Document And Entity Information
Document And Entity Information - shares | 6 Months Ended | |
Jun. 30, 2019 | Jul. 26, 2019 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Amendment Flag | false | |
Document Period End Date | Jun. 30, 2019 | |
Document Fiscal Year Focus | 2019 | |
Document Fiscal Period Focus | Q2 | |
Trading Symbol | TRTX | |
Entity Registrant Name | TPG RE Finance Trust, Inc. | |
Entity Central Index Key | 0001630472 | |
Current Fiscal Year End Date | --12-31 | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Current Reporting Status | Yes | |
Entity Shell Company | false | |
Entity File Number | 001-38156 | |
Entity Tax Identification Number | 364796967 | |
Entity Address, Address Line One | 888 Seventh Avenue | |
Entity Address, Address Line Two | 35th Floor | |
Entity Address, City or Town | New York | |
Entity Address, State or Province | New York | |
Entity Address, Postal Zip Code | 10106 | |
City Area Code | 212 | |
Local Phone Number | 601-4700 | |
Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 72,943,213 | |
Class A Common Stock | ||
Document Information [Line Items] | ||
Entity Common Stock, Shares Outstanding | 1,143,313 |
Consolidated Balance Sheets (Un
Consolidated Balance Sheets (Unaudited) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 | |
ASSETS | |||
Cash and Cash Equivalents | [1] | $ 70,042 | $ 39,720 |
Restricted Cash | [1] | 450 | 1,000 |
Accounts Receivable | [1] | 42 | 38 |
Accounts Receivable from Servicer/Trustee | [1] | 213,410 | 96,464 |
Accrued Interest Receivable | [1] | 30,923 | 20,731 |
Loans Held for Investment, net (includes $2,807,240 and $2,219,574 pledged as collateral under secured revolving repurchase and secured credit agreements) | 4,830,235 | 4,293,787 | |
Investment in Available-for-Sale Debt Securities (includes $641,426 and $36,307 pledged as collateral under secured revolving repurchase agreements) | 679,178 | 74,381 | |
Other Assets, Net | [1] | 354 | 669 |
Total Assets | [1] | 5,824,634 | 4,526,790 |
Liabilities | |||
Accrued Interest Payable | [1] | 9,604 | 6,146 |
Accrued Expenses | [1] | 6,084 | 8,151 |
Secured Revolving Repurchase, Senior Secured, and Secured Credit Agreements (net of deferred financing costs of $9,823 and $10,448) | 2,749,126 | 1,494,078 | |
Collateralized Loan Obligations (net of deferred financing costs of $7,945 and $12,447) | [1] | 1,179,464 | 1,509,930 |
Term Loan Facility (net of deferred financing costs of $1,023 and $758) | [1] | 266,638 | 113,504 |
Asset-Specific Financings (net of deferred financing costs of $564 and $129) | [1] | 108,936 | 32,371 |
Payable to Affiliates | [1] | 7,649 | 5,996 |
Deferred Revenue | [1] | 391 | 463 |
Dividends Payable | [1] | 31,985 | 28,981 |
Total Liabilities | [1] | 4,359,877 | 3,199,620 |
Commitments and Contingencies—See Note 14 | [1] | ||
Stockholders’ Equity: | |||
Preferred Stock ($0.001 par value per share; 100,000,000 shares authorized; 125 and 0 shares issued and outstanding, respectively) | [1] | ||
Additional Paid-in-Capital | [1] | 1,492,670 | 1,355,002 |
Accumulated Deficit | [1] | (29,220) | (25,915) |
Accumulated Other Comprehensive Gain (Loss) | 1,233 | (1,985) | |
Total Stockholders' Equity | [1] | 1,464,757 | 1,327,170 |
Total Liabilities and Stockholders' Equity | [1] | 5,824,634 | 4,526,790 |
Common Stock, Undefined Class | |||
Stockholders’ Equity: | |||
Common Stock Value | [1] | 73 | 67 |
Class A Common Stock | |||
Stockholders’ Equity: | |||
Common Stock Value | [1] | 1 | 1 |
Total Stockholders' Equity | $ 1 | $ 1 | |
[1] | The Company’s consolidated Total Assets and Total Liabilities at June 30, 2019 include assets and liabilities of variable interest entities (“VIEs”) of $1.6 billion and $1.2 billion, respectively. The Company’s consolidated Total Assets and Total Liabilities at December 31, 2018 include assets and liabilities of VIEs of $1.9 billion and $1.5 billion, respectively. These assets can be used only to satisfy obligations of the VIEs, and creditors of the VIEs have recourse only to these assets, and not to TPG RE Finance Trust, Inc. See Note 5 to the Consolidated Financial Statements for details |
Consolidated Balance Sheets (Pa
Consolidated Balance Sheets (Parenthetical) (unaudited) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 | |
Preferred stock, par value | $ 0.001 | $ 0.001 | |
Preferred stock, authorized shares | 100,000,000 | 100,000,000 | |
Preferred stock, shares issued | 125 | 0 | |
Preferred stock, shares outstanding | 125 | 0 | |
Common stock, par value | $ 0.001 | $ 0.001 | |
Common stock, authorized shares | 300,000,000 | 300,000,000 | |
Common stock, shares issued | 72,996,096 | 66,020,387 | |
Common stock, shares outstanding | 72,996,096 | 66,020,387 | |
Total assets | [1] | $ 5,824,634 | $ 4,526,790 |
Total liabilities | [1] | 4,359,877 | 3,199,620 |
Variable Interest Entity, Primary Beneficiary | |||
Total assets | 1,600,000 | 1,900,000 | |
Total liabilities | $ 1,200,000 | $ 1,500,000 | |
Class A Common Stock | |||
Common stock, par value | $ 0.001 | $ 0.001 | |
Common stock, authorized shares | 2,500,000 | 2,500,000 | |
Common stock, shares issued | 1,143,313 | 1,143,313 | |
Common stock, shares outstanding | 1,143,313 | 1,143,313 | |
Repurchase Agreements | |||
Loans pledged as collateral | $ 2,807,240 | $ 2,219,574 | |
Available-for-sale securities pledged as collateral | 641,426 | 36,307 | |
Deferred financing costs | 9,823 | 10,448 | |
Term Loan Facility | |||
Deferred financing costs | 1,023 | 758 | |
Asset-specific Financing | |||
Deferred financing costs | 564 | 129 | |
Collateralized Loan Obligation | |||
Loans pledged as collateral | 1,401,841 | 1,824,281 | |
Deferred financing costs | $ 7,945 | $ 12,447 | |
[1] | The Company’s consolidated Total Assets and Total Liabilities at June 30, 2019 include assets and liabilities of variable interest entities (“VIEs”) of $1.6 billion and $1.2 billion, respectively. The Company’s consolidated Total Assets and Total Liabilities at December 31, 2018 include assets and liabilities of VIEs of $1.9 billion and $1.5 billion, respectively. These assets can be used only to satisfy obligations of the VIEs, and creditors of the VIEs have recourse only to these assets, and not to TPG RE Finance Trust, Inc. See Note 5 to the Consolidated Financial Statements for details |
Consolidated Statements of Inco
Consolidated Statements of Income and Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
INTEREST INCOME | ||||
Interest Income | $ 88,254 | $ 64,693 | $ 164,855 | $ 124,058 |
Interest Expense | (46,426) | (30,154) | (85,793) | (56,152) |
Net Interest Income | 41,828 | 34,539 | 79,062 | 67,906 |
OTHER REVENUE | ||||
Other Income, net | 412 | 509 | 834 | 875 |
Total Other Revenue | 412 | 509 | 834 | 875 |
OTHER EXPENSES | ||||
Professional Fees | 593 | 855 | 1,272 | 1,754 |
General and Administrative | 1,674 | 1,089 | 2,999 | 2,197 |
Servicing and Asset Management Fees | 431 | 767 | 944 | 1,534 |
Management Fee | 5,323 | 4,763 | 10,466 | 9,467 |
Incentive Management Fee | 2,048 | 1,146 | 3,413 | 2,072 |
Total Other Expenses | 10,069 | 8,620 | 19,094 | 17,024 |
Income Before Income Taxes | 32,171 | 26,428 | 60,802 | 51,757 |
Income Tax (Expense) Income, net | (202) | 10 | (421) | (205) |
Net Income | 31,969 | 26,438 | 60,381 | 51,552 |
Preferred Stock Dividends | (4) | (7) | (3) | |
Net Income Attributable to TPG RE Finance Trust, Inc. | $ 31,965 | $ 26,438 | $ 60,374 | $ 51,549 |
Basic Earnings per Common Share | $ 0.43 | $ 0.44 | $ 0.85 | $ 0.86 |
Diluted Earnings per Common Share | $ 0.43 | $ 0.44 | $ 0.85 | $ 0.86 |
Weighted Average Number of Common Shares Outstanding | ||||
Basic: | 73,963,337 | 60,175,373 | 71,144,696 | 60,283,992 |
Diluted: | 73,963,337 | 60,175,373 | 71,144,696 | 60,283,992 |
OTHER COMPREHENSIVE INCOME | ||||
Net Income | $ 31,969 | $ 26,438 | $ 60,381 | $ 51,552 |
Unrealized Gain (Loss) on Available-for-Sale Debt Securities | 3,112 | (1,424) | 3,218 | (1,638) |
Comprehensive Net Income | $ 35,081 | $ 25,014 | $ 63,599 | $ 49,914 |
Consolidated Statement of Chang
Consolidated Statement of Changes in Equity (Unaudited) - USD ($) $ in Thousands | Total | Class A Common Stock | Preferred Stock | Common Stock | Additional Paid-in-Capital | Accumulated Deficit | Accumulated Other Comprehensive Income (Loss) | |
Balance at Dec. 31, 2017 | $ 1,201,331 | $ 1 | $ 60 | $ 1,216,112 | $ (14,808) | $ (34) | ||
Balance, Shares at Dec. 31, 2017 | 1,178,618 | 125 | 59,440,112 | |||||
Conversions of Class A Common Stock to Common Stock | (24,071) | 24,071 | ||||||
Repurchases of Common Stock | (8,360) | (9) | (8,351) | |||||
Repurchases of Common Stock, Shares | (443,570) | |||||||
Redemption of Series A Preferred Stock | (125) | (125) | ||||||
Redemption of Series A Preferred Stock, Shares | (125) | |||||||
Amortization of Share Based Compensation | 177 | 177 | ||||||
Net Income | 25,114 | 25,114 | ||||||
Other Comprehensive Income (Loss) | (214) | (214) | ||||||
Dividends on Preferred Stock | (3) | (3) | ||||||
Dividends on Common Stock (Dividends Declared per Share) | (24,822) | (24,822) | ||||||
Dividends on Class A Common Stock (Dividends Declared per Share) | (485) | (485) | ||||||
Balance at Mar. 31, 2018 | 1,192,613 | $ 1 | $ 60 | 1,216,155 | (23,355) | (248) | ||
Balance, Shares at Mar. 31, 2018 | 1,154,547 | 59,020,613 | ||||||
Balance at Dec. 31, 2017 | 1,201,331 | $ 1 | $ 60 | 1,216,112 | (14,808) | (34) | ||
Balance, Shares at Dec. 31, 2017 | 1,178,618 | 125 | 59,440,112 | |||||
Net Income | 51,552 | |||||||
Balance at Jun. 30, 2018 | 1,191,913 | $ 1 | $ 60 | 1,216,352 | (22,828) | (1,672) | ||
Balance, Shares at Jun. 30, 2018 | 1,154,547 | 59,039,965 | ||||||
Balance at Mar. 31, 2018 | 1,192,613 | $ 1 | $ 60 | 1,216,155 | (23,355) | (248) | ||
Balance, Shares at Mar. 31, 2018 | 1,154,547 | 59,020,613 | ||||||
Issuance of Common Stock, Shares | 19,352 | |||||||
Amortization of Share Based Compensation | 197 | 197 | ||||||
Net Income | 26,438 | 26,438 | ||||||
Other Comprehensive Income (Loss) | (1,424) | (1,424) | ||||||
Dividends on Common Stock (Dividends Declared per Share) | (25,415) | (25,415) | ||||||
Dividends on Class A Common Stock (Dividends Declared per Share) | (496) | (496) | ||||||
Balance at Jun. 30, 2018 | 1,191,913 | $ 1 | $ 60 | 1,216,352 | (22,828) | (1,672) | ||
Balance, Shares at Jun. 30, 2018 | 1,154,547 | 59,039,965 | ||||||
Balance at Dec. 31, 2018 | 1,327,170 | [1] | $ 1 | $ 67 | 1,355,002 | (25,915) | (1,985) | |
Balance, Shares at Dec. 31, 2018 | 1,143,313 | 66,020,387 | ||||||
Issuance of Common Stock | 119,100 | $ 6 | 119,094 | |||||
Issuance of Common Stock, Shares | 6,000,000 | |||||||
Repurchases of Common Stock | (42) | (42) | ||||||
Repurchases of Common Stock, Shares | (2,324) | |||||||
Issuance of Series A Preferred Stock | 125 | 125 | ||||||
Issuance of Series A Preferred Stock, Shares | 125 | |||||||
Equity Issuance and Equity Distribution Agreement Transaction Costs | (300) | (300) | ||||||
Amortization of Share Based Compensation | 633 | 633 | ||||||
Net Income | 28,412 | 28,412 | ||||||
Other Comprehensive Income (Loss) | 106 | 106 | ||||||
Dividends on Preferred Stock | (3) | (3) | ||||||
Dividends on Common Stock (Dividends Declared per Share) | (31,160) | (31,160) | ||||||
Dividends on Class A Common Stock (Dividends Declared per Share) | (492) | (492) | ||||||
Balance at Mar. 31, 2019 | 1,443,549 | $ 1 | $ 73 | 1,474,554 | (29,200) | (1,879) | ||
Balance, Shares at Mar. 31, 2019 | 1,143,313 | 125 | 72,018,063 | |||||
Balance at Dec. 31, 2018 | 1,327,170 | [1] | $ 1 | $ 67 | 1,355,002 | (25,915) | (1,985) | |
Balance, Shares at Dec. 31, 2018 | 1,143,313 | 66,020,387 | ||||||
Net Income | 60,381 | |||||||
Balance at Jun. 30, 2019 | 1,464,757 | [1] | $ 1 | $ 73 | 1,492,670 | (29,220) | 1,233 | |
Balance, Shares at Jun. 30, 2019 | 1,143,313 | 125 | 72,996,096 | |||||
Balance at Mar. 31, 2019 | 1,443,549 | $ 1 | $ 73 | 1,474,554 | (29,200) | (1,879) | ||
Balance, Shares at Mar. 31, 2019 | 1,143,313 | 125 | 72,018,063 | |||||
Issuance of Common Stock | 17,432 | 17,432 | ||||||
Issuance of Common Stock, Shares | 978,033 | |||||||
Equity Issuance and Equity Distribution Agreement Transaction Costs | (197) | (197) | ||||||
Amortization of Share Based Compensation | 881 | 881 | ||||||
Net Income | 31,969 | 31,969 | ||||||
Other Comprehensive Income (Loss) | 3,112 | 3,112 | ||||||
Dividends on Preferred Stock | (4) | (4) | ||||||
Dividends on Common Stock (Dividends Declared per Share) | (31,494) | (31,494) | ||||||
Dividends on Class A Common Stock (Dividends Declared per Share) | (491) | (491) | ||||||
Balance at Jun. 30, 2019 | $ 1,464,757 | [1] | $ 1 | $ 73 | $ 1,492,670 | $ (29,220) | $ 1,233 | |
Balance, Shares at Jun. 30, 2019 | 1,143,313 | 125 | 72,996,096 | |||||
[1] | The Company’s consolidated Total Assets and Total Liabilities at June 30, 2019 include assets and liabilities of variable interest entities (“VIEs”) of $1.6 billion and $1.2 billion, respectively. The Company’s consolidated Total Assets and Total Liabilities at December 31, 2018 include assets and liabilities of VIEs of $1.9 billion and $1.5 billion, respectively. These assets can be used only to satisfy obligations of the VIEs, and creditors of the VIEs have recourse only to these assets, and not to TPG RE Finance Trust, Inc. See Note 5 to the Consolidated Financial Statements for details |
Consolidated Statement of Cha_2
Consolidated Statement of Changes in Equity (Unaudited) (Parenthetical) - $ / shares | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Mar. 31, 2019 | Mar. 31, 2018 | Jun. 30, 2019 | |
Common stock dividends declared per share | $ 0.43 | $ 0.43 | $ 0.42 | $ 0.43 |
Class A Common Stock | ||||
Common stock dividends declared per share | $ 0.43 | $ 0.43 | $ 0.42 | $ 0.43 |
Consolidated Statements of Cash
Consolidated Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | ||
Cash Flows from Operating Activities: | |||
Net Income | $ 60,381 | $ 51,552 | |
Adjustment to Reconcile Net Income to Net Cash Provided by Operating Activities: | |||
Amortization and Accretion of Premiums, Discounts and Loan Origination Fees, net | (7,898) | (8,911) | |
Amortization of Deferred Financing Costs | 9,393 | 7,900 | |
Stock Compensation Expense | 1,514 | 374 | |
Cash Flows Due to Changes in Operating Assets and Liabilities: | |||
Accounts Receivable | (4) | 104 | |
Accrued Interest Receivable | (12,224) | (1,500) | |
Accrued Expenses | (3,525) | 1,165 | |
Accrued Interest Payable | 3,458 | 77 | |
Payable to Affiliates | 1,653 | 960 | |
Deferred Fee Income | (72) | 204 | |
Other Assets | 315 | 234 | |
Net Cash Provided by Operating Activities | 52,991 | 52,159 | |
Cash Flows from Investing Activities: | |||
Origination and Acquisition of Loans Held for Investment | (1,133,817) | (1,040,793) | |
Advances on Loans Held for Investment | (117,131) | (150,769) | |
Principal Repayments of Loans Held for Investment | 608,338 | 534,580 | |
Purchase of Available-for-Sale Debt Securities | (632,267) | (143,643) | |
Principal Repayments of Available-for-Sale Debt Securities | 6,641 | 4,536 | |
Net Cash (Used in) Investing Activities | (1,268,236) | (796,089) | |
Cash Flows from Financing Activities: | |||
Payments on Collateralized Loan Obligations | (311,672) | ||
Proceeds from Collateralized Loan Obligations | 745,904 | ||
Payments on Secured Financing Agreements | (812,429) | (1,037,666) | |
Proceeds from Secured Financing Agreements | 2,297,147 | 1,073,518 | |
Payment of Deferred Financing Costs | (3,817) | (13,361) | |
Payments to Repurchase Common Stock | (42) | (8,360) | |
Proceeds from Issuance of Preferred Stock | 125 | ||
Proceeds from Issuance of Common Stock | 136,532 | ||
Payment of Equity Issuance and Equity Distribution Agreement Transaction Costs | (188) | ||
Net Cash Provided by Financing Activities | 1,245,017 | 711,532 | |
Net Change in Cash, Cash Equivalents, and Restricted Cash | 29,772 | (32,398) | |
Cash, Cash Equivalents and Restricted Cash at Beginning of Period | 40,720 | 75,737 | |
Cash, Cash Equivalents and Restricted Cash at End of Period | 70,492 | 43,339 | |
Supplemental Disclosure of Cash Flow Information: | |||
Interest Paid | 72,942 | 48,175 | |
Taxes Paid | 368 | 205 | |
Supplemental Disclosure of Non-Cash Investing and Financing Activities: | |||
Principal Repayments of Loans Held for Investment Held by Servicer/Trustee, net | 208,697 | 36,435 | |
Principal Repayments of Available-for-Sale Debt Securities Held by Servicer/Trustee, net | 960 | 105 | |
Proceeds from Secured Financing Agreements Held by Trustee | 103 | ||
Dividends Declared, not paid | 31,985 | [1] | 25,911 |
Accrued Equity Issuance and Equity Distribution Agreement Transaction Costs | 309 | 78 | |
Accrued Deferred Financing Costs | 1,148 | 1,177 | |
Unrealized Gain (Loss) on Available-for-Sale Debt Securities | 3,218 | (1,638) | |
Preferred Class A | |||
Cash Flows from Financing Activities: | |||
Payments to Redeem Series A Preferred Stock | (125) | ||
Dividends paid | (7) | (3) | |
Common Stock, Undefined Class | |||
Cash Flows from Financing Activities: | |||
Dividends paid | (59,649) | (47,442) | |
Class A Common Stock | |||
Cash Flows from Financing Activities: | |||
Dividends paid | $ (983) | $ (933) | |
[1] | The Company’s consolidated Total Assets and Total Liabilities at June 30, 2019 include assets and liabilities of variable interest entities (“VIEs”) of $1.6 billion and $1.2 billion, respectively. The Company’s consolidated Total Assets and Total Liabilities at December 31, 2018 include assets and liabilities of VIEs of $1.9 billion and $1.5 billion, respectively. These assets can be used only to satisfy obligations of the VIEs, and creditors of the VIEs have recourse only to these assets, and not to TPG RE Finance Trust, Inc. See Note 5 to the Consolidated Financial Statements for details |
Business and Organization
Business and Organization | 6 Months Ended |
Jun. 30, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Business and Organization | (1) Business and Organization TPG RE Finance Trust, Inc. (together with its consolidated subsidiaries, “we,” “us,” “our” or the “Company”) is a Maryland corporation that was incorporated on October 24, 2014 and commenced operations on December 18, 2014 (“Inception”). We are organized as a holding company and conduct our operations primarily through TPG RE Finance Trust Holdco, LLC (“Holdco”), a Delaware limited liability company that is wholly owned by the Company, and Holdco’s direct and indirect subsidiaries. We conduct our operations as a real estate investment trust (“REIT”) for U.S. federal income tax purposes. We generally will not be subject to U.S. federal income taxes on our REIT taxable income to the extent that we annually distribute all of our REIT taxable income to stockholders and maintain our qualification as a REIT. We also operate our business in a manner that permits us to maintain an exclusion from registration under the Investment Company Act of 1940, as amended. The Company’s principal business activity is to directly originate and acquire a diversified portfolio of commercial real estate related assets, consisting primarily of first mortgage loans and senior participation interests in first mortgage loans secured by institutional-quality properties in primary and select secondary markets in the United States and commercial real estate debt securities, including commercial mortgage-backed securities (“CMBS”) and commercial real estate collateralized loan obligation securities (“CRE CLO”). As of June 30, 2019, and December 31, 2018, the Company conducted substantially all of its operations through a Delaware limited liability company, TPG RE Finance Trust Holdco, LLC (“Holdco”), and the Company’s other wholly-owned subsidiaries. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 6 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | (2) Summary of Significant Accounting Policies Basis of Presentation The interim consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). The interim consolidated financial statements include the Company’s accounts, consolidated variable interest entities for which the Company is the primary beneficiary, and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated. Use of Estimates The preparation of the interim consolidated financial statements in conformity with GAAP requires estimates of assets, liabilities, revenues, expenses and disclosure of contingent assets and liabilities at the date of the interim consolidated financial statements. Actual results could differ from management’s estimates, and such differences could be material. Significant estimates made in the interim consolidated financial statements include, but are not limited to: impairment; adequacy of provisions for loan losses; and valuation of financial instruments. Principles of Consolidation Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 810—Consolidation (“ASC 810”) provides guidance on the identification of a VIE (a variable interest entity for which control is achieved through means other than voting rights) and the determination of which business enterprise, if any, should consolidate the VIE. An entity is considered a VIE if any of the following applies: (1) the equity investors (if any) lack one or more of the essential characteristics of a controlling financial interest; (2) the equity investment at risk is insufficient to finance that entity’s activities without additional subordinated financial support; or (3) the equity investors have voting rights that are not proportionate to their economic interests and the activities of the entity involve or are conducted on behalf of an investor with a disproportionately small voting interest. The Company consolidates VIEs in which it is considered to be the primary beneficiary. The primary beneficiary is defined as the entity having both of the following characteristics: (1) the power to direct the activities that, when taken together, most significantly impact the VIE’s performance; and (2) the obligation to absorb losses and right to receive the returns from the VIE that would be significant to the VIE. At each reporting date, the Company reconsiders its primary beneficiary conclusion to determine if its obligation to absorb losses of, or its rights to receive benefits from, the VIE could potentially be more than insignificant, and will consolidate or not consolidate accordingly (see Note 5 for details). Revenue Recognition Interest income on loans is accrued using the interest method based on the contractual terms of the loan, adjusted for credit impairment, if any. The objective of the interest method is to arrive at periodic interest income including recognition of fees and costs at a constant effective yield. Premiums, discounts, and origination fees are amortized or accreted into interest income over the lives of the loans using the interest method, or on a straight line basis when it approximates the interest method. Extension and modification fees are accreted into income on a straight line basis, when it approximates the interest method, over the related extension or modification period. Exit fees are accreted into income on a straight line basis, when it approximates the interest method, over the lives of the loans to which they relate unless they can be waived by the Company or a co-lender in connection with a loan refinancing. Prepayment penalties from borrowers are recognized as interest income when received. Certain of the Company’s loan investments have in the past and may in the future provide for additional interest based on the borrower’s operating cash flow or appreciation of the underlying collateral. Such amounts are considered contingent interest and are reflected as interest income only upon certainty of collection. The Company considers a loan to be non-performing and places the loan on non-accrual status when: (1) management determines the borrower is incapable of, or has ceased efforts toward, curing the cause of a default; (2) the loan becomes 90 days delinquent; or (3) the loan experiences a maturity default. Based on the Company’s judgment as to the collectability of principal, a loan on non-accrual status is either accounted for on a cash basis, where interest income is recognized only upon receipt of cash for principal and interest payments, or on a cost-recovery basis, where all cash receipts reduce the loan’s carrying value, and interest income is only recorded when such carrying value has been fully recovered. During the six months ended June 30, 2019 and the year end December 31, 2018, no loans were placed on non-accrual status and no losses or impairments were recorded to our loan portfolio. Loans Held for Investment Loans that the Company has the intent and ability to hold for the foreseeable future, or until maturity or repayment, are reported at their outstanding principal balances net of any premiums, discounts, loan origination fees and loan loss allowances, if any. Loan origination fees and direct loan origination costs are deferred and recognized in interest income over the estimated life of the loans using the interest method, or on a straight line basis when it approximates the interest method, adjusted for actual prepayments. The Company evaluates each loan classified as a loan held for investment for impairment on a quarterly basis. Impairment occurs when it is deemed probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan. If the loan is considered to be impaired, a loan loss allowance is recorded to reduce the carrying value of the loan to the present value of the expected future cash flows discounted at the loan’s contractual effective rate, or the fair value of the collateral securing the impaired loan, less estimated costs to sell such collateral, if recovery of the Company’s investment is expected solely from the sale of such collateral. As part of the quarterly impairment review, the Company evaluates the risk of each loan and assigns a risk rating based on a variety of factors, grouped as follows to include, among other factors: (i) loan and credit structure, including the as-is loan-to-value (“LTV”) ratio and structural features; (ii) quality and stability of real estate value and operating cash flow, including debt yield, property type, dynamics of the geographic, property-type and local market, physical condition, stability of cash flow, leasing velocity and quality and diversity of tenancy; (iii) performance against underwritten business plan; and (iv) quality, experience and financial condition of sponsor, borrower and guarantor(s). Based on a 5-point scale, the Company’s loans are rated “1” through “5,” from least risk to greatest risk, respectively, which ratings are defined as follows: 1- Outperform—Exceeds performance metrics (for example, technical milestones, occupancy, rents, net operating income) included in original or current credit underwriting and business plan; 2- Meets or Exceeds Expectations—Collateral performance meets or exceeds substantially all performance metrics included in