- Earnings call transcript Q3 2022

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Operator

I’d like to remind everyone that today’s call and webcast are being recorded. Please note that they are the property of Apollo Commercial Real Estate Finance, Inc. and that they – any unauthorized broadcast in any form is strictly prohibited. Information about the audio replay of this call is available in our earnings press release. I’d also like to call your attention to the customary Safe Harbor disclosure in our press release regarding forward-looking statements. important webcast that forward-looking most materially you with SEC and and and recent from call cause the ask could projections. we refer for these conference statements may to statements include projections, filings actual and Today’s results that differ factors to our

obligation presentation, certain in will are not at copies is projections, Executive Company’s of this or At financial like I’d XXX-XXX-XXXX. website. to which These measures www.apollocref.com the visit unless obtain measures SEC latest call, our to which law. at stockholders In filings, this addition, our non-GAAP relevant the please over Chief we time, To forward-looking Company’s update turn management to undertake to assessing figures our the GAAP our to Officer, reconciled our earnings be discussing the us of required call in on believes are Rothstein. call available statements any performance. Stuart section do website by We or

Stuart Rothstein

themes which XX% with all in several persistent Despite quarter, market. volatility dominant and dividend activity, of overall positive common the central run inflation, the while an this rate initiatives. loans. operator move transaction the a management third by balance Financial by key book remain portfolio continued stockholders and is of permeating you, our macro call. sheet rate us thank share, that Commercial for comfortably approximately you $X.XX Apollo the fight supported in the earnings annualized Inc.’s trading morning, significant and of our markets capital XX-plus is yield same, in Mironova, percent this backdrop, challenging Estate real ARI and quarterly the resulting a to of Finance, reported with on us even joined on noting the morning am ARI's interest current banks efforts continued quarter Real XXXX per of increases, joining in by stock the I third Officer. additional stock to worth earnings are From Anastasia paying Chief distributable those good slowdown at perspective, It estate Thank morning, and consisting rate a optimization floating dividend asset ARI common progress of somewhat excess XX% value capital earnings

maintaining earnings capital ARI's ARI's debt pace Apollo past originating per a robust estate which and expect while to enables and stock XX remains loan data company year. $XX balance originations closing other capital. the is incremental on originates balance to of information we on management. milestones of to dividend behalf transactions deployment broader and Apollo's ARI in In common this the assess access sheet. which company's selective we the market taking the of marketplace, the a enable maintaining platform, like over capital transactions of billion few Importantly, distributable months sheet with approach benefit over that of consistent to liquidity focus continue fortunate will support real generating flexibility. to commercial ARI any to from I approach, active managed would with the the right capital, real-time respect key Shifting investable highlight as to a use more side

capital past expanding MUFG, roster the Banco the in the million respectively, with choppy August markets. During matured during Also year, need the ARI entered has and asset-specific lending convertible that access $XXX liquidity scalable Santander quarter, capital relationships. ARI's ARI of to repaid notes facilities without existing new of with and

billion ended obligation is a the Central one largest property times. location. for $X.X construction addition, UK assets London in a X.X of In and down prime of million $XXX which ARI's the a loans, over debt-to-equity mixed-use of unencumbered ratio approximately of company the ARI funding financing sold a quarter of with future

executed There respect transaction the group to portfolio. important the We ARI's has and focused expect loans. substantial to with are close The District to deposit, we posted year-end. sell updates contract Miami a to prior the the a purchasing Design to Turning loan. several properties underlying

As enabling redeploy retain such, remaining of with ARI additional of reversed in impairment of return previously with financing provide economics market performance-based $XX this recorded consistent the In new $XX seller loan capital that a will into additional million million portion connection ARI ARI recapture and result to the current transaction, loan. we'll terms the performing some may a impairment.

