31, 2015. We have a $50.0 million warehouse facility with a financial institution to finance first mortgage loans on multifamily properties. The facility bears interest at a rate of 200 basis points over LIBOR and was to mature in February 2016. In February 2016, we amended the facility, increasing the committed amount by $25.0 million to $50.0 million and extending the maturity to February 2017 with two one-year extension options, subject to certain conditions. Debt carrying value is net of less than $0.1 million of deferred financing fees at both March 31, 2016 and December 31, 2015. In September 2015, we entered into a $16.5 million term facility with a financial institution to finance a first mortgage loan. The facility bears interest at a rate of 275 basis points over LIBOR, matures in December 2016 and has a compensating balance requirement of $3.0 million to be maintained by us and our affiliates. Debt carrying value is net of $0.1 million of deferred financing fees at March 31, 2016 and December 31, 2015, respectively. Our warehouse credit facilities generally allow for an original warehousing period of up to 24 months from the initial advance on an asset. In addition, our credit facilities and repurchase agreements contain several restrictions including full repayment of an advance if a loan becomes 60 days past due, is in default or is written down by us. Our credit facilities and repurchase agreements also contain representations, warranties, covenants, conditions precedent to funding, events of default and indemnities that are customary for agreements of these types. See “Debt Covenants” below for details. Collateralized Loan Obligations (CLOs) In August 2015, we completed a collateralized securitization vehicle (“CLO V”), issuing to third party investors three tranches of investment grade CLOs through two newly-formed wholly-owned subsidiaries totaling $267.8 million, of which we purchased $12.5 million of Class C notes that we subsequently sold at par for $12.5 million. As of the CLO closing date, the notes were secured by a portfolio of loan obligations with a face value of approximately $302.6 million, consisting primarily of bridge loans that were contributed from our existing loan portfolio. The financing has an approximate three year replacement period that allows the principal proceeds and sale proceeds (if any) of the loan obligations to be reinvested in qualifying replacement loan obligations, subject to the satisfaction of certain conditions set forth in the indenture. Thereafter, the outstanding debt balance will be reduced as loans are repaid. Initially, the proceeds of the issuance of the securities also included $47.4 million for the purpose of acquiring additional loan obligations for a period of up to 120 days from the closing date of the CLO. In September 2015, the additional proceeds were fully utilized resulting in the issuer owning loan obligations with a face value of approximately $350.0 million. We retained a residual interest in the portfolio with a notional amount of approximately $82.3 million. The notes have an initial weighted average interest rate of approximately 2.44% plus one-month LIBOR and interest payments on the notes are payable monthly. Including certain fees and costs, the initial weighted average note rate was 3.07%. In March 2015, we completed the unwinding of CLO II, redeeming $177.0 million of our outstanding notes which were repaid primarily from the refinancing of the remaining assets within our new and existing financing facilities as well as with cash held by the CLO and expensed $1.5 million of deferred fees in the first quarter of 2015 into interest expense on the consolidated statements of income. In February 2015, we completed a collateralized securitization vehicle (“CLO IV”), issuing to third party investors three tranches of investment grade CLOs through two newly-formed wholly-owned subsidiaries totaling $219.0 million. At closing, the notes were secured by a portfolio of loan obligations with a face value of $250.0 million, consisting primarily of bridge loans that were contributed from our existing loan portfolio, as well as $50.0 million for the purpose of acquiring additional loan obligations . The financing has an approximate 2.5 year replacement period from closing that allows the principal proceeds and sale proceeds (if any) of the loan obligations to be reinvested in qualifying replacement loan obligations, subject to the satisfaction of certain conditions set forth in the indenture. Thereafter, the outstanding debt balance will be reduced as loans are repaid. We retained a residual interest in the portfolio with a notional amount of approximately $81.0 million. The notes had an initial weighted average interest rate of approximately 2.24% plus one-month LIBOR and interest payments on the notes are payable monthly. Including certain fees and costs, the initial weighted average note rate was 2.96%. The following table outlines borrowings and the corresponding collateral under our CLOs as of March 31, 2016: Debt Collateral Loans Cash Face Carrying Unpaid Carrying Restricted Collateral Value Value Principal Value Cash (1) At-Risk (2) CLO III $ $ $ $ $ $ — CLO IV — CLO V — Total CLOs $ $ $ $ $ $ — The following table outlines borrowings and the corresponding collateral under our CLOs as of December 31, 2015: Debt Collateral Loans Cash Face Carrying Unpaid Carrying Restricted Collateral Value Value Principal Value Cash (1) At-Risk (2) CLO III $ $ $ $ $ $ — CLO IV — CLO V — Total CLOs $ $ $ $ $ $ — CLO III — Issued three investment grade tranches in April 2014 with a replacement period through October 2016 and a stated maturity date in May 2024. Interest is variable based on three-month LIBOR; the weighted average note rate was 2.87% and 2.86% at March 31, 2016 and December 31, 2015, respectively . Debt carrying value is net of $1.8 million and $2.1 million of deferred financing fees at March 31, 2016 and December 31, 2015, respectively. CLO IV — Issued three investment grade tranches in February 2015 with a replacement period through September 2017 and a stated maturity date in March 2025. Interest is variable based on three-month LIBOR; the weighted average note rate was 2.72% and 2.71% at March 31, 2016 and December 31, 2015, respectively. Debt carrying value is net of $2.7 million and $3.0 million of deferred financing fees at March 31, 2016 and December 31, 2015, respectively. CLO V — Issued three investment grade tranches in August 2015 with a replacement period through September 2018 and a stated maturity date in September 2025. Interest is variable based on one-month LIBOR; the weighted average note rate was 2.92% and 2.91% at March 31, 2016 and December 31, 2015, respectively. Debt carrying value is net of $3.7 million and $3.8 million of deferred financing fees at March 31, 2016 and December 31, 2015, respectively. (1) Represents restricted cash held for principal repayments as well as for reinvestment in the CLOs. Does not include restricted cash related to interest payments, delayed fundings and expenses. (2) Amounts represent the face value of collateral in default, as defined by the CLO indenture, as well as assets deemed to be “credit risk.” Credit risk assets are reported by each of the CLOs and are generally defined as one that, in the CLO collateral manager’s reasonable business judgment, has a significant risk of declining in credit quality or, with a passage of time, becoming a defaulted asset. At both March 31, 2016 and December 31, 2015, the aggregate weighted average note rate for our CLOs was 2.84%. Including certain fees and costs, the weighted average note rate was 3.27% and 3.24% at March 31, 2016 and December 31, 2015, respectively. We account for our CLO transactions on our consolidated balance sheet as financing facilities. Our CLOs are VIEs for which we are the primary beneficiary and are consolidated in our financial statements accordingly. The investment grade tranches are treated as secured financings, and are non-recourse to us. Collateralized Debt Obligations (CDOs) In July 2015, we completed the unwind of CDO III, our last remaining CDO vehicle, redeeming $71.1 million of our outstanding notes. The notes were repaid primarily from proceeds received from the refinancing of CDO III’s remaining assets within our existing financing facilities, as well as with cash held by the CDO. We also terminated a related interest rate swap and incurred a loss of $0.3 million in the third quarter of 2015. CDO III had a $100.0 million revolving note class that provided a revolving note facility, which was paid off in the first quarter of 2015. In January 2015, we completed the unwind of CDO I and CDO II, redeeming $167.9 million of our outstanding notes. The notes were repaid primarily from proceeds received from the refinancing of CDO I and II’s remaining assets within a new $150.0 million warehouse repurchase facility and our existing financing facilities, as well as with cash held by each CDO. As a result of this transaction, we generated approximately $30.0 million in cash equity and expensed $0.5 million of deferred fees in the first quarter of 2015. We also terminated the related basis and interest rate swaps and incurred a loss of $4.3 million in the first quarter of 2015. See Note 8 — “Derivative Financial Instruments” for additional details. In 2010, we re-issued our own CDO bonds we had acquired throughout 2009 with an aggregate face amount of approximately $42.8 million as part of an exchange for the retirement of $114.1 million of our junior subordinated notes. This transaction resulted in the recording of $65.2 million of additional CDO debt, of which $42.3 million represents the portion of our CDO bonds that were exchanged and $22.9 million represents the estimated interest due on the reissued bonds through their maturity. In January 2015, we unwound our CDO I and CDO II vehicles and reduced the balance of estimated interest by $11.0 million and in July 2015, we unwound our CDO III vehicle and reduced the remaining balance of estimated interest by $8.2 million, recording a gain on acceleration of deferred income in the consolidated statements of income. Senior Unsecured Notes During 2014, we issued $90.0 million aggregate principal amount of 7.375% senior unsecured notes due in 2021 in an underwritten public offering for net proceeds of $85.4 million after deducting the issuance and underwriting discounts and offering expenses. In connection with this offering, the underwriters exercised a portion of their overallotment option for a $7.8 million aggregate principal amount providing additional net proceeds of $7.4 million. The notes can be redeemed by us after May 15, 2017. The interest is paid quarterly in February, May, August and November. Including certain fees and costs, the weighted average note rate was 8.15% and 8.12% at March 31, 2016 and December 31, 2015, respectively. The debt carrying value of $94.0 million and $93.8 million at March 31, 2016 and December 31, 2015, respectively, is net of $3.9 million and $3.5 million, respectively, of deferred financing fees. We used the net proceeds to make investments, to repurchase or pay liabilities and for general corporate purposes. Junior Subordinated Notes The carrying value of borrowings under our junior subordinated notes was $157.3 million and $157.1 million at March 31, 2016 and December 31, 2015, respectively, which is net of a deferred amount of $15.3 million and $15.5 million, respectively, that is being amortized into interest expense over the life of the notes and $3.2 million and $3.3 million, respectively, of deferred financing fees. These notes have maturities ranging from March 2034 through April 2037, pay interest quarterly at a fixed or floating rate of interest based on three-month LIBOR and were not redeemable for the first two years. The current weighted average note rate was 3.45% and 3.43% at March 31, 2016 and December 31, 2015, respectively. Including certain fees and costs, the weighted average note rate was 3.56% and 3.55% at March 31, 2016 and December 31, 2015, respectively. The entities that issued the junior subordinated notes have been deemed VIEs. See Note 9 — “Variable Interest Entities” for further details. Mortgage Note Payable — Real Estate Owned and Held-For-Sale In the first quarter of 2015, we made required paydowns of $10.3 million and repaid the Multifamily Portfolio mortgage of $20.7 million, replacing it with two new notes payable totaling $27.2 million. At March 31, 2016, the new notes payable consists of a $24.7 million secured loan that bears interest at a fixed rate of 3.00% and matures in December 2017, as well as a $2.5 million, unsecured loan that bears interest at a variable rate of one-month LIBOR plus 2.75% and matures in December 2016. These notes payable were repaid in full in April 2016 in connection with the sale of the remaining properties in the Multifamily Portfolio. Debt Covenants Our debt facilities contain various financial covenants and restrictions, including a minimum liquidity requirement of $20.0 million, minimum net worth requirement of $100.0 million to $300.0 million depending on the debt facility and a maximum total liabilities less subordinated debt requirement of $2.0 billion, as well as certain other debt service coverage ratios and debt to equity ratios. We were in compliance with all financial covenants and restrictions at March 31, 2016. Our CLO vehicles contain interest coverage and asset overcollateralization covenants that must be met as of the waterfall distribution date in order for us to receive such payments. If we fail these covenants in any of our CLOs, all cash flows from the applicable CLO would be diverted to repay principal and interest on the outstanding CLO bonds and we would not receive any residual payments until that CLO regained compliance with such tests. Our CLOs were in compliance with all such covenants as of March 31 , 2016, as well as on the most recent determination dates in April 2016. In the event of a breach of the CLO covenants that could not be cured in the near-term, we would be required to fund our non-CLO expenses, including management fees and employee costs, distributions required to maintain our REIT status, debt costs, and other expenses with (i) cash on hand, (ii) income from any CLO not in breach of a covenant test, (iii) income from real property and loan assets, (iv) sale of assets, or (v) or accessing the equity or debt capital markets, if available. We have the right to cure covenant breaches which would resume normal residual payments to us by purchasing non-performing loans out of the CLOs. However, we may not have sufficient liquidity available to do so at such time. The chart below is a summary of our CLO compliance tests as of the most recent determination dates in April 2016: Cash Flow Triggers CLO III CLO IV CLO V Overcollateralization (1) Current % % % Limit % % % Pass / Fail Pass Pass Pass Interest Coverage (2) Current % % % Limit % % % Pass / Fail Pass Pass Pass (1) The overcollateralization ratio divides the total principal balance of all collateral in the CLO by the total principal balance of the bonds associated with the applicable ratio. To the extent an asset is considered a defaulted security, the asset’s principal balance for purposes of the overcollateralization test is the lesser of the asset’s market value or the principal balance of the defaulted asset multiplied by the asset’s recovery rate which is determined by the rating agencies. Rating downgrades of CLO collateral will generally not have a direct impact on the principal balance of a CLO asset for purposes of calculating the CLO overcollateralization test unless the rating downgrade is below a significantly low threshold (e.g. CCC-) as defined in each CLO vehicle. (2) The interest coverage ratio divides interest income by interest expense for the classes senior to those retained by us. The chart below is a summary of our CLO overcollateralization ratios as of the determination dates subsequent to each quarter: Determination (1) CLO III CLO IV CLO V April 2016 % % % January 2016 % % % October 2015 % % % July 2015 % % — April 2015 % % — (1) The table above represents the quarterly trend of our overcollateralization ratio, however, the CLO determination dates are monthly and we were in compliance with this test for all periods presented. The ratio will fluctuate based on the performance of the underlying assets, transfers of assets into the CLOs prior to the expiration of their respective replenishment dates, purchase or disposal of other investments, and loan payoffs. No payment due under the junior subordinated indentures may be paid if there is a default under any senior debt and the senior lender has sent notice to the trustee. The junior subordinated indentures are also cross-defaulted with each other. |
Derivative Financial Instrument
Derivative Financial Instruments | 3 Months Ended |
Mar. 31, 2016 | |
Derivative Financial Instruments | |
Derivative Financial Instruments | Note 8 — Derivative Financial Instruments The following is a summary of the derivative financial instruments held by us (dollars in thousands): Notional Value Balance Fair Value Designation\ Cash Flow Derivative Count March 31, 2016 Count December 31, 2015 Expiration Date Sheet Location March 31, 2016 December 31, 2015 Qualifying LIBOR Caps 2 $ 2 $ 2017 Other Assets $ $ Qualifying Interest Rate Swaps 5 $ 5 $ 2016 - 2017 Other Liabilities $ ) $ ) The changes in the fair value of qualifying interest rate swap cash flow hedges are recorded in accumulated other comprehensive loss o n the consolidated balance sheets. These swap agreements must be effective in reducing the variability of cash flows of the hedged items in order to qualify for the aforementioned hedge accounting treatment. These interest rate swaps are used to hedge the variable cash flows associated with existing variable-rate debt, and amounts reported in accumulated other comprehensive loss related to derivatives will be reclassified to interest expense as interest payments are made on our variable-rate debt. As of March 31, 2016 , we expect to reclassify $(3.6) million of other comprehensive loss from qualifying cash flow hedges to interest expense over the next twelve months assuming interest rates on that date are held constant. During the three months ended March 31, 2015, CDO I and CDO II were unwound and the related interest rate swaps with an aggregate notional value of $134.6 million and an aggregate fair value of $(4.3) million were terminated and recorded as a loss in the first quarter of 2015. See Note 7 — “Debt Obligations — Collateralized Debt Obligations” for further details. Also d uring the three months ended March 31, 2015, we entered into a qualifying LIBOR cap hedge due to a CLO agreement requiring a LIBOR cap of 2% with a notional value of $43.5 million . Gains and losses on terminated swaps are being deferred and recognized in earnings over the original life of the hedged item. As of March 31, 2016 and December 31, 2015, we had a net deferred loss of $0.5 million and $0.6 million, respectively, in accumulated other comprehensive loss related to these terminated swap agreements. We recorded $0.2 million as additional interest expense related to the amortization of the loss for both the three months ended March 31, 2016 and 2015, and less than $0.1 million and $0.1 million as a reduction to interest expense related to the accretion of the net gains for the three months ended March 31, 2016 and 2015, respectively. We expect to record approximately $0.5 million of net deferred loss to interest expense over the next twelve months. Non-qualifying basis swap hedges were used to manage our exposure to interest rate movements and other identified risks but do not meet hedge accounting requirements. D uring the three months ended March 31, 2015, our remaining basis swap with a notional value of $3.0 million and a fair value of less than $0.1 million was terminated as part of the CDO II unwind and a loss was recorded in the first quarter of 2015. The following table presents the effect of our derivative financial instruments on the statements of income (dollars in thousands): Amount of Loss Recognized in Other Comprehensive Loss (Effective Portion) For the Three Months Ended March 31, Amount of Loss Reclassified from Accumulated Other Comprehensive Loss into Interest Expense (Effective Portion) For the Three Months Ended March 31, Amount of Loss Reclassified from Accumulated Other Comprehensive Loss into Loss on Termination of Swaps (Ineffective Portion) For the Three Months Ended March 31, Amount of Loss Recognized in Loss on Termination of Swaps (Ineffective Portion) For the Three Months Ended March 31, Designation\Cash Flow Derivative 2016 2015 2016 2015 2016 2015 2016 2015 Non-Qualifying Basis Swaps $ — $ — $ — $ — $ — $ — $ — $ ) Qualifying Interest Rate Swaps/Cap $ $ $ ) $ ) $ — $ ) $ — $ — The cumulative amount of other comprehensive loss related to net unrealized losses on derivatives designated as qualifying hedges as of March 31 , 2016 and December 31, 2015 of $(4.1) million and $(5.3) million, respectively, is a combination of the fair value of qualifying cash flow hedges of $(3.6) million and $(4.7) million, respectively, and net deferred losses on terminated interest rate swaps of $(0.5) million and $(0.6) million, respectively. We have agreements with certain of our derivative counterparties that contain a provision where if we default on any of our indebtedness, including default where repayment of the indebtedness has not been accelerated by the lender, then we could also be declared in default on our derivative obligations. As of March 31 , 2016 and December 31, 2015, the fair value of derivatives in a net liability position, which includes accrued interest but excludes any adjustment for nonperformance risk related to these agreements, was $(3.6) million and $(4.6) million, respectively. As of March 31 , 2016 and December 31, 2015, we had minimum collateral posting thresholds with certain of our derivative counterparties and had posted collateral of $4.1 million and $5.0 million, respectively, which is recorded in other assets in our consolidated balance sheets. |