original or current underwriting / business plan; 3- Satisfactory—Collateral performance meets or is on track to meet underwriting; business plan is met or can reasonably be achieved; 4- Underperformance—Collateral performance falls short of original underwriting, material differences exist from business plan, or both; technical milestones have been missed; defaults may exist, or may soon occur absent material improvement; and 5- Risk of Impairment/Default—Collateral performance is significantly worse than underwriting; major variance from business plan; loan covenants or technical milestones have been breached; timely exit from loan via sale or refinancing is questionable. Since Inception, the Company has not recognized any impairments on its loan portfolio and has not recorded any loan loss allowances against any of the loans in its portfolio . The Company’s determination of asset-specific loan loss reserves, should any such reserves be necessary, relies on material estimates regarding the fair value of loan collateral. Such losses could be caused by various factors, including, but not limited to, unanticipated adverse changes in the economy or events adversely affecting specific assets, borrowers, industries in which our borrowers operate or markets in which our borrowers or their properties are located. Significant judgment is required when evaluating loans for impairment. The Company’s loans are typically collateralized by real estate, or in the case of mezzanine loans, by a partnership or similar equity interest in an entity that owns real estate. As a result, the Company regularly evaluates on a loan-by-loan basis the extent and impact of any credit deterioration associated with the performance and/or value of the underlying collateral property as well as the financial and operating capability of the borrower/sponsor. The Company also evaluates the financial strength of loan guarantors, if any, and the borrower’s competency in managing and operating the property or properties. In addition, the Company considers the overall economic environment, real estate sector, and geographic sub-market in which the borrower operates. Such impairment analyses are completed and reviewed by asset management personnel and evaluated by senior management, who utilize various data sources, including (i) periodic financial data such as property occupancy, tenant profile, rental rates, operating expenses, the borrower’s exit plan, and capitalization and discount rates, (ii) site inspections, (iii) sales and financing comparables, (iv) current credit spreads for refinancing and (v) other market data. Commercial Mortgage-Backed and Commercial Real Estate Collateralized Loan Obligation Securities The Company acquires CMBS and CRE CLO investments primarily for cash management purposes, and also for investment purposes. The Company designates CMBS and CRE CLO investments as available-for-sale on the acquisition date. CMBS and CRE CLO investments that are classified as available-for-sale are recorded at fair value through other comprehensive income (loss) in the Company’s consolidated financial statements. Additionally, CMBS and CRE CLO investments that are not classified as held-to-maturity and which the Company does not hold for the purpose of selling in the near-term, but may dispose of prior to maturity, are also designated as available-for-sale and are carried at fair value. The Company’s recognition of interest income from its CMBS and CRE CLO investments, including its amortization of premium and discount, follows the Company’s revenue recognition policy as described under “Revenue Recognition” above. The Company uses a specific identification method when determining the cost of a security sold and the amount of unrealized gain or loss reclassified from accumulated other comprehensive income (loss) into earnings. Unrealized losses on securities that, in the judgment of management, are other than temporary are charged against earnings as a loss in the consolidated statements of income and comprehensive income. Significant valuation inputs are Level II in the fair value hierarchy as described below under “Fair Value Measurements”. Portfolio Financing Arrangements The Company finances certain loan and CMBS and CRE CLO investments using secured revolving repurchase agreements, asset-specific financing arrangements, senior secured and secured credit agreements, collateralized loan obligations, and a term loan facility. The related borrowings are recorded as separate liabilities on the Company’s consolidated balance sheets. Interest income earned on the investments and interest expense incurred on the related borrowings are reported separately on the Company’s consolidated statements of income and comprehensive income. In certain instances, the Company creates structural leverage through the co-origination or non-recourse syndication of a senior loan interest to a third party. For all such syndications the Company has completed through June 30, 2019, the Company has transferred 100% of the senior mortgage loan that the Company originated on a non-recourse basis to a third-party lender and has retained as a loan investment a separate mezzanine loan investment secured by a pledge of the equity in the mortgage borrower. With respect to the senior mortgage loan transferred, the Company retains: no control over the mortgage loan; no economic interest in the mortgage loan; and no recourse to the purchaser or the borrower. Consequently, based on these circumstances and because the Company does not have any continuing involvement with the transferred senior mortgage loan, these syndications are accounted for as sales under GAAP and are removed from the Company’s consolidated financial statements at the time of transfer. The Company’s consolidated balance sheets only include the separate mezzanine loan remaining after the transfer, and not the non-consolidated senior loan interest sold or co-originated that the Company transferred. As of December 31, 2018, the Company revised its “Note Payable” naming convention in its consolidated balance sheet to “Asset-Specific Financings”. No amounts reported in prior periods were reclassified between financial statement line items and there was no impact to the Company’s consolidated financial statements resulting from this naming convention change during the current fiscal year. Fair Value Measurements The Company follows ASC 820-10, Fair Value Measurements and Disclosures “ASC 820-10” Level I Level II Level III For certain financial instruments, the various inputs that management uses to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the determination of which category within the fair value hierarchy is appropriate for such financial instrument is based on the lowest level of input that is significant to the fair value measurement. The assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the financial instrument. The Company may use valuation techniques consistent with the market and income approaches to measure the fair value of its assets and liabilities. The market approach uses third-party valuations and information obtained from market transactions involving identical or similar assets or liabilities. The income approach uses projections of the future economic benefits of an instrument to determine its fair value, such as in the discounted cash flow methodology. The inputs or methodology used for valuing financial instruments are not necessarily an indication of the risk associated with investing in these financial instruments. Transfers between levels of the fair value hierarchy are assumed to occur at the end of the reporting period. Income Taxes The Company qualifies and has elected to be taxed as a REIT for U.S. federal income tax purposes under the Internal Revenue Code of 1986, as amended, commencing with its initial taxable year ended December 31, 2014. To the extent that it annually distributes at least 90% of its REIT taxable income to stockholders and complies with various other requirements as a REIT, the Company generally will not be subject to U.S. federal income taxes on its distributed REIT taxable income. If the Company fails to continue to qualify as a REIT in any taxable year and does not qualify for certain statutory relief provisions, the Company will be subject to U.S. federal and state income taxes at regular corporate rates beginning with the year in which it fails to qualify and may be precluded from being able to elect to be treated as a REIT for the Company’s four subsequent taxable years. Even though the Company currently qualifies for taxation as a REIT, the Company may be subject to certain U.S. federal, state, local and foreign taxes on the Company’s income and property and to U.S. federal income and excise taxes on the Company’s undistributed REIT taxable income. Deferred tax assets and liabilities are recognized for future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the periods in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period in which the enactment date occurs. Under ASC Topic 740, Income Taxes (“ASC 740”), a valuation allowance is established when management believes it is more likely than not that a deferred tax asset will not be realized. The Company intends to continue to operate in a manner consistent with, and to continue to meet the requirements to be treated as, a REIT for tax purposes and to distribute all of its REIT taxable income. Accordingly, the Company does not expect to pay corporate level federal taxes. Earnings per Common Share The Company utilizes the two-class method when assessing participating securities to calculate earnings per common share. Basic and diluted earnings per common share is computed by dividing net income attributable to common stockholders (i.e., holders of common stock and Class A common stock), by the weighted-average number of common shares (both common stock and Class A common stock) outstanding during the period. The preferences, rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications and terms and conditions of redemption of the Class A common stock are identical to the common stock, except (1) the Class A common stock is not a “margin security” as defined in Regulation U of the Board of Governors of the U.S. Federal Reserve System (and rulings and interpretations thereunder) and may not be listed on a national securities exchange or a national market system and (2) each share of Class A common stock is convertible at any time or from time to time, at the option of the holder, for one fully paid and non-assessable share of common stock. The Class A common stock votes together with the common stock as a single class. Shares of Class A common stock have been issued to, and are owned by, TPG RE Finance Trust Management, L.P., a Delaware limited partnership (the “Manager”), and certain individuals or entities who are or were affiliated with the Manager, and the sale or conversion to common stock by investors of such shares of Class A common stock is subject to certain restrictions. Diluted earnings per common share is calculated by including the effect of dilutive securities. The Company accounts for unvested share-based payment awards that contain non-forfeitable dividend rights or dividend equivalents (whether paid or unpaid) as participating securities, which are included in the computation of earnings per share pursuant to the two-class method. Share-Based Compensation Share-based compensation consists of awards issued by the Company to certain employees of affiliates of our Manager and certain members of our Board of Directors. These share-based awards generally vest in installments over a fixed period of time. Compensation expense is recognized in net income on a straight-line basis over the applicable awards’ vesting period. Forfeitures of share-based awards are recognized as they occur. Deferred Financing Costs Deferred financing costs are reflected net of the collateralized loan obligations and secured financing arrangements on the Company’s consolidated balance sheets. These costs are amortized in interest expense using the interest method, or on a straight line basis when it approximates the interest method, over the shorter of the initial maturity of the obligation or financing arrangement. Cash and Cash Equivalents Cash and cash equivalents include cash held in banks or invested in money market funds with original maturities of less than 90 days. The Company deposits its cash and cash equivalents with high credit quality institutions to minimize credit risk exposure. The Company maintains cash accounts at several financial institutions, which are insured up to a maximum of $250,000 per account as of June 30, 2019 and December 31, 2018. The balances in these accounts may exceed the insured limits. Restricted Cash Restricted cash primarily represents deposit proceeds from potential borrowers which may be returned to borrowers, after deducting transaction costs paid by the Company for the benefit of the borrowers, upon the closing of a loan transaction. Accounts Receivable from Servicer/Trustee Accounts receivable from Servicer/Trustee represents cash proceeds from loan and CMBS and CRE CLO investment activities that have not been remitted to the Company based on contractual procedures previously agreed upon. Amounts are generally held by the Servicer/Trustee for less than 60 days before being remitted to the Company. Recently Issued Accounting Pronouncements In June 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). ASU 2016-13 significantly changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. ASU 2016-13 will replace the “incurred loss” model under existing guidance with an “expected loss” model for instruments measured at amortized cost, and require entities to record allowances for available-for-sale debt securities rather than reduce the carrying amount, as they do today under the other-than-temporary impairment model. Upon adoption, and resulting from this change, the Company expects that it will be required to record a loan loss reserve at origination or acquisition of an individual loan or a loan portfolio. ASU 2016-13 also simplifies the accounting model for purchased credit-impaired debt securities and loans. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019 and is to be adopted through a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. The Company is currently evaluating the impact ASU 2016-13 will have on its consolidated financial statements. |
Loans Held for Investment
Loans Held for Investment | 6 Months Ended |
Jun. 30, 2019 | |
Receivables [Abstract] | |
Loans Held for Investment | (3) Loans Held for Investment The Company currently originates and acquires first mortgage and mezzanine loans secured by commercial properties. These loans can potentially subject the Company to concentrations of credit risk as measured by various metrics, including without limitation property type collateralizing the loan, loan size, loans to a single sponsor and loans in a single geographic area. The Company’s loans held for investment are accounted for at amortized cost. During the three months ended June 30, 2019, the Company originated or acquired eight loans with a total commitment of approximately $755.0 million (including a non-consolidated senior interest of $132.0 million), an initial unpaid principal balance of $507.8 million, and unfunded commitments at closing of $115.2 million. For the six months ended June 30, 2019, the Company originated or acquired 19 loans with a total commitment of approximately $1.5 billion (including a non-consolidated senior interest of $132.0 million), initial unpaid principal balance of $1.1 billion, and unfunded commitments at closing of $195.7 million. The following tables present an overview of the loan investment portfolio as of June 30, 2019 and December 31, 2018 (dollars in thousands): June 30, 2019 Loans Receivable Outstanding Principal Unamortized Premium (Discount), Loan Origination Fees, net Carrying Amount Senior loans $ 4,844,228 $ (18,644 ) $ 4,825,584 Subordinated and mezzanine loans 5,000 (349 ) 4,651 Subtotal before allowance 4,849,228 (18,993 ) 4,830,235 Allowance for loan losses — — — Total $ 4,849,228 $ (18,993 ) $ 4,830,235 December 31, 2018 Loans Receivable Outstanding Principal Unamortized Premium (Discount), Loan Origination Fees, net Carrying Amount Senior loans $ 4,313,591 $ (19,804 ) $ 4,293,787 Subordinated and mezzanine loans — — — Subtotal before allowance 4,313,591 (19,804 ) 4,293,787 Allowance for loan losses — — — Total $ 4,313,591 $ (19,804 ) $ 4,293,787 For the six months ended June 30, 2019, loan portfolio activity was as follows (dollars in thousands): Carrying Value Balance at December 31, 2018 $ 4,293,787 Additions during the period: Loans originated and acquired 1,133,817 Additional fundings 117,131 Amortization of discount and origination fees 7,902 Deductions during the period: Collection of principal (722,402 ) Balance at June 30, 2019 $ 4,830,235 During the three months ended June 30, 2019, the Company co-originated a $167.0 million construction loan, of which $132.0 million is accounted for as a non-consolidated senior interest. At closing, the Company retained a mezzanine loan investment with a total loan commitment of $35.0 million, an initial unpaid principal balance of $5.0 million, and an interest rate of LIBOR plus 10.3%. At June 30, 2019 and December 31, 2018, there was no unamortized loan discount or premium included in loans held for investment at amortized cost on the consolidated balance sheets. The table below summarizes the carrying values and results of the Company’s internal risk rating review performed as of June 30, 2019 and December 31, 2018 (dollars in thousands): Carrying Value Rating June 30, 2019 December 31, 2018 1 $ — $ 29,923 2 1,073,740 959,314 3 3,420,107 3,099,401 4 336,388 205,149 5 — — Totals $ 4,830,235 $ 4,293,787 Weighted Average Risk Rating (1) 2.8 2.8 (1) Weighted Average Risk Rating calculated based on carrying value at period end. The weighted average risk rating at June 30, 2019 was 2.8, which was unchanged from the weighted average risk rating at December 31, 2018. During the three months ended June 30, 2019, two loans were moved from the Company’s Category 3 risk rating into its Category 2 risk rating, resulting from recent improvements in the operating performance of the underlying collateral. Additionally, during the three months ended June 30, 2019, the Company moved one loan from its Category 2 risk rating into its Category 3 risk rating, and three loans from its Category 3 risk rating into its Category 4 risk rating, based in three instances on a decline in operating performance of the underlying collateral during the current period, and in one instance due to recently enacted changes in New York City rent regulation whose impact on collateral performance is currently uncertain. At June 30, 2019 and December 31, 2018, there were no loans on non-accrual status or that were impaired; thus, the Company did not record any allowance for loan losses. |
Available-for-Sale Debt Securit
Available-for-Sale Debt Securities | 6 Months Ended |
Jun. 30, 2019 | |
Investments Debt And Equity Securities [Abstract] | |
Available-for-Sale Debt Securities | (4) Available-for-Sale Debt Securities During the three months ended June 30, 2019, the Company purchased for short-term cash management and investment purposes 17 CRE CLO investments for an aggregate purchase price of $368.2 million. The purchased CRE CLO investments consist of floating rate debt securities which, in the aggregate, had a weighted average coupon of LIBOR plus 1.9%. For the six months ended June 30, 2019, the Company purchased 27 CRE CLO investments for an aggregate purchase price of $602.4 million which, in the aggregate, have a weighted average coupon of LIBOR plus 2.0%. The CRE CLO investments purchased during the current year consist solely of floating rate investment grade debt securities. As of June 30, 2019 and December 31, 2018, the Company had 31 and four CMBS and CRE CLO investments, respectively, designated as available-for-sale debt securities. Details of the carrying and fair values of the Company’s CMBS and CRE CLO investment portfolio are as follows (dollars in thousands): June 30, 2019 Face Amount Unamortized Premium (Discount), net Gross Unrealized Gain (Loss) Estimated Fair Value Investments, at Fair Value CMBS and CRE CLO Investments $ 677,800 $ 145 $ 1,233 $ 679,178 December 31, 2018 Face Amount Unamortized Premium (Discount), net Gross Unrealized (Loss) Estimated Fair Value Investments, at Fair Value CMBS and CRE CLO Investments $ 76,404 $ (38 ) $ (1,985 ) $ 74,381 CMBS and CRE CLO investment fair values are considered Level II fair value measurements within the fair value hierarchy of ASC 820-10. The CMBS and CRE CLO investment fair values are based upon multiple market, broker, and counterparty or pricing services quotations, which provide valuation estimates, based upon reasonable market order indications. The Company reviews the fair value quotations, which are subject to significant variability based on market conditions such as interest rates, credit spreads and market liquidity, for reasonableness and consistency. The Company’s CMBS and CRE CLO investments have a weighted average contractual maturity, based on estimated fair value, of 16.4 years. The amortized cost and estimated fair value of the Company’s available-for-sale CMBS and CRE CLO investments by contractual maturity are shown in the following table (dollars in thousands): June 30, 2019 Amortized Cost Estimated Fair Value Maturity Date Within five years $ 37,834 $ 37,752 After five years 640,111 641,426 Total investment in CMBS and CRE CLO securities, at amortized cost and estimated fair value $ 677,945 $ 679,178 December 31, 2018 Amortized Cost Estimated Fair Value Maturity Date After one, within five years $ 37,929 $ 38,076 After five years 38,436 36,305 Total investment in CMBS and CRE CLO securities, at amortized cost and estimated fair value $ 76,365 $ 74,381 As of June 30, 2019, four of the Company’s CMBS and CLO investment holdings were in an unrealized loss position. During the six months ended June 30, 2019 and year ended December 31, 2018, these CMBS and CLO investments traded at, or near, their carrying values, and interest and principal payments are current. Additionally, as of June 30, 2019, substantially all of the unrealized loss position relates to CMBS investments issued by a government sponsored enterprise. Currently, all of the underlying mortgage loans are performing. No other-than-temporary impairments were recognized through income during the three and six months ended June 30, 2019 or the year ended December 31, 2018. |
Variable Interest Entities and
Variable Interest Entities and Collateralized Loan Obligations | 6 Months Ended |
Jun. 30, 2019 | |
Organization Consolidation And Presentation Of Financial Statements [Abstract] | |