estate financing Brooklyn, by known with closing M&T multi-family the Brook. transferred as to and as and to difference development. America Bank owned, the of and million of recognized the which for value, prior balance was provided sheet loan fair ARI's The book the ARI gain the balance In current between $XX a real ARI's value connection Bank the addition, in the of construction in development investment reflects

progress capital. strength with pleased focused the to capabilities the the loans, commitment of our management extremely ongoing highlights which of our asset addition focus on to preservation in on these are made and We

units units to the loan recapitalization, portion LTV the global portion West to loan for quarter The The recapitalized existing senior expected In the recently the as closed be by this reduced a positions. senior Street with Turning end senior ARI's funded of ARI junior to XX% a and the financing no XX% change its both loan year-end, will the end of portion contract were by approximately senior bank. is subsequent mortgage by upon XXX known loan exposure of was loan year. ARI's with provided on XXth commonly under by with property of providing approximately loan we the to close a center loan. mezzanine senior anticipate and ARI well mezzanine million $XXX bank a that are refinanced existing at money Building. connection the a as also ARI to new and Based as Steinway the

to page Europe of supplemental call ARI's additional secured an properties our We wanted to to more by provide represent package few European portfolio. than of quarter slightly on the now this over loans exposure disclosure the color turning a as in portfolio. Anastasia, on information spend XX% added to incremental ARI's I Before minutes

a members active the lending to Europe. in as the commercial sector estate market Apollo lenders Commercial of XX commercial of in Apollo's Estate As comprised Europe an to platform. one have leading the whom capturing our all of Apollo to contributing we is when share non-bank success team and job outstanding debt of senior the real reputation estate in developing done moved expansion real the since our of one throughout European market team of reminder, has been the Western people XXXX to oversee London Real Today,

date and performance the Europe risk of sponsorship have on XX%. the payments. lending ARI with expected and by which and effectiveness local financing structures deal The portfolio and work as which had some with there, be XX% secured effective. a property-specific, provide approximately Kingdom. external the we with post-pandemic economic activity with we United to necessary used, loans sophisticated quarter portfolio, in our consistently structures our properties in At by of systems operating and the borrower and hedging asset US end, ARI quality with ARI estate take proven principal that two-third lender consists Europe. Importantly, positions currency transacted of advisers expanded and respect market ARI's the the does legal been With loan is to types, private been very consistent Europe. sponsors the countries world, equity ARI's asset-specific ARI XX protections. not equity $X.X internal owners are at interest largest used and being billion, have and level positive is has generally transaction review are in currency, has portfolio the in LTV of the the to to-date the consistent recovery. strategies Blackstone European We average Further, Any totaling highly of origination in originations. of only in of most in the have transact equity senior operators appropriately hedge real weighted to

In rated have and are to At no totaling senior position. European entire reserves. portfolio asset-specific $XXX ARI's – debt million three, addition, present, ARI's there European risk is five loans subordinated mortgage portfolio

property-type the XX% portion comprised non-UK industrial the of is hotel exposures, over and portfolio terms assets. of of In

well, strength the present, recognize ongoing to dollar, the positive recessionary we report of rates comfortable lower Approximately, warehouse of assets very property heightened Given to typically of we rising outperformed that portfolio, reliance from one-third properties, focus the a these and continue the traditional both assets, UK and split to and including market and around At have outlet underlying on exposure US given retail the is which supply loans With perform cities. the increased uncertainty on ARI's risks assets, which cost broadly but ARI's the with discounted energy occupancy diversified continue and retail portfolio respect goods. other due persistent assets include of European metrics. to across has hospitality UK in is inflation, major are London Russia. retail between the centers multiple burden challenges, added RevPAR types interest European

continue Europe, impact value hedging of relative and any economic risen to limiting respect given the will to currency coupled in the exposures. portfolio rates the over the a for US, as to Anastasia be to asset-specific capital has With the with rising ARI's decline call deployment and its I where As due proactive monitor bar closely ARI's quarter. financial European results costs. the in and we in new on to primarily to that, managing result, the will With significantly, possible, turn impact uncertainty, compared review

Anastasia Mironova

general our another on and title to Stuart, $XX financial allowance, ARI QX, at and stockholders The compared gain quarter. share. our $X.XX in with be in the net value of prior reported of $X.XX with from share the continue This $X.XX the reversals the of this $XX.XX or in diluted volatile $X.XX was of which and and gain in positively this to million Brook, per morning per on per acquisition realized or income and hedges, climate. beneficial specific income earnings focused loans in X% second interest share. realized to $X.XX GAAP to per net as good ForEx includes our the of available common net currency distributable you, share end unrealized book gain quarter of everyone. CECL Thank and $XX.XX depreciation allowance million increased CECL results net the impacted to prior investments which quarter, stable $X.XX $XXX progress to

closing. Europe. given As net all our entering by Stuart steps properties our contracts basis foreign secured portfolio XX% by risk, the that a are hedge for several our mitigate into in equity of mentioned, currency transactions currency currency foreign exposure at to we forward We loans take in on nominated

resulted contracts impacts realized gains currency foreign which our earnings. quarter, on distributable the in $X.X also impact positively million point Forward of during