Variable Interest Entities
Variable Interest Entities | 3 Months Ended |
Mar. 31, 2016 | |
Variable Interest Entities | |
Variable Interest Entities | Note 9 — Variable Interest Entities We have evaluated our loans and investments, mortgage related securities, investments in equity affiliates, senior unsecured notes, junior subordinated notes and CLOs, in order to determine if they qualify as VIEs or as variable interests in VIEs. This evaluation resulted in determining that our bridge loans, junior participation loans, mezzanine loans, preferred equity investments, investments in equity affiliates, junior subordinated notes, CLOs and investments in mortgage related securities are potential VIEs. Our involvement with VIEs primarily affects our financial performance and cash flows through amounts recorded in interest income, interest expense, provision for loan losses and through activity associated with our derivative instruments. Consolidated VIEs We consolidate our CLO subsidiaries, which qualify as VIEs, of which we are the primary beneficiary. These CLOs invest in real estate and real estate-related securities and are financed by the issuance of CLO debt securities. We, or one of our affiliates, is named collateral manager, servicer, and special servicer for all CLO collateral assets which we believe gives us the power to direct the most significant economic activities of the entity. We also have exposure to CLO losses to the extent of our equity interests and also have rights to waterfall payments in excess of required payments to CLO bond investors. As a result of consolidation, equity interests in these CLOs have been eliminated, and the consolidated balance sheets reflect both the assets held and debt issued by the CLOs to third parties. Our operating results and cash flows include the gross amounts related to CLO assets and liabilities as opposed to our net economic interests in the CLO entities. Assets held by the CLOs are restricted and can be used only to settle obligations of the CLOs. The liabilities of the CLOs are non-recourse to us and can only be satisfied from each CLOs respective asset pool. Assets and liabilities related to the CLOs are disclosed parenthetically, in the aggregate, in our consolidated balance sheets. See Note 7 — “Debt Obligations” for further details. We are not obligated to provide, have not provided, and do not intend to provide financial support to any of the consolidated CLOs. For the first quarter of 2016, we adopted the amended guidance on the consolidation of VIEs, modifying the analysis we must perform to determine whether we should consolidate certain types of legal entities. Under the revised guidance, our operating partnership, ARLP, was determined to be a VIE. As this operating partnership is already consolidated in our financial statements, the identification of this entity as a VIE has no impact on our consolidated financial statements. Unconsolidated VIEs We determined that we are not the primary beneficiary of 23 VIEs in which we have a variable interest as of March 31, 2016 because we do not have the ability to direct the activities of the VIEs that most significantly impact each entity’s economic performance. VIEs, of which we are not the primary beneficiary, have an aggregate carrying amount of $374.3 million and exposure to real estate debt of approximately $1.7 billion at March 31 , 20 16. The following is a summary of our variable interests in identified VIEs, of which we are not the primary beneficiary, as of March 31, 2016: Type Carrying Amount (1) Maximum Exposure to Loss (2) Loans $ $ Equity investments Junior subordinated notes (3) Total $ $ (1) Represents the carrying amount of loans and investments before reserves. At March 31, 2016, $152.8 million of loans to VIEs had corresponding loan loss reserves of $80.6 million. See Note 3 — “Loans and Investments” for further details. (2) Our maximum exposure to loss as of March 31, 2016 would not exceed the carrying amount of its investment. (3) It is not appropriate to consolidate these entities as equity interests are variable interests only to the extent that the investment is considered to be at risk. Since our investments were funded by the entities that issued the junior subordinated notes, it is not considered to be at risk. |
Fair Value
Fair Value | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value. | |
Fair Value | Note 10 — Fair Value Fair Value of Financial Instruments Fair value estimates are dependent upon subjective assumptions and involve significant uncertainties resulting in variability in estimates with changes in assumptions. The following table summarizes the principal amounts, carrying values and the estimated fair values of our financial instruments: March 31, 2016 December 31, 2015 Principal / Principal / Notional Carrying Estimated Notional Carrying Estimated Amount Value Fair Value Amount Value Fair Value Financial assets: Loans and investments $ $ $ $ $ $ Available-for-sale securities Derivative financial instruments Financial liabilities: Credit and repurchase facilities $ $ $ $ $ $ Collateralized loan obligations Senior unsecured notes Junior subordinated notes Mortgage note payable - real estate owned and held-for-sale Derivative financial instruments Fair Value Measurement Fair value is defined as the price at which an asset could be exchanged in a current transaction between knowledgeable, willing parties. A liability’s fair value is defined as the amount that would be paid to transfer the liability to a new obligor, not the amount that would be paid to settle the liability with the creditor. Where available, fair value is based on observable market prices or parameters or derived from such prices or parameters. Where observable prices or inputs are not available, valuation models are applied. These valuation techniques involve some level of management estimation and judgment, the degree of which is dependent on the price transparency for the instruments or market and the instruments’ complexity. Assets and liabilities disclosed at fair value are categorized based upon the level of judgment associated with the inputs used to measure their fair value. Hierarchical levels directly related to the amount of subjectivity associated with the inputs to fair valuation of these assets and liabilities are as follows: Level 1 — Inputs are unadjusted and quoted prices exist in active markets for identical assets or liabilities at the measurement date. The types of assets and liabilities carried at Level 1 fair value generally are government and agency securities, equities listed in active markets, investments in publicly traded mutual funds with quoted market prices and listed derivatives. Level 2 — Inputs (other than quoted prices included in Level 1) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life. Level 2 inputs include quoted market prices in markets that are not active for an identical or similar asset or liability, and quoted market prices in active markets for a similar asset or liability. Fair valued assets and liabilities that are generally included in this category are non-government securities, municipal bonds, certain hybrid financial instruments, certain mortgage and asset-backed securities, certain corporate debt, certain commitments and guarantees, certain private equity investments and certain derivatives. Level 3 — Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. These valuations are based on significant unobservable inputs that require a considerable amount of judgment and assumptions. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model. Generally, assets and liabilities carried at fair value and included in this category are certain mortgage and asset-backed securities, certain corporate debt, certain private equity investments, certain municipal bonds, certain commitments and guarantees and certain derivatives. Determining which category an asset or liability falls within the hierarchy requires significant judgment and we evaluate our hierarchy disclosures each quarter. The following is a description of the valuation techniques used to measure fair value and the general classification of these instruments pursuant to the fair value hierarchy. Loans and investments, net: Fair values of loans and investments that are not impaired are estimated using Level 3 inputs based on discounted cash flow methodology, using discount rates, which, in the opinion of management, best reflect current market interest rates that would be offered for loans with similar characteristics and credit quality. Fair values of loans and investments that are impaired are estimated using Level 3 inputs by us that require significant judgments, which include assumptions regarding discount rates, capitalization rates, leasing, creditworthiness of major tenants, occupancy rates, availability of financing, exit plan, loan sponsorship, actions of other lenders and other factors deemed necessary by management. Available-for-sale securities: Fair values are approximated based on current market quotes received from active markets or financial sources that trade such securities. The fair values of available-for-sale equity securities traded in active markets are approximated using Level 1 inputs, while the fair values of available-for-sale debt securities that are approximated using recent purchase price and subsequent sales price of the securities, were valued using Level 2 inputs. Derivative financial instruments: Fair values of interest rate and basis swap derivatives and LIBOR caps are approximated using Level 2 inputs based on current market data received from financial sources that trade such instruments and are based on prevailing market data and derived from third party proprietary models based on well recognized financial principles including counterparty risks, credit spreads and interest rate projections, as well as reasonable estimates about relevant future market conditions. These items are included in other assets and other liabilities on the consolidated balance sheets. We incorporate credit valuation adjustments in the fair values of our derivative financial instruments to reflect counterparty nonperformance risk. Credit facilities, repurchase agreements and mortgage notes payable: Fair values are estimated at Level 3 using discounted cash flow methodology, using discount rates, which, in the opinion of management, best reflect current market interest rates for financing with similar characteristics and credit quality. Collateralized loan obligations: Fair values are estimated at Level 3 based on broker quotations, representing the discounted expected future cash flows at a yield that reflects current market interest rates and credit spreads. Senior unsecured notes: Fair values are estimated at Level 1 based on current market quotes received from active markets. Junior subordinated notes: Fair values are estimated at Level 3 based on broker quotations, representing the discounted expected future cash flows at a yield that reflects current market interest rates and credit spreads. We measure certain financial assets and financial liabilities at fair value on a recurring basis. The fair value of these financial assets and liabilities was determined using the following input levels as of March 31, 2016: Fair Value Measurements Carrying Fair Using Fair Value Hierarchy Value Value Level 1 Level 2 Level 3 Financial assets: Available-for-sale securities $ $ $ $ — $ — Derivative financial instruments — — Financial liabilities: Derivative financial instruments $ $ $ — $ $ — We measure certain financial and non-financial assets at fair value on a nonrecurring basis. The fair value of these financial assets was determined using the following input levels as of March 31, 2016: Net Carrying Fair Fair Value Measurements Using Fair Value Hierarchy Value Value Level 1 Level 2 Level 3 Financial assets: Impaired loans, net (1) $ $ $ — $ — $ (1) We had an allowance for loan losses of $86.7 million relating to nine loans with an aggregate carrying value, before loan loss reserves, of $189.7 million at March 31, 2016. Loan impairment assessments : Loans held for investment are intended to be held to maturity and, accordingly, are carried at cost, net of unamortized loan origination costs and fees, loan purchase discounts, and net of the allowance for loan losses when such loan or investment is deemed to be impaired. We consider a loan impaired when, based upon current information and events, it is probable that we will be unable to collect all amounts due for both principal and interest according to the contractual terms of the loan agreement. We perform evaluations of our loans to determine if the value of the underlying collateral securing the impaired loan is less than the net carrying value of the loan, which may result in an allowance and corresponding charge to the provision for loan losses. These valuations require significant judgments, which include assumptions regarding capitalization and discount rates, revenue growth rates, leasing, creditworthiness of major tenants, occupancy rates, availability of financing, exit plan, loan sponsorship, actions of other lenders and other factors deemed necessary by management. The table above includes all impaired loans, regardless of the period in which an impairment was recognized. Quantitative information about Level 3 fair value measurements on a recurring and non-recurring basis: March 31, 2016 Fair Value Valuation Techniques Significant Unobservable Inputs Range (Weighted Average) Financial assets: Impaired loans (1): Multi-family $ Direct capitalization analysis Capitalization rate Revenue growth rate 6.50% to 9.75% (8.86%) 4.30% Office Discounted cash flows Discount rate Capitalization rate Revenue growth rate 11.00% 8.03% 2.50% Land Discounted cash flows Discount rate Capitalization rate Revenue growth rate 15.00% 7.25% 3.00% Hotel Discounted cash flows Discount rate Capitalization rate Revenue growth rate 9.25% 7.25% 3.80% Commercial — Discounted cash flows Capitalization rate 6.00% (1) Includes all impaired loans regardless of the period in which a loan loss provision was recorded. We measure certain assets and liabilities for which fair value is only disclosed. The fair value of these assets and liabilities was determined using the following input levels as of March 31, 2016: Fair Value Measurements Carrying Fair Using Fair Value Hierarchy Value Value Level 1 Level 2 Level 3 Financial assets: Loans and investments, net $ $ $ — $ — $ Financial liabilities: Credit facilities and repurchase agreements $ $ $ — $ — $ Collateralized loan obligations — — Senior unsecured notes — — Junior subordinated notes — — Mortgage note payable — real estate owned — — |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
Mar. 31, 2016 | |
Commitments and Contingencies | |
Commitments and Contingencies | Note 11 — Commitments and Contingencies Contractual Commitments Our debt obligations have approximate maturities of $158.7 million in 2016, $325.8 million in 2017, $384.1 million in 2018, $89.6 million in 2019, $32.1 million in 2020 and $273.7 million thereafter. In accordance with certain loans and investments, we have outstanding unfunded commitments of $10.5 million as of March 31 , 2016 that we are obligated to fund as the borrowers meet certain requirements. Of this total, we have $2.7 million in restricted cash which was available to fund all of the unfunded commitments for loans financed by our CLO vehicles. Specific requirements include, but are not limited to, property renovations, building construction, and building conversions based on criteria met by the borrower in accordance with the loan agreements. Litigation We currently are neither subject to any material litigation nor, to our knowledge, is any material litigation currently threatened against us other than the following: On June 15, 2011, three related lawsuits were filed by the Extended Stay Litigation Trust (the “Trust”), a post-bankruptcy litigation trust alleged to have standing to pursue claims that previously had been held by Extended Stay, Inc. and the Homestead Village L.L.C. family of companies (together “ESI”) (formerly Chapter 11 debtors, together the “Debtors”) that have emerged from bankruptcy. Two of the lawsuits were filed in the U.S. Bankruptcy Court for the Southern District of New York, and the third in the Supreme Court of the State of New York, New York County. There were 73 defendants in the three lawsuits, including 55 corporate and partnership entities and 18 individuals. A subsidiary of ours and certain other entities that are affiliates of ours are included as defendants. The New York State Court action has been removed to the Bankruptcy Court. Our affiliates filed a motion to dismiss the three lawsuits. The lawsuits all allege, as a factual basis and background certain facts surrounding the June 2007 leveraged buyout of ESI from affiliates of Blackstone Capital. Our subsidiary, Arbor ESH II, LLC, had a $115.0 million investment in the Series A1 Preferred Units of a holding company of Extended Stay, Inc. The New York State Court action and one of the two federal court actions name as defendants, Arbor ESH II, LLC, Arbor Commercial Mortgage, LLC and ABT-ESI LLC, an entity in which we have a membership interest, among the broad group of defendants. These two actions were commenced by substantially identical complaints. The defendants are alleged in these complaints, among other things, to have breached fiduciary and contractual duties by causing or allowing the Debtors to pay illegal dividends or other improper distributions of value at a time when the Debtors were insolvent. These two complaints also allege that the defendants aided and abetted, induced, or participated in breaches of fiduciary duty, waste, and unjust enrichment (“Fiduciary Duty Claims”) and name a director of ours, and a former general counsel of Arbor Commercial Mortgage, LLC, each of whom had served on the Board of Directors of ESI for a period of time. We are defending these two defendants and paying the costs of such defense. On the basis of the foregoing allegations, the Trust has asserted claims under a number of common law theories, seeking the return of assets transferred by the Debtors prior to the Debtors’ bankruptcy filing. In the third action, filed in Bankruptcy Court, the same plaintiff, the Trust, has named Arbor Commercial Mortgage, LLC and ABT-ESI LLC, together with a number of other defendants and asserts claims, including constructive and fraudulent conveyance claims under state and federal statutes, as well as a claim under the Federal Debt Collection Procedure Act. On June 28, 2013, the Trust filed a motion to amend the lawsuits, to, among other things, (i) consolidate the lawsuits into one lawsuit, (ii) remove 47 defendants, none of whom are related to us, from the lawsuits so that there are 26 remaining defendants, including 16 corporate and partnership entities and 10 individuals, and (iii) reduce the counts within the lawsuits from over 100 down to 17. The remaining counts in the amended complaint against our affiliates are principally state law claims for breach of fiduciary duties, waste, unlawful dividends and unjust enrichment, and claims under the Bankruptcy Code for avoidance and recovery actions, among others. The bankruptcy court granted the motion and the amended complaint has been filed. The amended complaint seeks approximately $139.0 million in the aggregate from director designees, portions of which are also sought from our affiliates as well as from unaffiliated defendants. We have moved to dismiss the referenced actions and intend to vigorously defend against the claims asserted therein. During a status conference held on March 18, 2014, the Court heard oral argument on the motion to dismiss and adjourned the case pending a ruling. We have not made a loss accrual for this litigation because we believe that it is not probable that a loss has been incurred and an amount cannot be reasonably estimated. |