Variable Interest Entities and Collateralized Loan Obligations | (5) Variable Interest Entities and Collateralized Loan Obligations On November 29, 2018 (the “FL2 Closing Date”), TPG RE Finance Trust CLO Sub-REIT, a subsidiary of the Company (“Sub-REIT”), entered into a collateralized loan obligation (“TRTX 2018-FL2”) through its wholly-owned subsidiaries TRTX 2018-FL2 Issuer, Ltd., an exempted company incorporated in the Cayman Islands with limited liability, as issuer (the “FL2 Issuer”), and TRTX 2018-FL2 Co-Issuer, LLC, a Delaware limited liability company, as co-issuer (the “FL2 Co-Issuer” and together with the FL2 Issuer, the “FL2 Issuers”). On the FL2 Closing Date, FL2 Issuer issued $872.6 million principal amount of notes (the “FL2 Notes”). The FL2 Co-Issuer co-issued $795.1 million principal amount of investment grade-rated notes which were purchased by third party investors. Concurrently with the issuance of the FL2 Notes, the FL2 Issuer also issued preferred shares, par value $0.001 per share and with an aggregate liquidation preference and notional amount equal to $1,000 per share (the “FL2 Preferred Shares” and, together with the FL2 Notes, the “FL2 Securities”), to TRTX 2018-FL2 Retention Holder, LLC, a Delaware limited liability company and wholly-owned subsidiary of the Sub-REIT (“FL2 Retention Holder”). Through FL2 Retention Holder, the Sub-REIT retained ownership of $205.0 million of FL2 Notes issued and FL2 Preferred Shares. Additionally, the Company currently holds as an investment $19.7 million (principal amount) of FL2 Notes, all of which were purchased during the three months ended March 31, 2019. Proceeds from the issuance of the FL2 Securities were used by the FL2 Issuers to purchase two commercial real estate whole loans (the “FL2 Whole Loans”) and 23 fully-funded pari passu Pari Passu For the three months ended June 30, 2019, the Company utilized the reinvestment feature twice, contributing FL2 Additional Interests of $69.5 million, and receiving net cash proceeds of $17.1 million, after the repayment of $52.4 million of existing borrowings, including accrued interest, secured by the FL2 Additional Interests. For the six months ended June 30, 2019, the Company utilized the reinvestment feature four times, contributing FL2 Additional Interests of $101.3 million, and receiving net cash proceeds of $23.5 million, after the repayment of $77.8 million of existing borrowings, including accrued interest, secured by the FL2 Additional Interests. The Company incurred approximately $8.7 million of issuance costs which are amortized on an effective yield basis over the shorter of the remaining life of the loans that collateralized the FL2 Notes, or the FL2 Notes. As of June 30, 2019, the Company’s unamortized issuance costs were $7.3 million. Interest expense on the outstanding FL2 Notes is payable monthly. For the three and six months ended June 30, 2019, interest expense (excluding amortization of deferred financing costs) of $7.6 million and $15.3 million, respectively, is included in the Company’s consolidated statements of income and comprehensive income. As of June 30, 2019, FL2 Mortgage Assets represented 18.4% of the aggregate unpaid principal balance of the Company’s loan investment portfolio and had an aggregate principal balance of approximately $892.3 million. On February 14, 2018 (the “FL1 Closing Date”), the Sub-REIT entered into a collateralized loan obligation (“TRTX 2018-FL1”) through its wholly-owned subsidiaries TPG Real Estate Finance 2018-FL1 Issuer, Ltd., an exempted company incorporated in the Cayman Islands with limited liability, as issuer (the “FL1 Issuer”), and TPG RE Finance Trust 2018-FL1 Co-Issuer, LLC, a Delaware limited liability company, as co-issuer (the “FL1 Co-Issuer” and together with the FL1 Issuer, the “FL1 Issuers”). On the FL1 Closing Date, FL1 Issuer issued $820.5 million principal amount of notes (the “FL1 Notes”). The FL1 Co-Issuer co-issued $745.9 million principal amount of investment grade-rated notes which were purchased by third party investors. Concurrently with the issuance of the FL1 Notes, the FL1 Issuer also issued preferred shares, par value $0.001 per share and with an aggregate liquidation preference and notional amount equal to $1,000 per share (the “FL1 Preferred Shares” and, together with the FL1 Notes, the “FL1 Securities”), to TPG RE Finance Trust 2018-FL1 Retention Holder, LLC, a Delaware limited liability company and wholly-owned subsidiary of the Sub-REIT (“FL1 Retention Holder”). Through FL1 Retention Holder, the Sub-REIT retained ownership of $186.5 million of the FL1 Notes issued and FL1 Preferred Shares. Additionally, the Company currently holds as an investment $8.5 million (principal amount) of FL1 Notes, of which $9.9 million were purchased during the three months ended March 31, 2019. Proceeds from the issuance of the FL1 Securities were used by the FL1 Issuers to purchase one commercial real estate whole loan (the “FL1 Whole Loan”) and 25 fully-funded pari passu Pari Passu The Company incurred approximately $9.8 million of issuance costs which are amortized on an effective yield basis over the shorter of the remaining life of the loans that collateralized the FL1 Notes, or the FL1 Notes. As of June 30, 2019, the Company’s unamortized issuance costs were $0.6 million. Interest expense on the outstanding FL1 Notes is payable monthly. For the three and six months ended June 30, 2019, interest expense (excluding amortization of deferred financing costs) of $4.5 million and $9.9 million, respectively, is included in the Company’s consolidated statements of income and comprehensive income. As of June 30, 2019, FL1 Mortgage Assets represent 10.5% of the aggregate unpaid principal balance of the Company’s loan investment portfolio and had an aggregate principal balance of approximately $509.5 million. In accordance with ASC 810, the Company evaluated the key attributes of the FL2 Issuers and the FL1 Issuers to determine if they were VIEs and, if so, whether the Company was the primary beneficiary of their operating activities. This analysis caused the Company to conclude that the FL2 Issuers and FL1 Issuers were VIEs and that the Company was the primary beneficiary. The Company is the primary beneficiary of the VIEs because it has the ability to control the most significant activities of the FL2 Issuers and the FL1 Issuers, the obligation to absorb losses, and the right to receive benefits, that could potentially be significant to these entities. As a result, the Company consolidates the FL2 Issuers and FL1 Issuers. The Company’s total assets and total liabilities as of June 30, 2019 and December 31, 2018 included the following VIE assets and liabilities of TRTX 2018-FL2 and TRTX 2018-FL1 (dollars in thousands): June 30, 2019 December 31, 2018 ASSETS Cash and Cash Equivalents $ 6,013 $ 3,896 Accounts Receivable from Servicer/Trustee 205,236 94,763 Accrued Interest Receivable 3,975 3,672 Loans Held for Investment 1,401,841 1,824,281 Total Assets $ 1,617,065 $ 1,926,612 LIABILITIES Accrued Interest Payable $ (2,074 ) $ (2,637 ) Accrued Expenses (619 ) (668 ) Collateralized Loan Obligations (1,207,620 ) (1,514,790 ) Total Liabilities $ (1,210,313 ) $ (1,518,095 ) The following table outlines TRTX 2018-FL2 and TRTX 2018-FL1 loan collateral and borrowings under the TRTX 2018-FL2 and TRTX 2018-FL1 collateralized loan obligations as of June 30, 2019 and December 31, 2018 (dollars in thousands): June 30, 2019 Collateral (loan investments) Debt (notes issued) Outstanding Principal Carrying Value Face Value Carrying Value $ 1,401,841 $ 1,401,841 $ (1,215,565 ) $ (1,207,620 ) December 31, 2018 Collateral (loan investments) Debt (notes issued) Outstanding Principal Carrying Value Face Value Carrying Value $ 1,824,281 $ 1,824,281 $ (1,527,237 ) $ (1,514,790 ) Assets held by the FL2 Issuers and the FL1 Issuers are restricted and can only be used to settle obligations of the related VIE. The liabilities of the FL2 Issuers and the FL1 Issuers are non-recourse to the Company and can only be satisfied from the assets of the related VIE. |
Secured Revolving Repurchase Ag
Secured Revolving Repurchase Agreements, Senior Secured and Secured Credit Agreements, Term Loan Facility, and Asset-Specific Financings | 6 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Secured Revolving Repurchase Agreements, Senior Secured and Secured Credit Agreements, Term Loan Facility, and Asset-Specific Financings | (6) Secured Revolving Repurchase Agreements, Senior Secured and Secured Credit Agreements, Term Loan Facility, and Asset-Specific Financing At June 30, 2019 and December 31, 2018, the Company had secured revolving repurchase agreements, senior secured and secured credit agreements, a term loan facility and asset-specific financings for certain of the Company’s originated loans. In general, these financing arrangements bear interest at a rate equal to LIBOR plus a credit spread determined primarily by advance rate and property type. The financing arrangements contain covenants that include certain financial requirements, including maintenance of minimum liquidity, minimum tangible net worth, maximum debt to net worth ratio, current ratio and limitations on capital expenditures, indebtedness, distributions, transactions with affiliates and maintenance of positive net income as defined in the agreements. The following table presents certain information regarding the Company’s secured revolving repurchase agreements, senior secured and secured credit agreements, and asset-specific financing as of June 30, 2019 and December 31, 2018. Except as otherwise noted, all agreements are on a non-recourse basis (dollars in thousands): June 30, 2019 Asset-specific Financing Maturity Date Index Rate Weighted Average Credit Spread Interest Rate Commitment Amount Maximum Current Availability Balance Outstanding Principal Balance of Collateral BMO Harris Bank (1) 04/09/20 1 Month LIBOR 2.7 % 5.0 % $ 32,500 — $ 32,500 $ 45,000 Institutional Lender 10/09/20 1 Month LIBOR 4.2 6.5 77,000 — 77,000 112,000 Subtotal $ 109,500 — $ 109,500 $ 157,000 Secured Revolving Repurchase Agreements Goldman Sachs (1) 08/19/19 1 Month LIBOR 2.1 % 4.5 % $ 750,000 $ 315,565 $ 434,435 $ 661,876 Wells Fargo (1) 04/18/22 1 Month LIBOR 1.7 4.1 750,000 177,934 572,066 771,022 Morgan Stanley (1) 05/04/20 1 Month LIBOR 2.1 4.5 500,000 208,719 291,281 379,106 JP Morgan (1) 08/20/21 1 Month LIBOR 2.1 4.5 400,000 233,179 166,821 222,348 US Bank (1) 10/09/21 1 Month LIBOR 1.7 4.1 233,883 17,243 216,640 274,051 Goldman Sachs (CMBS and CRE CLO) (2) 07/05/19 1 Month OIS 0.8 3.2 60,555 — 60,555 70,433 JP Morgan (CMBS and CRE CLO) (2) 07/10/19 1 Month LIBOR 0.9 3.3 400,856 — 400,856 458,635 Wells Fargo (CMBS and CRE CLO) (2) 07/22/19 1 Month LIBOR 1.0 3.4 117,178 — 117,178 137,322 Royal Bank of Canada (CMBS and CRE CLO) (2) N/A N/A N/A N/A — — — — Subtotal $ 3,212,472 $ 952,640 $ 2,259,832 $ 2,974,793 Senior Secured and Secured Credit Agreements Bank of America (1) 09/29/20 1 Month LIBOR 1.8 % 4.2 % $ 500,000 $ 89,563 410,437 514,714 Citibank (3) 07/12/20 1 Month LIBOR 2.3 4.6 160,000 71,320 88,680 132,400 Subtotal $ 660,000 $ 160,883 $ 499,117 $ 647,114 Total $ 3,981,972 $ 1,113,523 $ 2,868,449 $ 3,778,907 (1) Borrowings under secured revolving repurchase agreements, a senior secured credit agreement, and one asset-specific financing arrangement with a guarantee for 25% recourse. (2) Borrowings under secured revolving repurchase agreements with a guarantee for 100% recourse. Maturity Date represents the sooner of the next maturity date of the CMBS and CRE CLO investment secured revolving repurchase agreement, or roll over date for the applicable underlying trade confirmation, subsequent to June 30, 2019. All of the financing arrangements were extended subsequent to period end. (3) Borrowings under the secured credit agreement with a guarantee for 100% recourse. December 31, 2018 Asset-specific Financing Maturity Date Index Rate Weighted Average Credit Spread Interest Rate Commitment Amount Maximum Current Availability Balance Outstanding Principal Balance of Collateral BMO Harris Bank (1) 04/09/20 1 Month LIBOR 2.7 % 4.0 % $ 32,500 — $ 32,500 $ 45,000 Subtotal $ 32,500 — $ 32,500 $ 45,000 Secured Revolving Repurchase Agreements Goldman Sachs (1) 08/19/19 1 Month LIBOR 2.2 % 4.6 % $ 750,000 $ 558,836 $ 191,164 $ 474,243 Wells Fargo (1) 05/25/19 1 Month LIBOR 1.8 4.3 750,000 503,792 246,208 339,012 Morgan Stanley (1) 05/04/19 1 Month LIBOR 2.2 4.7 500,000 317,493 182,507 244,936 JP Morgan (1) 08/20/21 1 Month LIBOR 2.2 4.6 400,000 214,471 185,529 254,026 US Bank (1) 10/09/21 1 Month LIBOR 1.8 4.3 212,840 6,800 206,040 262,929 Goldman Sachs (CMBS and CRE CLO) (2) 01/02/19 1 Month OIS 0.6 2.9 100,000 67,303 32,697 38,517 Royal Bank of Canada (CMBS and CRE CLO) (2) N/A N/A N/A N/A 100,000 100,000 — — Subtotal $ 2,812,840 $ 1,768,695 $ 1,044,145 $ 1,613,663 Senior Secured and Secured Credit Agreements Bank of America (1) 09/29/20 1 Month LIBOR 1.9 % 4.2 % $ 500,000 $ 112,560 387,440 494,247 Citibank (3) 07/12/20 1 Month LIBOR 2.3 4.8 160,000 87,059 72,941 169,134 Subtotal $ 660,000 $ 199,619 $ 460,381 $ 663,381 Total $ 3,505,340 $ 1,968,314 $ 1,537,026 $ 2,322,044 (1) Borrowings under secured revolving repurchase agreements, a senior secured credit agreement, and one asset-specific financing arrangement with a guarantee for 25% recourse. (2) Borrowings under secured revolving repurchase agreements with a guarantee for 100% recourse. Maturity Date represents the sooner of the next maturity date of the CMBS and CRE CLO investment secured revolving repurchase agreement, or roll over date for the applicable underlying trade confirmation, subsequent to December 31, 2018. All of the financing arrangements were extended subsequent to period end. (3) Borrowings under the secured credit agreement with a guarantee for 100% recourse. Asset-Specific Financings As of June 30, 2019 and December 31, 2018, the Company had two and one asset-specific financing arrangements, respectively, to finance certain of its lending activities. On April 2, 2019, the Company entered into an asset-specific financing with an institutional lender that is secured by one loan held for investment. The asset-specific financing does not provide for additional advances. The BMO Harris asset-specific financing allows for additional advances up to a specified cap and is secured by one loan held for investment. Holdco has delivered a payment guarantee in favor of BMO Harris, the lender, as additional credit support for the financing. The liability of Holdco under this guarantee is generally capped at 25% of the outstanding obligations of the special purpose subsidiary which is the primary obligor under the financing. In addition, Holdco has delivered a non-recourse carveout guarantee, which can trigger recourse to Holdco as a result of certain “bad boy” defaults for losses incurred by BMO Harris or the entire outstanding obligations of the financing borrower, depending on the nature of the “bad boy” default in question. The BMO Harris asset-specific financing at June 30, 2019 and December 31, 2018 is guaranteed by Holdco, and the agreement includes guarantor covenants regarding liquid assets and net worth requirements. The Company was in compliance with all covenants as of June 30, 2019 and December 31, 2018. Secured Revolving Repurchase Agreements The Company frequently utilizes secured revolving repurchase agreements to finance the direct origination or acquisition of commercial real estate mortgage loans, and CMBS and CRE CLO investments. Under these secured revolving repurchase agreements, the Company transfers all of its rights, title and interest in the loans, CMBS and CRE CLO investments to the repurchase counterparty in exchange for cash, and simultaneously agrees to reacquire the asset at a future date for an amount equal to the cash exchanged plus an interest factor. The repurchase counterparty collects all principal and interest on related loans or CMBS and CRE CLO investments and remits to the Company only the net after collecting its interest and other fees. The loan and CMBS and CRE CLO investments related secured revolving repurchase agreements are 25% and 100% recourse to Holdco, respectively. At June 30, 2019 and December 31, 2018, the Company had five secured revolving repurchase agreements to finance its loan investing activities. Credit spreads vary depending upon the collateral type and advance rate. Assets pledged at June 30, 2019 and December 31, 2018 consisted of 53 and 51 mortgage loans, or participation interests therein, respectively. The Company’s secured revolving repurchase agreements secured by commercial mortgage loans are considered long-term borrowings. At June 30, 2019 and December 31, 2018, the Company had four and two secured revolving repurchase agreements to finance its CMBS and CRE CLO investment activities, of which the commitment amounts are based on the assets pledged. Credit spreads also vary depending upon the collateral type and advance rate. CMBS and CRE CLO investments pledged consisted of 27 CRE CLO investments and two CMBS investments at June 30, 2019 and two CMBS investments at December 31, 2018. The Company’s secured revolving repurchase agreements secured by CMBS and CRE CLO investments are considered short-term borrowings. The following table summarizes certain characteristics of the Company’s secured revolving repurchase agreements secured by commercial mortgage loans and CMBS and CRE CLO investments, including counterparty concentration risks, at June 30, 2019 (dollars in thousands): June 30, 2019 Loan Financings Commitment Amount UPB of Collateral Carrying Value of Collateral (1) Amounts Payable (2) Net Counterparty Exposure (3) Percent of Stockholders' Equity Days to Extended Maturity (4) Goldman Sachs Bank $ 750,000 $ 661,876 $ 663,507 $ 435,535 $ 227,972 15.6 % 50 Wells Fargo Bank 750,000 771,022 771,966 572,773 199,193 13.6 1,023 Morgan Stanley Bank (4) 500,000 379,106 377,786 292,177 85,609 5.8 N/A JP Morgan Chase Bank 400,000 222,348 221,408 167,112 54,296 3.7 1,512 US Bank 233,883 274,051 273,038 216,970 56,068 3.8 1,745 Subtotal / Weighted Average $ 2,633,883 $ 2,308,403 $ 2,307,705 $ 1,684,567 $ 623,138 890 CMBS and CRE CLO Investment Financings Goldman Sachs Bank $ 60,555 $ 70,433 $ 70,139 $ 61,055 $ 9,084 0.6 % 5 JP Morgan 400,856 458,635 463,336 401,533 61,803 4.2 11 Wells Fargo 117,178 137,322 137,965 117,390 20,575 1.4 23 Royal Bank of Canada — — — — — — — Subtotal / Weighted Average $ 578,589 $ 666,390 $ 671,440 $ 579,978 $ 91,462 12 Total / Weighted Average - Loans, CMBS and CRE CLO $ 3,212,472 $ 2,974,793 $ 2,979,145 $ 2,264,545 $ 714,600 632 (1) Loan amounts shown in the table include interest receivable of $13.7 million and are net of premium, discount and origination fees of $14.4 million. CMBS and CRE CLO investment amounts shown in the table include interest receivable of $3.5 million and are net of premium, discount, and unrealized gains of $1.5 million. (2) Loan amounts shown in the table include interest payable of $3.3 million and do not reflect unamortized deferred financing fees of $7.1 million. CMBS and CRE CLO investments shown in the table include interest payable of $1.4 million. (3) Loan amounts represent the net carrying value of the commercial real estate assets sold under agreements to repurchase, including accrued interest plus any cash or assets on deposit to secure the repurchase obligation, less the amount of the repurchase liability, including accrued interest. CMBS and CRE CLO investment amounts represents the net carrying value of available-for-sale securities sold under agreements to repurchase, including accrued interest plus any cash or assets on deposit to secure the repurchase obligation, less the amount of the repurchase liability, including accrued interest. (4) The secured revolving repurchase agreement provided by Morgan Stanley Bank is excluded from the “Days to Extended Maturity” column because it does not have a limit on the maximum number of permitted extensions, subject to satisfaction of certain conditions and approvals. CMBS and CRE CLO investment extended maturity represents the sooner of the next maturity date of the CMBS and CRE CLO investment secured revolving repurchase agreement, or roll date for the applicable underlying trade confirmation, subsequent to June 30, 2019. The following table summarizes certain characteristics of the Company’s secured revolving repurchase agreements secured by commercial mortgage loans and CMBS and CRE CLO investments, including counterparty concentration risks, at December 31, 2018 (dollars in thousands): December 31, 2018 Loan Financings Commitment Amount UPB of Collateral Carrying Value of Collateral (1) Amounts Payable (2) Net Counterparty Exposure (3) Percent of Stockholders' Equity Days to Extended Maturity (4) Goldman Sachs Bank $ 750,000 $ 474,243 $ 472,797 $ 191,705 $ 281,092 21.2 % 231 Wells Fargo Bank 750,000 339,012 338,531 246,635 91,896 6.9 876 Morgan Stanley Bank (4) 500,000 244,936 245,932 183,901 62,031 4.7 N/A JP Morgan Chase Bank 400,000 254,026 253,145 185,892 67,253 5.1 1,693 US Bank 212,840 262,929 261,916 206,422 55,494 4.2 1,743 Subtotal / Weighted Average $ 2,612,840 $ 1,575,146 $ 1,572,321 $ 1,014,555 $ 557,766 1,125 CMBS and CRE CLO Investment Financings Goldman Sachs Bank $ 100,000 $ 38,517 $ 36,414 $ 32,984 $ 3,430 0.3 % 2 Royal Bank of Canada 100,000 — — — — — — Subtotal / Weighted Average $ 200,000 $ 38,517 $ 36,414 $ 32,984 $ 3,430 2 Total / Weighted Average - Loans, CMBS and CRE CLO $ 2,812,840 $ 1,613,663 $ 1,608,735 $ 1,047,539 $ 561,196 1,083 (1) Loan amounts shown in the table include interest receivable of $14.5 million and are net of premium, discount and origination fees of $17.3 million. CMBS and CRE CLO investment amounts shown in the table include interest receivable of $0.1 million and are net of premium, discount, and unrealized gains of $2.2 million. (2) Loan amounts shown in the table include interest payable of $3.1 million and do not reflect unamortized deferred financing fees of $6.7 million. CMBS and CRE CLO investment amounts shown in the table include interest payable of $0.3 million. (3) Loan amounts represent the net carrying value of the commercial real estate assets sold under agreements to repurchase, including accrued interest plus any cash or assets on deposit to secure the repurchase obligation, less the amount of the repurchase liability, including accrued interest. CMBS and CRE CLO investment amounts represent the net carrying value of available-for-sale securities sold under agreements to repurchase, including accrued interest plus any cash or assets on deposit to secure the repurchase obligation, less the amount of the repurchase liability, including accrued interest. (4) The secured revolving repurchase agreement provided by Morgan Stanley Bank is excluded from the “Days to Extended Maturity” column because it does not have a limit on the maximum number of permitted extensions, subject to satisfaction of certain conditions and approvals. CMBS and CRE CLO investment extended maturity represents the sooner of the next maturity date of the CMBS and CRE CLO secured revolving repurchase agreement, or roll date for the applicable underlying trade confirmation, subsequent to December 31, 2018. The agreements include various covenants covering net worth, liquidity, recourse limitations, and debt coverage. The Company was in compliance with all covenants as of June 30, 2019 and December 31, 2018. Senior Secured and Secured Credit Agreements The Company has a senior secured credit agreement with Bank of America N.A. that has a maximum commitment amount of $500 million and $410.4 million outstanding as of June 30, 2019. The senior secured credit agreement bears interest at LIBOR plus 1.8%. The current initial maturity of this agreement is September 29, 2020. The Company has a secured credit agreement (the “Credit Agreement”), as borrower, with Citibank, N.A. as administrative agent and lender, and Citigroup Global Markets Inc. as sole lead arranger and sole lead book running manager. The Credit Agreement governs a secured revolving credit agreement with aggregate secured borrowing capacity of up to $160.0 million, subject to borrowing base availability and certain other conditions, which the Company uses to finance originations or acquisitions of eligible loans on an interim basis until permanent financing is arranged. The Credit Agreement has an initial maturity date of July 12, 2020, and borrowings bear interest at an interest rate per annum equal to one-month LIBOR or the applicable base rate plus a margin of 2.25%. The initial advance rate on borrowings under the Credit Agreement with respect to individual pledged assets can vary up to 70%, and may decline over the borrowing term of up to a 90-day period, after which borrowings against that respective asset must be repaid. At June 30, 2019, $88.7 million was outstanding on the Credit Agreement. The agreements include various covenants covering net worth, liquidity, recourse limitations, and debt coverage. The Company was in compliance with all covenants as of June 30, 2019 and December 31, 2018. Term Loan Facility The Company entered into a term loan facility, as the borrower, with an institutional asset manager as the lender. The term loan facility has capacity up to $750 million, bears interest at LIBOR plus 1.85%, and allows for an advance rate of no less than 70% and up to 85% based on the loans pledged to the facility. As of June 30, 2019, the Company pledged five loan investments to the term loan facility supporting outstanding borrowings of $267.7 million. The agreement includes various covenants covering net worth, liquidity, recourse limitations, and debt coverage. The Company was in compliance with all covenants as of June 30, 2019 and December 31, 2018. |
Schedule of Maturities
Schedule of Maturities | 6 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Maturities | (7) Schedule of Maturities The future principal payments for the five years subsequent to June 30, 2019 and thereafter are as follows (in thousands): Collateralized loan obligations Secured revolving repurchase agreements Senior secured and secured credit agreements Term loan facility Asset-specific financing 2019 $ 441,772 $ 1,163,883 $ — $ — $ — 2020 411,138 498,957 499,117 114,020 109,500 2021 195,780 334,266 — 34,827 — 2022 138,719 262,726 — 88,654 — 2023 — — — 30,160 — Thereafter — — — — — Total $ 1,187,409 $ 2,259,832 $ 499,117 $ 267,661 $ 109,500 |
Fair Value Measurements
Fair Value Measurements | 6 Months Ended |
Jun. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Fair Value Measurements | (8) Fair Value Measurements The Company’s consolidated balance sheet includes Level I fair value measurements related to cash equivalents, restricted cash, accounts receivable, and accrued liabilities. At June 30, 2019, the Company had $36.8 million invested in money market funds with original maturities of less than 90 days. The carrying values of these financial assets and liabilities are reasonable estimates of fair value because of the short-term maturities of these instruments. The consolidated balance sheet also includes Loans Held for Investment, the assets and liabilities of TRTX 2018-FL1 and TRTX 2018-FL2 (collateralized loan obligations as of June 30, 2019 and December 31, 2018), and secured financing arrangements that are considered Level III fair value measurements that are not measured at fair value on a recurring basis, but are subject to fair value adjustments utilizing the fair value of the underlying collateral when there is evidence of impairment. The Company did not have any non-recurring fair value items as of June 30, 2019 and December 31, 2018. The following tables provide information about financial assets and liabilities not carried at fair value on a recurring basis in our consolidated balance sheet (dollars in thousands): June 30, 2019 Fair Value Carrying Value Level I Level II Level III Financial Assets Loans Held for Investment $ 4,830,235 — — $ 4,856,225 Financial Liabilities Term Loan Facility 266,638 — — 266,638 Collateralized Loan Obligations 1,179,464 — — 1,179,464 Secured Financing Arrangements 2,858,062 — — 2,858,062 December 31, 2018 Fair Value Carrying Value Level I Level II Level III Financial Assets Loans Held for Investment $ 4,293,787 — — $ 4,317,844 Financial Liabilities Term Loan Facility 113,504 — — 113,504 Collateralized Loan Obligations 1,509,930 — — 1,509,930 Secured Financing Arrangements 1,526,449 — — 1,526,449 Level III fair values were determined based on standardized valuation models and significant unobservable market inputs, including holding period, discount rates based on LTV ratio, property type and loan pricing expectations developed by the Manager that were corroborated with other institutional lenders to determine a market spread that was added to the one-month LIBOR forward curve. There were no transfers of financial assets or liabilities within the fair value hierarchy during the three months ended June 30, 2019 or December 31, 2018. At June 30, 2019 and December 31, 2018, the estimated fair value of Loans Held for Investment was $4.9 billion and $4.3 billion, respectively. The weighted average gross spread at June 30, 2019 and December 31, 2018 was 3.8% and 3.9%, respectively. The weighted average years to maturity at June 30, 2019 and December 31, 2018 was 3.8 years and 3.9 years, respectively, assuming full extension of all loans. At June 30, 2019 and December 31, 2018, the carrying value of the secured financing agreements approximates fair value as current borrowing spreads reflect market terms. At June 30, 2019 and December 31, 2018, the carrying value of the assets and liabilities of TRTX 2018-FL1 and TRTX 2018-FL2 approximates fair value as current borrowing spreads reflect market terms. |
Income Taxes
Income Taxes | 6 Months Ended |