Our and a with rising $X.XX compliance on in $X.X respect and combination of interest portfolio US facilities remains respective in of rate And assets. liquidity, floating undrawn With existing our maintain cash of well-positioned increase total Europe are our to quarter floating basis floors. our capacity and $X.XX of respectively, US income. all credit of net for the and of as the $XXX billion XX unencumbered and our XX% which lead end, share, to as the to million loans UK liquidity. loan was quarter interest and continue their all We would per of additional were with ended covenants of of strong UK an borrowings, excess in points and An loans rate. are rates incremental we

Our to decreased end X.X debt-to-equity at ratio quarter times.

focus several developments to had we quarter, for loans. CECL connection Stuart the as our Turning in with positive mentioned, allowance our

CECL XX District to higher than our the was specific contract be a carrying of quarter, in which near-term loan pre-reversal. loan the Design secures the under allowance as reversed the the loan During the million value Miami is sold at collateral value on

seasoning loan mixed-use outlook. In to general million, CECL and and a ARI's land. the our secured asset unfunded mentioned due macroeconomic in addition, Operator, partially please offset originations Question-and-Answer loan decreased like for adverse questions. by Session a of previously was go one primarily we'd $X.X This with with allowance line and commitments portfolio sale to that, And ahead. open the new by more

Operator

first Our Harter Doug Instructions] Suisse. Credit [Operator from you. with comes Thank question

You may proceed.

Doug Harter

guess, out various could quarters liquidity consider loans? call? -- you expect coming you the that, playing the Hoping I would parts deployment the of also of envisioning about and capital into the terms hold mentioned of Thanks. months, to talk how you capital you're beginning at level along new And the given structure in the of valuation your you

Stuart Rothstein

from think comfortably think my remarks, I indicated Look, generate the Doug. as dividend. Thanks, in that lens of the earnings I to Yeah. I continuing support

we vis-à-vis level at certainly transactions, know future looking portfolio given market a requirements, on in at I well as the but still side more look any and what dry some point one need at think high towards at funding right expected We're be as our is time. the fully say repayments. keeping now, would we to the liquidity I powder in things. things, biased versus still level, underwrite still We at invested feeling that

repurchase now still all external with your capital uncertainty We be look But a perspective, again, plenty but part share across question, deal flow be that lack capital from the excess advisers end biased opportunities of the the dialogue, pretty things in we come fit daily parts do and To place of towards structure. capacity. on dry internally in a portfolio We've the I muted in the and about I to keeping of will and a between would frequent to -- year. of phrase. at a powder the latter of a structure better plan think period with got of something basis, for both certainly

point at they're given where get keeping deploying the marshaling and too just compelling a this dry I not to less capital. capital, towards level anything from think things powder do to ROE potential biased

Doug Harter

have today? then refinancing, year final in you or a impact would much how be deck of -- to just showed given don't that the you the your talk you the borrowers But of able about can facing higher they Thanks. -- page maturities And your maturities to two. be rates that expect slide in next lot

Stuart Rothstein

to people certainly business getting Yeah. think, on obviously, to still things exchange or by market, off. a achieved willing our those us plan be due situations to existed choppy either coming deal, transaction. to willing are conversely, get to other certainly off. where Look, pay situations extent have the more extended either capital into made But for entire our plan. which where a had paid way, extending people where in business XX-year costs financing a form higher I make we've various people dependent more for has to where people in available date There's progress despite We're wanting or situations, history or there pref feel continue situations to those mezz well to to We're and the of situations in equity capital, common in protected. we loan to add the economic support we consider like the be might additional equity subordinate in progress

will of latter wrong lot out a what on ultimately, a forecast or assume think down – are. I next lot many fairly of year. in now part coming by forecasts rates right plays the significantly the right the how depend Obviously, of

to be remains to it think or seen that not. whether I comes fruition

Doug Harter

you. Thank

Stuart Rothstein

Sure.

Operator

for moment One you. Thank questions.

Laws with next Our Stephen from comes Raymond question James.

You may proceed.