Equity
Equity | 3 Months Ended |
Mar. 31, 2016 | |
Equity | |
Equity | Note 12 — Equity Preferred Stock The Series A, B and C preferred stock may not be redeemed by us before February 2018, May 2018 and February 2019, respectively. Common Stock As of March 31, 2016, 6,500,000 common shares are available under an “At-The-Market” equity offering with JMP Securities LLC. As of March 31, 2016, we have $330.4 million available under our $500.0 million shelf registration statement that was declared effective by the SEC in August 2013. Distributions The following table presents dividends declared (on a per share basis) for the three months ended March 31, 2016: Common Stock Preferred Stock Dividend (1) Declaration Date Dividend Declaration Date Series A Series B Series C February 24, 2016 $ February 1, 2016 $ $ $ (1) The dividend declared on February 1, 2016 for the Series A, B and C preferred stock was for the period December 1, 2015 through February 29, 2016. Common Stock — On May 4, 2016, the Board of Directors declared a cash dividend of $0.15 per share of common stock. The dividend is payable on May 31, 2016 to common stockholders of record as of the close of business on May 18, 2016. Preferred Stock — On May 2, 2016, the Board of Directors declared a cash dividend of $0.515625 per share of 8.25% Series A preferred stock; a cash dividend of $0.484375 per share of 7.75% Series B preferred stock; and a cash dividend of $0.53125 per share of 8.50% Series C preferred stock. These amounts reflect dividends from March 1, 2016 through May 31, 2016 and are payable on May 31, 2016 to preferred stockholders of record on May 15, 2016. Deferred Compensation In March 2016, we issued 282,405 shares of restricted common stock under the 2014 Omnibus Stock Incentive Plan (the “2014 Plan”) to certain employees of ours and our Manager with a total grant date fair value of $1.9 million and recorded $0.2 million to employee compensation and benefits and $0.5 million to selling and administrative expense in our consolidated statements of income. One third of the shares vested as of the date of grant, one third will vest in March 2017, and the remaining third will vest in March 2018. In March 2016, we also issued 67,260 shares of fully vested common stock to the independent members of the Board of Directors under the 2014 Plan and recorded $0.4 million to selling and administrative expense in our consolidated statements of income. During the first quarter of 2016, we issued 70,225 shares of restricted common stock to Mr. Ivan Kaufman, our chairman and chief executive officer, under his 2015 annual incentive agreement with a grant date fair value of $0.5 million and recorded $0.1 million to employee compensation and benefits in our consolidated statements of income. One quarter of the shares vested as of the date of grant and one quarter will vest on each of the first, second and third anniversaries of the date of grant. Mr. Kaufman was also granted up to 421,348 performance-based restricted stock units that vest at the end of a four-year performance period based on our achievement of certain total stockholder return objectives. The restricted stock units had a grant date fair value of $0.9 million and we recorded less than $0.1 million to employee compensation and benefits in our consolidated statements of income. To date under his 2015 annual incentive agreement, Mr. Kaufman was granted in the aggregate up to 867,113 performance-based restricted stock units. As of March 31, 2016, unvested restricted stock consisted of 237,299 shares granted to our employees with a grant date fair value of $1.6 million and 241,343 shares granted to employees of our Manager with a grant date fair value of $1.6 million, which is subject to re-measurement each reporting period. Expense is recognized ratably over the vesting period in our consolidated statements of income in employee compensation and benefits expense and selling and administrative expense, respectively. During the three months ended March 31, 2016 and 2015, we recorded the ratable portion of the unvested restricted stock to employees as employee compensation and benefits of $0.1 million for both periods and for non-employees to selling and administrative expense for $0.1 million and $0.2 million, respectively. During the first quarter of 2016, a total of 1,001 shares of unvested restricted stock with a grant date value of less than $0.1 million were forfeited. Vesting of restricted shares is dependent on a service requirement. Dividends paid on restricted shares are recorded as dividends on shares of our common stock whether or not they are vested. For accounting purposes, we measure the compensation costs for these shares as of the date of the grant, with subsequent re-measurement for any unvested shares granted to non-employees of ours with such amounts expensed against earnings, at the grant date (for the portion that vest immediately) or ratably over the respective vesting periods. Accumulated Other Comprehensive Loss At March 31, 2016, accumulated other comprehensive loss was $3.7 million and consisted of $3.6 million of net unrealized losses on derivatives designated as cash flow hedges, and $0.5 million of net deferred losses on terminated interest swaps, less a $0.4 million unrealized gain related to available-for-sale securities. At December 31, 2015, accumulated other comprehensive loss was $4.8 million and consisted of $4.7 million of net unrealized losses on derivatives designated as cash flow hedges, and $0.6 million of net deferred losses on terminated interest swaps, less a $0.4 million unrealized gain related to available-for-sale securities. Reclassifications out of accumulated other comprehensive loss is as follows: Three Months Ended March 31, 2016 2015 Statement of Income Caption Net realized losses on derivatives designated as cash flow hedges: Interest rate swaps $ ) $ ) Interest expense (1) Termination of interest rate swaps $ — $ ) Loss on termination of swaps (1) (1) See Note 8 — “Derivative Financial Instruments” for additional details . |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share | |
Earnings Per Share | Note 13 — Earnings Per Share Basic EPS is calculated by dividing net income attributable to Arbor Realty Trust, Inc. by the weighted average number of shares of common stock outstanding during each period inclusive of unvested restricted stock with full dividend participation rights. Diluted EPS is calculated by dividing net income by the weighted average number of shares of common stock outstanding plus the additional dilutive effect of common stock equivalents during each period using the treasury stock method. Our common stock equivalents are comprised of the weighted average dilutive effect of performance-based restricted stock units granted to our chief executive officer in the first quarter of 2016 and 2015. The following is a reconciliation of the numerator and denominator of the basic and diluted EPS computations for the periods presented: Three Months Ended Three Months Ended March 31, 2016 March 31, 2015 Basic Diluted Basic Diluted Net income attributable to common stockholders (1) $ $ $ $ Weighted average number of common shares outstanding Dilutive effect of restricted stock units (2) — — Weighted average number of common shares outstanding Net income per common share (1) $ $ $ $ (1) Net of preferred stock dividends. (2) Mr. Kaufman was granted restricted stock units in 2016 and 2015 which vest at the end of a four-year performance period based upon our achievement of total shareholder return objectives. See Note 12 — “Equity” for further details. |
Agreements and Tansactions with
Agreements and Tansactions with Related Parties | 3 Months Ended |
Mar. 31, 2016 | |
Agreements and Transactions with Related Parties | |
Agreements and Transactions with Related Parties | Note 14 — Agreements and Transactions with Related Parties Management Agreement We, ARLP and Arbor Realty SR, Inc. have a management agreement with our Manager, pursuant to which our Manager provides certain services and we pay our Manager a base management fee and under certain circumstances, an annual incentive fee. The base management fee is an arrangement whereby we reimburse our Manager for its actual costs incurred in managing our business based on the parties’ agreement in advance on an annual budget with subsequent quarterly true-ups to actual costs. We retain all origination fees on investments. The incentive fee is measured on an annual basis and is calculated as (1) 25% of the amount by which (a) our funds from operations per share, adjusted for certain gains and losses including gains from the retirement and restructuring of debt and 60% of any loan loss reserve recoveries (spread over a three year period), exceeds (b) the product of (x) 9.5% per annum or the Ten Year U.S. Treasury Rate plus 3.5%, whichever is greater, and (y) the greater of $10.00 or the weighted average of book value of the net assets contributed by our Manager to ARLP per ARLP partnership unit, the offering price per share of our common equity in the private offering on July 1, 2003 and subsequent offerings and the issue price per ARLP partnership unit for subsequent contributions to ARLP, multiplied by (2) the weighted average of our outstanding shares. The minimum return, or incentive fee hurdle to be reached before an incentive fee is earned, is a percentage applied on a per share basis to the greater of $10.00 or the average gross proceeds per share. In addition, 60% of any loan loss and other reserve recoveries are eligible to be included in the incentive fee calculation, which recoveries are spread over a three year period. The management agreement also allows us to consider, from time to time, the payment of additional “success-based” fees to our Manager for accomplishing certain specified corporate objectives; has a termination fee of $10.0 million; and is renewable automatically for successive one-year terms, unless terminated with six months prior written notice. If we terminate or elect not to renew the management agreement without cause, we are required to pay the termination fee of $10.0 million. The following table sets forth our base management fees and incentive fees for the periods indicated: Three Months Ended March 31, Management Fees: 2016 2015 Base $ $ Incentive — — Total management fee $ $ For the three months ended March 31, 2016 and 2015, no “success-based” payments were incurred. Other Related Party Transactions Due from related party was $0.4 million and $8.1 million at March 31, 2016 and December 31, 2015, respectively, and consisted primarily of paydowns to be remitted and escrows held by our Manager and its affiliates related to real estate transactions. Due to related party was $2.4 million at March 31, 2016 and consisted primarily of $1.3 million of base management fees due to our Manager , of which $0.7 million will be remitted by us in the following quarter and $1.1 million of escrows due to our Manager and its affiliates related to real estate transactions . At December 31, 2015, due to related party was $3.4 million and consisted primarily of base management fees due to our Manager that we remitted in the following quarter. In January 2016, we originated a $12.7 million bridge loan and a $5.2 million preferred equity investment on two multifamily properties owned by a consortium of investors consisting of certain of our officers, including Mr. Kaufman, who together own an interest of approximately 50% in the borrowing entity. The bridge loan has an interest rate of one-month LIBOR plus 4.50% with a LIBOR floor of 0.25% and a maturity date of January 2019. The preferred equity investment has a fixed interest rate of 10% and a maturity date of April 2016, which was extended to July 2016. Interest income recorded from these loans totaled $0.3 million for the three months ended March 31, 2016. In January 2016, we originated a $19.0 million bridge loan on a multifamily property owned by a consortium of investors consisting of certain of our officers, including Mr. Kaufman, who together own an interest of approximately 7.5% in the borrowing entity. The loan has an interest rate of one-month LIBOR plus 4.50% with a LIBOR floor of 0.25% and a maturity date of January 2019. Interest income recorded from this loan totaled $0.2 million for the three months ended March 31, 2016. In November 2015, we originated a $7.1 million bridge loan on a multifamily property owned by a consortium of investors consisting of certain of our officers, including Mr. Kaufman, who together own an interest of approximately 7.5% in the borrowing entity. The loan has an interest rate of LIBOR plus 4.50% with a LIBOR floor of 0.25% and a maturity date of November 2018 with two one-year extension options. Interest income recorded from this loan totaled $0.1 million for the three months ended March 31, 2016. In October 2015, we originated two bridge loans totaling $16.7 million secured by multifamily properties acquired by a third party investor. The properties had been owned and were sold by a consortium of investors, consisting of certain of our officers, including Mr. Kaufman, certain other related parties and certain unaffiliated persons. The loans have an interest rate of LIBOR plus 5.00% with a LIBOR floor of 0.25% and a maturity date of October 2017. Interest income recorded from these loans totaled $0.2 million for the three months ended March 31, 2016. In April 2015, we originated a $6.3 million bridge loan on a multifamily property owned by a consortium of investors consisting of certain of our officers, including Mr. Kaufman and our Manager, who together own an interest of approximately 90% in the borrowing entity. The loan has an interest rate of LIBOR plus 4.50% with a LIBOR floor of 0.25% and a maturity date of April 2018. Interest income recorded from this loan totaled $0.1 million for the three months ended March 31, 2016. In February 2015, we modified an $18.0 million preferred equity investment, increasing our balance to $23.0 million with a fixed interest rate of 10% and a maturity date of February 2018 . In order to accomplish the modification, we formed a joint venture with a consortium of investors consisting of certain of our officers, including Mr. Kaufman, and other related parties, to invest in an additional $2.0 million preferred equity investment that is generally subordinate to ours. Interest income recorded from this loan was $0.6 million for the three ended March 31, 2016. In the first quarter of 2015, we invested $9.6 million for 50% of our Manager’s indirect interest in a joint venture with a third party that was formed to invest in a residential mortgage banking business. As a result of this transaction, we had an initial indirect interest of 22.5% in this entity. In 2015, we also invested a total of $9.7 million through this joint venture in non-qualified residential mortgages purchased from the mortgage banking business’s origination platform. During the three months ended March 31, 2016, we funded an additional $2.4 million into these residential mortgages. We recorded income of $1.6 million from these investments during the three months ended March 31, 2016. See Note 5 — “Investment in Equity Affiliates” for further details . In 2014, we invested $0.1 million for a 5% interest in a joint venture that owns two multifamily properties. The joint venture consists of a consortium of investors consisting of certain of our officers, including Mr. Kaufman, and other related parties, who together own an interest of approximately 95%. In 2014, we originated two bridge loans totaling $5.0 million to the joint venture with an interest rate of 5.5% over one-month LIBOR and a maturity date extended to March 2016. The maturity date on both of these loans was extended to June 2016. Interest income recorded from these loans was less than $0.1 million for the three months ended March 31, 2016. In 2014, we originated a $30.4 million bridge loan for an office property owned by a consortium of investors, including Mr. Kaufman and his affiliates, who together own an interest of approximately 24% in the borrowing entity. The loan has an interest rate of LIBOR plus 7.90% with a LIBOR floor of 0.50% and a maturity date that was extended to January 2017. In January 2016, we also originated a $4.6 million mezzanine loan to this entity that has a fixed interest rate of 12% and a maturity of January 2017. Interest income recorded from these loans was $0.9 million for the three months ended March 31, 2016. In 2014, our Manager purchased a property subject to two loans originated by us, a first mortgage of $14.6 million and a second mortgage of $5.1 million, both with maturity dates of April 2016 and an interest rate of LIBOR plus 4.80%. During the first quarter of 2016, the $5.1 million second mortgage was repaid in full by our Manager and the $14.6 million first mortgage was extended to September 2016. Interest income recorded from these loans totaled $0.3 million for the three months ended March 31 , 2016. In June 2013, our Board of Directors formed a special committee consisting of independent directors in connection with the exploration and evaluation of a potential transaction with our Manager involving the acquisition of our Manager’s Fannie Mae, DUS, FHA and CMBS platforms, as well as the internalization of the management of our current business. In late June of 2014, preliminary discussions regarding a possible transaction resumed and in February 2016, we entered into a Purchase Agreement to acquire the ACM Agency Business from our Manager for $250.0 million. See Note 1 — “Description of Business” for further details. In connection with evaluating this potential transaction, we incurred advisory fees totaling $3.1 million during the three months ended March 31, 2016. In 2011, we restructured a preferred equity investment on the Lexford Portfolio (“Lexford”), which is a portfolio of multifamily assets. In connection with this restructuring, we, along with an executive officer of the Company and a consortium of independent outside investors made an additional preferred and direct equity investment. Both of our preferred equity investments were repaid in full by the third quarter of 2015. As a result of the direct equity investment, which was also repaid in the third quarter of 2015, we received distributions totaling $5.5 million during 2015 and a $0.2 million distribution in the first quarter of 2016 that we recorded as income from equity affiliates. In addition, under the terms of the restructuring, Lexford’s first mortgage lender required a change of property manager for the underlying assets. The new management company is owned primarily by a consortium of affiliated investors including Mr. Kaufman and an executive officer of the Company, and has a contract with the new entity for 7.5 years and is entitled to 4.75% of gross revenues of the underlying properties, along with the potential to share in the proceeds of a sale or refinancing of the debt should the management company remain engaged by the new entity at the time of such capital event. We have provided limited (“bad boy”) guarantees for certain debt controlled by Lexford. The bad boy guarantees may become a liability for us upon standard “bad” acts such as fraud or a material misrepresentation by Lexford or us. At March 31, 2016, this debt had an aggregate outstanding balance of $854.3 million and is scheduled to mature between 2017 and 2025. We are dependent upon our Manager with whom we have a conflict of interest, to provide services to us that are vital to our operations. Our chairman, chief executive officer and president, Mr. Ivan Kaufman, is also the chief executive officer and president of our Manager, and, our chief financial officer and treasurer, Mr. Paul Elenio, is the chief financial officer of our Manager. In addition, Mr. Kaufman and his affiliated entities (“the Kaufman Entities”) together beneficially own approximately 92% of the outstanding membership interests of our Manager and certain of our employees and directors also hold an ownership interest in our Manager. Furthermore, one of our former directors is general counsel to our Manager and another of our directors also serves as the trustee of one of the Kaufman Entities that holds a majority of the outstanding membership interests in our Manager and co-trustee of another Kaufman Entity that owns an equity interest in our Manager. Our Manager currently holds approximately 5.3 million of our common shares, representing approximately 10.4% of the voting power of our outstanding stock as of March 31, 2016. Our Board of Directors approved a resolution under our charter allowing Mr. Kaufman and our Manager , (which Mr. Kaufman has a controlling equity interest in), to own more than the 5% ownership interest limit of our common stock as stated in our charter as amended. |