Jun. 30, 2019 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | (9) Income Taxes The Company indirectly owns 100% of the equity of multiple taxable REIT subsidiaries (collectively “TRSs”), including certain of its TRTX 2018-FL1 and TRTX 2018-FL2 subsidiaries. Taxable REIT subsidiaries are subject to applicable U.S. federal, state, local and foreign income tax on their taxable income. In addition, as a REIT, the Company also may be subject to a 100% excise tax on certain transactions between it and its TRSs that are not conducted on an arm’s-length basis. The Company files income tax returns in the United States federal jurisdiction as well as various state and local jurisdictions. The filings are subject to normal reviews by regulatory agencies until the related statute of limitations expires, with open tax years for all years since the Company’s initial capitalization in 2014. The years open to examination generally range from 2015 to present. ASC 740 also prescribes a recognition threshold and measurement attribute for the financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. ASC 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim periods, disclosure and transition. The Company has analyzed its various federal and state filing positions and believes that its income tax filing positions and deductions are well documented and supported. As of June 30, 2019 and December 31, 2018, based on the Company’s evaluation, there is no reserve for any uncertain income tax positions. The Company’s policy is to classify interest and penalties associated with underpayment of U.S. federal and state income taxes, if any, as a component of general and administrative expense on its consolidated statements of income and comprehensive income. For the three and six months ended June 30, 2019 and 2018, respectively the Company did not have interest or penalties associated with the underpayment of any income taxes. For the three and six months ended June 30, 2019 and 2018, the Company incurred no federal, state and local tax expense relating to its TRSs. For the three months ended June 30, 2019 and 2018, the Company recognized $0.2 million and $0.0 million, respectively, of federal, state and local tax expense. For the six months ended June 30, 2019 and 2018, the Company recognized $0.4 million and $0.2 million, respectively, of federal, state and local tax expense. At June 30, 2019 and 2018, the Company’s effective tax rate was 0.7% and 0.4%, respectively. At June 30, 2019 and December 31, 2018, the Company had no deferred tax assets or liabilities. |
Related Party Transactions
Related Party Transactions | 6 Months Ended |
Jun. 30, 2019 | |
Related Party Transactions [Abstract] | |
Related Party Transactions | (10) Related Party Transactions Management Agreement The Company is externally managed and advised by the Manager pursuant to the terms of a management agreement, dated July 25, 2017, between the Company and the Manager (as amended, the “Management Agreement”). On May 2, 2018, the Company and the Manager amended the Management Agreement solely for the purpose of amending the definitions of “Equity,” “Core Earnings” and “Incentive Compensation” in the Management Agreement. The changes were effected to include equity issued by subsidiaries of the Company in the definition of Equity, and to exclude distributions on equity issued by subsidiaries from the calculation of the Manager’s Incentive Compensation. Pursuant to the Management Agreement, the Company pays the Manager a base management fee equal to the greater of $250,000 per annum ($62,500 per quarter) and 1.50% per annum (0.375% per quarter) of the Company’s “Equity.” The base management fee is payable in cash, quarterly in arrears. As amended, “Equity” means (a) the sum of (1) the net proceeds received by the Company and, without duplication, the Company’s subsidiaries, from all issuances of the Company’s and the subsidiaries’ equity securities, including for the avoidance of doubt issuances of common stock and Class A common stock by the Company prior to the completion of the Company’s initial public offering (for purposes of calculating this amount, the net proceeds received by the Company from all issuances of the Company’s outstanding common stock and Class A common stock prior to the completion of the Company’s initial public offering equals approximately $1.0 billion), plus (2) the value of contributions, including, without limitation, contributions of assets or interests in assets in exchange for equity securities, made by persons other than the Company or a subsidiary of the Company, from time to time, to the capital of the Company or another subsidiary of the Company plus (3) the Company’s cumulative Core Earnings for the period commencing on the completion of the Company’s initial public offering to the end of the most recently completed calendar quarter, and (b) less (1) any distributions made by the Company to the holders of the Company’s equity securities and any distributions made by the Company’s subsidiaries to the holders of the subsidiaries’ equity securities (other than to the Company or another subsidiary of the Company) following the completion of the Company’s initial public offering, (2) any amount that the Company or any of the Company’s subsidiaries has paid to repurchase for cash the Company’s common stock or Class A common stock following the completion of the Company’s initial public offering and (3) any Incentive Compensation earned by the Manager following the completion of the Company’s initial public offering. With respect to that portion of the period from and after the completion of the Company’s initial public offering that is used in the calculation of Incentive Compensation or the base management fee, all items in the foregoing sentence (other than the Company’s cumulative Core Earnings) will be calculated on a daily weighted average basis. The Manager is entitled to incentive compensation which is calculated and payable in cash with respect to each calendar quarter following the completion of the Company’s initial public offering (or part thereof that the Management Agreement is in effect) in arrears in an amount, not less than zero, equal to the difference between: (1) the product of (a) 20% and (b) the difference between (i) the Company’s Core Earnings for the most recent 12-month period (or such lesser number of completed calendar quarters, if applicable), including the calendar quarter (or part thereof) for which the calculation of incentive compensation is being made (the “applicable period”), and (ii) the product of (A) the Company’s Equity in the most recent 12-month period (or such lesser number of completed calendar quarters, if applicable), including the applicable period, and (B) 7% per annum; and (2) the sum of any incentive compensation paid to the Manager with respect to the first three calendar quarters of the most recent 12-month period (or such lesser number of completed calendar quarters preceding the applicable period, if applicable). No incentive compensation is payable to the Manager with respect to any calendar quarter unless Core Earnings for the 12 most recently completed calendar quarters (or such lesser number of completed calendar quarters following the completion of the Company’s initial public offering) is greater than zero. For purposes of calculating the Manager’s incentive compensation, the Management Agreement, as amended, specifies that equity securities of the Company or any of the Company’s subsidiaries that are entitled to a specified periodic distribution or have other debt characteristics will not constitute equity securities and will not be included in “Equity” for the purpose of calculating incentive compensation. Instead, the aggregate distribution amount that accrues to such equity securities during the calendar quarter of such calculation will be subtracted from Core Earnings, before incentive compensation for purposes of calculating incentive compensation, unless such distribution is otherwise excluded from Core Earnings. As amended, “Core Earnings” means the net income (loss) attributable to the holders of the Company’s common stock and Class A common stock and, without duplication, the holders of the Company’s subsidiaries’ equity securities (other than the Company or any of the Company’s subsidiaries), computed in accordance with GAAP, including realized gains and losses not otherwise included in net income (loss), and excluding (i) non-cash equity compensation expense, (ii) the Incentive Compensation, (iii) depreciation and amortization, (iv) any unrealized gains or losses or other similar non-cash items that are included in net income for the applicable period, regardless of whether such items are included in other comprehensive income or loss or in net income and (v) one-time events pursuant to changes in GAAP and certain material non-cash income or expense items, in each case after discussions between the Manager and the Company’s independent directors and approved by a majority of the Company’s independent directors. The Company is required to reimburse the Manager or its affiliates for documented costs and expenses incurred by it and its affiliates on the Company’s behalf except those specifically required to be borne by the Manager or its affiliates under the Management Agreement. The Company’s reimbursement obligation is not subject to any dollar limitation. The Manager or its affiliates is responsible for, and the Company will not reimburse the Manager or its affiliates for, the expenses related to the personnel of the Manager and its affiliates who provide services to the Company. However, the Company will reimburse the Manager for the Company’s allocable share of the compensation (including, without limitation, annual base salary, bonus, any related withholding taxes and employee benefits) paid to (1) the Manager’s personnel serving as the Company’s chief financial officer based on the percentage of his or her time spent managing the Company’s affairs and (2) other corporate finance, tax, accounting, internal audit, legal risk management, operations, compliance and other non-investment personnel of the Manager or its affiliates who spend all or a portion of their time managing the Company’s affairs, based on the percentage of time devoted by such personnel to the Company’s and the Company’s subsidiaries’ affairs. Management Fees Incurred and Paid for the three and six months ended June 30, 2019 and June 30, 2018 For the three and six months ended June 30, 2019 and 2018, the Company incurred and paid the following management fees and incentive management fees pursuant to the Management Agreement (dollars in thousands): Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 Management Agreement fees incurred $ 7,371 $ 5,909 $ 13,879 $ 11,539 Management Agreement fees paid 6,508 5,630 12,608 10,862 Management fees and incentive management fees included in payable to affiliates on the consolidated balance sheets at June 30, 2019 and December 31, 2018 are $7.4 million and $6.1 million, respectively. The Company is responsible for reimbursing the Manager for certain expenses paid by the Manager on behalf of the Company or for certain services provided by the Manager to the Company. Expenses incurred by the Manager and reimbursed by the Company are reflected in the respective consolidated statements of income and comprehensive income expense category or the consolidated balance sheets based on the nature of the item. For the three months ended June 30, 2019 and 2018, the Manager incurred $0.3 million, respectively of expenses that were reimbursable by the Company. For the six months ended June 30, 2019 and 2018, the Manager incurred $0.6 million, respectively of expenses that were reimbursable by the Company. As of June 30, 2019, $0.3 million remained outstanding that was reimbursable by the Company to the Manager. As of December 31, 2019, no amounts remained outstanding that were reimbursable by the Company to the Manager. Termination Fee A termination fee will be payable to the Manager upon termination of the Management Agreement by the Company absent a cause event. The termination fee would also be payable to the Manager upon termination of the Management Agreement by the Manager if the Company materially breaches the Management Agreement. The termination fee is equal to three times the sum of (x) the average annual base management fee and (y) the average annual incentive compensation earned by the Manager, in each case during the 24-month period immediately preceding the most recently completed calendar quarter prior to the date of termination or, if such termination occurs prior to July 25, 2019, and such termination fee is payable, the base management fees and the incentive compensation will be annualized for the period from July 25, 2017 to July 25, 2019 based on such fees actually received by the Manager during such period. |
Earnings per Share
Earnings per Share | 6 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share [Abstract] | |
Earnings per Share | (11) Earnings per Share The Company calculates its basic and diluted earnings per share using the two-class method for all periods presented, as the unvested restricted shares of its common stock granted to certain current and former employees and affiliates of the Manager, qualify as participating securities. These restricted shares have the same rights as the Company’s other shares of common stock and Class A common stock, including participating in any dividends, and therefore have been included in the Company’s basic and diluted earnings per share calculation. For the three months ended June 30, 2019 and 2018, $0.1 million and $0.0 million, respectively of common stock dividends declared and undistributed net income attributable to common stockholders were allocated to unvested shares of our common stock pursuant to stock grants made under the Company’s Incentive Plan (see Note 13 for details). For the six months ended June 30, 2019 and 2018, $0.3 million and $0.1 million, respectively of common stock dividends declared and undistributed net income attributable to common stockholders were allocated to unvested shares of our common stock pursuant to stock grants made under the Company’s Incentive Plan. The following table sets forth the calculation of basic and diluted earnings per common share (common stock and Class A common stock) based on the weighted-average number of shares of common stock and Class A common stock outstanding (in thousands, except share and per share data): Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 Net Income Attributable to TPG RE Finance Trust, Inc. $ 31,965 $ 26,438 $ 60,374 $ 51,549 Participating Securities' Share in Earnings (138 ) — (279 ) — Net Income Attributable to Common Stockholders $ 31,827 $ 26,438 $ 60,095 $ 51,549 Weighted Average Common Shares Outstanding, Basic and Diluted 73,963,337 60,175,373 71,144,696 60,283,992 Per Common Share Amount, Basic and Diluted $ 0.43 $ 0.44 $ 0.85 $ 0.86 (1) Totals may not sum due to rounding |
Stockholders' Equity
Stockholders' Equity | 6 Months Ended |
Jun. 30, 2019 | |
Stockholders Equity Note [Abstract] | |
Stockholders' Equity | (12) Stockholders’ Equity Equity Distribution Agreement On March 7, 2019, the Company and the Manager entered into an equity distribution agreement with each of Citigroup Global Markets Inc., J.P. Morgan Securities LLC, JMP Securities LLC, Wells Fargo Securities, LLC and TPG Capital BD, LLC (each a “Sales Agent” and, collectively, the “Sales Agents”) relating to the issuance and sale by the Company of shares of its common stock, $0.001 par value per share, pursuant to a continuous offering program. In accordance with the terms of the equity distribution agreement, the Company may, at its discretion and from time to time, offer and sell shares of its common stock having an aggregate gross sales price of up to $125.0 million through the Sales Agents, each acting as the Company’s agent. The offering of shares of the Company’s common stock pursuant to the equity distribution agreement will terminate upon the earlier of (1) the sale of shares of the Company’s common stock subject to the equity distribution agreement having an aggregate gross sales price of $125.0 million and (2) the termination of the equity distribution agreement by the Sales Agents or the Company at any time as set forth in the equity distribution agreement. Each Sales Agent will be entitled to commissions in an amount not to exceed 1.75% of the gross sales prices of shares of the Company’s common stock sold through it, as the Company’s agent. For the three and six months ended June 30, 2019, no shares of common stock were sold pursuant to the equity distribution agreement. Common Stock Offering Option Exercise On April 12, 2019, Morgan Stanley & Co. LLC, as representative of the underwriters, exercised in full the underwriters’ option to purchase 900,000 additional shares of common stock. As a result, and pursuant to the terms of the underwriting agreement, the Company issued and sold 900,000 additional shares of common stock to the underwriters on April 16, 2019, generating additional net proceeds, before transaction expenses, of approximately $17.4 million from the issuance and sale of such shares. Dividends Upon the approval of the Company’s Board of Directors, dividends are accrued by the Company. Dividends are paid first to the holders of the Company’s Series A preferred stock at the rate of 12.5% of the total $0.001 million liquidation preference per annum plus all accumulated and unpaid dividends thereon, and then to the holders of the Company’s common stock and Class A common stock. The Company intends to distribute each year substantially all of its taxable income to its stockholders to comply with the REIT provisions of the Internal Revenue Code of 1986, as amended. Preferred Stock During the three months ended June 30, 2019, a subsidiary of the Company declared and paid a dividend of $0.007 million on the subsidiary’s outstanding Series A preferred shares. No dividends were paid on the subsidiary’s outstanding Series A preferred shares during the three and six months ended June 30, 2018. Common and Class A Common Stock On June 18, 2019, the Company’s Board of Directors declared a dividend for the second quarter of 2019 in the amount of $0.43 per share of common stock and Class A common stock, or $32.0 million in the aggregate, which dividend was payable on July 25, 2019 to holders of record of our common stock and Class A common stock as of June 28, 2019. On June 15, 2018, the Company declared a dividend for the second quarter of 2018 in the amount of $0.43 per share of common stock and Class A common stock, or $25.9 million in the aggregate, which was paid on July 25, 2018 to holders of record of our common stock and Class A common stock as of June 25, 2018. For the six months ended June 30, 2019 and 2018, common stock and Class A common stock dividends in the amount of $63.6 million and $51.2 million were declared and approved, respectively. As of June 30, 2019 and December 31, 2018, $32.0 million and $29.0 million, respectively, remain unpaid and are reflected in dividends payable on the Company’s consolidated balance sheets. Other Comprehensive Gain (Loss) Income For the three months ended June 30, 2019 and 2018, other comprehensive gain (loss) income was $3.1 million and $(1.4) million, respectively. For the six months ended June 30, 2019 and June 30, 2018, other comprehensive (loss) income was $3.2 million and $(1.6) million, respectively. Other comprehensive (loss) income is a result of unrealized (losses) gains on available-for-sale securities (CMBS and CRE CLO investments held at period end). |
Share-based Incentive Plan
Share-based Incentive Plan | 6 Months Ended |
Jun. 30, 2019 | |
Disclosure Of Compensation Related Costs Sharebased Payments [Abstract] | |
Share-based Incentive Plan | (13) Share-based Incentive Plan The Company does not have any employees as it is externally managed by the Manager. However, as of June 30, 2019, certain individuals employed by an affiliate of the Manager and certain members of the Company’s Board of Directors were compensated, in part, through the issuance of share-based instruments. The Company’s Board of Directors has adopted, and the Company’s stockholders have approved, the TPG RE Finance Trust, Inc. 2017 Equity Incentive Plan (the “Incentive Plan”). The Incentive Plan provides for the grant of equity-based awards to the Company’s, and its affiliates’, directors, officers, employees (if any) and consultants, and the members, officers, directors, employees and consultants of our Manager or its affiliates, as well as to our Manager and other entities that provide services to us and our affiliates and the employees of such entities. The total number of shares of common stock or long term incentive plan (“LTIP”) units that may be awarded under the Incentive Plan is 4,600,463. The Incentive Plan will automatically expire on the tenth anniversary of its effective date, unless terminated earlier by the Company’s Board of Directors. Generally, the shares vest in installments over a four-year period, pursuant to the terms of the award and the Incentive Plan. As of June 30, 2019, there were 263,000 shares of common stock that will vest as follows: 35,404 shares in 2019; 93,876 shares in 2020; 93,877 shares in 2021; and 39,843 shares in 2022. As of June 30, 2019, total unrecognized compensation cost relating to unvested share-based compensation arrangements was $4.6 million. This non-cash expense is expected to be recognized over a weighted average period of 1.7 years from June 30, 2019. For the three and six months ended June 30, 2019, the Company recognized $0.9 million and $1.5 million, respectively of share-based compensation expense as general and administrative expense in the consolidated statements of income and comprehensive income. For the three and six months ended June 30, 2018, the Company recognized $0.2 million and $0.4 million, respectively of share-based compensation expense as general and administrative expense in the consolidated statements of income and comprehensive income. During the three months ended June 30, 2019, the Company issued deferred stock units to the non-management members of the Company’s Board of Directors. The deferred stock units were fully vested on the grant date and accrue dividends that are paid-in kind on a quarterly basis. On May 14, 2019, the Company issued, and the non-management members of the Company’s Board of Directors received, deferred stock units with an aggregate fair value of $0.3 million, which is included in share-based compensation expense as general and administrative expense in the consolidated statements of income and comprehensive income. |
Commitments and Contingencies
Commitments and Contingencies | 6 Months Ended |
Jun. 30, 2019 | |
Commitments And Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | (14) Commitments and Contingencies Unfunded Commitments As of June 30, 2019 and December 31, 2018, the Company had $664.4 million and $634.2 million, respectively, of unfunded commitments related to loans held for investment. These commitments are not reflected on the consolidated balance sheets. Litigation From time to time, the Company may be involved in various claims and legal actions arising in the ordinary course of business. The Company establishes an accrued liability for loss contingencies when a settlement arising from a legal proceeding is both probable and reasonably estimable. If a legal matter is not probable and reasonably estimable, no such liability is recorded. Examples of this include (i) early stages of a legal proceeding, (ii) damages that are unspecified or cannot be determined, (iii) discovery has not started or is incomplete or (iv) there is uncertainty as to the outcome of pending appeals or motions. If these items exist, an estimated range of potential loss cannot be determined and as such the Company does not record an accrued liability. As of June 30, 2019 and December 31, 2018, the Company was not involved in any material legal proceedings and has not recorded an accrued liability for loss contingencies. |
Concentration of Credit Risk
Concentration of Credit Risk | 6 Months Ended |
Jun. 30, 2019 | |
Risks And Uncertainties [Abstract] | |
Concentration of Credit Risk | (15) Concentration of Credit Risk Property Type A summary of the loan portfolio by property type as of June 30, 2019 and December 31, 2018 based on total loan commitment and current unpaid principal balance (“UPB”) is as follows (dollars in thousands): June 30, 2019 Property Type Loan Commitment Unfunded Commitment % of Loan Commitment Loan UPB % of Loan UPB Office $ 2,012,904 $ 292,217 36.6 % $ 1,720,687 35.5 % Multifamily 1,325,378 104,905 24.0 1,220,473 25.2 Mixed Use 1,003,725 142,017 18.2 861,708 17.8 Hotel 716,293 74,685 13.0 641,608 13.2 Retail 233,554 47,016 4.2 186,538 3.8 Condominium 109,783 3,569 2.0 106,214 2.2 Other 112,000 — 2.0 112,000 2.3 Total $ 5,513,637 $ 664,409 100.0 % $ 4,849,228 100.0 % December 31, 2018 Property Type Loan Commitment Unfunded Commitment % of Loan Commitment Loan UPB % of Loan UPB Office $ 1,898,511 $ 316,510 38.5 % $ 1,582,001 36.8 % Multifamily 1,247,860 131,177 25.2 1,116,683 25.9 Mixed Use 838,200 114,748 16.9 723,452 16.8 Hotel 508,450 10,896 10.3 497,554 11.5 Retail 233,555 50,247 4.7 183,308 4.2 Condominium 154,673 10,580 3.1 144,093 3.3 Industrial 66,500 — 1.3 66,500 1.5 Total $ 4,947,749 $ 634,158 100.0 % $ 4,313,591 100.0 % Geography All of the Company’s loans held for investment are secured by properties within the United States. The geographic composition of loans held for investment based on total loan commitment and current UPB as of June 30, 2019 and December 31, 2018 is as follows (dollars in thousands): June 30, 2019 Geographic Region Loan Commitment Unfunded Commitment % of Loan Commitment Loan UPB % of Loan UPB East $ 1,970,524 $ 152,536 35.9 % $ 1,817,988 37.6 % South 1,568,407 242,862 28.4 1,325,545 27.3 West 955,925 121,112 17.3 834,813 17.2 Midwest 795,704 120,674 14.4 675,030 13.9 Various 223,077 27,225 4.0 195,852 4.0 Total $ 5,513,637 $ 664,409 100.0 % $ 4,849,228 100.0 % December 31, 2018 Geographic Region Loan Commitment Unfunded Commitment % of Loan Commitment Loan UPB % of Loan UPB East $ 2,084,807 $ 170,131 42.1 % $ 1,914,676 44.4 % South 1,525,173 270,933 30.8 1,254,240 29.1 West 760,416 100,422 15.4 659,994 15.3 Midwest 577,353 92,672 11.7 484,681 11.2 Total $ 4,947,749 $ 634,158 100.0 % $ 4,313,591 100.0 % Category A summary of the loan portfolio by category as of June 30, 2019 and December 31, 2018 based on total loan commitment and current UPB is as follows (dollars in thousands): June 30, 2019 Loan Category Loan Commitment Unfunded Commitment % of Loan Commitment Loan UPB % of Loan UPB Bridge $ 2,712,650 $ 188,200 49.2 % $ 2,524,450 52.0 % Light Transitional 1,505,874 158,557 27.3 1,347,317 27.8 Moderate Transitional 1,260,113 287,652 22.9 972,461 20.1 Construction 35,000 30,000 0.6 5,000 0.1 Total $ 5,513,637 $ 664,409 100.0 % $ 4,849,228 100.0 % December 31, 2018 Loan Category Loan Commitment Unfunded Commitment % of Loan Commitment Loan UPB % of Loan UPB Bridge $ 2,414,456 $ 199,397 48.8 % $ 2,215,059 51.3 % Light Transitional 1,513,227 212,290 30.6 1,300,937 30.2 Moderate Transitional 1,020,066 222,471 20.6 797,595 18.5 Total $ 4,947,749 $ 634,158 100.0 % $ 4,313,591 100.0 % Loan commitments represent principal commitments made by the Company at June 30, 2019 and December 31, 2018, respectively. |
Subsequent Events
Subsequent Events | 6 Months Ended |
Jun. 30, 2019 | |
Subsequent Events [Abstract] | |