Stephen Laws

morning. good Hi,

Stuart Rothstein

Good Steve. morning,

Stephen Laws

Hi, Stuart.

with capital. you I First, as hurdle it think, mentioned I clear, you start want to deploying of phrased far as kind a to how higher

even needs kind be you guessing lies with cycles about how comments, the in the you And your Europe market I think where far around investments attractiveness comments versus each do to do they or across are new think even further US as respective of think Continental now? to versus maybe right about I'm maybe of relative Europe? the UK – bifurcated liquidity. the the as the But was how in given that Europe board, just

Stuart Rothstein

a the as an Europe great as underwriting well applies of a right, the think deals you as coming on confidence time being as we given strength the of economic pickup about where interest just estate of of to assume obviously post-financing, sort think as the back Europe, dollar. return a It's – pickup could making has world, comment Yes. in at out hedging return of was US rate I you rate reaffirmed. through plan, disappeared a differentials, question. was to when that Look, XXXX, of interest for well Doug or risk, et and my moves were my the And the we pandemic I things achievable it, and bar to business as certainly response high-level doing loans call US, sponsorship, it, in call real -- positive yes, my around in much lending like-for-like pickup to there think look given cetera. early the There both period terms higher

As about perspective. we we think and Europe from the talking obviously, time versus of about lot US, it spent macro a a

the inflation well. and food. you if of inflation, I Europe look components as think that at is underlying Europe high high from inflation most what's is enough, level, of energy suffering driving while in Interestingly

of which are the US, in are are that specific. in to generated, argue it's by sources more the as and in there a as doing supplies being the result, to little things the are inflation That get targeted, and the I say, quickly could the Europe. towards service bring down chance are over driven European economies. US So on. think fairly said, the being where more new things in that perhaps sectors concern as quarters, things would more one fairly in looking our inflation equal, next there's all respects, bit than over of are in And created, handle little economies diversified And US a than many more areas sectors, a good in harder alternative there's US say, the I'd mind, versus I the couple a bias doing bit a

parts UK get of I the the other over in interesting more say the to somewhat while the granular UK the have certainly been least. last Western think months want to three Europe, if vis-à-vis and machinations you political

addressing a transparent as to one over last what in system I There the get finish to weeks. six been address, lot the is think when need twice respects powder Europe who's attracted that looking unclear the it There's dry they But in Europe. of they very has speak a more to strength of line. is does the lot a in of dollar still of other at look those at dry still parts many at UK. markets. to looking powder The capital

little And So our We're a of the that more XX% sort be things versus all right to to the a at functioning. way But just given a Europe where fact now. bar we're towards now, saying bit markets the that in portfolio. seem there's US long-winded are of right look biased represents find the for we high cautious on par, economies of more that's given deals Europe. trying

Stephen Laws

I Stuart, additional appreciate the have the Miami on one that, color Anastasia, I asset. in the the and is follow-up deck. on

I contract situation? think under see commented the soon. see was just So million that we specific as specific the of $XX and you given maybe and close is be maybe that, But reserve to that I expected the earnings do to remaining, or run going or is a remaining different XQ asset it when through loss, the distributable realized close, accounting is reserve think we

Anastasia Mironova

you. the indication books to asset sale probably Yes, think realize I closes. is expect in that Thank the you good realized the a for once the currently we that loss reserve of the remainder see

Stuart Rothstein

But I an just that that's economics the technical loss. deal Stephen, in may to time. be those potentially we some would comments, we realizing that say answer, but view of there's the additional claw just while to back over more we'll be maintain optimistic economics my back will the

Stephen Laws

Great.

Take the I care. comments this morning. Okay. appreciate

Stuart Rothstein

you. Thank

Operator

you. Thank questions. for moment One

Rahmani with KBW. comes question Jade from next Our

You may proceed.

Stuart Rothstein

Jade. Hey,

Jade Rahmani

going? is it Hey. How

Stuart Rothstein

Good.