Due to Borrowers
Due to Borrowers | 3 Months Ended |
Mar. 31, 2016 | |
Due to Borrowers | |
Due to Borrowers | Note 15 — Due to Borrowers Due to borrowers represents borrowers’ funds held by us to fund certain expenditures or to be released at our discretion upon the occurrence of certain pre-specified events, and to serve as additional collateral for borrowers’ loans. While retained, these balances earn interest in accordance with the specific loan terms they are associated with. |
Summary of Significant Accoun24
Summary of Significant Accounting Policies (Policies) | 3 Months Ended |
Mar. 31, 2016 | |
Summary of Significant Accounting Policies | |
Basis of Presentation and Principles of Consolidation | Basis of Presentation and Principles of Consolidation The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”), for interim financial statements and the instructions to Form 10-Q and Rule 10-01 of Regulation S-X. Accordingly, certain information and footnote disclosures normally included in the consolidated financial statements prepared under GAAP have been condensed or omitted. In the opinion of management, all adjustments considered necessary for a fair presentation of our financial position, results of operations and cash flows have been included and are of a normal and recurring nature. The operating results presented for interim periods are not necessarily indicative of the results that may be expected for any other interim period or for the entire year. These consolidated financial statements should be read in conjunction with our consolidated financial statements and notes thereto included in our 2015 Annual Report, which was filed with the SEC. The accompanying unaudited consolidated financial statements include our financial statements, our wholly owned subsidiaries, and partnerships or other joint ventures in which we own a voting interest of greater than 50 percent, and variable interest entities (“VIEs”) of which we are the primary beneficiary. VIEs are defined as entities in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. A VIE is required to be consolidated by its primary beneficiary, which is the party that (i) has the power to control the activities that most significantly impact the VIE’s economic performance and (ii) has the obligation to absorb losses of the VIE that could potentially be significant to the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE. Current accounting guidance requires us to present a) assets of a consolidated VIE that can be used only to settle obligations of the consolidated VIE, and b) liabilities of a consolidated VIE for which creditors (or beneficial interest holders) do not have recourse to the general credit of the primary beneficiary. As a result of this guidance, we have separately disclosed parenthetically the assets and liabilities of our collateralized loan obligation (“CLO”) subsidiaries on our consolidated balance sheets. Entities in which we have significant influence are accounted for primarily under the equity method. As a REIT, we are generally not subject to federal income tax on our REIT—taxable income that we distribute to our stockholders, provided that we distribute at least 90% of our REIT—taxable income and meet certain other requirements. As of March 31, 2016 and 2015, we were in compliance with all REIT requirements and, therefore, have not provided for income tax expense for the three months ended March 31, 2016 and 2015. Certain of our assets that produce non-qualifying income are owned by our taxable REIT subsidiaries, the income of which is subject to federal and state income taxes. During the three months ended March 31, 2016 and 2015, we did not record any provision for income taxes for these taxable REIT subsidiaries as we expect any income to be offset by available federal and state net operating loss carryforwards. The preparation of consolidated financial statements in conformity with GAAP requires management to make estimates and assumptions that could materially affect the amounts reported in the consolidated financial statements and accompanying notes. Actual results could differ from those estimates. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In March 2016, the Financial Accounting Standards Board (“FASB”) amended its guidance on stock compensation, which is intended to simplify several aspects of the accounting for share-based payment award transactions. The guidance is effective for the first quarter of 2017 and we are currently evaluating the impact it may have on our consolidated financial statements. In March 2016, the FASB amended its guidance on accounting for equity method investments. Among other things, the amended guidance eliminates the requirement that when an investment qualifies for use of the equity method as a result of an increase in the level of ownership interest or degree of influence, an investor must adjust the investment, results of operations, and retained earnings retroactively on a step-by-step basis as if the equity method had been in effect during all previous periods that the investment had been held. The guidance is effective for the first quarter of 2017 and we are currently evaluating the impact it may have on our consolidated financial statements. In February 2016, the FASB amended its guidance on accounting for leases that requires an entity to recognize balance sheet assets and liabilities for leases with terms of more than 12 months and also requires disclosure of key information about an entity’s leasing arrangements. The guidance is effective for the first quarter of 2019 with early adoption permitted. A modified retrospective approach is required. We are currently evaluating the impact this guidance may have on our consolidated financial statements. In January 2016, the FASB amended its guidance on the recognition and measurement of financial assets and liabilities. The amended guidance requires equity investments (except those accounted for under the equity method of accounting or those that result in consolidation of the investee) to be measured at fair value with changes in fair value recognized in net income. This update also, among other things, eliminates the requirement for an entity to disclose the methods and significant assumptions used to estimate the fair value that is required to be disclosed for financial instruments measured at amortized cost. The guidance is effective for the first quarter of 2018 and we are currently evaluating the impact it may have on our consolidated financial statements. In September 2015, the FASB amended its guidance on measurement-period adjustments arising from business combinations. The guidance was effective for the first quarter of 2016 and it did not have a material impact on our consolidated financial statements. In April 2015, the FASB amended its guidance on the balance sheet presentation of debt issuance costs. The guidance was effective for the first quarter of 2016. We early adopted this guidance in the fourth quarter of 2015 and it did not have a material effect on our consolidated financial statements. In February 2015, the FASB amended its guidance on the consolidation analysis of VIEs. The guidance was effective for the first quarter of 2016 and it did not have a material impact on our consolidated financial statements. |
Loans and Investments (Tables)
Loans and Investments (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Loans and Investments | |
Schedule of composition of loan and investment portfolio | March 31, 2016 Percent of Total Loan Count Wtd. Avg. Pay Rate (1) Wtd. Avg. Remaining Months to Maturity Wtd. Avg. First Dollar LTV Ratio (2) Wtd. Avg. Last Dollar LTV Ratio (3) Bridge loans $ % % % % Mezzanine loans % % % % Junior participation loans % % % % Preferred equity investments % % % % % % % % Unearned revenue ) Allowance for loan losses ) Loans and investments, net $ December 31, 2015 Percent of Total Loan Count Wtd. Avg. Pay Rate (1) Wtd. Avg. Remaining Months to Maturity Wtd. Avg. First Dollar LTV Ratio (2) Wtd. Avg. Last Dollar LTV Ratio (3) Bridge loans $ % % % % Mezzanine loans % % % % Junior participation loans % % % % Preferred equity investments % % % % % % % % Unearned revenue ) Allowance for loan losses ) Loans and investments, net $ (1) “Weighted Average Pay Rate” is a weighted average, based on the unpaid principal balances of each loan in our portfolio, of the interest rate that is required to be paid monthly as stated in the individual loan agreements. Certain loans and investments that require an additional rate of interest “Accrual Rate” to be paid at the maturity are not included in the weighted average pay rate as shown in the table. (2) The “First Dollar LTV Ratio” is calculated by comparing the total of our senior most dollar and all senior lien positions within the capital stack to the fair value of the underlying collateral to determine the point at which we will absorb a total loss of our position. (3) The “Last Dollar LTV Ratio” is calculated by comparing the total of the carrying value of our loan and all senior lien positions within the capital stack to the fair value of the underlying collateral to determine the point at which we will initially absorb a loss. |
Summary of the loan and investment portfolio's weighted average internal risk ratings and LTV ratios by asset class | March 31, 2016 Asset Class Unpaid Principal Balance Percentage of Portfolio Wtd. Avg. Internal Risk Rating Wtd. Avg. First Dollar LTV Ratio Wtd. Avg. Last Dollar LTV Ratio Multi-family $ % % % Office % % % Land % % % Hotel % % % Other % % % Total $ % % % December 31, 2015 Asset Class Unpaid Principal Balance Percentage of Portfolio Wtd. Avg. Internal Risk Rating Wtd. Avg. First Dollar LTV Ratio Wtd. Avg. Last Dollar LTV Ratio Multi-family $ % % % Office % % % Land % % % Hotel % % % Other % % % Total $ % % % |
Summary of the changes in the allowance for loan losses | Three Months Ended March 31, 2016 2015 Allowance at beginning of the period $ $ Provision for loan losses — Charge-offs — — Recoveries of reserves ) ) Allowance at end of the period $ $ |
Summary of charge-offs and recoveries | Three Months Ended March 31, 2016 2015 Charge-offs: Hotel $ — $ — Office — — Multi-family — — Total $ — $ — Recoveries: Multi-family $ ) $ ) Total $ ) $ ) Net (Charge-offs) Recoveries $ $ Ratio of net (charge-offs) recoveries during the period to average loans and investments outstanding during the period % % |
Summary of the company's impaired loans by asset class | March 31, 2016 Three Months Ended March 31, 2016 Asset Class Unpaid Principal Balance Carrying Value (1) Allowance for Loan Losses Average Recorded Investment (2) Interest Income Recognized Multi-family $ $ $ $ $ Office Land — Hotel Commercial — Total $ $ $ $ $ December 31, 2015 Three Months Ended March 31, 2015 Asset Class Unpaid Principal Balance Carrying Value (1) Allowance for Loan Losses Average Recorded Investment (2) Interest Income Recognized Multi-family $ $ $ $ $ Office Land — Hotel Commercial — — Total $ $ $ $ $ (1) Represents the UPB of impaired loans less unearned revenue and other holdbacks and adjustments by asset class and was comprised of nine loans at both March 31, 2016 and December 31, 2015. (2) Represents an average of the beginning and ending UPB of each asset class. |
Summary of the company's non-performing loans by asset class | March 31, 2016 December 31, 2015 Asset Class Carrying Value Less Than 90 Days Past Due Greater Than 90 Days Past Due Carrying Value Less Than 90 Days Past Due Greater Than 90 Days Past Due Multi-family $ $ — $ $ $ — $ Office — — Commercial — — Total $ $ — $ $ $ — $ |
Summary of loan modifications, refinancings and/or extensions by asset class that the entity considered to be troubled debt restructurings by asset class | Three Months Ended March 31, 2016 Three Months Ended March 31, 2015 Asset Class Number of Loans Original Unpaid Principal Balance Original Rate of Interest Extended Unpaid Principal Balance Extended Weighted Average Rate of Interest Number of Loans Original Unpaid Principal Balance Original Weighted Average Rate of Interest Extended Unpaid Principal Balance Extended Weighted Average Rate of Interest Multifamily $ % $ % $ % $ % |
Securities (Tables)
Securities (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Securities | |
Summary of the company's securities classified as available-for-sale | The following is a summary of our securities classified as available-for-sale at March 31, 2016: Amortized Cumulative Unrealized Carrying Value / Estimated Cost Gain Fair Value 2,939,465 common shares of CV Holdings, Inc. $ $ $ The following is a summary of our securities classified as available-for-sale at December 31, 2015: Face Amortized Cumulative Unrealized Carrying Value / Estimated Value Cost Gain Fair Value Federal Home Loan Mortgage Corporation $ $ $ — $ 2,939,465 common shares of CV Holdings, Inc. — $ Total available-for-sale securities $ $ $ $ |
Investments in Equity Affilia27
Investments in Equity Affiliates (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Investments in Equity Affiliates | |
Summary of the company's investments in equity affiliates | Investments in Equity Affiliates at UPB of Loans to Equity Affiliates at Equity Affiliates March 31, 2016 December 31, 2015 March 31, 2016 Arbor Residential Investor LLC $ $ $ — West Shore Café Lightstone Value Plus REIT L.P. — Issuers of Junior Subordinated Notes — JT Prime — East River Portfolio Lexford Portfolio — Ritz-Carlton Club — — — Total $ $ $ |
Summary of statements of operations for the Company's individually significant investments in ARI | Three Months Ended March 31, Statements of Operations: 2016 2015 Revenue: Total revenues $ $ Total expenses Net income $ $ Arbor’s share of income $ $ |
Real Estate Owned and Held-Fo28
Real Estate Owned and Held-For-Sale (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Real Estate Owned and Held-For-Sale | |
Schedule of real estate owned | March 31, 2016 December 31, 2015 Hotel Portfolio Office Building Total Multifamily Portfolio Hotel Portfolio Office Building Total Land $ $ $ $ $ $ $ Building and intangible assets Less: accumulated depreciation and amortization ) ) ) ) ) ) ) Real estate owned, net $ $ $ $ $ $ $ |
Schedule of results of operations for properties classified as held-for-sale | Three Months Ended March 31, 2016 2015 Revenue: Property operating income $ $ Expenses: Property operating expense Depreciation Net income (loss) $ $ ) |
Debt Obligations (Tables)
Debt Obligations (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Credit facilities and repurchase agreements | |
Debt Obligations | |
Schedule of borrowings | March 31, 2016 December 31, 2015 Debt Debt Collateral Weighted Debt Debt Collateral Weighted Principal Carrying Carrying Average Principal Carrying Carrying Average Balance Value Value Note Rate Value Value Value Note Rate $150 million warehouse repurchase facility $ $ $ % $ $ $ % $100 million warehousing credit facility % % $75 million warehousing credit facility % % $75 million warehousing credit facility % — — — — $50 million warehousing credit facility % % $16.5 million term credit facility % % Total $ $ $ % $ $ $ % |
Collateralized loan obligations | |
Debt Obligations | |
Schedule of borrowings | The following table outlines borrowings and the corresponding collateral under our CLOs as of March 31, 2016: Debt Collateral Loans Cash Face Carrying Unpaid Carrying Restricted Collateral Value Value Principal Value Cash (1) At-Risk (2) CLO III $ $ $ $ $ $ — CLO IV — CLO V — Total CLOs $ $ $ $ $ $ — The following table outlines borrowings and the corresponding collateral under our CLOs as of December 31, 2015: Debt Collateral Loans Cash Face Carrying Unpaid Carrying Restricted Collateral Value Value Principal Value Cash (1) At-Risk (2) CLO III $ $ $ $ $ $ — CLO IV — CLO V — Total CLOs $ $ $ $ $ $ — CLO III — Issued three investment grade tranches in April 2014 with a replacement period through October 2016 and a stated maturity date in May 2024. Interest is variable based on three-month LIBOR; the weighted average note rate was 2.87% and 2.86% at March 31, 2016 and December 31, 2015, respectively . Debt carrying value is net of $1.8 million and $2.1 million of deferred financing fees at March 31, 2016 and December 31, 2015, respectively. CLO IV — Issued three investment grade tranches in February 2015 with a replacement period through September 2017 and a stated maturity date in March 2025. Interest is variable based on three-month LIBOR; the weighted average note rate was 2.72% and 2.71% at March 31, 2016 and December 31, 2015, respectively. Debt carrying value is net of $2.7 million and $3.0 million of deferred financing fees at March 31, 2016 and December 31, 2015, respectively. CLO V — Issued three investment grade tranches in August 2015 with a replacement period through September 2018 and a stated maturity date in September 2025. Interest is variable based on one-month LIBOR; the weighted average note rate was 2.92% and 2.91% at March 31, 2016 and December 31, 2015, respectively. Debt carrying value is net of $3.7 million and $3.8 million of deferred financing fees at March 31, 2016 and December 31, 2015, respectively. (1) Represents restricted cash held for principal repayments as well as for reinvestment in the CLOs. Does not include restricted cash related to interest payments, delayed fundings and expenses. (2) Amounts represent the face value of collateral in default, as defined by the CLO indenture, as well as assets deemed to be “credit risk.” Credit risk assets are reported by each of the CLOs and are generally defined as one that, in the CLO collateral manager’s reasonable business judgment, has a significant risk of declining in credit quality or, with a passage of time, becoming a defaulted asset. |
Collateralized debt obligations and collateralized loan obligations | |
Debt Obligations | |
Summary of the company's CLO compliance tests as of the most recent determination dates | The chart below is a summary of our CLO compliance tests as of the most recent determination dates in April 2016: Cash Flow Triggers CLO III CLO IV CLO V Overcollateralization (1) Current % % % Limit % % % Pass / Fail Pass Pass Pass Interest Coverage (2) Current % % % Limit % % % Pass / Fail Pass Pass Pass (1) The overcollateralization ratio divides the total principal balance of all collateral in the CLO by the total principal balance of the bonds associated with the applicable ratio. To the extent an asset is considered a defaulted security, the asset’s principal balance for purposes of the overcollateralization test is the lesser of the asset’s market value or the principal balance of the defaulted asset multiplied by the asset’s recovery rate which is determined by the rating agencies. Rating downgrades of CLO collateral will generally not have a direct impact on the principal balance of a CLO asset for purposes of calculating the CLO overcollateralization test unless the rating downgrade is below a significantly low threshold (e.g. CCC-) as defined in each CLO vehicle. (2) The interest coverage ratio divides interest income by interest expense for the classes senior to those retained by us. |
Summary of the Company's CLO overcollateralization ratios | Determination (1) CLO III CLO IV CLO V April 2016 % % % January 2016 % % % October 2015 % % % July 2015 % % — April 2015 % % — (1) The table above represents the quarterly trend of our overcollateralization ratio, however, the CLO determination dates are monthly and we were in compliance with this test for all periods presented. |
Derivative Financial Instrume30
Derivative Financial Instruments (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Derivative Financial Instruments | |
Schedule of derivative financial instruments held by the company | The following is a summary of the derivative financial instruments held by us (dollars in thousands): Notional Value Balance Fair Value Designation\ Cash Flow Derivative Count March 31, 2016 Count December 31, 2015 Expiration Date Sheet Location March 31, 2016 December 31, 2015 Qualifying LIBOR Caps 2 $ 2 $ 2017 Other Assets $ $ Qualifying Interest Rate Swaps 5 $ 5 $ 2016 - 2017 Other Liabilities $ ) $ ) |