Subsequent Events | (16) Subsequent Events The following events occurred subsequent to June 30, 2019: Investment Activity From July 1, 2019 through July 29, 2019, the Company has closed, or is in the process of closing, three first mortgage loans with a total loan commitment amount of $454.3 million. Senior Mortgage Loan Repayments From July 1, 2019 through July 29, 2019, the Company received full loan repayments related to two of its first mortgage loans with a total loan commitment and unpaid principal balance of $290.6 million and $249.1 million, respectively. These loan repayments consist of a Category 4 risk rated loan with a total loan commitment of $141.6 million and unpaid principal balance of $100.1 million, and a Category 2 risk rated loan with a total loan commitment of $149.0 million and unpaid principal balance $149.0 million, as of June 30, 2019. Cash Dividend On July 25, 2019, the Company paid a cash dividend on its common stock and Class A common stock of $0.43 per share, or $32.0 million, to stockholders of record as of June 28, 2019. |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 6 Months Ended |
Jun. 30, 2019 | |
Accounting Policies [Abstract] | |
Basis of Presentation | Basis of Presentation The interim consolidated financial statements of the Company have been prepared in accordance with accounting principles generally accepted in the United States (“GAAP”). The interim consolidated financial statements include the Company’s accounts, consolidated variable interest entities for which the Company is the primary beneficiary, and its wholly-owned subsidiaries. All intercompany transactions and balances have been eliminated. |
Use of Estimates | Use of Estimates The preparation of the interim consolidated financial statements in conformity with GAAP requires estimates of assets, liabilities, revenues, expenses and disclosure of contingent assets and liabilities at the date of the interim consolidated financial statements. Actual results could differ from management’s estimates, and such differences could be material. Significant estimates made in the interim consolidated financial statements include, but are not limited to: impairment; adequacy of provisions for loan losses; and valuation of financial instruments. |
Principles of Consolidation | Principles of Consolidation Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 810—Consolidation (“ASC 810”) provides guidance on the identification of a VIE (a variable interest entity for which control is achieved through means other than voting rights) and the determination of which business enterprise, if any, should consolidate the VIE. An entity is considered a VIE if any of the following applies: (1) the equity investors (if any) lack one or more of the essential characteristics of a controlling financial interest; (2) the equity investment at risk is insufficient to finance that entity’s activities without additional subordinated financial support; or (3) the equity investors have voting rights that are not proportionate to their economic interests and the activities of the entity involve or are conducted on behalf of an investor with a disproportionately small voting interest. The Company consolidates VIEs in which it is considered to be the primary beneficiary. The primary beneficiary is defined as the entity having both of the following characteristics: (1) the power to direct the activities that, when taken together, most significantly impact the VIE’s performance; and (2) the obligation to absorb losses and right to receive the returns from the VIE that would be significant to the VIE. At each reporting date, the Company reconsiders its primary beneficiary conclusion to determine if its obligation to absorb losses of, or its rights to receive benefits from, the VIE could potentially be more than insignificant, and will consolidate or not consolidate accordingly (see Note 5 for details). |
Revenue Recognition | Revenue Recognition Interest income on loans is accrued using the interest method based on the contractual terms of the loan, adjusted for credit impairment, if any. The objective of the interest method is to arrive at periodic interest income including recognition of fees and costs at a constant effective yield. Premiums, discounts, and origination fees are amortized or accreted into interest income over the lives of the loans using the interest method, or on a straight line basis when it approximates the interest method. Extension and modification fees are accreted into income on a straight line basis, when it approximates the interest method, over the related extension or modification period. Exit fees are accreted into income on a straight line basis, when it approximates the interest method, over the lives of the loans to which they relate unless they can be waived by the Company or a co-lender in connection with a loan refinancing. Prepayment penalties from borrowers are recognized as interest income when received. Certain of the Company’s loan investments have in the past and may in the future provide for additional interest based on the borrower’s operating cash flow or appreciation of the underlying collateral. Such amounts are considered contingent interest and are reflected as interest income only upon certainty of collection. The Company considers a loan to be non-performing and places the loan on non-accrual status when: (1) management determines the borrower is incapable of, or has ceased efforts toward, curing the cause of a default; (2) the loan becomes 90 days delinquent; or (3) the loan experiences a maturity default. Based on the Company’s judgment as to the collectability of principal, a loan on non-accrual status is either accounted for on a cash basis, where interest income is recognized only upon receipt of cash for principal and interest payments, or on a cost-recovery basis, where all cash receipts reduce the loan’s carrying value, and interest income is only recorded when such carrying value has been fully recovered. During the six months ended June 30, 2019 and the year end December 31, 2018, no loans were placed on non-accrual status and no losses or impairments were recorded to our loan portfolio. |
Loans Held for Investment | Loans Held for Investment Loans that the Company has the intent and ability to hold for the foreseeable future, or until maturity or repayment, are reported at their outstanding principal balances net of any premiums, discounts, loan origination fees and loan loss allowances, if any. Loan origination fees and direct loan origination costs are deferred and recognized in interest income over the estimated life of the loans using the interest method, or on a straight line basis when it approximates the interest method, adjusted for actual prepayments. The Company evaluates each loan classified as a loan held for investment for impairment on a quarterly basis. Impairment occurs when it is deemed probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan. If the loan is considered to be impaired, a loan loss allowance is recorded to reduce the carrying value of the loan to the present value of the expected future cash flows discounted at the loan’s contractual effective rate, or the fair value of the collateral securing the impaired loan, less estimated costs to sell such collateral, if recovery of the Company’s investment is expected solely from the sale of such collateral. As part of the quarterly impairment review, the Company evaluates the risk of each loan and assigns a risk rating based on a variety of factors, grouped as follows to include, among other factors: (i) loan and credit structure, including the as-is loan-to-value (“LTV”) ratio and structural features; (ii) quality and stability of real estate value and operating cash flow, including debt yield, property type, dynamics of the geographic, property-type and local market, physical condition, stability of cash flow, leasing velocity and quality and diversity of tenancy; (iii) performance against underwritten business plan; and (iv) quality, experience and financial condition of sponsor, borrower and guarantor(s). Based on a 5-point scale, the Company’s loans are rated “1” through “5,” from least risk to greatest risk, respectively, which ratings are defined as follows: 1- Outperform—Exceeds performance metrics (for example, technical milestones, occupancy, rents, net operating income) included in original or current credit underwriting and business plan; 2- Meets or Exceeds Expectations—Collateral performance meets or exceeds substantially all performance metrics included in original or current underwriting / business plan; 3- Satisfactory—Collateral performance meets or is on track to meet underwriting; business plan is met or can reasonably be achieved; 4- Underperformance—Collateral performance falls short of original underwriting, material differences exist from business plan, or both; technical milestones have been missed; defaults may exist, or may soon occur absent material improvement; and 5- Risk of Impairment/Default—Collateral performance is significantly worse than underwriting; major variance from business plan; loan covenants or technical milestones have been breached; timely exit from loan via sale or refinancing is questionable. Since Inception, the Company has not recognized any impairments on its loan portfolio and has not recorded any loan loss allowances against any of the loans in its portfolio . The Company’s determination of asset-specific loan loss reserves, should any such reserves be necessary, relies on material estimates regarding the fair value of loan collateral. Such losses could be caused by various factors, including, but not limited to, unanticipated adverse changes in the economy or events adversely affecting specific assets, borrowers, industries in which our borrowers operate or markets in which our borrowers or their properties are located. Significant judgment is required when evaluating loans for impairment. The Company’s loans are typically collateralized by real estate, or in the case of mezzanine loans, by a partnership or similar equity interest in an entity that owns real estate. As a result, the Company regularly evaluates on a loan-by-loan basis the extent and impact of any credit deterioration associated with the performance and/or value of the underlying collateral property as well as the financial and operating capability of the borrower/sponsor. The Company also evaluates the financial strength of loan guarantors, if any, and the borrower’s competency in managing and operating the property or properties. In addition, the Company considers the overall economic environment, real estate sector, and geographic sub-market in which the borrower operates. Such impairment analyses are completed and reviewed by asset management personnel and evaluated by senior management, who utilize various data sources, including (i) periodic financial data such as property occupancy, tenant profile, rental rates, operating expenses, the borrower’s exit plan, and capitalization and discount rates, (ii) site inspections, (iii) sales and financing comparables, (iv) current credit spreads for refinancing and (v) other market data. |
Commercial Mortgage-Backed and Commercial Real Estate Collateralized Loan Obligation Securities | Commercial Mortgage-Backed and Commercial Real Estate Collateralized Loan Obligation Securities The Company acquires CMBS and CRE CLO investments primarily for cash management purposes, and also for investment purposes. The Company designates CMBS and CRE CLO investments as available-for-sale on the acquisition date. CMBS and CRE CLO investments that are classified as available-for-sale are recorded at fair value through other comprehensive income (loss) in the Company’s consolidated financial statements. Additionally, CMBS and CRE CLO investments that are not classified as held-to-maturity and which the Company does not hold for the purpose of selling in the near-term, but may dispose of prior to maturity, are also designated as available-for-sale and are carried at fair value. The Company’s recognition of interest income from its CMBS and CRE CLO investments, including its amortization of premium and discount, follows the Company’s revenue recognition policy as described under “Revenue Recognition” above. The Company uses a specific identification method when determining the cost of a security sold and the amount of unrealized gain or loss reclassified from accumulated other comprehensive income (loss) into earnings. Unrealized losses on securities that, in the judgment of management, are other than temporary are charged against earnings as a loss in the consolidated statements of income and comprehensive income. Significant valuation inputs are Level II in the fair value hierarchy as described below under “Fair Value Measurements”. |
Portfolio Financing Arrangements | Portfolio Financing Arrangements The Company finances certain loan and CMBS and CRE CLO investments using secured revolving repurchase agreements, asset-specific financing arrangements, senior secured and secured credit agreements, collateralized loan obligations, and a term loan facility. The related borrowings are recorded as separate liabilities on the Company’s consolidated balance sheets. Interest income earned on the investments and interest expense incurred on the related borrowings are reported separately on the Company’s consolidated statements of income and comprehensive income. In certain instances, the Company creates structural leverage through the co-origination or non-recourse syndication of a senior loan interest to a third party. For all such syndications the Company has completed through June 30, 2019, the Company has transferred 100% of the senior mortgage loan that the Company originated on a non-recourse basis to a third-party lender and has retained as a loan investment a separate mezzanine loan investment secured by a pledge of the equity in the mortgage borrower. With respect to the senior mortgage loan transferred, the Company retains: no control over the mortgage loan; no economic interest in the mortgage loan; and no recourse to the purchaser or the borrower. Consequently, based on these circumstances and because the Company does not have any continuing involvement with the transferred senior mortgage loan, these syndications are accounted for as sales under GAAP and are removed from the Company’s consolidated financial statements at the time of transfer. The Company’s consolidated balance sheets only include the separate mezzanine loan remaining after the transfer, and not the non-consolidated senior loan interest sold or co-originated that the Company transferred. As of December 31, 2018, the Company revised its “Note Payable” naming convention in its consolidated balance sheet to “Asset-Specific Financings”. No amounts reported in prior periods were reclassified between financial statement line items and there was no impact to the Company’s consolidated financial statements resulting from this naming convention change during the current fiscal year. |
Fair Value Measurements | Fair Value Measurements The Company follows ASC 820-10, Fair Value Measurements and Disclosures “ASC 820-10” Level I Level II Level III For certain financial instruments, the various inputs that management uses to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the determination of which category within the fair value hierarchy is appropriate for such financial instrument is based on the lowest level of input that is significant to the fair value measurement. The assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment and considers factors specific to the financial instrument. The Company may use valuation techniques consistent with the market and income approaches to measure the fair value of its assets and liabilities. The market approach uses third-party valuations and information obtained from market transactions involving identical or similar assets or liabilities. The income approach uses projections of the future economic benefits of an instrument to determine its fair value, such as in the discounted cash flow methodology. The inputs or methodology used for valuing financial instruments are not necessarily an indication of the risk associated with investing in these financial instruments. Transfers between levels of the fair value hierarchy are assumed to occur at the end of the reporting period. |
Income Taxes | Income Taxes The Company qualifies and has elected to be taxed as a REIT for U.S. federal income tax purposes under the Internal Revenue Code of 1986, as amended, commencing with its initial taxable year ended December 31, 2014. To the extent that it annually distributes at least 90% of its REIT taxable income to stockholders and complies with various other requirements as a REIT, the Company generally will not be subject to U.S. federal income taxes on its distributed REIT taxable income. If the Company fails to continue to qualify as a REIT in any taxable year and does not qualify for certain statutory relief provisions, the Company will be subject to U.S. federal and state income taxes at regular corporate rates beginning with the year in which it fails to qualify and may be precluded from being able to elect to be treated as a REIT for the Company’s four subsequent taxable years. Even though the Company currently qualifies for taxation as a REIT, the Company may be subject to certain U.S. federal, state, local and foreign taxes on the Company’s income and property and to U.S. federal income and excise taxes on the Company’s undistributed REIT taxable income. Deferred tax assets and liabilities are recognized for future tax consequences attributable to temporary differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the periods in which those temporary differences are expected to be recovered or settled. The effect on deferred tax assets and liabilities of a change in tax rates is recognized in the period in which the enactment date occurs. Under ASC Topic 740, Income Taxes (“ASC 740”), a valuation allowance is established when management believes it is more likely than not that a deferred tax asset will not be realized. The Company intends to continue to operate in a manner consistent with, and to continue to meet the requirements to be treated as, a REIT for tax purposes and to distribute all of its REIT taxable income. Accordingly, the Company does not expect to pay corporate level federal taxes. |
Earnings per Common Share | Earnings per Common Share The Company utilizes the two-class method when assessing participating securities to calculate earnings per common share. Basic and diluted earnings per common share is computed by dividing net income attributable to common stockholders (i.e., holders of common stock and Class A common stock), by the weighted-average number of common shares (both common stock and Class A common stock) outstanding during the period. The preferences, rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications and terms and conditions of redemption of the Class A common stock are identical to the common stock, except (1) the Class A common stock is not a “margin security” as defined in Regulation U of the Board of Governors of the U.S. Federal Reserve System (and rulings and interpretations thereunder) and may not be listed on a national securities exchange or a national market system and (2) each share of Class A common stock is convertible at any time or from time to time, at the option of the holder, for one fully paid and non-assessable share of common stock. The Class A common stock votes together with the common stock as a single class. Shares of Class A common stock have been issued to, and are owned by, TPG RE Finance Trust Management, L.P., a Delaware limited partnership (the “Manager”), and certain individuals or entities who are or were affiliated with the Manager, and the sale or conversion to common stock by investors of such shares of Class A common stock is subject to certain restrictions. Diluted earnings per common share is calculated by including the effect of dilutive securities. The Company accounts for unvested share-based payment awards that contain non-forfeitable dividend rights or dividend equivalents (whether paid or unpaid) as participating securities, which are included in the computation of earnings per share pursuant to the two-class method. |
Share-Based Compensation | Share-Based Compensation Share-based compensation consists of awards issued by the Company to certain employees of affiliates of our Manager and certain members of our Board of Directors. These share-based awards generally vest in installments over a fixed period of time. Compensation expense is recognized in net income on a straight-line basis over the applicable awards’ vesting period. Forfeitures of share-based awards are recognized as they occur. |
Deferred Financing Costs | Deferred Financing Costs Deferred financing costs are reflected net of the collateralized loan obligations and secured financing arrangements on the Company’s consolidated balance sheets. These costs are amortized in interest expense using the interest method, or on a straight line basis when it approximates the interest method, over the shorter of the initial maturity of the obligation or financing arrangement. |
Cash and Cash Equivalents | Cash and Cash Equivalents Cash and cash equivalents include cash held in banks or invested in money market funds with original maturities of less than 90 days. The Company deposits its cash and cash equivalents with high credit quality institutions to minimize credit risk exposure. The Company maintains cash accounts at several financial institutions, which are insured up to a maximum of $250,000 per account as of June 30, 2019 and December 31, 2018. The balances in these accounts may exceed the insured limits. |
Restricted Cash | Restricted Cash Restricted cash primarily represents deposit proceeds from potential borrowers which may be returned to borrowers, after deducting transaction costs paid by the Company for the benefit of the borrowers, upon the closing of a loan transaction. |
Accounts Receivable from Servicer/Trustee | Accounts Receivable from Servicer/Trustee Accounts receivable from Servicer/Trustee represents cash proceeds from loan and CMBS and CRE CLO investment activities that have not been remitted to the Company based on contractual procedures previously agreed upon. Amounts are generally held by the Servicer/Trustee for less than 60 days before being remitted to the Company. |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In June 2016, the FASB issued Accounting Standards Update (“ASU”) 2016-13, Financial Instruments—Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments (“ASU 2016-13”). ASU 2016-13 significantly changes how entities will measure credit losses for most financial assets and certain other instruments that are not measured at fair value through net income. ASU 2016-13 will replace the “incurred loss” model under existing guidance with an “expected loss” model for instruments measured at amortized cost, and require entities to record allowances for available-for-sale debt securities rather than reduce the carrying amount, as they do today under the other-than-temporary impairment model. Upon adoption, and resulting from this change, the Company expects that it will be required to record a loan loss reserve at origination or acquisition of an individual loan or a loan portfolio. ASU 2016-13 also simplifies the accounting model for purchased credit-impaired debt securities and loans. ASU 2016-13 is effective for fiscal years beginning after December 15, 2019 and is to be adopted through a cumulative-effect adjustment to retained earnings as of the beginning of the first reporting period in which the guidance is effective. The Company is currently evaluating the impact ASU 2016-13 will have on its consolidated financial statements. |
Loans Held for Investment (Tabl
Loans Held for Investment (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Receivables [Abstract] | |
Schedule of Loan Investment Portfolio | The following tables present an overview of the loan investment portfolio as of June 30, 2019 and December 31, 2018 (dollars in thousands): June 30, 2019 Loans Receivable Outstanding Principal Unamortized Premium (Discount), Loan Origination Fees, net Carrying Amount Senior loans $ 4,844,228 $ (18,644 ) $ 4,825,584 Subordinated and mezzanine loans 5,000 (349 ) 4,651 Subtotal before allowance 4,849,228 (18,993 ) 4,830,235 Allowance for loan losses — — — Total $ 4,849,228 $ (18,993 ) $ 4,830,235 December 31, 2018 Loans Receivable Outstanding Principal Unamortized Premium (Discount), Loan Origination Fees, net Carrying Amount Senior loans $ 4,313,591 $ (19,804 ) $ 4,293,787 Subordinated and mezzanine loans — — — Subtotal before allowance 4,313,591 (19,804 ) 4,293,787 Allowance for loan losses — — — Total $ 4,313,591 $ (19,804 ) $ 4,293,787 |
Summary of Loan Portfolio Activity | For the six months ended June 30, 2019, loan portfolio activity was as follows (dollars in thousands): Carrying Value Balance at December 31, 2018 $ 4,293,787 Additions during the period: Loans originated and acquired 1,133,817 Additional fundings 117,131 Amortization of discount and origination fees 7,902 Deductions during the period: Collection of principal (722,402 ) Balance at June 30, 2019 $ 4,830,235 |
Summary of Carrying Values and Results of Internal Risk Rating Review | The table below summarizes the carrying values and results of the Company’s internal risk rating review performed as of June 30, 2019 and December 31, 2018 (dollars in thousands): Carrying Value Rating June 30, 2019 December 31, 2018 1 $ — $ 29,923 2 1,073,740 959,314 3 3,420,107 3,099,401 4 336,388 205,149 5 — — Totals $ 4,830,235 $ 4,293,787 Weighted Average Risk Rating (1) 2.8 2.8 (1) Weighted Average Risk Rating calculated based on carrying value at period end. |
Available-for-Sale Debt Secur_2
Available-for-Sale Debt Securities (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Investments Debt And Equity Securities [Abstract] | |
Details of Carrying and Fair Values Of CMBS And CRE CLO Investment Portfolio | Details of the carrying and fair values of the Company’s CMBS and CRE CLO investment portfolio are as follows (dollars in thousands): June 30, 2019 Face Amount Unamortized Premium (Discount), net Gross Unrealized Gain (Loss) Estimated Fair Value Investments, at Fair Value CMBS and CRE CLO Investments $ 677,800 $ 145 $ 1,233 $ 679,178 December 31, 2018 Face Amount Unamortized Premium (Discount), net Gross Unrealized (Loss) Estimated Fair Value Investments, at Fair Value CMBS and CRE CLO Investments $ 76,404 $ (38 ) $ (1,985 ) $ 74,381 |
Available-for-sale CMBS and CRE CLO Investments by Contractual Maturity | The Company’s CMBS and CRE CLO investments have a weighted average contractual maturity, based on estimated fair value, of 16.4 years. The amortized cost and estimated fair value of the Company’s available-for-sale CMBS and CRE CLO investments by contractual maturity are shown in the following table (dollars in thousands): June 30, 2019 Amortized Cost Estimated Fair Value Maturity Date Within five years $ 37,834 $ 37,752 After five years 640,111 641,426 Total investment in CMBS and CRE CLO securities, at amortized cost and estimated fair value $ 677,945 $ 679,178 December 31, 2018 Amortized Cost Estimated Fair Value Maturity Date After one, within five years $ 37,929 $ 38,076 After five years 38,436 36,305 Total investment in CMBS and CRE CLO securities, at amortized cost and estimated fair value $ 76,365 $ 74,381 |