Jade Rahmani

for the Thanks questions. taking

the the loan, loan? new what's Miami size of On the Design District

Stuart Rothstein

when a rough the million $XXX million will it is price. on announce done. plus But you $XXX and loan to or be if minus value, we'll based will be conservative about deal LTV purchase – the think fairly not We're

Jade Rahmani

maturity around what West number XXth the there's and Okay. some six revised XXX if unsold Thanks last, over been contracts is Street, much. give date you On months? the can recent of any units, say, details very

Stuart Rothstein

more High XX% the level, to a It's Sure. than building XX-unit sold. be still has building.

think, been under date of last head, There you of is or off if units months, but the you the XXXX, a foot maturity I overall minus late handful the high say, Those I'll the have top remains look a at volatility level of close, So thing. math. asset. before call -- contract. healthy, plus is over. loan more there's could do I is been my it the six put The under new continuing create get the for think positive And I to positive are the units you would traffic life as contract not capital markets around they in a

September And So to of it. we're new of is continuing so maturity the through date loan grind the September on next XXXX. year,

Jade Rahmani

maturity the there's initial options. and That's extension

Stuart Rothstein

Yes.

Jade Rahmani

seems September maybe unlikely units be unsold that sold year? be Because than of or units next there'll to Okay. there's it that by XX more

Stuart Rothstein

the I Actually, result. have date is what X/XXXX maturity actual thought. might just I misspoke that's It's

Jade Rahmani

XXXX. September

great. Okay,

Stuart Rothstein

Yes.

Jade Rahmani

the also moves first banks, now financing two that and received believe, investment center of do a derisking sort position the XX% of made were you the you're thereby I case? as money the view because validating from you the in mortgage

Stuart Rothstein

think A derisking couple I a -- I think of things, partial derisking. partial -- more us it puts

back I think think flow paid the the over what way about the position, senior sort allow really, off bottom will Obviously, to some start being as still the hopefully us sold the is gets and you time. on an rights. worked senior of dollars in a We priority exit it the paying of basis. but position were craft is structure something parts little XX% you was units go-forward certain of LTV better and for the original at senior on And bit project that a looking that the able level had sooner. at for lender a given derisking the little to

Jade Rahmani

there what's loan, maturity office it missed London The in the update since October?

Stuart Rothstein

come force we a expectation sale. And we -- up bit this But the path subordinate point, are subordinate in our that sale intentional an Yes. was will well asset getting providing there refinanced a end a that loan sold asset. out. refinanced mezzanine the then towards mezzanine to level, believe the more is didn't fruition, the out. and whatever that time for little if the And lender. we to reason is to whole There at High we the a getting is protected us created we originally with given position of lender believe which position,

Jade Rahmani

in out. near-term about loan a few there's Just that thinking maturities XXXX, jump

some One office side. of on the risk peers downgrades rating your had

are So, loan January for XXXX? in you example, loans for up coming thinking the how with about generally there's a that maturity, are Chicago office maturity

Stuart Rothstein

our business clear In dialogue path time borrowers I In repayment. some in But Yes, that repaid or situations, think, you get accounting subordinate perspective, dialogue additional been the and leverage plan Harter, us. to with reserves to comfortable been should with additional around maturity obviously, other everything to has already. there's reserves a path capital achieved, were alluded, in for as near-term a assume through as an decreased to additional there's Doug either that active presents or from asset-specific to trading situations, get our such no coming capital I taking.

Jade Rahmani

lastly, dividend with rate the current commentary in the asset the the that that maintenance moves around policy current would signal management liquidity, the that was exceed dividend, to rising positive dividend? And the of environment, earnings

Stuart Rothstein

dividend going to covering the was comfortably path see that It forward. a indicate towards we meant

Jade Rahmani

Thank you.

Stuart Rothstein

Jade. Thanks

Operator

One questions. moment you. for Thank

Steve from Securities. with comes JMP question next Our DeLaney

You may proceed.

Steve DeLaney

Thanks. Good everyone. morning

fantastic out report how night here. of a your So, while one and you would been a Miami, but I you on Brooklyn that off Stuart, seen don't if ought a lottery to I quarter, two had have one come pulled resolved know you ticket or buy -- in you're last had roll

So, congratulations.