Schedule of the effect of the company's derivative financial instruments on the statements of income | The following table presents the effect of our derivative financial instruments on the statements of income (dollars in thousands): Amount of Loss Recognized in Other Comprehensive Loss (Effective Portion) For the Three Months Ended March 31, Amount of Loss Reclassified from Accumulated Other Comprehensive Loss into Interest Expense (Effective Portion) For the Three Months Ended March 31, Amount of Loss Reclassified from Accumulated Other Comprehensive Loss into Loss on Termination of Swaps (Ineffective Portion) For the Three Months Ended March 31, Amount of Loss Recognized in Loss on Termination of Swaps (Ineffective Portion) For the Three Months Ended March 31, Designation\Cash Flow Derivative 2016 2015 2016 2015 2016 2015 2016 2015 Non-Qualifying Basis Swaps $ — $ — $ — $ — $ — $ — $ — $ ) Qualifying Interest Rate Swaps/Cap $ $ $ ) $ ) $ — $ ) $ — $ — |
Variable Interest Entities (Tab
Variable Interest Entities (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Variable Interest Entities | |
Summary of the company's variable interests in identified VIEs, of which the company is not the primary beneficiary | The following is a summary of our variable interests in identified VIEs, of which we are not the primary beneficiary, as of March 31, 2016: Type Carrying Amount (1) Maximum Exposure to Loss (2) Loans $ $ Equity investments Junior subordinated notes (3) Total $ $ (1) Represents the carrying amount of loans and investments before reserves. At March 31, 2016, $152.8 million of loans to VIEs had corresponding loan loss reserves of $80.6 million. See Note 3 — “Loans and Investments” for further details. (2) Our maximum exposure to loss as of March 31, 2016 would not exceed the carrying amount of its investment. (3) It is not appropriate to consolidate these entities as equity interests are variable interests only to the extent that the investment is considered to be at risk. Since our investments were funded by the entities that issued the junior subordinated notes, it is not considered to be at risk. |
Fair Value (Tables)
Fair Value (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Fair Value. | |
Summary of the carrying values and the estimated fair values of the Company's financial instruments | March 31, 2016 December 31, 2015 Principal / Principal / Notional Carrying Estimated Notional Carrying Estimated Amount Value Fair Value Amount Value Fair Value Financial assets: Loans and investments $ $ $ $ $ $ Available-for-sale securities Derivative financial instruments Financial liabilities: Credit and repurchase facilities $ $ $ $ $ $ Collateralized loan obligations Senior unsecured notes Junior subordinated notes Mortgage note payable - real estate owned and held-for-sale Derivative financial instruments |
Schedule of certain financial assets and financial liabilities measured at fair value on a recurring basis | The fair value of these financial assets and liabilities was determined using the following input levels as of March 31, 2016: Fair Value Measurements Carrying Fair Using Fair Value Hierarchy Value Value Level 1 Level 2 Level 3 Financial assets: Available-for-sale securities $ $ $ $ — $ — Derivative financial instruments — — Financial liabilities: Derivative financial instruments $ $ $ — $ $ — |
Schedule of certain financial and non-financial assets measured at fair value on a nonrecurring basis | The fair value of these financial assets was determined using the following input levels as of March 31, 2016: Net Carrying Fair Fair Value Measurements Using Fair Value Hierarchy Value Value Level 1 Level 2 Level 3 Financial assets: Impaired loans, net (1) $ $ $ — $ — $ (1) We had an allowance for loan losses of $86.7 million relating to nine loans with an aggregate carrying value, before loan loss reserves, of $189.7 million at March 31, 2016. |
Schedule of quantitative information about Level 3 Fair Value Measurements on a recurring and non-recurring basis | March 31, 2016 Fair Value Valuation Techniques Significant Unobservable Inputs Range (Weighted Average) Financial assets: Impaired loans (1): Multi-family $ Direct capitalization analysis Capitalization rate Revenue growth rate 6.50% to 9.75% (8.86%) 4.30% Office Discounted cash flows Discount rate Capitalization rate Revenue growth rate 11.00% 8.03% 2.50% Land Discounted cash flows Discount rate Capitalization rate Revenue growth rate 15.00% 7.25% 3.00% Hotel Discounted cash flows Discount rate Capitalization rate Revenue growth rate 9.25% 7.25% 3.80% Commercial — Discounted cash flows Capitalization rate 6.00% (1) Includes all impaired loans regardless of the period in which a loan loss provision was recorded. |
Schedule of fair value of assets and liabilities | The fair value of these assets and liabilities was determined using the following input levels as of March 31, 2016: Fair Value Measurements Carrying Fair Using Fair Value Hierarchy Value Value Level 1 Level 2 Level 3 Financial assets: Loans and investments, net $ $ $ — $ — $ Financial liabilities: Credit facilities and repurchase agreements $ $ $ — $ — $ Collateralized loan obligations — — Senior unsecured notes — — Junior subordinated notes — — Mortgage note payable — real estate owned — — |
Equity (Tables)
Equity (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Equity | |
Schedule of dividends declared by the Company (on a per share basis) | The following table presents dividends declared (on a per share basis) for the three months ended March 31, 2016: Common Stock Preferred Stock Dividend (1) Declaration Date Dividend Declaration Date Series A Series B Series C February 24, 2016 $ February 1, 2016 $ $ $ (1) The dividend declared on February 1, 2016 for the Series A, B and C preferred stock was for the period December 1, 2015 through February 29, 2016. |
Schedule of reclassifications out of accumulated other comprehensive loss | Three Months Ended March 31, 2016 2015 Statement of Income Caption Net realized losses on derivatives designated as cash flow hedges: Interest rate swaps $ ) $ ) Interest expense (1) Termination of interest rate swaps $ — $ ) Loss on termination of swaps (1) (1) See Note 8 — “Derivative Financial Instruments” for additional details . |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Earnings Per Share | |
Reconciliation of the numerator and denominator of the basic and diluted EPS computations | Three Months Ended Three Months Ended March 31, 2016 March 31, 2015 Basic Diluted Basic Diluted Net income attributable to common stockholders (1) $ $ $ $ Weighted average number of common shares outstanding Dilutive effect of restricted stock units (2) — — Weighted average number of common shares outstanding Net income per common share (1) $ $ $ $ (1) Net of preferred stock dividends. (2) Mr. Kaufman was granted restricted stock units in 2016 and 2015 which vest at the end of a four-year performance period based upon our achievement of total shareholder return objectives. See Note 12 — “Equity” for further details. |
Agreements and Transactions wit
Agreements and Transactions with Related Parties (Tables) | 3 Months Ended |
Mar. 31, 2016 | |
Agreements and Transactions with Related Parties | |
Schedule of Company's base management fees and incentive fees | Three Months Ended March 31, Management Fees: 2016 2015 Base $ $ Incentive — — Total management fee $ $ |
Description of Business (Detail
Description of Business (Detail) $ / shares in Units, shares in Thousands, $ in Millions | Feb. 25, 2016USD ($)employeeitem$ / sharesshares | Feb. 29, 2016USD ($) | Mar. 31, 2016USD ($) | Mar. 31, 2016USD ($) |
Description of Business | ||||
Advisory fees | $ 3.1 | $ 7.6 | ||
Agency Platform | ACM / Our "Manager" | ||||
Description of Business | ||||
Acquisition purchase price | $ 250 | $ 250 | ||
Consideration in stock (as a percent) | 50.00% | |||
Consideration in cash (as a percent) | 50.00% | |||
Op Units Redeemable for cash (in ratio) | 1 | |||
Consideration in stock to be paid with operating partnership units (in shares) | shares | 19,230 | |||
Number of votes | item | 1 | |||
Stock consideration paid in the form of operating partnership units (USD per partnership unit) | $ / shares | $ 6.50 | |||
Number of employees | employee | 230 | |||
Period to exercise the option to purchase the existing management contract | 2 years | |||
Consideration to purchase the existing management contract | $ 25 | |||
Consideration to purchase the existing management contract second year | 27 | |||
Agency Platform | ACM / Our "Manager" | Maximum | ||||
Description of Business | ||||
Seller financing used to satisfy the cash portion of the consideration | $ 50 |
Loans and Investments, Disclosu
Loans and Investments, Disclosures (Details) | 3 Months Ended | 12 Months Ended | ||
Mar. 31, 2016USD ($)item | Mar. 31, 2015USD ($) | Dec. 31, 2015USD ($)item | Dec. 31, 2014USD ($) | |
Loans and Investments | ||||
Loans and investments, gross | $ | $ 1,677,335,360 | $ 1,545,126,045 | ||
Unearned revenue | $ | (8,966,815) | (8,030,129) | ||
Allowance for loan losses | $ | (86,746,575) | $ (116,470,000) | (86,761,575) | $ (115,487,320) |
Loans and investments, net | $ | $ 1,581,621,970 | $ 1,450,334,341 | ||
Percent of Total | 100.00% | 100.00% | ||
Loan Count | 135 | 128 | ||
Wtd. Avg. Pay Rate (as a percent) | 5.60% | 5.63% | ||
Wtd. Avg. Remaining Months to Maturity | 18 months 15 days | 17 months 21 days | ||
Wtd. Avg. First Dollar LTV Ratio (as percent) | 7.00% | 7.00% | ||
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 77.00% | 76.00% | ||
Employee compensation and benefits | $ | $ 4,328,342 | $ 4,290,206 | ||
Number of portfolio segments | 1 | |||
Higher credit risk | ||||
Loans and Investments | ||||
Loans and investments, gross | $ | $ 155,300,000 | $ 154,700,000 | ||
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 94.00% | 94.00% | ||
Credit risk concentration | ||||
Loans and Investments | ||||
Loans and investments, gross | $ | $ 1,677,335,360 | $ 1,545,126,045 | ||
Percent of Total | 100.00% | 100.00% | ||
Wtd. Avg. First Dollar LTV Ratio (as percent) | 7.00% | 7.00% | ||
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 77.00% | 76.00% | ||
Credit risk concentration | Minimum | ||||
Loans and Investments | ||||
Credit risk individual ratings | 1 | |||
Credit risk concentration | Maximum | ||||
Loans and Investments | ||||
Credit risk individual ratings | 5 | |||
Credit risk concentration | Risk rating, three | ||||
Loans and Investments | ||||
Credit risk individual ratings | 3 | |||
Credit risk concentration | Risk rating, four | ||||
Loans and Investments | ||||
Credit risk individual ratings | 4 | |||
Credit risk concentration | Risk rating, five | ||||
Loans and Investments | ||||
Credit risk individual ratings | 5 | |||
Credit risk concentration | Risk rating, 3.5 | ||||
Loans and Investments | ||||
Credit risk individual ratings | 3.5 | |||
Credit risk concentration | Risk rating, 4.5 | ||||
Loans and Investments | ||||
Credit risk individual ratings | 4.5 | |||
Total assets | Credit risk concentration | ||||
Loans and Investments | ||||
Loan Count | 23 | 22 | ||
Number of different borrowers | 5 | 5 | ||
Concentration risk, percentage | 23.00% | 22.00% | ||
Bridge Loans | ||||
Loans and Investments | ||||
Loans and investments, gross | $ | $ 1,481,287,587 | $ 1,353,132,435 | ||
Percent of Total | 88.00% | 88.00% | ||
Loan Count | 112 | 105 | ||
Wtd. Avg. Pay Rate (as a percent) | 5.46% | 5.48% | ||
Wtd. Avg. Remaining Months to Maturity | 18 months 3 days | 16 months 21 days | ||
Wtd. Avg. First Dollar LTV Ratio (as percent) | 0.00% | 0.00% | ||
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 76.00% | 75.00% | ||
Mezzanine Loans | ||||
Loans and Investments | ||||
Loans and investments, gross | $ | $ 44,251,715 | $ 40,390,905 | ||
Percent of Total | 3.00% | 3.00% | ||
Loan Count | 11 | 11 | ||
Wtd. Avg. Pay Rate (as a percent) | 8.55% | 8.19% | ||
Wtd. Avg. Remaining Months to Maturity | 26 months 27 days | 32 months 27 days | ||
Wtd. Avg. First Dollar LTV Ratio (as percent) | 30.00% | 35.00% | ||
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 79.00% | 83.00% | ||
Junior participation loans | ||||
Loans and Investments | ||||
Loans and investments, gross | $ | $ 62,256,582 | $ 62,256,582 | ||
Percent of Total | 4.00% | 4.00% | ||
Loan Count | 2 | 2 | ||
Wtd. Avg. Pay Rate (as a percent) | 4.50% | 4.50% | ||
Wtd. Avg. Remaining Months to Maturity | 8 months 6 days | 11 months 6 days | ||
Wtd. Avg. First Dollar LTV Ratio (as percent) | 85.00% | 85.00% | ||
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 87.00% | 87.00% | ||
Preferred equity investments | ||||
Loans and Investments | ||||
Loans and investments, gross | $ | $ 89,539,476 | $ 89,346,123 | ||
Percent of Total | 5.00% | 5.00% | ||
Loan Count | 10 | 10 | ||
Wtd. Avg. Pay Rate (as a percent) | 7.29% | 7.52% | ||
Wtd. Avg. Remaining Months to Maturity | 27 months 27 days | 30 months 15 days | ||
Wtd. Avg. First Dollar LTV Ratio (as percent) | 44.00% | 43.00% | ||
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 85.00% | 80.00% |
Loans and Investments, Risk Rat
Loans and Investments, Risk Ratings and LTV Ratios (Details) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2016USD ($)item | Dec. 31, 2015USD ($)item | |
Loans and Investments | ||
Unpaid Principal Balance | $ 1,677,335,360 | $ 1,545,126,045 |
Percentage of Portfolio | 100.00% | 100.00% |
Wtd. Avg. First Dollar LTV Ratio (as percent) | 7.00% | 7.00% |
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 77.00% | 76.00% |
Loans and investments portfolio | New York | ||
Loans and Investments | ||
Concentration risk, percentage | 30.00% | 34.00% |
Loans and investments portfolio | Florida | ||
Loans and Investments | ||
Concentration risk, percentage | 16.00% | 14.00% |
Loans and investments portfolio | California | ||
Loans and Investments | ||
Concentration risk, percentage | 14.00% | 14.00% |
Loans and investments portfolio | Texas | ||
Loans and Investments | ||
Concentration risk, percentage | 11.00% | 12.00% |
Credit risk concentration | ||
Loans and Investments | ||
Unpaid Principal Balance | $ 1,677,335,360 | $ 1,545,126,045 |
Percentage of Portfolio | 100.00% | 100.00% |
Wtd. Avg. First Dollar LTV Ratio (as percent) | 7.00% | 7.00% |
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 77.00% | 76.00% |
Credit risk concentration | Weighted average | ||
Loans and Investments | ||
Wtd. Avg. Internal Risk Rating | item | 3.1 | 3.1 |
Credit risk concentration | Multi-family | ||
Loans and Investments | ||
Unpaid Principal Balance | $ 1,243,001,961 | $ 1,083,822,788 |
Percentage of Portfolio | 74.00% | 70.00% |
Wtd. Avg. First Dollar LTV Ratio (as percent) | 2.00% | 2.00% |
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 76.00% | 75.00% |
Credit risk concentration | Multi-family | Weighted average | ||
Loans and Investments | ||
Wtd. Avg. Internal Risk Rating | item | 3 | 3 |
Credit risk concentration | Office | ||
Loans and Investments | ||
Unpaid Principal Balance | $ 198,324,828 | $ 198,829,086 |
Percentage of Portfolio | 12.00% | 13.00% |
Wtd. Avg. First Dollar LTV Ratio (as percent) | 27.00% | 27.00% |
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 75.00% | 75.00% |
Credit risk concentration | Office | Weighted average | ||
Loans and Investments | ||
Wtd. Avg. Internal Risk Rating | item | 2.9 | 3 |
Credit risk concentration | Land | ||
Loans and Investments | ||
Unpaid Principal Balance | $ 169,470,238 | $ 164,410,838 |
Percentage of Portfolio | 10.00% | 11.00% |
Wtd. Avg. First Dollar LTV Ratio (as percent) | 4.00% | 5.00% |
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 89.00% | 90.00% |
Credit risk concentration | Land | Weighted average | ||
Loans and Investments | ||
Wtd. Avg. Internal Risk Rating | item | 3.7 | 3.8 |
Credit risk concentration | Hotel | ||
Loans and Investments | ||
Unpaid Principal Balance | $ 34,750,000 | $ 66,250,000 |
Percentage of Portfolio | 2.00% | 4.00% |
Wtd. Avg. First Dollar LTV Ratio (as percent) | 60.00% | 32.00% |
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 100.00% | 80.00% |
Credit risk concentration | Hotel | Weighted average | ||
Loans and Investments | ||
Wtd. Avg. Internal Risk Rating | item | 4 | 3.5 |
Credit risk concentration | Other | ||
Loans and Investments | ||
Unpaid Principal Balance | $ 31,788,333 | $ 31,813,333 |
Percentage of Portfolio | 2.00% | 2.00% |
Wtd. Avg. First Dollar LTV Ratio (as percent) | 12.00% | 13.00% |
Wtd. Avg. Last Dollar LTV Ratio (as percent) | 68.00% | 67.00% |
Credit risk concentration | Other | Weighted average | ||
Loans and Investments | ||
Wtd. Avg. Internal Risk Rating | item | 3.1 | 3.1 |
Loans and Investments, Impaired
Loans and Investments, Impaired Loans (Details) | 3 Months Ended | |
Mar. 31, 2016USD ($)item | Mar. 31, 2015USD ($)item | |
Loans and Investments | ||
Number of impaired loans | item | 2 | |
Carrying value of impaired loan | $ 4,800,000 | |
Number of loans for which no provision for loan loss made | item | 0 | 0 |
Changes in allowance for loan losses | ||
Allowance at beginning of the period | $ 86,761,575 | $ 115,487,320 |
Provision for loan losses | 1,000,000 | |
Recoveries of reserves | (15,000) | (17,320) |
Allowance at end of the period | 86,746,575 | $ 116,470,000 |
Maturity date of September 2017 | ||
Changes in allowance for loan losses | ||
Allowance at end of the period | 49,100,000 | |
Six loans collateralized by a land development project | Maturity date of September 2017 | ||
Loans and Investments | ||
Carrying value of impaired loan | $ 118,600,000 | |
Number of loans with unpaid principal balance | item | 6 | |
Four loans collateralized by a land development project | Maturity date of September 2017 | ||
Loans and Investments | ||
Carrying value of impaired loan | $ 97,200,000 | |
Number of loans with unpaid principal balance | item | 4 | |
Weighted average accrual rate of interest (as a percent) | 9.60% |
Loans and Investments, Charge-o
Loans and Investments, Charge-offs and Recoveries (Details) | 3 Months Ended | ||
Mar. 31, 2016USD ($)item | Mar. 31, 2015USD ($) | Dec. 31, 2015USD ($)item | |
Loans and Investments | |||
Recoveries of reserves | $ (15,000) | $ (17,320) | |
Net Recoveries (Charge-offs) Recoveries | $ 15,000 | $ 17,320 | |
Ratio of net (charge-offs) recoveries during the period to average loans and investments outstanding during the period | 0.00% | 0.00% | |
Unpaid Principal Balance | $ 199,445,407 | $ 198,861,364 | |
Carrying value | 189,663,108 | 189,209,415 | |
Allowance for Loan losses | 86,746,575 | $ 86,761,575 | |
Average Recorded Investment | 199,153,386 | $ 232,266,457 | |
Interest Income Recognized | $ 368,732 | 602,072 | |
Number of impaired loans | item | 9 | 9 | |
Multi-family | |||
Loans and Investments | |||
Recoveries of reserves | $ (15,000) | (17,320) | |
Unpaid Principal Balance | 7,347,115 | $ 7,362,115 | |
Carrying value | 7,390,618 | 7,350,764 | |
Allowance for Loan losses | 5,490,653 | 5,505,653 | |
Average Recorded Investment | 7,354,615 | 39,231,234 | |
Interest Income Recognized | 63,536 | 70,089 | |
Office | |||
Loans and Investments | |||
Unpaid Principal Balance | 27,576,082 | 27,580,582 | |
Carrying value | 22,791,944 | 22,796,444 | |
Allowance for Loan losses | 21,972,444 | 21,972,444 | |
Average Recorded Investment | 27,578,332 | 36,086,582 | |
Interest Income Recognized | 23,047 | 274,853 | |
Land | |||
Loans and Investments | |||
Unpaid Principal Balance | 128,072,210 | 127,468,667 | |
Carrying value | 123,380,546 | 122,875,774 | |
Allowance for Loan losses | 53,883,478 | 53,883,478 | |
Average Recorded Investment | 127,770,439 | 122,073,641 | |
Hotel | |||
Loans and Investments | |||
Unpaid Principal Balance | 34,750,000 | 34,750,000 | |
Carrying value | 34,400,000 | 34,486,433 | |
Allowance for Loan losses | 3,700,000 | 3,700,000 | |
Average Recorded Investment | 34,750,000 | 34,875,000 | |
Interest Income Recognized | 282,149 | $ 257,130 | |
Commercial | |||
Loans and Investments | |||
Unpaid Principal Balance | 1,700,000 | 1,700,000 | |
Carrying value | 1,700,000 | 1,700,000 | |
Allowance for Loan losses | 1,700,000 | $ 1,700,000 | |
Average Recorded Investment | $ 1,700,000 |
Loans and Investments, Non-perf
Loans and Investments, Non-performing Loans (Details) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2016USD ($)loanitem | Dec. 31, 2015USD ($)loanitem | |
Non-performing loans by asset class | ||
Number of loans | item | 135 | 128 |
Carrying value of loans before loan loss reserves | $ 1,677,335,360 | $ 1,545,126,045 |
Non-performing loans | ||
Non-performing loans by asset class | ||
Number of loans | item | 3 | 3 |
Carrying value of loans before loan loss reserves | $ 100,000 | |
Number of loans classified as non-performing which have loan loss reserve | loan | 3 | 3 |