Variable Interest Entities an_2
Variable Interest Entities and Collateralized Loan Obligations (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Summary of Variable Interest Entities Assets and Liabilities | The Company’s total assets and total liabilities as of June 30, 2019 and December 31, 2018 included the following VIE assets and liabilities of TRTX 2018-FL2 and TRTX 2018-FL1 (dollars in thousands): June 30, 2019 December 31, 2018 ASSETS Cash and Cash Equivalents $ 6,013 $ 3,896 Accounts Receivable from Servicer/Trustee 205,236 94,763 Accrued Interest Receivable 3,975 3,672 Loans Held for Investment 1,401,841 1,824,281 Total Assets $ 1,617,065 $ 1,926,612 LIABILITIES Accrued Interest Payable $ (2,074 ) $ (2,637 ) Accrued Expenses (619 ) (668 ) Collateralized Loan Obligations (1,207,620 ) (1,514,790 ) Total Liabilities $ (1,210,313 ) $ (1,518,095 ) |
Collateralized Loan Obligation | |
Schedule of Borrowings and Corresponding Collateral | The following table outlines TRTX 2018-FL2 and TRTX 2018-FL1 loan collateral and borrowings under the TRTX 2018-FL2 and TRTX 2018-FL1 collateralized loan obligations as of June 30, 2019 and December 31, 2018 (dollars in thousands): June 30, 2019 Collateral (loan investments) Debt (notes issued) Outstanding Principal Carrying Value Face Value Carrying Value $ 1,401,841 $ 1,401,841 $ (1,215,565 ) $ (1,207,620 ) December 31, 2018 Collateral (loan investments) Debt (notes issued) Outstanding Principal Carrying Value Face Value Carrying Value $ 1,824,281 $ 1,824,281 $ (1,527,237 ) $ (1,514,790 ) |
Secured Revolving Repurchase _2
Secured Revolving Repurchase Agreements, Senior Secured and Secured Credit Agreements, Term Loan Facility, and Asset-Specific Financings (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Debt Instrument [Line Items] | |
Schedule of Information Related to Secured Revolving Repurchase Agreements, Senior Secured and Secured Credit Agreements, and Asset-Specific Financings | The following table presents certain information regarding the Company’s secured revolving repurchase agreements, senior secured and secured credit agreements, and asset-specific financing as of June 30, 2019 and December 31, 2018. Except as otherwise noted, all agreements are on a non-recourse basis (dollars in thousands): June 30, 2019 Asset-specific Financing Maturity Date Index Rate Weighted Average Credit Spread Interest Rate Commitment Amount Maximum Current Availability Balance Outstanding Principal Balance of Collateral BMO Harris Bank (1) 04/09/20 1 Month LIBOR 2.7 % 5.0 % $ 32,500 — $ 32,500 $ 45,000 Institutional Lender 10/09/20 1 Month LIBOR 4.2 6.5 77,000 — 77,000 112,000 Subtotal $ 109,500 — $ 109,500 $ 157,000 Secured Revolving Repurchase Agreements Goldman Sachs (1) 08/19/19 1 Month LIBOR 2.1 % 4.5 % $ 750,000 $ 315,565 $ 434,435 $ 661,876 Wells Fargo (1) 04/18/22 1 Month LIBOR 1.7 4.1 750,000 177,934 572,066 771,022 Morgan Stanley (1) 05/04/20 1 Month LIBOR 2.1 4.5 500,000 208,719 291,281 379,106 JP Morgan (1) 08/20/21 1 Month LIBOR 2.1 4.5 400,000 233,179 166,821 222,348 US Bank (1) 10/09/21 1 Month LIBOR 1.7 4.1 233,883 17,243 216,640 274,051 Goldman Sachs (CMBS and CRE CLO) (2) 07/05/19 1 Month OIS 0.8 3.2 60,555 — 60,555 70,433 JP Morgan (CMBS and CRE CLO) (2) 07/10/19 1 Month LIBOR 0.9 3.3 400,856 — 400,856 458,635 Wells Fargo (CMBS and CRE CLO) (2) 07/22/19 1 Month LIBOR 1.0 3.4 117,178 — 117,178 137,322 Royal Bank of Canada (CMBS and CRE CLO) (2) N/A N/A N/A N/A — — — — Subtotal $ 3,212,472 $ 952,640 $ 2,259,832 $ 2,974,793 Senior Secured and Secured Credit Agreements Bank of America (1) 09/29/20 1 Month LIBOR 1.8 % 4.2 % $ 500,000 $ 89,563 410,437 514,714 Citibank (3) 07/12/20 1 Month LIBOR 2.3 4.6 160,000 71,320 88,680 132,400 Subtotal $ 660,000 $ 160,883 $ 499,117 $ 647,114 Total $ 3,981,972 $ 1,113,523 $ 2,868,449 $ 3,778,907 (1) Borrowings under secured revolving repurchase agreements, a senior secured credit agreement, and one asset-specific financing arrangement with a guarantee for 25% recourse. (2) Borrowings under secured revolving repurchase agreements with a guarantee for 100% recourse. Maturity Date represents the sooner of the next maturity date of the CMBS and CRE CLO investment secured revolving repurchase agreement, or roll over date for the applicable underlying trade confirmation, subsequent to June 30, 2019. All of the financing arrangements were extended subsequent to period end. (3) Borrowings under the secured credit agreement with a guarantee for 100% recourse. December 31, 2018 Asset-specific Financing Maturity Date Index Rate Weighted Average Credit Spread Interest Rate Commitment Amount Maximum Current Availability Balance Outstanding Principal Balance of Collateral BMO Harris Bank (1) 04/09/20 1 Month LIBOR 2.7 % 4.0 % $ 32,500 — $ 32,500 $ 45,000 Subtotal $ 32,500 — $ 32,500 $ 45,000 Secured Revolving Repurchase Agreements Goldman Sachs (1) 08/19/19 1 Month LIBOR 2.2 % 4.6 % $ 750,000 $ 558,836 $ 191,164 $ 474,243 Wells Fargo (1) 05/25/19 1 Month LIBOR 1.8 4.3 750,000 503,792 246,208 339,012 Morgan Stanley (1) 05/04/19 1 Month LIBOR 2.2 4.7 500,000 317,493 182,507 244,936 JP Morgan (1) 08/20/21 1 Month LIBOR 2.2 4.6 400,000 214,471 185,529 254,026 US Bank (1) 10/09/21 1 Month LIBOR 1.8 4.3 212,840 6,800 206,040 262,929 Goldman Sachs (CMBS and CRE CLO) (2) 01/02/19 1 Month OIS 0.6 2.9 100,000 67,303 32,697 38,517 Royal Bank of Canada (CMBS and CRE CLO) (2) N/A N/A N/A N/A 100,000 100,000 — — Subtotal $ 2,812,840 $ 1,768,695 $ 1,044,145 $ 1,613,663 Senior Secured and Secured Credit Agreements Bank of America (1) 09/29/20 1 Month LIBOR 1.9 % 4.2 % $ 500,000 $ 112,560 387,440 494,247 Citibank (3) 07/12/20 1 Month LIBOR 2.3 4.8 160,000 87,059 72,941 169,134 Subtotal $ 660,000 $ 199,619 $ 460,381 $ 663,381 Total $ 3,505,340 $ 1,968,314 $ 1,537,026 $ 2,322,044 (1) Borrowings under secured revolving repurchase agreements, a senior secured credit agreement, and one asset-specific financing arrangement with a guarantee for 25% recourse. (2) Borrowings under secured revolving repurchase agreements with a guarantee for 100% recourse. Maturity Date represents the sooner of the next maturity date of the CMBS and CRE CLO investment secured revolving repurchase agreement, or roll over date for the applicable underlying trade confirmation, subsequent to December 31, 2018. All of the financing arrangements were extended subsequent to period end. (3) Borrowings under the secured credit agreement with a guarantee for 100% recourse. |
Commercial Mortgage Loans | |
Debt Instrument [Line Items] | |
Summary of Repurchase Agreements Secured by Commercial Mortgage Loans, CMBS, CRE CLO Investments, Long - term Borrowings, and Counterparty Concentration | The following table summarizes certain characteristics of the Company’s secured revolving repurchase agreements secured by commercial mortgage loans and CMBS and CRE CLO investments, including counterparty concentration risks, at June 30, 2019 (dollars in thousands): June 30, 2019 Loan Financings Commitment Amount UPB of Collateral Carrying Value of Collateral (1) Amounts Payable (2) Net Counterparty Exposure (3) Percent of Stockholders' Equity Days to Extended Maturity (4) Goldman Sachs Bank $ 750,000 $ 661,876 $ 663,507 $ 435,535 $ 227,972 15.6 % 50 Wells Fargo Bank 750,000 771,022 771,966 572,773 199,193 13.6 1,023 Morgan Stanley Bank (4) 500,000 379,106 377,786 292,177 85,609 5.8 N/A JP Morgan Chase Bank 400,000 222,348 221,408 167,112 54,296 3.7 1,512 US Bank 233,883 274,051 273,038 216,970 56,068 3.8 1,745 Subtotal / Weighted Average $ 2,633,883 $ 2,308,403 $ 2,307,705 $ 1,684,567 $ 623,138 890 CMBS and CRE CLO Investment Financings Goldman Sachs Bank $ 60,555 $ 70,433 $ 70,139 $ 61,055 $ 9,084 0.6 % 5 JP Morgan 400,856 458,635 463,336 401,533 61,803 4.2 11 Wells Fargo 117,178 137,322 137,965 117,390 20,575 1.4 23 Royal Bank of Canada — — — — — — — Subtotal / Weighted Average $ 578,589 $ 666,390 $ 671,440 $ 579,978 $ 91,462 12 Total / Weighted Average - Loans, CMBS and CRE CLO $ 3,212,472 $ 2,974,793 $ 2,979,145 $ 2,264,545 $ 714,600 632 (1) Loan amounts shown in the table include interest receivable of $13.7 million and are net of premium, discount and origination fees of $14.4 million. CMBS and CRE CLO investment amounts shown in the table include interest receivable of $3.5 million and are net of premium, discount, and unrealized gains of $1.5 million. (2) Loan amounts shown in the table include interest payable of $3.3 million and do not reflect unamortized deferred financing fees of $7.1 million. CMBS and CRE CLO investments shown in the table include interest payable of $1.4 million. (3) Loan amounts represent the net carrying value of the commercial real estate assets sold under agreements to repurchase, including accrued interest plus any cash or assets on deposit to secure the repurchase obligation, less the amount of the repurchase liability, including accrued interest. CMBS and CRE CLO investment amounts represents the net carrying value of available-for-sale securities sold under agreements to repurchase, including accrued interest plus any cash or assets on deposit to secure the repurchase obligation, less the amount of the repurchase liability, including accrued interest. (4) The secured revolving repurchase agreement provided by Morgan Stanley Bank is excluded from the “Days to Extended Maturity” column because it does not have a limit on the maximum number of permitted extensions, subject to satisfaction of certain conditions and approvals. CMBS and CRE CLO investment extended maturity represents the sooner of the next maturity date of the CMBS and CRE CLO investment secured revolving repurchase agreement, or roll date for the applicable underlying trade confirmation, subsequent to June 30, 2019. The following table summarizes certain characteristics of the Company’s secured revolving repurchase agreements secured by commercial mortgage loans and CMBS and CRE CLO investments, including counterparty concentration risks, at December 31, 2018 (dollars in thousands): December 31, 2018 Loan Financings Commitment Amount UPB of Collateral Carrying Value of Collateral (1) Amounts Payable (2) Net Counterparty Exposure (3) Percent of Stockholders' Equity Days to Extended Maturity (4) Goldman Sachs Bank $ 750,000 $ 474,243 $ 472,797 $ 191,705 $ 281,092 21.2 % 231 Wells Fargo Bank 750,000 339,012 338,531 246,635 91,896 6.9 876 Morgan Stanley Bank (4) 500,000 244,936 245,932 183,901 62,031 4.7 N/A JP Morgan Chase Bank 400,000 254,026 253,145 185,892 67,253 5.1 1,693 US Bank 212,840 262,929 261,916 206,422 55,494 4.2 1,743 Subtotal / Weighted Average $ 2,612,840 $ 1,575,146 $ 1,572,321 $ 1,014,555 $ 557,766 1,125 CMBS and CRE CLO Investment Financings Goldman Sachs Bank $ 100,000 $ 38,517 $ 36,414 $ 32,984 $ 3,430 0.3 % 2 Royal Bank of Canada 100,000 — — — — — — Subtotal / Weighted Average $ 200,000 $ 38,517 $ 36,414 $ 32,984 $ 3,430 2 Total / Weighted Average - Loans, CMBS and CRE CLO $ 2,812,840 $ 1,613,663 $ 1,608,735 $ 1,047,539 $ 561,196 1,083 (1) Loan amounts shown in the table include interest receivable of $14.5 million and are net of premium, discount and origination fees of $17.3 million. CMBS and CRE CLO investment amounts shown in the table include interest receivable of $0.1 million and are net of premium, discount, and unrealized gains of $2.2 million. (2) Loan amounts shown in the table include interest payable of $3.1 million and do not reflect unamortized deferred financing fees of $6.7 million. CMBS and CRE CLO investment amounts shown in the table include interest payable of $0.3 million. (3) Loan amounts represent the net carrying value of the commercial real estate assets sold under agreements to repurchase, including accrued interest plus any cash or assets on deposit to secure the repurchase obligation, less the amount of the repurchase liability, including accrued interest. CMBS and CRE CLO investment amounts represent the net carrying value of available-for-sale securities sold under agreements to repurchase, including accrued interest plus any cash or assets on deposit to secure the repurchase obligation, less the amount of the repurchase liability, including accrued interest. (4) The secured revolving repurchase agreement provided by Morgan Stanley Bank is excluded from the “Days to Extended Maturity” column because it does not have a limit on the maximum number of permitted extensions, subject to satisfaction of certain conditions and approvals. CMBS and CRE CLO investment extended maturity represents the sooner of the next maturity date of the CMBS and CRE CLO secured revolving repurchase agreement, or roll date for the applicable underlying trade confirmation, subsequent to December 31, 2018. |
Schedule of Maturities (Tables)
Schedule of Maturities (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Debt Disclosure [Abstract] | |
Schedule of Future Principal Payments | The future principal payments for the five years subsequent to June 30, 2019 and thereafter are as follows (in thousands): Collateralized loan obligations Secured revolving repurchase agreements Senior secured and secured credit agreements Term loan facility Asset-specific financing 2019 $ 441,772 $ 1,163,883 $ — $ — $ — 2020 411,138 498,957 499,117 114,020 109,500 2021 195,780 334,266 — 34,827 — 2022 138,719 262,726 — 88,654 — 2023 — — — 30,160 — Thereafter — — — — — Total $ 1,187,409 $ 2,259,832 $ 499,117 $ 267,661 $ 109,500 |
Fair Value Measurements (Tables
Fair Value Measurements (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Fair Value Disclosures [Abstract] | |
Summary of Financial Assets and Liabilities Not Carried at Fair Value On Recurring Basis | The following tables provide information about financial assets and liabilities not carried at fair value on a recurring basis in our consolidated balance sheet (dollars in thousands): June 30, 2019 Fair Value Carrying Value Level I Level II Level III Financial Assets Loans Held for Investment $ 4,830,235 — — $ 4,856,225 Financial Liabilities Term Loan Facility 266,638 — — 266,638 Collateralized Loan Obligations 1,179,464 — — 1,179,464 Secured Financing Arrangements 2,858,062 — — 2,858,062 December 31, 2018 Fair Value Carrying Value Level I Level II Level III Financial Assets Loans Held for Investment $ 4,293,787 — — $ 4,317,844 Financial Liabilities Term Loan Facility 113,504 — — 113,504 Collateralized Loan Obligations 1,509,930 — — 1,509,930 Secured Financing Arrangements 1,526,449 — — 1,526,449 |
Related Party Transactions (Tab
Related Party Transactions (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Related Party Transactions [Abstract] | |
Summary of Management Fees and Incentive Management Fees Incurred and Paid Pursuant to Management Agreement | For the three and six months ended June 30, 2019 and 2018, the Company incurred and paid the following management fees and incentive management fees pursuant to the Management Agreement (dollars in thousands): Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 Management Agreement fees incurred $ 7,371 $ 5,909 $ 13,879 $ 11,539 Management Agreement fees paid 6,508 5,630 12,608 10,862 |
Earnings per Share (Tables)
Earnings per Share (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Earnings Per Share [Abstract] | |
Schedule of Calculation of Basic and Diluted Earnings per Common Share | The following table sets forth the calculation of basic and diluted earnings per common share (common stock and Class A common stock) based on the weighted-average number of shares of common stock and Class A common stock outstanding (in thousands, except share and per share data): Three Months Ended June 30, Six Months Ended June 30, 2019 2018 2019 2018 Net Income Attributable to TPG RE Finance Trust, Inc. $ 31,965 $ 26,438 $ 60,374 $ 51,549 Participating Securities' Share in Earnings (138 ) — (279 ) — Net Income Attributable to Common Stockholders $ 31,827 $ 26,438 $ 60,095 $ 51,549 Weighted Average Common Shares Outstanding, Basic and Diluted 73,963,337 60,175,373 71,144,696 60,283,992 Per Common Share Amount, Basic and Diluted $ 0.43 $ 0.44 $ 0.85 $ 0.86 (1) Totals may not sum due to rounding |
Concentration of Credit Risk (T
Concentration of Credit Risk (Tables) | 6 Months Ended |
Jun. 30, 2019 | |
Loans And Leases Receivable Disclosure [Line Items] | |
Summary of Loan Portfolio by Property/ Loan Category Type | Property Type A summary of the loan portfolio by property type as of June 30, 2019 and December 31, 2018 based on total loan commitment and current unpaid principal balance (“UPB”) is as follows (dollars in thousands): June 30, 2019 Property Type Loan Commitment Unfunded Commitment % of Loan Commitment Loan UPB % of Loan UPB Office $ 2,012,904 $ 292,217 36.6 % $ 1,720,687 35.5 % Multifamily 1,325,378 104,905 24.0 1,220,473 25.2 Mixed Use 1,003,725 142,017 18.2 861,708 17.8 Hotel 716,293 74,685 13.0 641,608 13.2 Retail 233,554 47,016 4.2 186,538 3.8 Condominium 109,783 3,569 2.0 106,214 2.2 Other 112,000 — 2.0 112,000 2.3 Total $ 5,513,637 $ 664,409 100.0 % $ 4,849,228 100.0 % December 31, 2018 Property Type Loan Commitment Unfunded Commitment % of Loan Commitment Loan UPB % of Loan UPB Office $ 1,898,511 $ 316,510 38.5 % $ 1,582,001 36.8 % Multifamily 1,247,860 131,177 25.2 1,116,683 25.9 Mixed Use 838,200 114,748 16.9 723,452 16.8 Hotel 508,450 10,896 10.3 497,554 11.5 Retail 233,555 50,247 4.7 183,308 4.2 Condominium 154,673 10,580 3.1 144,093 3.3 Industrial 66,500 — 1.3 66,500 1.5 Total $ 4,947,749 $ 634,158 100.0 % $ 4,313,591 100.0 % |
Summary of Geographic Composition of Loans Held for Investment Based on Current UPB and Loan Commitment | All of the Company’s loans held for investment are secured by properties within the United States. The geographic composition of loans held for investment based on total loan commitment and current UPB as of June 30, 2019 and December 31, 2018 is as follows (dollars in thousands): June 30, 2019 Geographic Region Loan Commitment Unfunded Commitment % of Loan Commitment Loan UPB % of Loan UPB East $ 1,970,524 $ 152,536 35.9 % $ 1,817,988 37.6 % South 1,568,407 242,862 28.4 1,325,545 27.3 West 955,925 121,112 17.3 834,813 17.2 Midwest 795,704 120,674 14.4 675,030 13.9 Various 223,077 27,225 4.0 195,852 4.0 Total $ 5,513,637 $ 664,409 100.0 % $ 4,849,228 100.0 % December 31, 2018 Geographic Region Loan Commitment Unfunded Commitment % of Loan Commitment Loan UPB % of Loan UPB East $ 2,084,807 $ 170,131 42.1 % $ 1,914,676 44.4 % South 1,525,173 270,933 30.8 1,254,240 29.1 West 760,416 100,422 15.4 659,994 15.3 Midwest 577,353 92,672 11.7 484,681 11.2 Total $ 4,947,749 $ 634,158 100.0 % $ 4,313,591 100.0 % |
Loan Category | |
Loans And Leases Receivable Disclosure [Line Items] | |
Summary of Loan Portfolio by Property/ Loan Category Type | A summary of the loan portfolio by category as of June 30, 2019 and December 31, 2018 based on total loan commitment and current UPB is as follows (dollars in thousands): June 30, 2019 Loan Category Loan Commitment Unfunded Commitment % of Loan Commitment Loan UPB % of Loan UPB Bridge $ 2,712,650 $ 188,200 49.2 % $ 2,524,450 52.0 % Light Transitional 1,505,874 158,557 27.3 1,347,317 27.8 Moderate Transitional 1,260,113 287,652 22.9 972,461 20.1 Construction 35,000 30,000 0.6 5,000 0.1 Total $ 5,513,637 $ 664,409 100.0 % $ 4,849,228 100.0 % December 31, 2018 Loan Category Loan Commitment Unfunded Commitment % of Loan Commitment Loan UPB % of Loan UPB Bridge $ 2,414,456 $ 199,397 48.8 % $ 2,215,059 51.3 % Light Transitional 1,513,227 212,290 30.6 1,300,937 30.2 Moderate Transitional 1,020,066 222,471 20.6 797,595 18.5 Total $ 4,947,749 $ 634,158 100.0 % $ 4,313,591 100.0 % Loan commitments represent principal commitments made by the Company at June 30, 2019 and December 31, 2018, respectively. |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies - Additional Information (Details) | 6 Months Ended | |
Jun. 30, 2019USD ($)Loan | Dec. 31, 2018USD ($)Loan | |
Accounting Policies [Abstract] | ||
Threshold period of delinquency | 90 days | |
Number of loans on non-accrual status | Loan | 0 | 0 |
Percentage of senior mortgage loan transferred to third-party | 100.00% | |
Maximum insured amount of each cash account | $ | $ 250,000 | $ 250,000 |
Loans Held for Investment - Add
Loans Held for Investment - Additional Information (Details) | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019USD ($)RatingLoan | Jun. 30, 2019USD ($)RatingLoan | Mar. 31, 2019Rating | Dec. 31, 2018USD ($)RatingLoan | |
Accounts Notes And Loans Receivable [Line Items] | ||||
Total loan commitment amount | $ 5,513,637,000 | $ 5,513,637,000 | $ 4,947,749,000 | |
Unfunded loan commitments | 664,409,000 | 664,409,000 | 634,158,000 | |
Construction loan | 167,000,000 | 167,000,000 | ||
Unamortized loan discount and premium | $ 0 | $ 0 | $ 0 | |
Number of loans on non-accrual status | Loan | 0 | 0 | 0 | |
Reserve | $ 0 | $ 0 | $ 0 | |
Weighted average risk rating | Rating | 2.8 | 2.8 | 2.8 | 2.8 |
Moved from Three Risk Rating into Two Risk Rating | ||||
Accounts Notes And Loans Receivable [Line Items] | ||||
Number of loans selected for risk rate changes | Loan | 2 | |||
Moved from Two Risk Rating into Three Risk Rating | ||||
Accounts Notes And Loans Receivable [Line Items] | ||||
Number of loans selected for risk rate changes | Loan | 1 | |||
Moved from Three Risk Rating into Four Risk Rating | ||||
Accounts Notes And Loans Receivable [Line Items] | ||||
Number of loans selected for risk rate changes | Loan | 3 | |||
Mezzanine Loan Investment | ||||
Accounts Notes And Loans Receivable [Line Items] | ||||
Total loan commitment amount | $ 35,000,000 | $ 35,000,000 | ||
Unpaid principal balance | $ 5,000,000 | $ 5,000,000 | ||
LIBOR | Mezzanine Loan Investment | ||||
Accounts Notes And Loans Receivable [Line Items] | ||||
Interest rate | 10.30% | 10.30% | ||
Non Consolidated Senior Interests | ||||
Accounts Notes And Loans Receivable [Line Items] | ||||
Construction loan | $ 132,000,000 | $ 132,000,000 | ||
Non Consolidated Senior Interests | Originated or Acquired 8 Loans | ||||
Accounts Notes And Loans Receivable [Line Items] | ||||
Total loan commitment amount | 132,000,000 | 132,000,000 | ||
Non Consolidated Senior Interests | Originated or Acquired 19 Loans | ||||
Accounts Notes And Loans Receivable [Line Items] | ||||
Total loan commitment amount | $ 132,000,000 | 132,000,000 | ||
German American Capital Corporation | Originated or Acquired 8 Loans | ||||
Accounts Notes And Loans Receivable [Line Items] | ||||
Number of loans originated or acquired | Loan | 8 | |||
Total loan commitment amount | $ 755,000,000 | 755,000,000 | ||
Unpaid principal balance | 507,800,000 | 507,800,000 | ||
Unfunded loan commitments | 115,200,000 | $ 115,200,000 | ||
German American Capital Corporation | Originated or Acquired 19 Loans | ||||
Accounts Notes And Loans Receivable [Line Items] | ||||
Number of loans originated or acquired | Loan | 19 | |||
Total loan commitment amount | 1,500,000,000 | $ 1,500,000,000 | ||
Unpaid principal balance | 1,100,000,000 | 1,100,000,000 | ||
Unfunded loan commitments | $ 195,700,000 | $ 195,700,000 |
Loans Held for Investment - Sch
Loans Held for Investment - Schedule of Loan Investment Portfolio (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Loans And Leases Receivable Disclosure [Line Items] | ||
Outstanding Principal, before allowance for loan losses | $ 4,849,228 | $ 4,313,591 |
Unamortized Premium (Discount), Loan Origination Fees net, before allowance for loan losses | (18,993) | (19,804) |
Carrying Amount, before allowance for loan losses | 4,830,235 | 4,293,787 |
Senior Loans | ||
Loans And Leases Receivable Disclosure [Line Items] | ||
Outstanding Principal, before allowance for loan losses | 4,844,228 | 4,313,591 |
Unamortized Premium (Discount), Loan Origination Fees net, before allowance for loan losses | (18,644) | (19,804) |
Carrying Amount, before allowance for loan losses | 4,825,584 | $ 4,293,787 |
Subordinated and Mezzanine Loans | ||
Loans And Leases Receivable Disclosure [Line Items] | ||
Outstanding Principal, before allowance for loan losses | 5,000 | |
Unamortized Premium (Discount), Loan Origination Fees net, before allowance for loan losses | (349) | |
Carrying Amount, before allowance for loan losses | $ 4,651 |
Loans Held for Investment - Sum
Loans Held for Investment - Summary of Loan Portfolio Activity (Details) $ in Thousands | 6 Months Ended |
Jun. 30, 2019USD ($) | |
Loans And Leases Receivable Disclosure [Abstract] | |
Balance at December 31, 2018 | $ 4,293,787 |
Loans originated and acquired | 1,133,817 |
Additional fundings | 117,131 |
Amortization of discount and origination fees | 7,902 |
Collection of principal | (722,402) |
Balance at June 30, 2019 | $ 4,830,235 |
Loans Held for Investment - S_2
Loans Held for Investment - Summary of Carrying Values and Results of Internal Risk Rating Review Performed (Details) $ in Thousands | Jun. 30, 2019USD ($)Rating | Mar. 31, 2019USD ($)Rating | Dec. 31, 2018USD ($)Rating |
Accounts Notes And Loans Receivable [Line Items] | |||
Carrying Value | $ 4,830,235 | $ 4,830,235 | $ 4,293,787 |
Weighted Average Risk Rating | Rating | 2.8 | 2.8 | 2.8 |
Rating 1 | |||
Accounts Notes And Loans Receivable [Line Items] | |||
Carrying Value | $ 29,923 | ||
Rating 2 | |||
Accounts Notes And Loans Receivable [Line Items] | |||
Carrying Value | $ 1,073,740 | 959,314 | |
Rating 3 | |||
Accounts Notes And Loans Receivable [Line Items] | |||
Carrying Value | 3,420,107 | 3,099,401 | |
Rating 4 | |||
Accounts Notes And Loans Receivable [Line Items] | |||
Carrying Value | $ 336,388 | $ 205,149 |
Available-for-Sale Debt Secur_3
Available-for-Sale Debt Securities - Additional Information (Details) | 3 Months Ended | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2019USD ($)Investment | Jun. 30, 2019USD ($)Investment | Jun. 30, 2018USD ($) | Dec. 31, 2018USD ($)Investment | |
Schedule Of Available For Sale Securities [Line Items] | ||||
Aggregate purchase price of investments | $ 632,267,000 | $ 143,643,000 | ||
Weighted average contractual maturity, Terms | 16 years 4 months 24 days | |||
CRE CLO Investments | ||||
Schedule Of Available For Sale Securities [Line Items] | ||||
Number of investments purchased | Investment | 17 | 27 | ||
Weighted average coupon rate | 1.90% | 2.00% | ||
Aggregate purchase price of investments | $ 368,200,000 | $ 602,400,000 | ||
CMBS and CRE CLO Investments | ||||
Schedule Of Available For Sale Securities [Line Items] | ||||
Number of Investments | Investment | 31 | 31 | 4 | |
Other than temporary impairments on available-for-sale | $ 0 | $ 0 | $ 0 |
Available-for-Sale Debt Secur_4
Available-for-Sale Debt Securities - Details of Carrying and Fair Values Of CMBS And CRE CLO Investment Portfolio (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Schedule Of Available For Sale Securities [Line Items] | ||