Okay.

be an -- provide you will third-party, it so be you equity now On well? the financing property in mean, position, financing all on need going some now, the And I to or as to right? are Brooklyn are

Stuart Rothstein

will third-party. financing All the be

with bank but an us into vehicle per in equity there's we to is like project, -- side. are bringing balance the on between partner risk on all put equity we investment, financing, very the We a recognize around of said, put end in early very, additional ARI don't to equity. the while like think long. will someone discussions at of multifamily you where equity works the some stage that we yet, being day. and the the not potentially that want I on Brooklyn day there financing the That will We in

with right the through of think structured point, pretty So, But mix we're Brooklyn. and just deal the as exposure trying in we're what equity way is we comfortable of upside. to and creating feel investment this the

Steve DeLaney

lending you're Miami, have as And Great. future transaction. part in a not do obligation not of you that --

Stuart Rothstein

us, it, shake buying it financing, on to out. $XXX that, providing, Jade We're someone's providing financing. And would deal then be to things call market-based the seller we will financing, $XXX seller from beyond million be based a I are right? So, indicated structured where market which million

anything like million envelope where assets, and then $XXX be $XXX new an be within million to upfront buying we'll total. funding but in So be someone we do, create all is fundings, there'll future something that to there'll in

Steve DeLaney

obviously, Great. way position. on property. first you a or messed it And situation that? was a position, project you that where more to a that's first put you senior a lien, -- structurally dollars typical on the that West Is XXth, the sounds table, And view to the like up. from simply lien but position went mezz

Stuart Rothstein

we to the of we've continue worked changed. structure dollar about was we best bank that are the not be the take last at top with us for our got money we the we've the but very the obviously, But in top you And, and the bottom, Look, has with the to money comfortable to the Yeah. risk way with dollar nothing at comfortable as top. last in think of put risk. changed to

Steve DeLaney

Got it.

the cost. for Thanks Okay.

Stuart Rothstein

Sure.

Operator

questions. you. moment Thank One for

with comes Our JPMorgan. next from Shane Rick question

proceed. may You

Rick Shane

to really thanks appreciate Stuart, should a guys, am due been to I more about liquidity. outlook? couple the of in It's successful reserve allowance your want Obviously, hedging. And have did of of curious I Europe, cautious reductions one and loans. of the there But for context general of terms both resolution about conservative disclosure have the terms the thinking the on indicated capital, taking question. be my or taking in thing. deploying you Hey more maintaining how the a assets in of terms talk helpful. we conservative in really approach we

Stuart Rothstein

that would perspective, a I we force CECL been Look, CECL say from pessimistic a the whereas, perspective, inputs say, into to as of I our the from perspective reserve. would influence put the on seasoning macroeconomic we've a from portfolio is CECL macroeconomic reserve, the countervailing

directions, your question, going all to bit factors making in both reserve from I'm I got collectively, going you've to a headed. it a little know, will editorial CECL comments a uncertain that period and I seems So refrain odd general. on where is But in about more broader assume in seeing any we're on down going CECL where the general economy see based

agree seasoning in the more there don't wave uncertain that allow that. factors but Anastasia with less know over. where that the about headed, assumptions is anything to CECL also Our there's you if CECL to are add you'd portfolio related we're economy I analysis

Anastasia Mironova

mentioned, And Stuart correct. and also and we reversal, sentiment property impact sorry. the include commitment on unfunded of of by outlook a and ahead, loan the London. that's did seasoning yes, portfolio piece by the was a generally, in Yeah, But a is our our secured primarily the macroeconomic -- that go sale mixed-use the unfunded as impacted recessionary

Rick Shane

ahead, I didn't Please go sorry, Go mean interrupt. to ahead.

Anastasia Mironova

the So market. that was macroeconomic echoing the projections included our in sentiment ultimately, Stu's I just comments recessionary

Rick Shane

it. Got

cognitive little terms as bit terms I well, of Stuart, yes, a the helpful. between reading thinking frustration, dissidence it you're thinking in interesting of good lines of about how how and you're and also. That's Okay. not And response can it maybe but sense in about

Stuart Rothstein

enough. Fair Yes.

right. you're I think

I to it's portfolio. asset-specific make around of think asset-specific assets, sure perspective, vis-à-vis with set and disclosure each think being to we But most on I mechanical willing that efforts it somewhat front a with the - reserves and I be questions our is. our evidenced to to the always meaningful CECL what specific specific I are reserves, respect our quarter our is think foot -- are respect is we've on Most from is exercise. it's necessary because trying it of front look, think,

Rick Shane

agree. record And I No, track particularly we've well. last validates again, the what that seen the and in really as quarter

Stuart Rothstein

Great. Thank you.

Operator

[Operator Instructions] next BTIG. Our Eric Hagen comes with question from

You may proceed.