Loan loss reserves | $ 22,900,000 | $ 22,900,000 |
Carrying Value | 22,943,097 | 22,938,243 |
Greater Than 90 Days Past Due | Non-performing loans | ||
Non-performing loans by asset class | ||
Past Due, Non-performing Loans | 22,943,097 | 22,938,243 |
Multi-family | Non-performing loans | ||
Non-performing loans by asset class | ||
Carrying Value | 770,653 | 765,799 |
Multi-family | Greater Than 90 Days Past Due | Non-performing loans | ||
Non-performing loans by asset class | ||
Past Due, Non-performing Loans | 770,653 | 765,799 |
Office | Non-performing loans | ||
Non-performing loans by asset class | ||
Carrying Value | 20,472,444 | 20,472,444 |
Office | Greater Than 90 Days Past Due | Non-performing loans | ||
Non-performing loans by asset class | ||
Past Due, Non-performing Loans | 20,472,444 | 20,472,444 |
Commercial | Non-performing loans | ||
Non-performing loans by asset class | ||
Carrying Value | 1,700,000 | 1,700,000 |
Commercial | Greater Than 90 Days Past Due | Non-performing loans | ||
Non-performing loans by asset class | ||
Past Due, Non-performing Loans | $ 1,700,000 | $ 1,700,000 |
Loans and Investments, Loan Mod
Loans and Investments, Loan Modifications, Refinancings and/or Extensions (Details) | 3 Months Ended | |
Mar. 31, 2016USD ($)item | Mar. 31, 2015USD ($)item | |
Troubled debt restructurings by asset class | ||
Number of loans considered to be troubled debt restructurings that subsequently considered non-performing | 0 | 0 |
Number of additional loans considered to be troubled debt restructurings | 0 | 0 |
Multi-family | ||
Troubled debt restructurings by asset class | ||
Number of loans considered to be troubled debt restructurings | 1 | 1 |
Original Unpaid Principal Balance | $ | $ 14,646,456 | $ 6,192,666 |
Original Weighted Average Rate of Interest (as a percent) | 5.24% | 5.93% |
Extended Unpaid Principal Balance | $ | $ 14,646,456 | $ 6,192,666 |
Extended Weighted Average Rate of Interest (as a percent) | 5.24% | 5.93% |
Loans and Investments, Interest
Loans and Investments, Interest Reserves (Details) $ in Millions | Mar. 31, 2016USD ($)item |
Loans and Investments | |
Total interest reserves | $ 16.1 |
Number of loans | item | 59 |
Aggregate unpaid principal balance | $ 787.8 |
Securities (Details)
Securities (Details) - USD ($) | 1 Months Ended | 3 Months Ended | |
Jan. 31, 2016 | Mar. 31, 2016 | Dec. 31, 2015 | |
Available-for-sale securities | |||
Carrying Value / Estimated Fair Value | $ 411,525 | $ 2,022,030 | |
Proceeds from sale of securities | 1,567,207 | ||
Gain on sale of securities | 15,491 | ||
Available-for-sale Securities | |||
Available-for-sale securities | |||
Fair Value | 1,500,000 | ||
Amortized Cost | 1,610,505 | ||
Cumulative Unrealized Gain | 411,525 | ||
Carrying Value / Estimated Fair Value | 2,022,030 | ||
Available-for-sale Securities | Federal Home Loan Mortgage Corporation | |||
Available-for-sale securities | |||
Fair Value | 1,500,000 | ||
Amortized Cost | 1,551,716 | ||
Carrying Value / Estimated Fair Value | $ 1,551,716 | ||
Fixed interest rate (as a percent) | 3.241% | ||
Proceeds from sale of securities | $ 1,600,000 | ||
Gain on sale of securities | $ 100,000 | ||
Available-for-sale Securities | Common Shares of CV Holdings, Inc. | |||
Available-for-sale securities | |||
Amortized Cost | 58,789 | $ 58,789 | |
Cumulative Unrealized Gain | 352,736 | 411,525 | |
Carrying Value / Estimated Fair Value | $ 411,525 | $ 470,314 | |
Number of shares of common stock purchased | 2,939,465 | 2,939,465 |
Investments in Equity Affilia45
Investments in Equity Affiliates, Summary (Details) - USD ($) | Mar. 31, 2016 | Dec. 31, 2015 |
Investment in Equity Affiliates | ||
Investment in Equity Affiliates | $ 34,927,586 | $ 30,870,235 |
Unpaid Principal Balance of Loans to Equity Affiliates | 6,681,666 | |
Arbor Residential Investor LLC | ||
Investment in Equity Affiliates | ||
Investment in Equity Affiliates | 29,964,030 | 25,923,679 |
West Shore Cafe | ||
Investment in Equity Affiliates | ||
Investment in Equity Affiliates | 1,975,933 | 1,955,933 |
Unpaid Principal Balance of Loans to Equity Affiliates | 1,687,500 | |
Lightstone Value Plus REIT L.P | ||
Investment in Equity Affiliates | ||
Investment in Equity Affiliates | 1,894,727 | 1,894,727 |
Issuers of Junior Subordinated Notes | ||
Investment in Equity Affiliates | ||
Investment in Equity Affiliates | 578,000 | 578,000 |
JT Prime | ||
Investment in Equity Affiliates | ||
Investment in Equity Affiliates | 425,000 | 425,000 |
East River Portfolio | ||
Investment in Equity Affiliates | ||
Investment in Equity Affiliates | 89,796 | 92,796 |
Unpaid Principal Balance of Loans to Equity Affiliates | 4,994,166 | |
Lexford Portfolio | ||
Investment in Equity Affiliates | ||
Investment in Equity Affiliates | $ 100 | $ 100 |
Investments in Equity Affilia46
Investments in Equity Affiliates, Additional Information (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Investment in Equity Affiliates | |||
Income from equity affiliates | $ 1,897,442 | $ 3,095,913 | |
Residential Mortgage Banking Company | |||
Investment in Equity Affiliates | |||
Income from equity affiliates | 1,600,000 | ||
Arbor Residential Investor LLC | Non-qualified Residential Mortgages | |||
Investment in Equity Affiliates | |||
Equity Investment | $ 9,700,000 | ||
Ownership percentage | 50.00% | ||
Arbor Residential Investor LLC | Additional mortgage purchases | |||
Investment in Equity Affiliates | |||
Equity Investment | 2,400,000 | ||
Arbor Residential Investor LLC | Non Qualified and Additional Residential Mortgages | |||
Investment in Equity Affiliates | |||
Equity Investment | 12,100,000 | ||
Arbor Residential Investor LLC | Non Qualified and Additional Residential Mortgages | Maximum | |||
Investment in Equity Affiliates | |||
Income from equity affiliates | 100,000 | 100,000 | |
Arbor Residential Investor LLC | Residential Mortgage Banking Company | |||
Investment in Equity Affiliates | |||
Equity Investment | $ 9,600,000 | ||
Percentage of ownership interest of related party in the entity | 50.00% | ||
Ownership percentage | 22.50% | ||
Income from equity affiliates | $ 1,600,000 | $ 3,100,000 |
Investments in Equity Affilia47
Investments in Equity Affiliates, Statements of Operations (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Revenue: | ||
Total revenues | $ 42,929,432 | $ 37,863,998 |
Total expenses | 36,007,398 | 25,154,107 |
Net income | 6,922,034 | 12,709,891 |
Arbor's share of income | $ 1,592,228 | $ 3,035,797 |
Real Estate Owned and Held-Fo48
Real Estate Owned and Held-For-Sale, Portfolio (Details) | 1 Months Ended | 3 Months Ended | ||
Apr. 30, 2016USD ($) | Mar. 31, 2016USD ($)propertyitem | Mar. 31, 2015USD ($) | Dec. 31, 2015USD ($)item | |
Real Estate owned | ||||
Real estate owned, net | $ 31,698,213 | $ 60,845,509 | ||
Restricted cash due to escrow requirement | 20,124,435 | 48,301,244 | ||
Real Estate Held-For-Sale | ||||
Property classified from real estate owned to real estate held-for-sale | $ 28,590,235 | |||
Multifamily and Hotel | Disposed of by sale | ||||
Real Estate Held-For-Sale | ||||
Proceeds from sale of properties | $ 18,800,000 | |||
Gain on sale of property | $ 4,000,000 | |||
Multi-family | ||||
Real Estate Held-For-Sale | ||||
Number of properties reclassified from real estate owned to real estate held-for-sale | property | 3 | |||
Property classified from real estate owned to real estate held-for-sale | $ 28,600,000 | |||
Aggregate debt balance | 27,100,000 | |||
Proceeds from sale of properties | $ 41,000,000 | |||
Gain on sale of property | $ 11,000,000 | |||
Hotel | ||||
Real Estate Held-For-Sale | ||||
Proceeds from sale of properties | 9,700,000 | |||
Gain on sale of property | 600,000 | |||
Real Estate owned | ||||
Real Estate owned | ||||
Less: accumulated depreciation and amortization | (8,015,307) | (16,869,757) | ||
Real estate owned, net | 31,698,213 | 60,845,509 | ||
Restricted cash due to escrow requirement | $ 2,000,000 | $ 1,600,000 | ||
Real Estate owned | Multi-family | ||||
Real Estate owned | ||||
Number of properties | item | 3 | 3 | ||
Less: accumulated depreciation and amortization | $ (9,399,041) | |||
Real estate owned, net | $ 28,783,692 | |||
Weighted average occupancy rate of properties (as a percent) | 97.00% | 94.00% | ||
Real Estate owned | Hotel | ||||
Real Estate owned | ||||
Number of properties | item | 1 | 2 | ||
Less: accumulated depreciation and amortization | $ (7,789,546) | $ (7,329,615) | ||
Real estate owned, net | $ 26,023,974 | 26,302,918 | ||
Weighted average occupancy rate of properties (as a percent) | 66.00% | 63.00% | ||
Amount of weighted average daily rate of properties | $ 97 | $ 103 | ||
Amount of weighted average daily revenue of properties | 65 | $ 64 | ||
Real Estate owned | Office | ||||
Real Estate owned | ||||
Less: accumulated depreciation and amortization | (225,761) | (141,101) | ||
Real estate owned, net | 5,674,239 | 5,758,899 | ||
Real Estate owned | Land | ||||
Real Estate owned | ||||
Real estate owned, gross | 7,802,651 | 13,341,495 | ||
Real Estate owned | Land | Multi-family | ||||
Real Estate owned | ||||
Real estate owned, gross | 5,538,844 | |||
Real Estate owned | Land | Hotel | ||||
Real Estate owned | ||||
Real estate owned, gross | 3,293,651 | 3,293,651 | ||
Real Estate owned | Land | Office | ||||
Real Estate owned | ||||
Real estate owned, gross | 4,509,000 | 4,509,000 | ||
Real Estate owned | Building and intangible assets | ||||
Real Estate owned | ||||
Real estate owned, gross | 31,910,869 | 64,373,771 | ||
Real Estate owned | Building and intangible assets | Multi-family | ||||
Real Estate owned | ||||
Real estate owned, gross | 32,643,889 | |||
Real Estate owned | Building and intangible assets | Hotel | ||||
Real Estate owned | ||||
Real estate owned, gross | 30,519,869 | 30,338,882 | ||
Real Estate owned | Building and intangible assets | Office | ||||
Real Estate owned | ||||
Real estate owned, gross | $ 1,391,000 | $ 1,391,000 |
Real Estate Owned and Held-Fo49
Real Estate Owned and Held-For-Sale, Results for Held-For-Sale (Details) - Held-For-Sale - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Revenue: | ||
Property operating income | $ 1,695,348 | $ 1,457,995 |
Expenses: | ||
Property operating expense | 1,061,828 | 1,096,038 |
Depreciation | 334,631 | 457,637 |
Net income (loss) | $ 298,889 | $ (95,680) |
Debt Obligations, Credit Facili
Debt Obligations, Credit Facilities and Repurchase Agreements (Details) | 1 Months Ended | 3 Months Ended | 4 Months Ended | 5 Months Ended | 6 Months Ended | |||||
Sep. 30, 2015USD ($) | Jun. 30, 2015USD ($) | May. 31, 2015 | Mar. 31, 2016USD ($)item | Mar. 31, 2015USD ($)item | Apr. 30, 2015 | May. 31, 2015 | Jun. 30, 2015USD ($) | Feb. 29, 2016USD ($) | Dec. 31, 2015USD ($)item | |
Debt Obligations | ||||||||||
Debt Carrying Value, Total credit facilities and repurchase agreements | $ 183,926,292 | $ 136,252,135 | ||||||||
Collateral Cash, Restricted Cash | $ 20,124,435 | 48,301,244 | ||||||||
Past due days, full repayment of a advance required | 60 days | |||||||||
Maximum | ||||||||||
Debt Obligations | ||||||||||
Warehousing period | 24 months | |||||||||
Healthcare related loans | Minimum | LIBOR | ||||||||||
Debt Obligations | ||||||||||
Variable rate, spread (as a percent) | 2.25% | |||||||||
Healthcare related loans | Maximum | LIBOR | ||||||||||
Debt Obligations | ||||||||||
Variable rate, spread (as a percent) | 2.50% | |||||||||
Credit facilities and repurchase agreements | ||||||||||
Debt Obligations | ||||||||||
Debt Principal Balance, Total credit facilities and repurchase agreements | $ 184,774,414 | 137,325,474 | ||||||||
Debt Carrying Value, Total credit facilities and repurchase agreements | 183,926,292 | 136,252,135 | ||||||||
Collateral Carrying Value, Total credit facilities and repurchase agreements | $ 281,454,746 | $ 216,061,504 | ||||||||
Weighted Average Note Rate (as a percent) | 2.65% | 2.69% | ||||||||
Weighted average note rate including certain fees and costs (as a percent) | 3.18% | 3.42% | ||||||||
Number of interest rate swaps | item | 0 | 0 | ||||||||
$150 million warehouse repurchase facility | ||||||||||
Debt Obligations | ||||||||||
Debt Principal Balance, Total credit facilities and repurchase agreements | $ 58,326,214 | $ 58,270,774 | ||||||||
Debt Carrying Value, Total credit facilities and repurchase agreements | 57,809,401 | 57,610,463 | ||||||||
Collateral Carrying Value, Total credit facilities and repurchase agreements | $ 99,189,746 | $ 99,641,504 | ||||||||
Weighted Average Note Rate (as a percent) | 2.70% | 2.70% | ||||||||
Committed line | $ 150,000,000 | $ 150,000,000 | $ 150,000,000 | |||||||
Extension of maturity date (in years) | 1 year | |||||||||
Deferred financing fees | $ 500,000 | 700,000 | ||||||||
$150 million warehouse repurchase facility | Senior mortgage loans | ||||||||||
Debt Obligations | ||||||||||
Variable rate, spread (as a percent) | 2.125% | |||||||||
Variable interest rate, description | LIBOR | |||||||||
$150 million warehouse repurchase facility | Junior participation loans | ||||||||||
Debt Obligations | ||||||||||
Variable rate, spread (as a percent) | 3.50% | |||||||||
Variable interest rate, description | LIBOR | |||||||||
$100 million warehousing credit facility | ||||||||||
Debt Obligations | ||||||||||
Debt Principal Balance, Total credit facilities and repurchase agreements | $ 21,837,200 | 24,582,200 | ||||||||
Debt Carrying Value, Total credit facilities and repurchase agreements | 21,625,911 | 24,328,863 | ||||||||
Collateral Carrying Value, Total credit facilities and repurchase agreements | $ 31,400,000 | $ 38,000,000 | ||||||||
Weighted Average Note Rate (as a percent) | 2.62% | 2.62% | ||||||||
Committed line | $ 100,000,000 | $ 100,000,000 | ||||||||
Variable rate, spread (as a percent) | 2.15% | 2.25% | ||||||||
Variable interest rate, description | LIBOR | |||||||||
Collateral Cash, Restricted Cash | $ 50,000,000 | |||||||||
Extension of maturity date (in years) | 1 year | |||||||||
Deferred financing fees | $ 200,000 | 300,000 | ||||||||
$100 million warehousing credit facility | Maximum | ||||||||||
Debt Obligations | ||||||||||
Advance rate (as a percent) | 75.00% | |||||||||
$75 million warehousing credit facility - one | ||||||||||
Debt Obligations | ||||||||||
Debt Principal Balance, Total credit facilities and repurchase agreements | $ 31,241,000 | 13,852,500 | ||||||||
Debt Carrying Value, Total credit facilities and repurchase agreements | 31,186,023 | 13,766,445 | ||||||||
Collateral Carrying Value, Total credit facilities and repurchase agreements | $ 45,465,000 | $ 18,470,000 | ||||||||
Weighted Average Note Rate (as a percent) | 2.60% | 2.59% | ||||||||
Committed line | $ 75,000,000 | $ 75,000,000 | ||||||||
Variable rate, spread (as a percent) | 2.25% | |||||||||
Variable interest rate, description | LIBOR | |||||||||
Deferred financing fees | $ 100,000 | 100,000 | ||||||||
Warehouse credit facility, sublimit | $ 25,000,000 | $ 25,000,000 | ||||||||
$75 million warehousing credit facility - one | LIBOR | ||||||||||
Debt Obligations | ||||||||||
Variable rate, spread (as a percent) | 2.125% | |||||||||
$75 million warehousing credit facility - one | Maximum | ||||||||||
Debt Obligations | ||||||||||
Advance rate (as a percent) | 75.00% | |||||||||
$75 million warehousing credit facility - two | ||||||||||
Debt Obligations | ||||||||||
Debt Principal Balance, Total credit facilities and repurchase agreements | $ 17,150,000 | |||||||||
Debt Carrying Value, Total credit facilities and repurchase agreements | 17,149,388 | |||||||||
Collateral Carrying Value, Total credit facilities and repurchase agreements | $ 26,000,000 | |||||||||
Weighted Average Note Rate (as a percent) | 2.47% | |||||||||
Committed line | $ 75,000,000 | 75,000,000 | ||||||||
Variable rate, spread (as a percent) | 2.00% | |||||||||
Variable interest rate, description | LIBOR | |||||||||
$75 million warehousing credit facility - two | Minimum | ||||||||||
Debt Obligations | ||||||||||
Advance rate (as a percent) | 70.00% | |||||||||
$75 million warehousing credit facility - two | Maximum | ||||||||||
Debt Obligations | ||||||||||
Advance rate (as a percent) | 75.00% | |||||||||
Deferred financing fees | $ 100,000 | 100,000 | ||||||||
$50 million warehousing credit facility | ||||||||||
Debt Obligations | ||||||||||
Debt Principal Balance, Total credit facilities and repurchase agreements | 39,720,000 | 24,120,000 | ||||||||
Debt Carrying Value, Total credit facilities and repurchase agreements | 39,706,666 | 24,114,494 | ||||||||
Collateral Carrying Value, Total credit facilities and repurchase agreements | $ 49,650,000 | $ 30,200,000 | ||||||||
Weighted Average Note Rate (as a percent) | 2.47% | 2.46% | ||||||||
$50 million term credit facility | ||||||||||
Debt Obligations | ||||||||||
Committed line | $ 50,000,000 | $ 50,000,000 | ||||||||
Line of credit, additional borrowing capacity | $ 25,000,000 | |||||||||
Number of one-year extension option | item | 2 | |||||||||
Variable rate, spread (as a percent) | 2.00% | |||||||||
Extension of maturity date (in years) | 1 year | |||||||||
$50 million term credit facility | LIBOR | ||||||||||
Debt Obligations | ||||||||||
Variable interest rate, description | LIBOR | |||||||||
$50 million term credit facility | Maximum | ||||||||||
Debt Obligations | ||||||||||
Deferred financing fees | $ 100,000 | $ 100,000 | ||||||||
$16.5 million term credit facility | ||||||||||
Debt Obligations | ||||||||||
Debt Principal Balance, Total credit facilities and repurchase agreements | 16,500,000 | 16,500,000 | ||||||||
Debt Carrying Value, Total credit facilities and repurchase agreements | 16,448,903 | 16,431,870 | ||||||||
Collateral Carrying Value, Total credit facilities and repurchase agreements | $ 29,750,000 | $ 29,750,000 | ||||||||
Weighted Average Note Rate (as a percent) | 3.23% | 3.22% | ||||||||
Committed line | $ 16,500,000 | $ 16,500,000 | ||||||||
Collateral Cash, Restricted Cash | $ 3,000,000 | |||||||||
Deferred financing fees | $ 100,000 | $ 100,000 | ||||||||
$16.5 million term credit facility | LIBOR | ||||||||||
Debt Obligations | ||||||||||
Variable rate, spread (as a percent) | 2.75% | |||||||||
Collateralized debt obligations | ||||||||||
Debt Obligations | ||||||||||
Number of collateral debt obligation | item | 2 |
Debt Obligations, Collateralize
Debt Obligations, Collateralized Loan Obligations (Details) | 1 Months Ended | 3 Months Ended | |||||
Aug. 31, 2015USD ($)item | Feb. 28, 2015USD ($)item | Apr. 30, 2014item | Mar. 31, 2016USD ($)item | Mar. 31, 2015USD ($) | Dec. 31, 2015USD ($) | Sep. 30, 2015USD ($) | |
Debt Obligations | |||||||
Collateral Cash, Restricted Cash | $ 20,124,435 | $ 48,301,244 | |||||
Collateralized loan obligations | |||||||
Debt Obligations | |||||||
Debt, Face Value | 768,000,000 | 768,000,000 | |||||
Debt, Carrying Value | 759,734,287 | 758,899,661 | |||||
Collateral Loans, Unpaid Principal | 1,008,226,333 | 971,162,690 | |||||
Collateral Loans, Carrying Value | 1,005,837,831 | 968,970,064 | |||||
Collateral Cash, Restricted Cash | $ 14,063,391 | $ 42,992,023 | |||||
Weighted average note rate (as a percent) | 2.84% | 2.84% | |||||
Weighted average note rate including certain fees and costs (as a percent) | 3.27% | 3.24% | |||||
CLO II | |||||||
Debt Obligations | |||||||
Debt instrument redemption value | $ 177,000,000 | ||||||
Deferred fees expensed as interest expense | $ 1,500,000 | ||||||
CLO III | |||||||
Debt Obligations | |||||||
Debt, Face Value | $ 281,250,000 | $ 281,250,000 | |||||
Debt, Carrying Value | 279,416,407 | 279,129,518 | |||||
Collateral Loans, Unpaid Principal | 362,392,312 | 339,019,221 | |||||
Collateral Loans, Carrying Value | 361,238,817 | 338,034,689 | |||||
Collateral Cash, Restricted Cash | $ 9,897,410 | $ 25,135,492 | |||||
Number of investment grade tranches issued | item | 3 | ||||||
Variable interest rate, description | three-month LIBOR | ||||||
Weighted average note rate (as a percent) | 2.87% | 2.86% | |||||
Deferred financing fees | $ 1,800,000 | $ 2,100,000 | |||||
CLO IV | |||||||
Debt Obligations | |||||||
Debt, Face Value | 219,000,000 | 219,000,000 | |||||
Debt, Carrying Value | $ 219,000,000 | 216,267,800 | 215,985,420 | ||||
Collateral Loans, Unpaid Principal | 299,042,848 | 288,581,773 | |||||
Collateral Loans, Carrying Value | $ 250,000,000 | 298,381,148 | 287,946,641 | ||||
Collateral Cash, Restricted Cash | $ 957,153 | $ 11,418,227 | |||||
Number of investment grade tranches issued | item | 3 | 3 | |||||
Number of newly-formed wholly-owned subsidiaries | item | 2 | ||||||
Variable interest rate, description | one-month LIBOR | three-month LIBOR | |||||
Weighted average note rate (as a percent) | 2.24% | 2.72% | 2.71% | ||||
Deferred financing fees | $ 2,700,000 | $ 3,000,000 | |||||