Estimated Fair Value | $ 679,178 | $ 74,381 |
CMBS and CRE CLO Investments | ||
Schedule Of Available For Sale Securities [Line Items] | ||
Face Amount | 677,800 | 76,404 |
Unamortized Premium (Discount), net | 145 | (38) |
Gross Unrealized Gain (Loss) | 1,233 | (1,985) |
Estimated Fair Value | $ 679,178 | $ 74,381 |
Available-for-Sale Debt Secur_5
Available-for-Sale Debt Securities - Available-for-sale CMBS and CRE CLO Investments by Contractual Maturity (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Estimated Fair Value | ||
Total investment in CMBS and CRE CLO securities, at amortized cost and estimated fair value | $ 679,178 | $ 74,381 |
CMBS and CRE CLO Investments | ||
Amortized Cost | ||
Within five years | 37,834 | |
After one, within five years | 37,929 | |
After five years | 640,111 | 38,436 |
Total investment in CMBS and CRE CLO securities, at amortized cost and estimated fair value | 677,945 | 76,365 |
Estimated Fair Value | ||
Within five years | 37,752 | |
After one, within five years | 38,076 | |
After five years | 641,426 | 36,305 |
Total investment in CMBS and CRE CLO securities, at amortized cost and estimated fair value | $ 679,178 | $ 74,381 |
Variable Interest Entities an_3
Variable Interest Entities and Collateralized Loan Obligations - Additional Information (Details) - USD ($) | Feb. 14, 2018 | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2019 | Dec. 31, 2018 | Nov. 29, 2018 |
Class A Senior Secured Note | ||||||
Variable Interest Entities And Collateralized Loan Obligation [Line Items] | ||||||
Replenishment feature utilization amount | $ 325,500,000 | |||||
Replenishment feature utilization percentage | 66.20% | 66.20% | ||||
FL2-Securities | ||||||
Variable Interest Entities And Collateralized Loan Obligation [Line Items] | ||||||
Liquidation preference notional amount | $ 1,000 | |||||
FL1-Securities | ||||||
Variable Interest Entities And Collateralized Loan Obligation [Line Items] | ||||||
Liquidation preference notional amount | $ 1,000 | |||||
TPG Real Estate Finance 2018-FL2 Issuer, Ltd. and TPG RE Finance Trust 2018-FL2 Co-Issuer, LLC | ||||||
Variable Interest Entities And Collateralized Loan Obligation [Line Items] | ||||||
Preferred shares par value per share | $ 0.001 | |||||
TPG Real Estate Finance 2018-FL2 Issuer, Ltd. and TPG RE Finance Trust 2018-FL2 Co-Issuer, LLC | FL2-Notes | ||||||
Variable Interest Entities And Collateralized Loan Obligation [Line Items] | ||||||
Principal amount of notes issued | $ 872,600,000 | |||||
FL2-Co-Issuer | ||||||
Variable Interest Entities And Collateralized Loan Obligation [Line Items] | ||||||
Principal amount of notes issued | 795,100,000 | |||||
FL2-Retention Holder | FL2-Securities | ||||||
Variable Interest Entities And Collateralized Loan Obligation [Line Items] | ||||||
Variable interest entity retained ownership amount | $ 205,000,000 | |||||
F L2 Mortgage Assets | ||||||
Variable Interest Entities And Collateralized Loan Obligation [Line Items] | ||||||
Principal amount of notes issued | $ 892,300,000 | $ 892,300,000 | ||||
Loans held for investment, aggregate unpaid principal balance percentage | 18.40% | 18.40% | ||||
TPG Real Estate Finance 2018-FL1 Issuer, Ltd. and TPG RE Finance Trust 2018-FL1 Co-Issuer, LLC | ||||||
Variable Interest Entities And Collateralized Loan Obligation [Line Items] | ||||||
Preferred shares par value per share | $ 0.001 | |||||
TPG Real Estate Finance 2018-FL1 Issuer, Ltd. and TPG RE Finance Trust 2018-FL1 Co-Issuer, LLC | FL1-Notes | ||||||
Variable Interest Entities And Collateralized Loan Obligation [Line Items] | ||||||
Principal amount of notes issued | $ 820,500,000 | |||||
FL1-Co-Issuer | ||||||
Variable Interest Entities And Collateralized Loan Obligation [Line Items] | ||||||
Principal amount of notes issued | 745,900,000 | |||||
FL1-Retention Holder | FL1-Securities | ||||||
Variable Interest Entities And Collateralized Loan Obligation [Line Items] | ||||||
Variable interest entity retained ownership amount | 186,500,000 | |||||
FL1-Mortgage Assets | ||||||
Variable Interest Entities And Collateralized Loan Obligation [Line Items] | ||||||
Principal amount of notes issued | $ 509,500,000 | $ 509,500,000 | ||||
Loans held for investment, aggregate unpaid principal balance percentage | 10.50% | 10.50% | ||||
Collateralized Loan Obligation | ||||||
Variable Interest Entities And Collateralized Loan Obligation [Line Items] | ||||||
Principal amount of notes issued | $ 1,215,565,000 | $ 1,215,565,000 | $ 1,527,237,000 | |||
Net cash proceeds utilizing replenishment feature | 17,100,000 | 23,500,000 | ||||
Additional interests related to replenishment | 69,500,000 | 101,300,000 | ||||
Repayment of existing borrowings including accrued interest | 52,400,000 | 77,800,000 | ||||
Unamortized issuance costs | 7,945,000 | 7,945,000 | $ 12,447,000 | |||
Collateralized Loan Obligation | FL2-Notes | ||||||
Variable Interest Entities And Collateralized Loan Obligation [Line Items] | ||||||
Payments to acquire variable interest entity as an investment (principal amount) | $ 19,700,000 | |||||
Debt issuance costs, gross | 8,700,000 | 8,700,000 | ||||
Unamortized issuance costs | 7,300,000 | 7,300,000 | ||||
Interest expense excluding amortization of deferred financing costs | 7,600,000 | 15,300,000 | ||||
Collateralized Loan Obligation | FL1-Notes | ||||||
Variable Interest Entities And Collateralized Loan Obligation [Line Items] | ||||||
Payments to acquire variable interest entity as an investment (principal amount) | $ 8,500,000 | $ 9,900,000 | ||||
Debt issuance costs, gross | 9,800,000 | 9,800,000 | ||||
Unamortized issuance costs | 600,000 | 600,000 | ||||
Interest expense excluding amortization of deferred financing costs | $ 4,500,000 | $ 9,900,000 |
Variable Interest Entities an_4
Variable Interest Entities and Collateralized Loan Obligations - Summary of Variable Interest Entities Assets and Liabilities (Details) - Variable Interest Entity, Primary Beneficiary - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
ASSETS | ||
Total Assets | $ 1,617,065 | $ 1,926,612 |
LIABILITIES | ||
Total Liabilities | (1,210,313) | (1,518,095) |
Cash and Cash Equivalents | ||
ASSETS | ||
Total Assets | 6,013 | 3,896 |
Accounts Receivable from Servicer/Trustee | ||
ASSETS | ||
Total Assets | 205,236 | 94,763 |
Accrued Interest Receivable | ||
ASSETS | ||
Total Assets | 3,975 | 3,672 |
Loans Held for Investment | ||
ASSETS | ||
Total Assets | 1,401,841 | 1,824,281 |
Accrued Interest Payable | ||
LIABILITIES | ||
Total Liabilities | (2,074) | (2,637) |
Accrued Expenses | ||
LIABILITIES | ||
Total Liabilities | (619) | (668) |
Collateralized Loan Obligation | ||
LIABILITIES | ||
Total Liabilities | $ (1,207,620) | $ (1,514,790) |
Variable Interest Entities an_5
Variable Interest Entities and Collateralized Loan Obligations - Schedule of Borrowings and Corresponding Collateral (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 | |
Debt Instrument [Line Items] | |||
Debt, Carrying Value | [1] | $ (1,179,464) | $ (1,509,930) |
Collateralized Loan Obligation | |||
Debt Instrument [Line Items] | |||
Collateral (loans), Outstanding Principal | 1,401,841 | 1,824,281 | |
Collateral (loans), Carrying Value | 1,401,841 | 1,824,281 | |
Debt, Face Value | (1,215,565) | (1,527,237) | |
Debt, Carrying Value | $ (1,207,620) | $ (1,514,790) | |
[1] | The Company’s consolidated Total Assets and Total Liabilities at June 30, 2019 include assets and liabilities of variable interest entities (“VIEs”) of $1.6 billion and $1.2 billion, respectively. The Company’s consolidated Total Assets and Total Liabilities at December 31, 2018 include assets and liabilities of VIEs of $1.9 billion and $1.5 billion, respectively. These assets can be used only to satisfy obligations of the VIEs, and creditors of the VIEs have recourse only to these assets, and not to TPG RE Finance Trust, Inc. See Note 5 to the Consolidated Financial Statements for details |
Summary of Secured Revolving Re
Summary of Secured Revolving Repurchase Agreements, Senior Secured and Secured Credit Agreements, and Asset-Specific Financings (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 | |
Debt Instrument [Line Items] | |||
Index Rate | one-month LIBOR | Index Rate | |
Senior Secured and Secured Credit Agreements | |||
Debt Instrument [Line Items] | |||
Commitment Amount | $ 660,000 | $ 660,000 | $ 660,000 |
Maximum Current Availability | 160,883 | 160,883 | 199,619 |
Balance Outstanding | 499,117 | 499,117 | 460,381 |
Principal Balance of Collateral | 647,114 | 647,114 | 663,381 |
Repurchase Agreements | |||
Debt Instrument [Line Items] | |||
Commitment Amount | 3,212,472 | 3,212,472 | 2,812,840 |
Maximum Current Availability | 952,640 | 952,640 | 1,768,695 |
Balance Outstanding | 2,259,832 | 2,259,832 | 1,044,145 |
Principal Balance of Collateral | 2,974,793 | 2,974,793 | 1,613,663 |
CMBS and CRE CLO Investments | |||
Debt Instrument [Line Items] | |||
Commitment Amount | 578,589 | 578,589 | 200,000 |
Asset-specific Financing | |||
Debt Instrument [Line Items] | |||
Commitment Amount | 109,500 | 109,500 | 32,500 |
Balance Outstanding | 109,500 | 109,500 | 32,500 |
Principal Balance of Collateral | 157,000 | 157,000 | 45,000 |
Asset-specific Financing, Secured Revolving Repurchase Agreements and Senior Secured and Secured Credit Agreements | |||
Debt Instrument [Line Items] | |||
Commitment Amount | 3,981,972 | 3,981,972 | 3,505,340 |
Maximum Current Availability | 1,113,523 | 1,113,523 | 1,968,314 |
Balance Outstanding | 2,868,449 | 2,868,449 | 1,537,026 |
Principal Balance of Collateral | $ 3,778,907 | $ 3,778,907 | $ 2,322,044 |
Debt Instrument, Interest Rate at 4.8% | Senior Secured and Secured Credit Agreements | |||
Debt Instrument [Line Items] | |||
Maturity Date | Jul. 12, 2020 | ||
Index Rate | 1 Month LIBOR | ||
Weighted Average Credit Spread | 2.30% | ||
Interest Rate | 4.80% | ||
Commitment Amount | $ 160,000 | ||
Maximum Current Availability | 87,059 | ||
Balance Outstanding | 72,941 | ||
Principal Balance of Collateral | $ 169,134 | ||
BMO Harris Bank | Debt Instrument, Interest Rate at 5.0% | Asset-specific Financing | |||
Debt Instrument [Line Items] | |||
Maturity Date | Apr. 9, 2020 | ||
Index Rate | 1 Month LIBOR | ||
Weighted Average Credit Spread | 2.70% | 2.70% | |
Interest Rate | 5.00% | 5.00% | |
Commitment Amount | $ 32,500 | $ 32,500 | |
Balance Outstanding | 32,500 | 32,500 | |
Principal Balance of Collateral | $ 45,000 | $ 45,000 | |
BMO Harris Bank | Debt Instrument, Interest Rate at 4.0% | Asset-specific Financing | |||
Debt Instrument [Line Items] | |||
Maturity Date | Apr. 9, 2020 | ||
Index Rate | 1 Month LIBOR | ||
Weighted Average Credit Spread | 2.70% | ||
Interest Rate | 4.00% | ||
Commitment Amount | $ 32,500 | ||
Balance Outstanding | 32,500 | ||
Principal Balance of Collateral | $ 45,000 | ||
Institutional Lender | Debt Instrument, Interest Rate at 6.5% | Asset-specific Financing | |||
Debt Instrument [Line Items] | |||
Maturity Date | Oct. 9, 2020 | ||
Index Rate | 1 Month LIBOR | ||
Weighted Average Credit Spread | 4.20% | 4.20% | |
Interest Rate | 6.50% | 6.50% | |
Commitment Amount | $ 77,000 | $ 77,000 | |
Balance Outstanding | 77,000 | 77,000 | |
Principal Balance of Collateral | $ 112,000 | $ 112,000 | |
Goldman Sachs | Debt Instrument, Interest Rate at 4.5% | Repurchase Agreements | |||
Debt Instrument [Line Items] | |||
Maturity Date | Aug. 19, 2019 | ||
Index Rate | 1 Month LIBOR | ||
Weighted Average Credit Spread | 2.10% | 2.10% | |
Interest Rate | 4.50% | 4.50% | |
Commitment Amount | $ 750,000 | $ 750,000 | |
Maximum Current Availability | 315,565 | 315,565 | |
Balance Outstanding | 434,435 | 434,435 | |
Principal Balance of Collateral | $ 661,876 | $ 661,876 | |
Goldman Sachs | Debt Instrument, Interest Rate at 3.2% | CMBS and CRE CLO Investments | Repurchase Agreements | |||
Debt Instrument [Line Items] | |||
Maturity Date | Jul. 5, 2019 | ||
Index Rate | 1 Month OIS | ||
Weighted Average Credit Spread | 0.80% | 0.80% | |
Interest Rate | 3.20% | 3.20% | |
Commitment Amount | $ 60,555 | $ 60,555 | |
Balance Outstanding | 60,555 | 60,555 | |
Principal Balance of Collateral | $ 70,433 | $ 70,433 | |
Goldman Sachs | Debt Instrument, Interest Rate at 4.6% | Repurchase Agreements | |||
Debt Instrument [Line Items] | |||
Maturity Date | Aug. 19, 2019 | ||
Index Rate | 1 Month LIBOR | ||
Weighted Average Credit Spread | 2.20% | ||
Interest Rate | 4.60% | ||
Commitment Amount | $ 750,000 | ||
Maximum Current Availability | 558,836 | ||
Balance Outstanding | 191,164 | ||
Principal Balance of Collateral | $ 474,243 | ||
Goldman Sachs | Debt Instrument, Interest Rate at 2.9% | CMBS and CRE CLO Investments | Repurchase Agreements | |||
Debt Instrument [Line Items] | |||
Maturity Date | Jan. 2, 2019 | ||
Index Rate | 1 Month OIS | ||
Weighted Average Credit Spread | 0.60% | ||
Interest Rate | 2.90% | ||
Commitment Amount | $ 100,000 | ||
Maximum Current Availability | 67,303 | ||
Balance Outstanding | 32,697 | ||
Principal Balance of Collateral | $ 38,517 | ||
Wells Fargo | Debt Instrument, Interest Rate at 4.1% | Repurchase Agreements | |||
Debt Instrument [Line Items] | |||
Maturity Date | Apr. 18, 2022 | ||
Index Rate | 1 Month LIBOR | ||
Weighted Average Credit Spread | 1.70% | 1.70% | |
Interest Rate | 4.10% | 4.10% | |
Commitment Amount | $ 750,000 | $ 750,000 | |
Maximum Current Availability | 177,934 | 177,934 | |
Balance Outstanding | 572,066 | 572,066 | |
Principal Balance of Collateral | $ 771,022 | $ 771,022 | |
Wells Fargo | Debt Instrument, Interest Rate at 3.4% | CMBS and CRE CLO Investments | Repurchase Agreements | |||
Debt Instrument [Line Items] | |||
Maturity Date | Jul. 22, 2019 | ||
Index Rate | 1 Month LIBOR | ||
Weighted Average Credit Spread | 1.00% | 1.00% | |
Interest Rate | 3.40% | 3.40% | |
Commitment Amount | $ 117,178 | $ 117,178 | |
Balance Outstanding | 117,178 | 117,178 | |
Principal Balance of Collateral | $ 137,322 | $ 137,322 | |
Wells Fargo | Debt Instrument, Interest Rate at 4.3% | Repurchase Agreements | |||
Debt Instrument [Line Items] | |||
Maturity Date | May 25, 2019 | ||
Index Rate | 1 Month LIBOR | ||
Weighted Average Credit Spread | 1.80% | ||
Interest Rate | 4.30% | ||
Commitment Amount | $ 750,000 | ||
Maximum Current Availability | 503,792 | ||
Balance Outstanding | 246,208 | ||
Principal Balance of Collateral | $ 339,012 | ||
Morgan Stanley | Debt Instrument, Interest Rate at 4.5% | Repurchase Agreements | |||
Debt Instrument [Line Items] | |||
Maturity Date | May 4, 2020 | ||
Index Rate | 1 Month LIBOR | ||
Weighted Average Credit Spread | 2.10% | 2.10% | |
Interest Rate | 4.50% | 4.50% | |
Commitment Amount | $ 500,000 | $ 500,000 | |
Maximum Current Availability | 208,719 | 208,719 | |
Balance Outstanding | 291,281 | 291,281 | |
Principal Balance of Collateral | $ 379,106 | $ 379,106 | |
Morgan Stanley | Debt Instrument, Interest Rate at 4.7% | Repurchase Agreements | |||
Debt Instrument [Line Items] | |||
Maturity Date | May 4, 2019 | ||
Index Rate | 1 Month LIBOR | ||
Weighted Average Credit Spread | 2.20% | ||
Interest Rate | 4.70% | ||
Commitment Amount | $ 500,000 | ||
Maximum Current Availability | 317,493 | ||
Balance Outstanding | 182,507 | ||
Principal Balance of Collateral | $ 244,936 | ||
JP Morgan | Debt Instrument, Interest Rate at 4.5% | Repurchase Agreements | |||
Debt Instrument [Line Items] | |||
Maturity Date | Aug. 20, 2021 | ||
Index Rate | 1 Month LIBOR | ||
Weighted Average Credit Spread | 2.10% | 2.10% | |
Interest Rate | 4.50% | 4.50% | |
Commitment Amount | $ 400,000 | $ 400,000 | |
Maximum Current Availability | 233,179 | 233,179 | |
Balance Outstanding | 166,821 | 166,821 | |
Principal Balance of Collateral | $ 222,348 | $ 222,348 | |
JP Morgan | Debt Instrument, Interest Rate at 3.3% | CMBS and CRE CLO Investments | Repurchase Agreements | |||
Debt Instrument [Line Items] | |||
Maturity Date | Jul. 10, 2019 | ||
Index Rate | 1 Month LIBOR | ||
Weighted Average Credit Spread | 0.90% | 0.90% | |
Interest Rate | 3.30% | 3.30% | |
Commitment Amount | $ 400,856 | $ 400,856 | |
Balance Outstanding | 400,856 | 400,856 | |
Principal Balance of Collateral | $ 458,635 | $ 458,635 | |
JP Morgan | Debt Instrument, Interest Rate at 4.6% | Repurchase Agreements | |||
Debt Instrument [Line Items] | |||
Maturity Date | Aug. 20, 2021 | ||
Index Rate | 1 Month LIBOR | ||
Weighted Average Credit Spread | 2.20% | ||
Interest Rate | 4.60% | ||
Commitment Amount | $ 400,000 | ||
Maximum Current Availability | 214,471 | ||
Balance Outstanding | 185,529 | ||
Principal Balance of Collateral | $ 254,026 | ||
US Bank | Debt Instrument, Interest Rate at 4.1% | Repurchase Agreements | |||
Debt Instrument [Line Items] | |||
Maturity Date | Oct. 9, 2021 | ||
Index Rate | 1 Month LIBOR | ||
Weighted Average Credit Spread | 1.70% | 1.70% | |
Interest Rate | 4.10% | 4.10% | |
Commitment Amount | $ 233,883 | $ 233,883 | |
Maximum Current Availability | 17,243 | 17,243 | |
Balance Outstanding | 216,640 | 216,640 | |
Principal Balance of Collateral | $ 274,051 | $ 274,051 | |
US Bank | Debt Instrument, Interest Rate at 4.3% | Repurchase Agreements | |||
Debt Instrument [Line Items] | |||
Maturity Date | Oct. 9, 2021 | ||
Index Rate | 1 Month LIBOR | ||
Weighted Average Credit Spread | 1.80% | ||
Interest Rate | 4.30% | ||
Commitment Amount | $ 212,840 | ||
Maximum Current Availability | 6,800 | ||
Balance Outstanding | 206,040 | ||
Principal Balance of Collateral | $ 262,929 | ||
Royal Bank of Canada | CMBS and CRE CLO Investments | Repurchase Agreements | |||
Debt Instrument [Line Items] | |||
Index Rate | N/A | N/A | |
Commitment Amount | $ 100,000 | ||
Maximum Current Availability | $ 100,000 | ||
Bank of America | Debt Instrument, Interest Rate at 4.2% | Senior Secured and Secured Credit Agreements | |||
Debt Instrument [Line Items] | |||
Maturity Date | Sep. 29, 2020 | Sep. 29, 2020 | |
Index Rate | 1 Month LIBOR | 1 Month LIBOR | |
Weighted Average Credit Spread | 1.80% | 1.80% | 1.90% |
Interest Rate | 4.20% | 4.20% | 4.20% |
Commitment Amount | $ 500,000 | $ 500,000 | $ 500,000 |
Maximum Current Availability | 89,563 | 89,563 | 112,560 |
Balance Outstanding | 410,437 | 410,437 | 387,440 |
Principal Balance of Collateral | $ 514,714 | $ 514,714 | $ 494,247 |
Citibank | Debt Instrument, Interest Rate at 4.6% | Senior Secured and Secured Credit Agreements | |||
Debt Instrument [Line Items] | |||
Maturity Date | Jul. 12, 2020 | ||
Index Rate | 1 Month LIBOR | ||
Weighted Average Credit Spread | 2.30% | 2.30% | |
Interest Rate | 4.60% | 4.60% | |
Commitment Amount | $ 160,000 | $ 160,000 | |
Maximum Current Availability | 71,320 | 71,320 | |
Balance Outstanding | 88,680 | 88,680 | |
Principal Balance of Collateral | $ 132,400 | $ 132,400 |
Summary of Secured Revolving _2
Summary of Secured Revolving Repurchase Agreements, Senior Secured and Secured Credit Agreements, and Asset-Specific Financings (Parenthetical) (Details) | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Asset-specific Financing, Secured Revolving Repurchase Agreements and Senior Secured and Secured Credit Agreements | ||
Debt Instrument [Line Items] | ||
Recourse guarantee percentage | 25.00% | 25.00% |
Repurchase Agreements | ||
Debt Instrument [Line Items] | ||
Recourse guarantee percentage | 100.00% | 100.00% |
Secured Credit Agreement | ||
Debt Instrument [Line Items] | ||
Recourse guarantee percentage | 100.00% | 100.00% |
Secured Revolving Repurchase _3
Secured Revolving Repurchase Agreements, Senior Secured and Secured Credit Agreements, Term Loan Facility, and Asset-Specific Financings - Additional Information (Details) | 3 Months Ended | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019USD ($) | Jun. 30, 2019USD ($)Agreement | Dec. 31, 2018USD ($)Agreement | |
Debt Instrument [Line Items] | |||
Index Rate | one-month LIBOR | Index Rate | |
Term Loan Facility | |||
Debt Instrument [Line Items] | |||
Line of credit facility, maximum borrowing capacity | $ 750,000,000 | $ 750,000,000 | |
Debt Instrument, outstanding borrowing | 267,700 | $ 267,700 | |
Term Loan Facility | Minimum | |||
Debt Instrument [Line Items] | |||
Percentage of individual pledged assets | 70.00% | ||
Term Loan Facility | Maximum | |||
Debt Instrument [Line Items] | |||
Percentage of individual pledged assets | 85.00% | ||
Term Loan Facility | LIBOR | |||
Debt Instrument [Line Items] | |||
Line of credit, spread on variable rate | 1.85% | ||
Repurchase Agreements | |||
Debt Instrument [Line Items] | |||
Recourse guarantee percentage | 100.00% | 100.00% | |
Number of repurchase agreements | Agreement | 5 | 5 | |
Debt Instrument, outstanding borrowing | 2,259,832,000 | $ 2,259,832,000 | $ 1,044,145,000 |
Repurchase Agreements | Commercial Mortgage Loans | |||
Debt Instrument [Line Items] | |||
Number of repurchase agreements | Agreement | 53 | 51 | |
Asset-specific Financing, Secured Revolving Repurchase Agreements and Senior Secured and Secured Credit Agreements | |||
Debt Instrument [Line Items] | |||
Recourse guarantee percentage | 25.00% | 25.00% | |
Number of repurchase agreements | Agreement | 4 | 2 | |
Asset-specific Financing, Secured Revolving Repurchase Agreements and Senior Secured and Secured Credit Agreements | CRE CLO Investments | |||
Debt Instrument [Line Items] | |||
Number of repurchase agreements | Agreement | 27 | ||
Asset-specific Financing, Secured Revolving Repurchase Agreements and Senior Secured and Secured Credit Agreements | CMBS Investments | |||
Debt Instrument [Line Items] | |||
Number of repurchase agreements | Agreement | 2 | 2 | |
Bank of America | Senior Secured Credit Agreement | |||
Debt Instrument [Line Items] | |||
Credit agreement initiation date | Jun. 30, 2019 | ||
Line of credit facility, maximum borrowing capacity | 500,000,000 | $ 500,000,000 | |
Line of credit facility, outstanding amount | 410,400,000 | $ 410,400,000 | |
Line of credit facility, initial maturity date | Sep. 29, 2020 | ||
Citibank | Secured Credit Agreement | |||
Debt Instrument [Line Items] | |||
Line of credit facility, maximum borrowing capacity | 160,000 | $ 160,000 | |
Line of credit facility, outstanding amount | 88,700,000 | $ 88,700,000 | |
Line of credit facility, initial maturity date | Jul. 12, 2020 | ||
Percentage of individual pledged assets | 70.00% | ||
Individual pledged assets term | 90 days | ||
Citibank | Secured Credit Agreement | LIBOR | |||
Debt Instrument [Line Items] | |||
Index Rate | one-month LIBOR | ||
Line of credit, spread on variable rate | 2.25% | ||
Holdco | Repurchase Agreements | |||
Debt Instrument [Line Items] | |||
Recourse guarantee percentage | 25.00% | ||
Holdco | Repurchase Agreements | CMBS and CRE CLO Investments | |||
Debt Instrument [Line Items] | |||
Recourse guarantee percentage | 100.00% | ||
Asset-specific Financing | |||
Debt Instrument [Line Items] | |||
Debt Instrument, outstanding borrowing | $ 109,500,000 | $ 109,500,000 | $ 32,500,000 |
Asset-specific Financing | Holdco | BMO Harris Bank | |||
Debt Instrument [Line Items] | |||
Guaranteed capped rate of outstanding obligations | 25.00% |
Summary of Repurchase Agreement
Summary of Repurchase Agreements Secured by Commercial Mortgage Loans, CMBS, CRE CLO Investments, Long - term Borrowings, and Counterparty Concentration (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Dec. 31, 2018 | |
Commercial Mortgage Loans | ||
Repurchase Agreement Counterparty [Line Items] | ||
Commitment Amount | $ 2,633,883 | $ 2,612,840 |
UPB of Collateral | 2,308,403 | 1,575,146 |
Carrying Value of Collateral | 2,307,705 | 1,572,321 |
Amounts Payable under Secured Revolving Repurchase Agreements | 1,684,567 | 1,014,555 |
Net Counterparty Exposure | $ 623,138 | $ 557,766 |
Days to Extended Maturity | 890 days | 1125 days |
CMBS and CRE CLO Investments | ||
Repurchase Agreement Counterparty [Line Items] | ||
Commitment Amount | $ 578,589 | $ 200,000 |
UPB of Collateral | 666,390 | 38,517 |
Carrying Value of Collateral | 671,440 | 36,414 |
Amounts Payable under Secured Revolving Repurchase Agreements | 579,978 | 32,984 |
Net Counterparty Exposure | $ 91,462 | $ 3,430 |
Days to Extended Maturity | 12 days | 2 days |
Commercial Mortgage Loans And CMBS and CRE CLO Investments | ||
Repurchase Agreement Counterparty [Line Items] | ||
Commitment Amount | $ 3,212,472 | $ 2,812,840 |
UPB of Collateral | 2,974,793 | 1,613,663 |
Carrying Value of Collateral | 2,979,145 | 1,608,735 |
Amounts Payable under Secured Revolving Repurchase Agreements | 2,264,545 | 1,047,539 |
Net Counterparty Exposure | $ 714,600 | $ 561,196 |
Days to Extended Maturity | 632 days | 1083 days |
Morgan Stanley Bank | Commercial Mortgage Loans | ||
Repurchase Agreement Counterparty [Line Items] | ||
Commitment Amount | $ 500,000 | $ 500,000 |
UPB of Collateral | 379,106 | 244,936 |
Carrying Value of Collateral | 377,786 | 245,932 |
Amounts Payable under Secured Revolving Repurchase Agreements | 292,177 | 183,901 |
Net Counterparty Exposure | $ 85,609 | $ 62,031 |
Percent of Stockholders' Equity | 5.80% | 4.70% |
US Bank | Commercial Mortgage Loans | ||
Repurchase Agreement Counterparty [Line Items] | ||
Commitment Amount | $ 233,883 | $ 212,840 |
UPB of Collateral | 274,051 | 262,929 |
Carrying Value of Collateral | 273,038 | 261,916 |
Amounts Payable under Secured Revolving Repurchase Agreements | 216,970 | 206,422 |
Net Counterparty Exposure | $ 56,068 | $ 55,494 |
Percent of Stockholders' Equity | 3.80% | 4.20% |
Days to Extended Maturity | 1745 days | 1743 days |
Goldman Sachs | Commercial Mortgage Loans | ||
Repurchase Agreement Counterparty [Line Items] | ||
Commitment Amount | $ 750,000 | $ 750,000 |
UPB of Collateral | 661,876 | 474,243 |
Carrying Value of Collateral | 663,507 | 472,797 |
Amounts Payable under Secured Revolving Repurchase Agreements | 435,535 | 191,705 |
Net Counterparty Exposure | $ 227,972 | $ 281,092 |
Percent of Stockholders' Equity | 15.60% | 21.20% |
Days to Extended Maturity | 50 days | 231 days |
Goldman Sachs | CMBS and CRE CLO Investments | ||
Repurchase Agreement Counterparty [Line Items] | ||
Commitment Amount | $ 60,555 | $ 100,000 |
UPB of Collateral | 70,433 | 38,517 |
Carrying Value of Collateral | 70,139 | 36,414 |
Amounts Payable under Secured Revolving Repurchase Agreements | 61,055 | 32,984 |
Net Counterparty Exposure | $ 9,084 | $ 3,430 |
Percent of Stockholders' Equity | 0.60% | 0.30% |
Days to Extended Maturity | 5 days | 2 days |
JP Morgan | Commercial Mortgage Loans | ||
Repurchase Agreement Counterparty [Line Items] | ||
Commitment Amount | $ 400,000 | $ 400,000 |
UPB of Collateral | 222,348 | 254,026 |
Carrying Value of Collateral | 221,408 | 253,145 |
Amounts Payable under Secured Revolving Repurchase Agreements | 167,112 | 185,892 |
Net Counterparty Exposure | $ 54,296 | $ 67,253 |
Percent of Stockholders' Equity | 3.70% | 5.10% |
Days to Extended Maturity | 1512 days | 1693 days |
JP Morgan | CMBS and CRE CLO Investments | ||