Eric Hagen

Hey, thanks. Good morning.

the York the what that [ph] York fundamentally, the Like the you can the say structure there of for around catalysts of the was would City? really more question around think assets disclosure maybe Some specific staying helpful, New funding. broadly away investors second secured New about? And to is then are upside but is in

the terms middle Just change tightening the a the loan could seen just conditions the how terms to think term you. Thank general haircut point? of drive you've ability lenders kind about of from of or in that to the tighten terms financing and you the lender maybe this question. of have that much the Does

Stuart Rothstein

Eric. Yes, repurchase banks facility, Working Yes. way cetera. backwards, there's on and of any the to between dialogue with spreads, et specific us haircuts, respect a sort regular

of the play think best the the how I pandemic obviously, those during is out. indication experience things

think those pretty managed have we always I comfortably. relationships

specific experience of relationships, which by types also assets we've as be think maintained say I more to given assets, for us their of allows be. I around to any roster what banks opposed specific has a may move would overall need asset. particular as our appetite always been a portfolio driven

lot So to date, a taking not place.

in financing respect guess I to any think through less views more banks new on conservative nature terms or Was a going on terms are broadly. assets. indicative I But deals. the certain nothing help broadly York? change just I'm types just question being with conservative assets? expressed on your clarify to material on question of specific being curious, I it New Was New the on York on of that clarify

Eric Hagen

really Sure. broad. more was It

for that about the New to that about any specifically. Thanks. might Just there's investors to other that can catalyst catalysts specific if portfolio? And for drive the catalysts York relative portfolio think think the

Stuart Rothstein

from work York. in York. would we're for many ARI York Center, at ARI macro think always it attractiveness funds we we I Global perspective, – look York to been, I types. Look, estate look, looking be cuts whether away liquidity, that look, the are lot Yeah. equity the to capital real from at New have continue what think across they've of think at be look New also things property opportunity Financial And a XX-hour portfolio what I cetera, We drivers an deals for then of et what existing of New city, which seeing, New

was market of extent the I the the question. think more genesis XXth specifically Street to to West that the condo XXX

than the globally respect to think certainly trying with that net ultimately, towards is what worth we're high to I geared ultra enough an client. more asset There sell. is wealth

our out viewed think as inflation seeing. has Foot confidence pandemic and what I sense ultimately, shows well. that peaked a a in or of doesn't the lessening And uncertainty that volatility thing. capital more would I international be is is exposure more But would been has help. volatility down, heading markets the say and like a favorably. they're people More coming good good of the asset traffic thing is the a

as the of I year year, to closing this between more as XXX create favorably plus was most both point puzzle And the well life to to piece the last what momentum. displayed be it projects the will now the week of And the units in reviews. favorable completion the creates the where you amenity final viewed close think we're at of package moving property, I minus the brokers at and or continues a by towards overwhelmingly end number which condo the think was of as marketplace asset.

as perspective. a good asset from the as So isn't a been in estate it's position physical itself real

would overall think benefit I markets. in from, of volatility sales velocity at less point, the capital some

Eric Hagen

that loan helpful. in what you UK that say can Did and you that of That's about sold of the talk were? you the guys Yeah. terms a one loans, participation

Stuart Rothstein

We sold obligations. funding the future

we future position. UK we obligation. removing were effectively always a multiple or million to a also that obligation million We our the of our of sizable We take. Two-plus mixed-use funding years It piece a of financing made the project expected future. a over place sold in effectively in typical removing years. our the London. taking some on give things. us minus or a growth – liquidity project a in in sell financed Central funded our the further funding point two was loan outstanding at $XXX And we future, the construction would did ago, need existing plus and future a future then So portfolio in which $XXX into into position. for We It's

Eric Hagen

Thank you helpful. guys very That's much.

Stuart Rothstein

Sure.

Operator

now for questions back I turn I'm to Mr. over the further call And showing Rothstein of would Q&A to time. like not you. Thank at any this any further End remarks.

Stuart Rothstein

everybody. you, this Thanks, all Thank Hilary, post that And always, and participated call. myself to morning. of have are if and operator, Anastasia people thanks you the questions available as

Operator

Thank for call. concludes participating. conference you Thank This today's you.

You may now disconnect.

Apollo Commercial Real Estate Finance (ARI) 25 Oct 222022 Q3 Earnings call transcript