Replacement period | 2 years 6 months | ||||||
Notional amount of equity interest retained | $ 81,000,000 | ||||||
Weighted average note rate including certain fees and costs (as a percent) | 2.96% | ||||||
Proceeds from additional loan obligations | $ 50,000,000 | ||||||
CLO V | |||||||
Debt Obligations | |||||||
Debt, Face Value | $ 302,600,000 | 267,750,000 | 267,750,000 | $ 350,000,000 | |||
Debt, Carrying Value | $ 267,800,000 | 264,050,080 | 263,784,723 | ||||
Collateral Loans, Unpaid Principal | 346,791,173 | 343,561,696 | |||||
Collateral Loans, Carrying Value | 346,217,866 | 342,988,734 | |||||
Collateral Cash, Restricted Cash | $ 3,208,828 | $ 6,438,304 | |||||
Number of investment grade tranches issued | item | 3 | ||||||
Number of newly-formed wholly-owned subsidiaries | item | 2 | ||||||
Variable interest rate, description | one-month LIBOR | ||||||
Weighted average note rate (as a percent) | 2.44% | 2.92% | 2.91% | ||||
Deferred financing fees | $ 3,700,000 | $ 3,800,000 | |||||
Replacement period | 3 years | ||||||
Notional amount of equity interest retained | $ 82,300,000 | ||||||
Weighted average note rate including certain fees and costs (as a percent) | 3.07% | ||||||
Proceeds from additional loan obligations | $ 47,400,000 | ||||||
Maximum period of additional loan obligations | 120 days | ||||||
Class C secured floating rate notes | |||||||
Debt Obligations | |||||||
Notes acquired | $ 12,500,000 | ||||||
Net proceeds | $ 12,500,000 |
Debt Obligations, Collaterali52
Debt Obligations, Collateralized Debt Obligations (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 12 Months Ended | ||||
Jul. 31, 2015 | Mar. 31, 2016 | Sep. 30, 2015 | Mar. 31, 2015 | Dec. 31, 2015 | Dec. 31, 2010 | Jan. 31, 2015 | |
Debt Obligations | |||||||
Loss on termination of swaps | $ 4,289,450 | ||||||
Collateralized debt obligations | |||||||
Debt Obligations | |||||||
Debt instrument redemption value | $ 71,100,000 | $ 167,900,000 | |||||
Face amount of debt instrument re-issued | $ 42,800,000 | ||||||
Additional debt | 65,200,000 | ||||||
Portion of the entity's bonds that were exchanged | 42,300,000 | ||||||
Estimated interest due on reissued bonds | 22,900,000 | 11,000,000 | |||||
Gains (Losses) on Extinguishment of Debt | $ 8,200,000 | ||||||
CDO III debt | |||||||
Debt Obligations | |||||||
Loss on termination of swaps | $ 300,000 | ||||||
Revolving note class | |||||||
Debt Obligations | |||||||
Revolving note amount | 100,000,000 | ||||||
$150 million warehouse repurchase facility | |||||||
Debt Obligations | |||||||
Cash equity generated | 30,000,000 | ||||||
Deferred fees expensed as interest expense | 500,000 | ||||||
Loss on terminated derivative | $ 4,300,000 | ||||||
Revolving note amount | $ 150,000,000 | ||||||
Junior subordinated notes | |||||||
Debt Obligations | |||||||
Amount of debt extinguished | $ 114,100,000 | ||||||
Deferred fees expensed as interest expense | $ 3,200,000 | $ 3,300,000 |
Debt Obligations, Senior Unsecu
Debt Obligations, Senior Unsecured Notes (Details) - Senior Unsecured Notes - USD ($) $ in Millions | 12 Months Ended | ||
Dec. 31, 2014 | Mar. 31, 2016 | Dec. 31, 2015 | |
Debt Obligations | |||
Face amount | $ 90 | ||
Interest rate (as a percent) | 7.375% | ||
Net proceeds | $ 85.4 | ||
Debt, Carrying Value | $ 94 | $ 93.8 | |
Deferred financing fees | $ 3.9 | $ 3.5 | |
Weighted average note rate (as a percent) | 8.15% | 8.12% | |
Over-Allotment Option | |||
Debt Obligations | |||
Face amount | 7.8 | ||
Net proceeds | $ 7.4 |
Debt Obligations, Junior Subord
Debt Obligations, Junior Subordinated Notes (Details) - USD ($) | 3 Months Ended | 12 Months Ended |
Mar. 31, 2016 | Dec. 31, 2015 | |
Debt Obligations | ||
Debt Carrying Value | $ 157,305,257 | $ 157,117,130 |
Junior subordinated notes | ||
Debt Obligations | ||
Debt Carrying Value | 157,300,000 | 157,100,000 |
Deferred amount Due at maturity | 15,300,000 | 15,500,000 |
Deferred fees expensed as interest expense | $ 3,200,000 | $ 3,300,000 |
Variable interest rate, description | three-month LIBOR | |
Nonredeemable period from issue date (in years) | 2 years | |
Weighted average note rate (as a percent) | 3.45% | 3.43% |
Weighted average note rate including certain fees and costs (as a percent) | 3.56% | 3.55% |
Debt Obligations, Mortgage Note
Debt Obligations, Mortgage Note Payable, Real Estate Owned and Held-For-Sale (Details) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2016USD ($)item | Mar. 31, 2015USD ($)item | Dec. 31, 2015USD ($)item | |
Debt Obligations | |||
Reduction in mortgage note payable | $ 42,557 | $ 30,984,357 | |
Number of loans | item | 135 | 128 | |
Mortgage note payable - real estate owned | $ 27,155,000 | ||
Mortgage Notes Payable - Real Estate Owned and Held-For-Sale | First mortgage | Multi-family | |||
Debt Obligations | |||
Reduction in mortgage note payable | 10,300,000 | ||
Mortgage note paid - real estate held-for-sale | $ 20,700,000 | ||
Number of loans | item | 2 | ||
Debt, Face Value | $ 27,200,000 | ||
Mortgage note payable - real estate owned | $ 24,700,000 | ||
Fixed interest rate (as a percent) | 3.00% | ||
Mortgage Notes Payable - Real Estate Owned and Held-For-Sale | Unsecured mortgage | Multi-family | |||
Debt Obligations | |||
Debt, Face Value | $ 2,500,000 | ||
Variable interest rate, description | one-month LIBOR | ||
Variable rate, spread (as a percent) | 2.75% |
Debt Obligations, Debt Covenant
Debt Obligations, Debt Covenants (Details) - USD ($) | 1 Months Ended | 3 Months Ended | ||||
Apr. 30, 2016 | Jan. 31, 2016 | Oct. 31, 2015 | Jul. 31, 2015 | Apr. 30, 2015 | Mar. 31, 2016 | |
Debt Covenants | ||||||
Minimum liquidity requirement | $ 20,000,000 | |||||
Minimum net worth requirement one | 100,000,000 | |||||
Minimum net worth requirement two | 300,000,000 | |||||
Maximum total liabilities less subordinated debt requirement | 2,000,000,000 | |||||
CLO III | ||||||
Debt Covenants | ||||||
Current overcollateralization ratio for cash flow triggers (as a percent) | 133.33% | 133.33% | 133.33% | 133.33% | 133.33% | |
Limit overcollateralization ratio for cash flow triggers (as a percent) | 132.33% | |||||
Current interest coverage ratio for cash flow triggers (as a percent) | 299.10% | |||||
Limit interest coverage ratio for cash flow triggers (as a percent) | 120.00% | |||||
CLO IV | ||||||
Debt Covenants | ||||||
Current overcollateralization ratio for cash flow triggers (as a percent) | 136.99% | 136.99% | 136.99% | 136.99% | 136.99% | |
Limit overcollateralization ratio for cash flow triggers (as a percent) | 135.99% | |||||
Current interest coverage ratio for cash flow triggers (as a percent) | 327.01% | |||||
Limit interest coverage ratio for cash flow triggers (as a percent) | 120.00% | |||||
CLO V | ||||||
Debt Covenants | ||||||
Current overcollateralization ratio for cash flow triggers (as a percent) | 130.72% | 130.72% | 130.72% | |||
Limit overcollateralization ratio for cash flow triggers (as a percent) | 129.72% | |||||
Current interest coverage ratio for cash flow triggers (as a percent) | 270.88% | |||||
Limit interest coverage ratio for cash flow triggers (as a percent) | 120.00% | |||||
Junior subordinated notes | ||||||
Debt Covenants | ||||||
Amount payable on default of senior debt | $ 0 |
Derivative Financial Instrume57
Derivative Financial Instruments, Summary (Details) $ in Thousands | Mar. 31, 2016USD ($)item | Dec. 31, 2015USD ($)item | Mar. 31, 2015USD ($)item |
Non-Qualifying | Basis Swaps | |||
Derivative Financial Instruments | |||
Notional Value, classified in Other Assets | $ 3,000 | ||
Non-Qualifying | Basis Swaps | Maximum | |||
Derivative Financial Instruments | |||
Fair Value, classified in Other Assets | $ 100 | ||
Qualifying | LIBOR Caps | |||
Derivative Financial Instruments | |||
Count | item | 2 | 2 | 2 |
Notional Value, classified in Other Assets | $ 84,100 | $ 84,100 | $ 43,500 |
Fair Value, classified in Other Assets | $ 1 | $ 3 | |
Cap rate (as a percent) | 2.00% | ||
Qualifying | Interest Rate Swaps | |||
Derivative Financial Instruments | |||
Count | item | 5 | 5 | |
Notional Value, classified in Other Liabilities | $ 107,821 | $ 107,821 | |
Fair Value, classified in Other Liabilities | $ (3,553) | $ (4,669) |
Derivative Financial Instrume58
Derivative Financial Instruments, Statements of Income (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Derivative Financial Instruments | |||
Cumulative amount of other comprehensive loss related to net unrealized losses on derivatives designated as qualifying hedges | $ (4,100) | $ (5,300) | |
Cumulative amount of other comprehensive loss related to net unrealized losses on derivatives designated as cash flow hedges attributable to fair value of qualifying cash flow hedges | (3,600) | (4,700) | |
Cumulative amount of other comprehensive loss related to net unrealized losses on derivatives designated as cash flow hedges attributable to deferred losses terminated interest swaps | (500) | (600) | |
Fair value of derivatives in a net liability position | (3,600) | (4,600) | |
Collateral posted | 4,100 | 5,000 | |
Non-Qualifying | Basis Swaps | |||
Derivative Financial Instruments | |||
Notional Value, classified in Other Assets | $ 3,000 | ||
Non-Qualifying | Basis Swaps | Interest expense | |||
Derivative Financial Instruments | |||
Change in fair value | (3) | ||
Non-Qualifying | Basis Swaps | Maximum | |||
Derivative Financial Instruments | |||
Fair Value, classified in Other Assets | 100 | ||
Qualifying | Interest Rate Swaps | |||
Derivative Financial Instruments | |||
Amount of Loss Recognized in Other Comprehensive Loss (Effective Portion) | 210 | 742 | |
Amount of Loss Reclassified from Accumulated Other Comprehensive Loss into Interest Expense (Effective Portion) | (1,365) | (1,731) | |
Interest expense expected to be reclassified from qualifying cash flow hedges over the next twelve months | (3,600) | ||
Qualifying | Interest Rate Swaps | Interest expense | |||
Derivative Financial Instruments | |||
Amount of Loss Reclassified in Loss into Loss on Termination of Swaps (Ineffective Portion) | (4,286) | ||
Qualifying | LIBOR Caps | |||
Derivative Financial Instruments | |||
Notional Value, classified in Other Assets | 84,100 | $ 43,500 | 84,100 |
Fair Value, classified in Other Assets | 1 | 3 | |
Cap rate (as a percent) | 2.00% | ||
Terminated hedges | Interest Rate Swaps | |||
Derivative Financial Instruments | |||
Net deferred loss in accumulated other comprehensive loss | 500 | $ 600 | |
Additional interest expense related to the amortization of the loss | 200 | $ 200 | |
Reduction to interest expense related to the accretion of the net gains | 100 | ||
Amount of net deferred loss expected to be recorded to interest expense over the next twelve months | 500 | ||
Terminated hedges | Interest Rate Swaps | Maximum | |||
Derivative Financial Instruments | |||
Reduction to interest expense related to the accretion of the net gains | $ 100 | ||
Terminated hedges | Interest Rate Swaps | CDO I and II debt | |||
Derivative Financial Instruments | |||
Aggregate notional value | 134,600 | ||
Aggregate fair value | $ (4,300) |
Variable Interest Entities (Det
Variable Interest Entities (Details) | 3 Months Ended | |||
Mar. 31, 2016USD ($)item | Dec. 31, 2015USD ($) | Mar. 31, 2015USD ($) | Dec. 31, 2014USD ($) | |
Variable Interest Entities | ||||
Loans to VIEs | $ 1,677,335,360 | $ 1,545,126,045 | ||
Loan loss reserves related to VIEs | $ 86,746,575 | $ 86,761,575 | $ 116,470,000 | $ 115,487,320 |
Unconsolidated VIEs | ||||
Variable Interest Entities | ||||
Number of VIEs where the reporting entity is not VIE's primary beneficiary | item | 23 | |||
Carrying Amount | $ 374,318,233 | |||
Exposure to real estate debt | 1,700,000,000 | |||
Loans to VIEs | 152,800,000 | |||
Loan loss reserves related to VIEs | 80,600,000 | |||
Unconsolidated VIEs | Maximum | ||||
Variable Interest Entities | ||||
Exposure to loss | 374,318,233 | |||
Unconsolidated VIEs | Loans | ||||
Variable Interest Entities | ||||
Carrying Amount | 371,784,201 | |||
Unconsolidated VIEs | Loans | Maximum | ||||
Variable Interest Entities | ||||
Exposure to loss | 371,784,201 | |||
Unconsolidated VIEs | Equity investment | ||||
Variable Interest Entities | ||||
Carrying Amount | 1,956,032 | |||
Unconsolidated VIEs | Equity investment | Maximum | ||||
Variable Interest Entities | ||||
Exposure to loss | 1,956,032 | |||
Unconsolidated VIEs | Junior subordinated notes | ||||
Variable Interest Entities | ||||
Carrying Amount | 578,000 | |||
Unconsolidated VIEs | Junior subordinated notes | Maximum | ||||
Variable Interest Entities | ||||
Exposure to loss | $ 578,000 |
Fair Value, Carrying Value and
Fair Value, Carrying Value and Estimated Fair Value (Details) - USD ($) | Mar. 31, 2016 | Dec. 31, 2015 |
Financial assets: | ||
Loans and investments, net | $ 1,581,621,970 | $ 1,450,334,341 |
Available-for-sale securities, at fair value | 411,525 | 2,022,030 |
Financial liabilities: | ||
Credit and repurchase facilities | 183,926,292 | 136,252,135 |
Collateralized loan obligations | 759,734,287 | 758,899,661 |
Senior unsecured notes | 93,955,461 | 93,764,994 |
Junior subordinated notes | 157,305,257 | 157,117,130 |
Principal / Notional Amount | ||
Financial assets: | ||
Loans and investments, net | 1,677,335,360 | 1,545,126,045 |
Available-for-sale securities, at fair value | 58,789 | 1,610,505 |
Derivative financial instruments | 84,100,000 | 84,100,000 |
Financial liabilities: | ||
Credit and repurchase facilities | 187,774,414 | 137,325,474 |
Collateralized loan obligations | 768,000,000 | 768,000,000 |
Senior unsecured notes | 97,860,025 | 97,860,025 |
Junior subordinated notes | 175,858,000 | 175,858,000 |
Mortgage note payable - real estate owned and held-for-sale | 27,112,443 | 27,155,000 |
Derivative financial instruments | 107,812,840 | 107,820,995 |
Carrying Value | ||
Financial assets: | ||
Loans and investments, net | 1,581,621,970 | 1,450,334,341 |
Available-for-sale securities, at fair value | 411,525 | 2,022,030 |
Derivative financial instruments | 480 | 3,345 |
Financial liabilities: | ||
Credit and repurchase facilities | 183,926,292 | 136,252,135 |
Collateralized loan obligations | 759,734,287 | 758,899,661 |
Senior unsecured notes | 93,955,461 | 93,764,994 |
Junior subordinated notes | 157,305,257 | 157,117,130 |
Mortgage note payable - real estate owned and held-for-sale | 27,112,443 | 27,155,000 |
Derivative financial instruments | 3,553,740 | 4,669,273 |
Fair Value | ||
Financial assets: | ||
Loans and investments, net | 1,631,872,629 | 1,481,353,410 |
Available-for-sale securities, at fair value | 411,525 | 2,022,030 |
Derivative financial instruments | 480 | 3,345 |
Financial liabilities: | ||
Credit and repurchase facilities | 184,428,918 | 137,072,691 |
Collateralized loan obligations | 752,105,625 | 766,065,400 |
Senior unsecured notes | 97,116,289 | 96,294,265 |
Junior subordinated notes | 104,465,277 | 104,073,847 |
Mortgage note payable - real estate owned and held-for-sale | 27,043,694 | 27,111,231 |
Derivative financial instruments | $ 3,553,740 | $ 4,669,273 |
Fair Value, Measurement on Recu
Fair Value, Measurement on Recurring Basis (Details) | Mar. 31, 2016USD ($)item | Dec. 31, 2015USD ($) |
Financial assets: | ||
Available-for-sale securities, at fair value | $ 411,525 | $ 2,022,030 |
Allowance for Loan losses | $ 86,746,575 | 86,761,575 |
Number of impaired loans | item | 9 | |
Aggregate carrying value, before reserves | $ 189,663,108 | 189,209,415 |
Carrying Value | ||
Financial assets: | ||
Available-for-sale securities, at fair value | 411,525 | 2,022,030 |
Derivative financial instruments | 480 | 3,345 |
Financial liabilities: | ||
Derivative financial instruments | 3,553,740 | 4,669,273 |
Fair Value | ||
Financial assets: | ||
Available-for-sale securities, at fair value | 411,525 | 2,022,030 |
Derivative financial instruments | 480 | 3,345 |
Financial liabilities: | ||
Derivative financial instruments | 3,553,740 | $ 4,669,273 |
Recurring basis | Carrying Value | ||
Financial assets: | ||
Available-for-sale securities, at fair value | 411,525 | |
Derivative financial instruments | 480 | |
Financial liabilities: | ||
Derivative financial instruments | 3,553,740 | |
Recurring basis | Fair Value | ||
Financial assets: | ||
Available-for-sale securities, at fair value | 411,525 | |
Derivative financial instruments | 480 | |
Financial liabilities: | ||
Derivative financial instruments | 3,553,740 | |
Nonrecurring basis | Carrying Value | ||
Financial assets: | ||
Impaired loans, net | 102,916,533 | |
Nonrecurring basis | Fair Value | ||
Financial assets: | ||
Impaired loans, net | 102,916,533 | |
Level 1 | Recurring basis | ||
Financial assets: | ||
Available-for-sale securities, at fair value | 411,525 | |
Level 2 | Recurring basis | ||
Financial assets: | ||
Derivative financial instruments | 480 | |
Financial liabilities: | ||
Derivative financial instruments | 3,553,740 | |
Level 3 | Nonrecurring basis | ||
Financial assets: | ||
Impaired loans, net | $ 102,916,533 |
Fair Value, Measurement on Nonr
Fair Value, Measurement on Nonrecurring Basis (Details) - Level 3 | 3 Months Ended |
Mar. 31, 2016USD ($) | |
Multi-family | Direct capitalization analysis and discounted cash flows | |
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract] | |
Impaired loans | $ 1,899,965 |
Revenue growth rate (as a percent) | 4.30% |
Multi-family | Direct capitalization analysis and discounted cash flows | Minimum | |
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract] | |
Capitalization rate (as a percent) | 6.50% |
Multi-family | Direct capitalization analysis and discounted cash flows | Maximum | |
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract] | |
Capitalization rate (as a percent) | 9.75% |
Multi-family | Direct capitalization analysis and discounted cash flows | Weighted average | |
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract] | |
Capitalization rate (as a percent) | 8.86% |
Office | Discounted cash flows | |
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract] | |
Impaired loans | $ 819,500 |
Discount rate (as a percent) | 11.00% |
Capitalization rate (as a percent) | 8.03% |
Revenue growth rate (as a percent) | 2.50% |
Land | Discounted cash flows | |
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract] | |
Impaired loans | $ 69,497,068 |
Discount rate (as a percent) | 15.00% |
Capitalization rate (as a percent) | 7.25% |
Revenue growth rate (as a percent) | 3.00% |
Hotel | Discounted cash flows | |
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract] | |
Impaired loans | $ 30,700,000 |
Discount rate (as a percent) | 9.25% |
Capitalization rate (as a percent) | 7.25% |
Revenue growth rate (as a percent) | 3.80% |
Commercial | Discounted cash flows | |
Financial Instruments, Financial Assets, Balance Sheet Groupings [Abstract] | |
Capitalization rate (as a percent) | 6.00% |
Fair Value, Financial Assets an
Fair Value, Financial Assets and Liabilities (Details) - USD ($) | Mar. 31, 2016 | Dec. 31, 2015 |
Financial assets: | ||
Loans and investments, net | $ 1,581,621,970 | $ 1,450,334,341 |
Financial liabilities: | ||
Credit facilities and repurchase agreements | 183,926,292 | 136,252,135 |
Collateralized loan obligation | 759,734,287 | 758,899,661 |
Senior unsecured notes | 93,955,461 | 93,764,994 |
Junior subordinated notes | 157,305,257 | 157,117,130 |
Mortgage note payable - real estate owned | 27,155,000 | |
Level 1 | ||
Financial liabilities: | ||
Senior unsecured notes | 97,116,289 | |
Level 3 | ||
Financial assets: | ||
Loans and investments, net | 1,631,872,629 | |
Financial liabilities: | ||
Credit facilities and repurchase agreements | 184,428,918 | |
Collateralized loan obligation | 752,105,625 | |
Junior subordinated notes | 104,465,277 | |
Mortgage note payable - real estate owned | 27,043,694 | |
Carrying Value | ||
Financial assets: | ||
Loans and investments, net | 1,581,621,970 | 1,450,334,341 |
Financial liabilities: | ||
Credit facilities and repurchase agreements | 183,926,292 | 136,252,135 |
Collateralized loan obligation | 759,734,287 | 758,899,661 |
Senior unsecured notes | 93,955,461 | 93,764,994 |
Junior subordinated notes | 157,305,257 | 157,117,130 |
Mortgage note payable - real estate owned | 27,112,443 | |
Fair Value | ||
Financial assets: | ||
Loans and investments, net | 1,631,872,629 | 1,481,353,410 |
Financial liabilities: | ||
Credit facilities and repurchase agreements | 184,428,918 | 137,072,691 |
Collateralized loan obligation | 752,105,625 | 766,065,400 |
Senior unsecured notes | 97,116,289 | 96,294,265 |
Junior subordinated notes | 104,465,277 | $ 104,073,847 |
Mortgage note payable - real estate owned | $ 27,043,694 |
Commitments and Contingencies,
Commitments and Contingencies, Contractual Commitments (Details) $ in Millions | Mar. 31, 2016USD ($) |