Repurchase Agreement Counterparty [Line Items] | ||
Commitment Amount | $ 400,856 | |
UPB of Collateral | 458,635 | |
Carrying Value of Collateral | 463,336 | |
Amounts Payable under Secured Revolving Repurchase Agreements | 401,533 | |
Net Counterparty Exposure | $ 61,803 | |
Percent of Stockholders' Equity | 4.20% | |
Days to Extended Maturity | 11 days | |
Wells Fargo | Commercial Mortgage Loans | ||
Repurchase Agreement Counterparty [Line Items] | ||
Commitment Amount | $ 750,000 | $ 750,000 |
UPB of Collateral | 771,022 | 339,012 |
Carrying Value of Collateral | 771,966 | 338,531 |
Amounts Payable under Secured Revolving Repurchase Agreements | 572,773 | 246,635 |
Net Counterparty Exposure | $ 199,193 | $ 91,896 |
Percent of Stockholders' Equity | 13.60% | 6.90% |
Days to Extended Maturity | 1023 days | 876 days |
Wells Fargo | CMBS and CRE CLO Investments | ||
Repurchase Agreement Counterparty [Line Items] | ||
Commitment Amount | $ 117,178 | |
UPB of Collateral | 137,322 | |
Carrying Value of Collateral | 137,965 | |
Amounts Payable under Secured Revolving Repurchase Agreements | 117,390 | |
Net Counterparty Exposure | $ 20,575 | |
Percent of Stockholders' Equity | 1.40% | |
Days to Extended Maturity | 23 days | |
Royal Bank of Canada | CMBS and CRE CLO Investments | ||
Repurchase Agreement Counterparty [Line Items] | ||
Commitment Amount | $ 100,000 |
Summary of Repurchase Agreeme_2
Summary of Repurchase Agreements Secured by Commercial Mortgage Loans, CMBS, CRE CLO Investments, Long - term Borrowings, and Counterparty Concentration (Parenthetical) (Details) - USD ($) $ in Thousands | 6 Months Ended | 12 Months Ended | |
Jun. 30, 2019 | Dec. 31, 2018 | ||
Repurchase Agreement Counterparty [Line Items] | |||
Interest receivable | [1] | $ 30,923 | $ 20,731 |
Accrued Interest Payable | [1] | 9,604 | 6,146 |
Unamortized deferred financing fees | 6,700 | ||
Commercial Mortgage Loans | |||
Repurchase Agreement Counterparty [Line Items] | |||
Interest receivable | 13,700 | 14,500 | |
Premium, discount and origination fees | 14,400 | 17,300 | |
Accrued Interest Payable | 3,300 | 3,100 | |
Unamortized deferred financing fees | 7,100 | ||
CMBS and CRE CLO Investments | |||
Repurchase Agreement Counterparty [Line Items] | |||
Interest receivable | 3,500 | 100 | |
Premium, discount and origination fees | 1,500 | 2,200 | |
Accrued Interest Payable | $ 1,400 | $ 300 | |
[1] | The Company’s consolidated Total Assets and Total Liabilities at June 30, 2019 include assets and liabilities of variable interest entities (“VIEs”) of $1.6 billion and $1.2 billion, respectively. The Company’s consolidated Total Assets and Total Liabilities at December 31, 2018 include assets and liabilities of VIEs of $1.9 billion and $1.5 billion, respectively. These assets can be used only to satisfy obligations of the VIEs, and creditors of the VIEs have recourse only to these assets, and not to TPG RE Finance Trust, Inc. See Note 5 to the Consolidated Financial Statements for details |
Schedule of Maturities - Schedu
Schedule of Maturities - Schedule of Future Principal Payments (Details) $ in Thousands | Jun. 30, 2019USD ($) |
Collateralized Loan Obligation | |
Debt Instrument [Line Items] | |
2019 | $ 441,772 |
2020 | 411,138 |
2021 | 195,780 |
2022 | 138,719 |
Total | 1,187,409 |
Asset-specific Financing | |
Debt Instrument [Line Items] | |
2020 | 109,500 |
Total | 109,500 |
Senior Secured and Secured Credit Agreements | |
Debt Instrument [Line Items] | |
2020 | 499,117 |
Total | 499,117 |
Secured Revolving Repurchase Agreements | |
Debt Instrument [Line Items] | |
2019 | 1,163,883 |
2020 | 498,957 |
2021 | 334,266 |
2022 | 262,726 |
Total | 2,259,832 |
Term Loan Facility | |
Debt Instrument [Line Items] | |
2020 | 114,020 |
2021 | 34,827 |
2022 | 88,654 |
2023 | 30,160 |
Total | $ 267,661 |
Fair Value Measurements - Addit
Fair Value Measurements - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended |
Jun. 30, 2019 | Jun. 30, 2019 | Dec. 31, 2018 | |
Fair Value Disclosures [Abstract] | |||
Money market funds | $ 36,800,000 | $ 36,800,000 | |
Threshold period of delinquency | 90 days | ||
Market spread | one-month LIBOR | Index Rate | |
Transfers of financial assets or liabilities with in fair value hierarchy | $ 0 | $ 0 | |
Estimated fair value of loans held for investment | $ 4,900,000,000 | $ 4,900,000,000 | $ 4,300,000,000 |
Weighted average gross spread percentage | 3.80% | 3.80% | 3.90% |
Weighted average maturity period | 3 years 9 months 18 days | 3 years 10 months 24 days |
Fair Value Measurements - Summa
Fair Value Measurements - Summary of Financial Assets and Liabilities Not Carried at Fair Value On Recurring Basis (Details) - Fair Value Measurements Nonrecurring - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Carrying Value | Loans Held for Investment | ||
Financial Assets | ||
Financial Assets, Nonrecurring | $ 4,830,235 | $ 4,293,787 |
Carrying Value | Term Loan Facility | ||
Financial Liabilities | ||
Financial Liabilities, Nonrecurring | 266,638 | 113,504 |
Carrying Value | Collateralized Loan Obligation | ||
Financial Liabilities | ||
Financial Liabilities, Nonrecurring | 1,179,464 | 1,509,930 |
Carrying Value | Secured Financing Arrangements | ||
Financial Liabilities | ||
Financial Liabilities, Nonrecurring | 2,858,062 | 1,526,449 |
Estimate of Fair Value Measurement | Level III | Loans Held for Investment | ||
Financial Assets | ||
Financial Assets, Nonrecurring | 4,856,225 | 4,317,844 |
Estimate of Fair Value Measurement | Level III | Term Loan Facility | ||
Financial Liabilities | ||
Financial Liabilities, Nonrecurring | 266,638 | 113,504 |
Estimate of Fair Value Measurement | Level III | Collateralized Loan Obligation | ||
Financial Liabilities | ||
Financial Liabilities, Nonrecurring | 1,179,464 | 1,509,930 |
Estimate of Fair Value Measurement | Level III | Secured Financing Arrangements | ||
Financial Liabilities | ||
Financial Liabilities, Nonrecurring | $ 2,858,062 | $ 1,526,449 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | |||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Income Tax [Line Items] | |||||
Reserve for uncertain income tax positions | $ 0 | $ 0 | $ 0 | ||
Interest for underpayment of income taxes | 0 | $ 0 | 0 | $ 0 | |
Penalties for underpayment of income taxes | 0 | 0 | 0 | 0 | |
Current portion of income tax expense | 200,000 | 0 | $ 400,000 | $ 200,000 | |
Effective income tax rate | 0.70% | 0.40% | |||
Deferred tax asset | 0 | $ 0 | 0 | ||
Deferred tax liabilities | 0 | 0 | $ 0 | ||
TRSs | |||||
Income Tax [Line Items] | |||||
Current portion of income tax expense | $ 0 | $ 0 | $ 0 | $ 0 | |
REIT Subsidiaries | |||||
Income Tax [Line Items] | |||||
Equity interest percentage by parent | 100.00% | 100.00% |
Related Party Transactions - Ad
Related Party Transactions - Additional Information (Details) - USD ($) | Jul. 25, 2017 | Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Dec. 31, 2018 | |
Related Party Transaction [Line Items] | |||||||
Proceeds from Issuance of Common Stock | $ 136,532,000 | ||||||
Incentive management fee percentage of Core Earnings less seven percent of stockholders equity | 20.00% | ||||||
Management fees and incentive management fees payable | [1] | $ 7,649,000 | 7,649,000 | $ 5,996,000 | |||
Amount incurred and reimbursable | 300,000 | $ 300,000 | 600,000 | $ 600,000 | |||
Reimbursable expenses remained outstanding | 300,000 | $ 300,000 | 0 | ||||
Termination fee, description | A termination fee will be payable to the Manager upon termination of the Management Agreement by the Company absent a cause event. The termination fee would also be payable to the Manager upon termination of the Management Agreement by the Manager if the Company materially breaches the Management Agreement. The termination fee is equal to three times the sum of (x) the average annual base management fee and (y) the average annual incentive compensation earned by the Manager, in each case during the 24-month period immediately preceding the most recently completed calendar quarter prior to the date of termination or, if such termination occurs prior to July 25, 2019, and such termination fee is payable, the base management fees and the incentive compensation will be annualized for the period from July 25, 2017 to July 25, 2019 based on such fees actually received by the Manager during such period | ||||||
Management Agreement | |||||||
Related Party Transaction [Line Items] | |||||||
Percentage of annual base management fee | 1.50% | ||||||
Percentage of quarterly base management fee | 0.375% | ||||||
Proceeds from Issuance of Common Stock | $ 1,000,000,000 | ||||||
Incentive management fee, description | The Manager is entitled to incentive compensation which is calculated and payable in cash with respect to each calendar quarter following the completion of the Company’s initial public offering (or part thereof that the Management Agreement is in effect) in arrears in an amount, not less than zero, equal to the difference between: (1) the product of (a) 20% and (b) the difference between (i) the Company’s Core Earnings for the most recent 12-month period (or such lesser number of completed calendar quarters, if applicable), including the calendar quarter (or part thereof) for which the calculation of incentive compensation is being made (the “applicable period”), and (ii) the product of (A) the Company’s Equity in the most recent 12-month period (or such lesser number of completed calendar quarters, if applicable), including the applicable period, and (B) 7% per annum; and (2) the sum of any incentive compensation paid to the Manager with respect to the first three calendar quarters of the most recent 12-month period (or such lesser number of completed calendar quarters preceding the applicable period, if applicable). No incentive compensation is payable to the Manager with respect to any calendar quarter unless Core Earnings for the 12 most recently completed calendar quarters (or such lesser number of completed calendar quarters following the completion of the Company’s initial public offering) is greater than zero. For purposes of calculating the Manager’s incentive compensation, the Management Agreement, as amended, specifies that equity securities of the Company or any of the Company’s subsidiaries that are entitled to a specified periodic distribution or have other debt characteristics will not constitute equity securities and will not be included in “Equity” for the purpose of calculating incentive compensation. Instead, the aggregate distribution amount that accrues to such equity securities during the calendar quarter of such calculation will be subtracted from Core Earnings, before incentive compensation for purposes of calculating incentive compensation, unless such distribution is otherwise excluded from Core Earnings. | ||||||
Percentage multiplied by stockholders equity included in incentive management fee | 7.00% | ||||||
Management fees and incentive management fees payable | $ 7,400,000 | $ 7,400,000 | $ 6,100,000 | ||||
Management Agreement | Minimum | |||||||
Related Party Transaction [Line Items] | |||||||
Management fee payable per annum | $ 250,000 | ||||||
Management fee payable per quarter | $ 62,500 | ||||||
[1] | The Company’s consolidated Total Assets and Total Liabilities at June 30, 2019 include assets and liabilities of variable interest entities (“VIEs”) of $1.6 billion and $1.2 billion, respectively. The Company’s consolidated Total Assets and Total Liabilities at December 31, 2018 include assets and liabilities of VIEs of $1.9 billion and $1.5 billion, respectively. These assets can be used only to satisfy obligations of the VIEs, and creditors of the VIEs have recourse only to these assets, and not to TPG RE Finance Trust, Inc. See Note 5 to the Consolidated Financial Statements for details |
Related Party Transactions - Su
Related Party Transactions - Summary of Management Fees and Incentive Management Fees Incurred and Paid Pursuant to Management Agreement (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Related Party Transactions [Abstract] | ||||
Management Agreement fees incurred | $ 7,371 | $ 5,909 | $ 13,879 | $ 11,539 |
Management Agreement fees paid | $ 6,508 | $ 5,630 | $ 12,608 | $ 10,862 |
Earnings per Share - Additional
Earnings per Share - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Earnings Per Share [Abstract] | ||||
Dividends declared | $ 0.1 | $ 0 | $ 0.3 | $ 0.1 |
Undistributed net income attributable to common stockholders | $ 0.1 | $ 0 | $ 0.3 | $ 0.1 |
Earnings per Share - Schedule o
Earnings per Share - Schedule of Calculation of Basic and Diluted Earnings per Common Share (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 6 Months Ended | ||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | |
Earnings Per Share [Abstract] | ||||
Net Income Attributable to TPG RE Finance Trust, Inc. | $ 31,965 | $ 26,438 | $ 60,374 | $ 51,549 |
Participating Securities' Share in Earnings | (138) | (279) | ||
Net Income Attributable to Common Stockholders | $ 31,827 | $ 26,438 | $ 60,095 | $ 51,549 |
Weighted Average Common Shares Outstanding, Basic and Diluted | 73,963,337 | 60,175,373 | 71,144,696 | 60,283,992 |
Per Common Share Amount, Basic and Diluted | $ 0.43 | $ 0.44 | $ 0.85 | $ 0.86 |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Details) - USD ($) | Jun. 18, 2019 | Apr. 16, 2019 | Mar. 07, 2019 | Jul. 25, 2018 | Jun. 15, 2018 | Jun. 30, 2019 | Mar. 31, 2019 | Jun. 30, 2018 | Mar. 31, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | Apr. 12, 2019 | Dec. 31, 2018 | |||
Class Of Stock [Line Items] | ||||||||||||||||
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |||||||||||||
Net proceeds from the issuance of common stock before transaction expenses | $ 136,532,000 | |||||||||||||||
Dividends on preferred stock | $ 4,000 | $ 3,000 | $ 3,000 | |||||||||||||
Unpaid dividends | $ 32,000,000 | 31,985,000 | [1] | $ 25,911,000 | 31,985,000 | [1] | $ 25,911,000 | $ 28,981,000 | [1] | |||||||
Dividends | $ 25,900,000 | 63,600,000 | 51,200,000 | |||||||||||||
Other comprehensive (loss) income | 3,112,000 | (1,424,000) | $ 3,218,000 | (1,638,000) | ||||||||||||
Series A Preferred Stock | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Dividend rate | 12.50% | |||||||||||||||
Preferred stock, liquidation preference per annum | 1,000 | $ 1,000 | ||||||||||||||
Dividend declared and paid | $ 7,000 | |||||||||||||||
Dividends on preferred stock | $ 0 | 0 | ||||||||||||||
Class A Common Stock | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Common stock, par value | $ 0.001 | $ 0.001 | $ 0.001 | |||||||||||||
Dividend declared per share | $ 0.43 | $ 0.43 | ||||||||||||||
Dividends | $ 63,600,000 | $ 51,200,000 | ||||||||||||||
Common Stock And Class A Common Stock | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Dividend payable date | Jul. 25, 2019 | Jul. 25, 2018 | ||||||||||||||
Dividend record date | Jun. 28, 2019 | Jun. 25, 2018 | ||||||||||||||
Dividend payable declared date | Jun. 15, 2018 | |||||||||||||||
Morgan Stanley And Co L L C | Exercise of Underwriters Option to Purchase Additional Shares | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Exercise of underwriters stock option to purchase additional shares | 900,000 | |||||||||||||||
Additional shares of common stock sold to the underwriters | 900,000 | |||||||||||||||
Net proceeds from the issuance of common stock before transaction expenses | $ 17,400,000 | |||||||||||||||
Common Stock | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Number of common shares issued | 978,033 | 6,000,000 | 19,352 | |||||||||||||
Dividend declared per share | $ 0.43 | $ 0.43 | ||||||||||||||
Equity Distribution Agreement | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Common stock, par value | $ 0.001 | |||||||||||||||
Equity Distribution Agreement | Common Stock | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Number of common shares issued | 0 | 0 | ||||||||||||||
Equity Distribution Agreement | Common Stock | Maximum | ||||||||||||||||
Class Of Stock [Line Items] | ||||||||||||||||
Aggregate gross sales price of common stock | $ 125,000,000 | |||||||||||||||
Percentage of commission to each sales agent, on gross sales price of shares sold | 1.75% | |||||||||||||||
[1] | The Company’s consolidated Total Assets and Total Liabilities at June 30, 2019 include assets and liabilities of variable interest entities (“VIEs”) of $1.6 billion and $1.2 billion, respectively. The Company’s consolidated Total Assets and Total Liabilities at December 31, 2018 include assets and liabilities of VIEs of $1.9 billion and $1.5 billion, respectively. These assets can be used only to satisfy obligations of the VIEs, and creditors of the VIEs have recourse only to these assets, and not to TPG RE Finance Trust, Inc. See Note 5 to the Consolidated Financial Statements for details |
Share-based Incentive Plan - Ad
Share-based Incentive Plan - Additional Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 6 Months Ended | ||||
Jun. 30, 2019 | Jun. 30, 2018 | Jun. 30, 2019 | Jun. 30, 2018 | May 14, 2019 | Mar. 31, 2019 | |
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Stock Compensation Expense | $ 1,514 | $ 374 | ||||
2017 Equity Incentive Plan | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Number of shares authorized under the plan | 4,600,463 | 4,600,463 | ||||
Share vesting installment period | 4 years | |||||
Total unrecognized compensation cost relating to unvested share-based compensation arrangements | $ 4,600 | |||||
Unrecognized compensation cost, recognition period | 1 year 8 months 12 days | |||||
Stock Compensation Expense | $ 900 | $ 200 | $ 1,500 | $ 400 | ||
2017 Equity Incentive Plan | Common Stock | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Shares of common stock expected to vest | 263,000 | 263,000 | ||||
2017 Equity Incentive Plan | 2019 | Common Stock | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Shares of common stock expected to vest | 35,404 | |||||
2017 Equity Incentive Plan | 2020 | Common Stock | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Shares of common stock expected to vest | 93,876 | |||||
2017 Equity Incentive Plan | 2021 | Common Stock | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Shares of common stock expected to vest | 93,877 | |||||
2017 Equity Incentive Plan | 2022 | Common Stock | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Shares of common stock expected to vest | 39,843 | |||||
Deferred Stock Units | Board of Directors | ||||||
Share Based Compensation Arrangement By Share Based Payment Award [Line Items] | ||||||
Deferred stock units, value | $ 300 |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) - USD ($) $ in Millions | Jun. 30, 2019 | Dec. 31, 2018 |
Commitments And Contingencies Disclosure [Abstract] | ||
Unfunded commitments related to loans held for investment | $ 664.4 | $ 634.2 |
Concentration of Credit Risk -
Concentration of Credit Risk - Summary of Loan Portfolio by Property Type (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Loans And Leases Receivable Disclosure [Line Items] | ||
Loan Commitment | $ 5,513,637 | $ 4,947,749 |
Unfunded Commitment | $ 664,409 | $ 634,158 |
% of Loan Commitment | 100.00% | 100.00% |
Loan UPB | $ 4,849,228 | $ 4,313,591 |
% of Loan UPB | 100.00% | 100.00% |
Office | ||
Loans And Leases Receivable Disclosure [Line Items] | ||
Loan Commitment | $ 2,012,904 | $ 1,898,511 |
Unfunded Commitment | $ 292,217 | $ 316,510 |
% of Loan Commitment | 36.60% | 38.50% |
Loan UPB | $ 1,720,687 | $ 1,582,001 |
% of Loan UPB | 35.50% | 36.80% |
Multifamily | ||
Loans And Leases Receivable Disclosure [Line Items] | ||
Loan Commitment | $ 1,325,378 | $ 1,247,860 |
Unfunded Commitment | $ 104,905 | $ 131,177 |
% of Loan Commitment | 24.00% | 25.20% |
Loan UPB | $ 1,220,473 | $ 1,116,683 |
% of Loan UPB | 25.20% | 25.90% |
Mixed Use | ||
Loans And Leases Receivable Disclosure [Line Items] | ||
Loan Commitment | $ 1,003,725 | $ 838,200 |
Unfunded Commitment | $ 142,017 | $ 114,748 |
% of Loan Commitment | 18.20% | 16.90% |
Loan UPB | $ 861,708 | $ 723,452 |
% of Loan UPB | 17.80% | 16.80% |
Hotel | ||
Loans And Leases Receivable Disclosure [Line Items] | ||
Loan Commitment | $ 716,293 | $ 508,450 |
Unfunded Commitment | $ 74,685 | $ 10,896 |
% of Loan Commitment | 13.00% | 10.30% |
Loan UPB | $ 641,608 | $ 497,554 |
% of Loan UPB | 13.20% | 11.50% |
Retail | ||
Loans And Leases Receivable Disclosure [Line Items] | ||
Loan Commitment | $ 233,554 | $ 233,555 |
Unfunded Commitment | $ 47,016 | $ 50,247 |
% of Loan Commitment | 4.20% | 4.70% |
Loan UPB | $ 186,538 | $ 183,308 |
% of Loan UPB | 3.80% | 4.20% |
Condominium | ||
Loans And Leases Receivable Disclosure [Line Items] | ||
Loan Commitment | $ 109,783 | $ 154,673 |
Unfunded Commitment | $ 3,569 | $ 10,580 |
% of Loan Commitment | 2.00% | 3.10% |
Loan UPB | $ 106,214 | $ 144,093 |
% of Loan UPB | 2.20% | 3.30% |
Industrial Property | ||
Loans And Leases Receivable Disclosure [Line Items] | ||
Loan Commitment | $ 66,500 | |
% of Loan Commitment | 1.30% | |
Loan UPB | $ 66,500 | |
% of Loan UPB | 1.50% | |
Other | ||
Loans And Leases Receivable Disclosure [Line Items] | ||
Loan Commitment | $ 112,000 | |
% of Loan Commitment | 2.00% | |
Loan UPB | $ 112,000 | |
% of Loan UPB | 2.30% |
Concentration of Credit Risk _2
Concentration of Credit Risk - Summary of Geographic Composition of Loans Held for Investment Based on Current UPB and Loan Commitment (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Loans And Leases Receivable Disclosure [Line Items] | ||
Loan Commitment | $ 5,513,637 | $ 4,947,749 |
Unfunded Commitment | $ 664,409 | $ 634,158 |
% Loan Commitment | 100.00% | 100.00% |
Loan UPB | $ 4,849,228 | $ 4,313,591 |
% Loan UPB | 100.00% | 100.00% |
East | ||
Loans And Leases Receivable Disclosure [Line Items] | ||
Loan Commitment | $ 1,970,524 | $ 2,084,807 |
Unfunded Commitment | $ 152,536 | $ 170,131 |
% Loan Commitment | 35.90% | 42.10% |
Loan UPB | $ 1,817,988 | $ 1,914,676 |
% Loan UPB | 37.60% | 44.40% |
South | ||
Loans And Leases Receivable Disclosure [Line Items] | ||
Loan Commitment | $ 1,568,407 | $ 1,525,173 |
Unfunded Commitment | $ 242,862 | $ 270,933 |
% Loan Commitment | 28.40% | 30.80% |
Loan UPB | $ 1,325,545 | $ 1,254,240 |
% Loan UPB | 27.30% | 29.10% |
West | ||
Loans And Leases Receivable Disclosure [Line Items] | ||
Loan Commitment | $ 955,925 | $ 760,416 |
Unfunded Commitment | $ 121,112 | $ 100,422 |
% Loan Commitment | 17.30% | 15.40% |
Loan UPB | $ 834,813 | $ 659,994 |
% Loan UPB | 17.20% | 15.30% |
Midwest | ||
Loans And Leases Receivable Disclosure [Line Items] | ||
Loan Commitment | $ 795,704 | $ 577,353 |
Unfunded Commitment | $ 120,674 | $ 92,672 |
% Loan Commitment | 14.40% | 11.70% |
Loan UPB | $ 675,030 | $ 484,681 |
% Loan UPB | 13.90% | 11.20% |
Various | ||
Loans And Leases Receivable Disclosure [Line Items] | ||
Loan Commitment | $ 223,077 | |
Unfunded Commitment | $ 27,225 | |
% Loan Commitment | 4.00% | |
Loan UPB | $ 195,852 | |
% Loan UPB | 4.00% |
Concentration of Credit Risk _3
Concentration of Credit Risk - Summary of Loan Portfolio by Loan Category Type (Details) - USD ($) $ in Thousands | Jun. 30, 2019 | Dec. 31, 2018 |
Loans And Leases Receivable Disclosure [Line Items] | ||
Loan Commitment | $ 5,513,637 | $ 4,947,749 |
Unfunded Commitment | $ 664,409 | $ 634,158 |
% Loan Commitment | 100.00% | 100.00% |
Loan UPB | $ 4,849,228 | $ 4,313,591 |
% Loan UPB | 100.00% | 100.00% |
Bridge | ||
Loans And Leases Receivable Disclosure [Line Items] | ||
Loan Commitment | $ 2,712,650 | $ 2,414,456 |
Unfunded Commitment | $ 188,200 | $ 199,397 |
% Loan Commitment | 49.20% | 48.80% |
Loan UPB | $ 2,524,450 | $ 2,215,059 |
% Loan UPB | 52.00% | 51.30% |
Light Transitional | ||
Loans And Leases Receivable Disclosure [Line Items] | ||
Loan Commitment | $ 1,505,874 | $ 1,513,227 |
Unfunded Commitment | $ 158,557 | $ 212,290 |
% Loan Commitment | 27.30% | 30.60% |
Loan UPB | $ 1,347,317 | $ 1,300,937 |
% Loan UPB | 27.80% | 30.20% |
Moderate Transitional | ||
Loans And Leases Receivable Disclosure [Line Items] | ||
Loan Commitment | $ 1,260,113 | $ 1,020,066 |
Unfunded Commitment | $ 287,652 | $ 222,471 |
% Loan Commitment | 22.90% | 20.60% |
Loan UPB | $ 972,461 | $ 797,595 |
% Loan UPB | 20.10% | 18.50% |
Construction | ||
Loans And Leases Receivable Disclosure [Line Items] | ||
Loan Commitment | $ 35,000 | |
Unfunded Commitment | $ 30,000 | |
% Loan Commitment | 0.60% | |
Loan UPB | $ 5,000 | |
% Loan UPB | 0.10% |
Subsequent Events - Additional
Subsequent Events - Additional Information (Details) $ / shares in Units, $ in Thousands | Jul. 25, 2019USD ($)$ / shares | Jul. 29, 2019USD ($)Loan | Jun. 30, 2019USD ($) | Jun. 18, 2019USD ($)$ / shares | Dec. 31, 2018USD ($) | Jun. 30, 2018USD ($) | Jun. 15, 2018$ / shares | ||
Subsequent Event [Line Items] | |||||||||
Loan commitment amount | $ 5,513,637 | $ 4,947,749 | |||||||
Dividends Payable | $ 31,985 | [1] | $ 32,000 | $ 28,981 | [1] | $ 25,911 | |||
Common Stock | |||||||||
Subsequent Event [Line Items] | |||||||||
Dividend amount per share | $ / shares | $ 0.43 | $ 0.43 | |||||||
Subsequent Events | Common Stock | |||||||||
Subsequent Event [Line Items] | |||||||||
Dividend payable date | Jul. 25, 2019 | ||||||||
Dividend record date | Jun. 28, 2019 | ||||||||
Dividend amount per share | $ / shares | $ 0.43 | ||||||||
Dividends Payable | $ 32,000 | ||||||||
Senior Mortgage Loan | Subsequent Events | |||||||||
Subsequent Event [Line Items] | |||||||||
Number of first mortgage loans closed | Loan | 3 | ||||||||
Loan commitment amount | $ 454,300 | ||||||||
Number of first mortgage loans repayments | Loan | 2 | ||||||||
Loan repayments related to mortgage loans, loan commitment | $ 290,600 | ||||||||
Loan repayments related to mortgage loans, unpaid principal | 249,100 | ||||||||
Senior Mortgage Loan | Subsequent Events | Category 4 Risk Rated Loan | |||||||||
Subsequent Event [Line Items] | |||||||||
Loan repayments related to mortgage loans, loan commitment | 141,600 | ||||||||
Loan repayments related to mortgage loans, unpaid principal | 100,100 | ||||||||
Senior Mortgage Loan | Subsequent Events | Category 2 Risk Rated Loan | |||||||||
Subsequent Event [Line Items] | |||||||||
Loan repayments related to mortgage loans, loan commitment | 149,000 | ||||||||
Loan repayments related to mortgage loans, unpaid principal | $ 149,000 | ||||||||
[1] | The Company’s consolidated Total Assets and Total Liabilities at June 30, 2019 include assets and liabilities of variable interest entities (“VIEs”) of $1.6 billion and $1.2 billion, respectively. The Company’s consolidated Total Assets and Total Liabilities at December 31, 2018 include assets and liabilities of VIEs of $1.9 billion and $1.5 billion, respectively. These assets can be used only to satisfy obligations of the VIEs, and creditors of the VIEs have recourse only to these assets, and not to TPG RE Finance Trust, Inc. See Note 5 to the Consolidated Financial Statements for details |