Contractual Obligations, Payments Due by Period | |
2,016 | $ 158.7 |
2,017 | 325.8 |
2,018 | 384.1 |
2,019 | 89.6 |
2,020 | 32.1 |
Thereafter | 273.7 |
Unfunded commitments related to loans and investments | 10.5 |
Available amount to fund unfunded commitments | $ 2.7 |
Commitments and Contingencies65
Commitments and Contingencies, Litigation (Details) $ in Millions | Jun. 28, 2013USD ($)lawsuitdefendant | Jun. 15, 2011USD ($)lawsuitdefendant |
Arbor ESH II, LLC | ||
Litigation | ||
Investments in the Series A1 Preferred Units of a holding company of Extended Stay, Inc. | $ | $ 115 | |
Lawsuits filed by Extended Stay Litigation Trust (the Trust) | ||
Litigation | ||
Number of lawsuits or complaints filed | lawsuit | 3 | |
Number of lawsuits filed in United States Bankruptcy Court | lawsuit | 2 | |
Number of defendants | 73 | |
Number of defendants who are corporate and partnership entities | 55 | |
Number of defendants named in a legal action who are individuals | 18 | |
Lawsuits filed by Extended Stay Litigation Trust (the Trust) | Fiduciary Duty Claims | ||
Litigation | ||
Number of lawsuits or complaints filed | lawsuit | 2 | |
Number of defendants | 2 | |
Lawsuits filed by Extended Stay Litigation Trust (the Trust) | Motion to amend the lawsuits | ||
Litigation | ||
Number of lawsuits consolidated | lawsuit | 1 | |
Number of defendants removed due to consolidation of lawsuits | 47 | |
Number of defendants related to the entity | 0 | |
Number of defendants who are corporate and partnership entities | 16 | |
Number of defendants named in a legal action who are individuals | 10 | |
Number of lawsuits before amendment | lawsuit | 100 | |
Number of lawsuits after amendment | lawsuit | 17 | |
Number of defendants remaining due to consolidation of lawsuits | 26 | |
Aggregate amount which the Trust would be seeking from the affiliates of the entity | $ | $ 139 |
Equity, Disclosures (Details)
Equity, Disclosures (Details) - USD ($) | May. 04, 2016 | May. 02, 2016 | Feb. 11, 2015 | Feb. 02, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | Mar. 31, 2016 |
Common stock | ||||||||||
Value of common stock remaining under shelf registration | $ 330,400,000 | $ 330,400,000 | $ 330,400,000 | |||||||
Aggregate amount of securities for which the entity filed shelf registration statement | $ 500,000,000 | $ 500,000,000 | $ 500,000,000 | |||||||
Distributions | ||||||||||
Cash dividend declared (in dollars per share) | $ 0.15 | $ 0.13 | ||||||||
Preferred distributions declared and paid | $ 1,888,430 | |||||||||
Restricted common stock | ||||||||||
Deferred Compensation | ||||||||||
Forfeited (in shares) | 1,001 | |||||||||
Restricted common stock | Maximum | ||||||||||
Deferred Compensation | ||||||||||
Total grant date fair value | $ 100,000 | |||||||||
Mr. Ivan Kaufman, chairman and chief executive officer | Restricted common stock | ||||||||||
Deferred Compensation | ||||||||||
Number of fully vested shares issued | 70,225 | |||||||||
Total grant date fair value | $ 500,000 | |||||||||
Vesting percentage | 25.00% | |||||||||
Mr. Ivan Kaufman, chairman and chief executive officer | Restricted common stock | March, 2016 | ||||||||||
Deferred Compensation | ||||||||||
Vesting percentage | 25.00% | |||||||||
Mr. Ivan Kaufman, chairman and chief executive officer | Restricted common stock | March, 2017 | ||||||||||
Deferred Compensation | ||||||||||
Vesting percentage | 25.00% | |||||||||
Mr. Ivan Kaufman, chairman and chief executive officer | Restricted common stock | March, 2018 | ||||||||||
Deferred Compensation | ||||||||||
Vesting percentage | 25.00% | |||||||||
Mr. Ivan Kaufman, chairman and chief executive officer | Performance | ||||||||||
Deferred Compensation | ||||||||||
Granted (in shares) | 421,348 | 867,113 | ||||||||
Total grant date fair value | $ 900,000 | |||||||||
Vesting period | 4 years | 4 years | ||||||||
Mr. Ivan Kaufman, chairman and chief executive officer | Employee compensation and benefits | Restricted common stock | ||||||||||
Deferred Compensation | ||||||||||
Share-based compensation expense | $ 100,000 | |||||||||
Mr. Ivan Kaufman, chairman and chief executive officer | Employee compensation and benefits | Performance | Maximum | ||||||||||
Deferred Compensation | ||||||||||
Share-based compensation expense | $ 100,000 | |||||||||
Employees of the company and a related party | Restricted common stock | ||||||||||
Deferred Compensation | ||||||||||
Number of fully vested shares issued | 282,405 | |||||||||
Total grant date fair value | $ 1,900,000 | |||||||||
Vesting percentage | 33.00% | |||||||||
Employees of the company and a related party | Restricted common stock | March, 2017 | ||||||||||
Deferred Compensation | ||||||||||
Vesting percentage | 33.00% | |||||||||
Employees of the company and a related party | Restricted common stock | March, 2018 | ||||||||||
Deferred Compensation | ||||||||||
Vesting percentage | 33.00% | |||||||||
Employees of the company and a related party | Employee compensation and benefits | Restricted common stock | ||||||||||
Deferred Compensation | ||||||||||
Share-based compensation expense | $ 200,000 | |||||||||
Employees of the company and a related party | Selling and administrative expense | Restricted common stock | ||||||||||
Deferred Compensation | ||||||||||
Share-based compensation expense | $ 500,000 | |||||||||
Non-employees | Selling and administrative expense | Restricted common stock | ||||||||||
Deferred Compensation | ||||||||||
Share-based compensation expense | $ 100,000 | $ 200,000 | ||||||||
Non-employees | ACM / Our "Manager" | Restricted common stock | ||||||||||
Deferred Compensation | ||||||||||
Granted (in shares) | 241,343 | |||||||||
Total grant date fair value | $ 1,600,000 | |||||||||
Employees | Restricted common stock | ||||||||||
Deferred Compensation | ||||||||||
Granted (in shares) | 237,299 | |||||||||
Total grant date fair value | $ 1,600,000 | |||||||||
Employees | Employee compensation and benefits | Restricted common stock | ||||||||||
Deferred Compensation | ||||||||||
Share-based compensation expense | $ 100,000 | $ 100,000 | ||||||||
8.25% Series A preferred stock | ||||||||||
Preferred Stock | ||||||||||
Return on the preferred shares issued to third parties by its subsidiary REIT (as a percent) | 8.25% | 8.25% | ||||||||
7.75% Series B preferred stock | ||||||||||
Preferred Stock | ||||||||||
Return on the preferred shares issued to third parties by its subsidiary REIT (as a percent) | 7.75% | 7.75% | ||||||||
8.50% Series C preferred stock | ||||||||||
Preferred Stock | ||||||||||
Return on the preferred shares issued to third parties by its subsidiary REIT (as a percent) | 8.50% | 8.50% | ||||||||
Preferred Stock | 8.25% Series A preferred stock | ||||||||||
Preferred Stock | ||||||||||
Return on the preferred shares issued to third parties by its subsidiary REIT (as a percent) | 8.25% | |||||||||
Distributions | ||||||||||
Cash dividend declared on redeemable preferred stock (in dollars per share) | $ 0.515625 | $ 0.515625 | ||||||||
Preferred Stock | 7.75% Series B preferred stock | ||||||||||
Preferred Stock | ||||||||||
Return on the preferred shares issued to third parties by its subsidiary REIT (as a percent) | 7.75% | |||||||||
Distributions | ||||||||||
Cash dividend declared on redeemable preferred stock (in dollars per share) | $ 0.484375 | 0.484375 | ||||||||
Preferred Stock | 8.50% Series C preferred stock | ||||||||||
Preferred Stock | ||||||||||
Return on the preferred shares issued to third parties by its subsidiary REIT (as a percent) | 8.50% | |||||||||
Distributions | ||||||||||
Cash dividend declared on redeemable preferred stock (in dollars per share) | $ 0.53125 | $ 0.53125 | ||||||||
Common Stock | ||||||||||
Common stock | ||||||||||
Number of shares available for sale through JMP | 6,500,000 | 6,500,000 | 6,500,000 | |||||||
Common Stock | Common Stock | ||||||||||
Distributions | ||||||||||
Cash dividend declared (in dollars per share) | $ 0.15 | $ 0.15 | ||||||||
Common Stock | Non-management members of the Board of Directors | ||||||||||
Deferred Compensation | ||||||||||
Number of fully vested shares issued | 67,260 | |||||||||
Common Stock | Non-management members of the Board of Directors | Selling and administrative expense | ||||||||||
Deferred Compensation | ||||||||||
Share-based compensation expense | $ 400,000 |
Equity, AOCI (Details)
Equity, AOCI (Details) - USD ($) | 3 Months Ended | ||
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Accumulated Other Comprehensive Loss | |||
Accumulated other comprehensive loss | $ 3,744,864 | $ 4,840,950 | |
Net unrealized losses on derivatives designated as cash flow hedges, net of deferred losses on terminated interest swaps | 3,600,000 | 4,700,000 | |
Deferred losses on terminated interest swaps | 500,000 | (600,000) | |
Unrealized gain related to available-for-sale securities | 400,000 | $ 400,000 | |
Interest expense | |||
Accumulated Other Comprehensive Loss | |||
Net realized losses on derivatives designated as cash flow hedges | $ (1,364,664) | $ (1,730,927) | |
Loss on termination of swaps | |||
Accumulated Other Comprehensive Loss | |||
Net realized losses on derivatives designated as cash flow hedges | $ (4,285,995) |
Earnings Per Share (Details)
Earnings Per Share (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | Dec. 31, 2015 | |
Basic | |||
Net income attributable to common stockholders | $ 1,134,896 | $ 15,010,469 | |
Weighted average number of common shares outstanding | 51,045,219 | 50,544,575 | |
Net income per common share (in dollars per share) | $ 0.02 | $ 0.30 | |
Diluted | |||
Net income attributable to common stockholders | $ 1,134,896 | $ 15,010,469 | |
Weighted average number of common shares outstanding | 51,045,219 | 50,544,575 | |
Dilutive effect of of restricted stock units (in shares) | 49,909 | 288,161 | |
Weighted average number of common shares outstanding | 51,095,128 | 50,832,736 | |
Net income per common share (in dollars per share) | $ 0.02 | $ 0.30 | |
Mr. Ivan Kaufman, chairman and chief executive officer | Performance | |||
Diluted | |||
Vesting period | 4 years | 4 years |
Agreements and Transactions w69
Agreements and Transactions with Related Parties, Management Agreement (Details) - USD ($) | 3 Months Ended | |
Mar. 31, 2016 | Mar. 31, 2015 | |
Management Fees: | ||
Total Management fee | $ 2,700,000 | $ 2,675,000 |
Success-based payment | $ 0 | 0 |
ACM / Our "Manager" | ||
Agreements and transactions with related parties | ||
Incentive fee calculation percentage | 25.00% | |
Percentage of loan loss reserve recoveries used in calculation of incentive fee | 60.00% | |
Period during which the loan loss reserve recoveries are to be taken into consideration for calculation of incentive fee | 3 years | |
Term of U.S. Treasury Rate used in computation of incentive fee | 10 years | |
Annual interest rate used in computation of incentive fee (as a percent) | 9.50% | |
Basis spread added to the U.S. Treasury Rate for computation of incentive fee (as a percent) | 3.50% | |
Multiplier used in computation of incentive fee | $ 10 | |
Termination fee | $ 10,000,000 | |
Renewable period for management agreement | 1 year | |
Management Fees: | ||
Base | $ 2,700,000 | 2,675,000 |
Total Management fee | $ 2,700,000 | $ 2,675,000 |
Agreements and Transactions w70
Agreements and Transactions with Related Parties, Other (Details) shares in Millions | Feb. 25, 2016USD ($) | Feb. 29, 2016USD ($) | Jan. 31, 2016USD ($)property | Nov. 30, 2015USD ($)item | Oct. 31, 2015USD ($)loan | Apr. 30, 2015USD ($) | Feb. 28, 2015USD ($) | Mar. 31, 2016USD ($)shares | Mar. 31, 2015USD ($) | Dec. 31, 2015USD ($) | Dec. 31, 2014USD ($)loanitem | Mar. 31, 2016USD ($)shares |
Agreements and transactions with related parties | ||||||||||||
Due from related party | $ 435,552 | $ 8,082,265 | $ 435,552 | |||||||||
Due to related party | 2,406,027 | 3,428,333 | 2,406,027 | |||||||||
Income from equity affiliates | 1,897,442 | $ 3,095,913 | ||||||||||
Investments in equity affiliates | 34,927,586 | 30,870,235 | 34,927,586 | |||||||||
Advisory fees | $ 3,100,000 | $ 7,600,000 | ||||||||||
Minimum | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Ownership interest allowed under company charter (as a percent) | 5.00% | 5.00% | ||||||||||
Residential Mortgage Banking Company | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Indirect ownership percentage | 22.50% | |||||||||||
Income from equity affiliates | $ 1,600,000 | |||||||||||
Maturity date of April 2016 | Preferred equity investments | Multi-family | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Fixed rate of interest (as a percent) | 10.00% | |||||||||||
Maturity date of April 2016 | Mortgage loans | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Base spread (as a percent) | 4.80% | |||||||||||
Maturity date of October 2017 | Bridge Loans | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Base spread (as a percent) | 5.00% | |||||||||||
LIBOR floor (as a percentage) | 0.25% | |||||||||||
Interest income recorded | 200,000 | |||||||||||
Amount of bridge loan purchased from related party | $ 16,700,000 | |||||||||||
Number of mortgage loans secured by property purchased from related party | loan | 2 | |||||||||||
Maturity date of November 2018 | Bridge Loans | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Extension period | 1 year | |||||||||||
Maturity date of January 2019 | Bridge loan, two multifamily properties | Multi-family | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Variable interest rate, description | one-month LIBOR | |||||||||||
Base spread (as a percent) | 4.50% | |||||||||||
LIBOR floor (as a percentage) | 0.25% | |||||||||||
Interest income recorded | 300,000 | |||||||||||
Maturity date of January 2019 | Bridge loan, one multifamily property | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Principal loan amount | $ 19,000,000 | |||||||||||
Variable interest rate, description | one-month LIBOR | |||||||||||
Base spread (as a percent) | 4.50% | |||||||||||
LIBOR floor (as a percentage) | 0.25% | |||||||||||
Interest income recorded | 200,000 | |||||||||||
Certain Officers | Bridge loan, one multifamily property | Multi-family | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Percentage of ownership interest of related party in the entity | 7.50% | |||||||||||
Certain Officers | Maturity date of April 2016 | Preferred equity investments | Multi-family | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Equity investment | $ 5,200,000 | |||||||||||
Certain Officers | Maturity date of November 2018 | Bridge Loans | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Percentage of ownership interest of related party in the entity | 7.50% | |||||||||||
Base spread (as a percent) | 4.50% | |||||||||||
LIBOR floor (as a percentage) | 0.25% | |||||||||||
Interest income recorded | 100,000 | |||||||||||
Amount of bridge loan purchased from related party | $ 7,100,000 | |||||||||||
Number of one-year extension options | item | 2 | |||||||||||
Certain Officers | Maturity date of January 2019 | Bridge loan, two multifamily properties | Multi-family | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Principal loan amount | $ 12,700,000 | |||||||||||
Number of properties owned | property | 2 | |||||||||||
Percentage of ownership interest of related party in the entity | 50.00% | |||||||||||
ACM / Our "Manager" | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Due from related party | 400,000 | 8,100,000 | $ 400,000 | |||||||||
Due to related party | 2,400,000 | 3,400,000 | 2,400,000 | |||||||||
Base management fees due to related party | 1,300,000 | 1,300,000 | ||||||||||
Management fees to be remitted | 700,000 | |||||||||||
Escrows due to related party | $ 1,100,000 | $ 1,100,000 | ||||||||||
Number of shares held by related party | shares | 5.3 | 5.3 | ||||||||||
Percentage of voting power held by related party | 10.40% | 10.40% | ||||||||||
ACM / Our "Manager" | Residential Mortgage Banking Company | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Noncontrolling interest in equity method investment acquired (as a percent) | 50.00% | |||||||||||
Acquisition purchase price | $ 9,600,000 | |||||||||||
ACM / Our "Manager" | Agency Platform | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Acquisition purchase price | $ 250,000,000 | $ 250,000,000 | ||||||||||
ACM / Our "Manager" | Non-qualified Residential Mortgages | Residential Mortgage Banking Company | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Equity investment made | 9,700,000 | |||||||||||
Additional investment made by the company along with a consortium of independent outside investors | $ 2,400,000 | |||||||||||
ACM / Our "Manager" | Maturity date of April 2016 | First mortgage | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Amount of mortgage loan secured by property purchased from related party | $ 14,600,000 | |||||||||||
ACM / Our "Manager" | Maturity date of April 2016 | Second mortgage | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Amount of mortgage loan secured by property purchased from related party | $ 5,100,000 | |||||||||||
ACM / Our "Manager" | Maturity date of April 2016 | Mortgage loans | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Interest income recorded | 300,000 | |||||||||||
Number of mortgage loans secured by property purchased from related party | loan | 2 | |||||||||||
Mr. Ivan Kaufman, chairman and chief executive officer | Maturity date of February 2018 | Preferred equity investments | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Principal loan amount | $ 23,000,000 | $ 18,000,000 | ||||||||||
Fixed rate of interest (as a percent) | 10.00% | |||||||||||
Interest income recorded | 600,000 | |||||||||||
Amount of ownership interest of related party in the entity | $ 2,000,000 | |||||||||||
Mr. Ivan Kaufman, chairman and chief executive officer | Maturity date of January 2017 | Bridge Loans | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Percentage of ownership interest of related party in the entity | 24.00% | |||||||||||
Base spread (as a percent) | 7.90% | |||||||||||
LIBOR floor (as a percentage) | 0.50% | |||||||||||
Amount of mortgage loan secured by property purchased from related party | $ 30,400,000 | |||||||||||
Mr. Ivan Kaufman, chairman and chief executive officer | Maturity date of March 2016 | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Base spread (as a percent) | 5.50% | |||||||||||
Number of bridge loans originated | item | 2 | |||||||||||
Amount of mortgage loan secured by property purchased from related party | $ 5,000,000 | |||||||||||
Mr. Ivan Kaufman, chairman and chief executive officer | Maturity date of March 2016 | Bridge Loans | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Interest income recorded | 100,000 | |||||||||||
Mr. Ivan Kaufman, chairman and chief executive officer | Maturity date of March 2016 | Bridge Loans | Multi-family | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Number of properties owned | item | 2 | |||||||||||
Percentage of ownership interest of related party in the entity | 95.00% | |||||||||||
Investments in equity affiliates | $ 100,000 | |||||||||||
Ownership interest (as a percent) | 5.00% | |||||||||||
Lexford Portfolio | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Aggregate outstanding balance of related party debt | 854,300,000 | $ 854,300,000 | ||||||||||
Lexford Portfolio | Preferred equity investments | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Income from equity affiliates | $ 200,000 | $ 5,500,000 | ||||||||||
Affiliate of Mr. Ivan Kaufman | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Contract period with the new entity | 7 years 6 months | |||||||||||
Fees as a percentage of gross revenues of the underlying properties | 4.75% | |||||||||||
Mr. Ivan Kaufman and his affiliates | Maturity date of January 2017 | Mezzanine Loans | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Fixed rate of interest (as a percent) | 12.00% | |||||||||||
Interest income recorded | $ 900,000 | |||||||||||
Amount of mortgage loan secured by property purchased from related party | $ 4,600,000 | |||||||||||
Certain officers and our Manager | Maturity date of April 2018 | Bridge Loans | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Percentage of ownership interest of related party in the entity | 90.00% | |||||||||||
Base spread (as a percent) | 4.50% | |||||||||||
Interest income recorded | $ 100,000 | |||||||||||
Interest rate, floor | 0.25% | |||||||||||
Amount of mortgage loan secured by property purchased from related party | $ 6,300,000 | |||||||||||
ACM / Our "Manager" | Kaufman Entities | ||||||||||||
Agreements and transactions with related parties | ||||||||||||
Percentage of outstanding membership interest of related party in another related party | 92.00% | 92.00% |