CLNY - Earnings call transcript Q3 2019 | DigitalBridge Group, Inc.

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Operator

Greetings, and welcome to Colony Capital, Inc.

Third Quarter 2019 Earnings Conference Call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. [Operator Instructions] Please note, this conference is being recorded.

to ADDO conference Investor like host, to now Glassen, Lasse Relations. would turn over the your I Thank you.

You may begin.

Lasse Glassen

Good morning, quarter call. third Capital, Colony everyone, and XXXX welcome earnings to Inc.’s conference

Barrack, from and session. COO The the Ganzi, company’s and company today are Mark Tangen; CFO. call Darren CEO, the CEO; and on is Speaking question-and-answer Tom future Chairman President, also and Hedstrom, for the Mark available

reports These the uncertainties presented information subject the time. that November hand duty materially I statements. does time for are intend on to company’s contains on filed discussed X, financial from Capital to not from as call information uncertainties call, undertakes certain to Potential forward-looking business company’s them, management’s and with note Before XXXX, on are results these the SEC and over of differ please All statements this call described are this forward-looking future could current circumstances. and statements based no is and cause in that Colony and risks events to today, or expectations update and assumptions. risks, periodic to the

why the and earnings GAAP measures, morning presented In represents are useful basis. financial call financial company appropriate an a investors. available on such reported the is of segmented and to believes presents release, company’s consolidated to addition, measure on website, information in The which reconciliations non-GAAP was both non-GAAP this certain financial the of this issued explanation company’s measures the and

also GAAP and certain the table company’s prepared company financial non-GAAP measures this available measure has website. the reportable appropriate the by addition, reconcile on segment a reconciliation is In to that

of call like and to Tom Capital. turn Tom? And Colony to Chairman over now, I’d the Barrack, CEO

Thomas Barrack

connectivity, best strategic you, thank the liquidity, to the of accelerating equity, occupancy, and legacy asset of our communications stakeholders, managing objectives Lasse. the logos so, we our world’s pivoting and leading mobile execute businesses of divide. solutions technology morning, credit leading and and bridge become provider the This in stewarding digital interest multitude hard to surgically quarter, doing to to infrastructure, of and successfully continue past in Good and

one, two, on build yield can into four, our profile and investment vehicles the align a businesses, These acquisitions, mismatch Capital’s strategy; with management have through simplify reduce scale. while our realign new legacy and business our field; transition our the public the the and return and valuations Colony of included: assets balance to estate with three, the assets; products assets; digital edge G&A real generate we athletes the to capital of of lastly, of platforms and and and incentives value goals total definable digital structure and company’s digital return arbitraging between balance the real business private an maximization REIT originated from current estate which sheet on away sheet real in eligible estate focus a liquidity

Colony our Capital we in infrastructure Overall, for sector have real estate, in on enable believe opportunities we and high-return strong I’m our sharpening which digital on to growth. secular a with the and objectives digital progress pleased delivering will continued focus capitalize compelling made positioned

of provide Digital some a quarter, like of with highlights from I’d the key the you Now review Bridge. to

second-half for acquisition Digital world-class CEO, effective the Bridge completed Marc brings sooner Bridge’s transaction XXXX. next we Ganzi no named quarter, the of as Capital’s During the Colony of Digital The and than will portfolio be professionals call under available today, franchise. of team Q&A on and and end the is of investment of the Colony the at us with call. assets Marc the high-performing

Colony Industrial.

our transaction for and allows industrial for achieve light liquidity, uses, generate among $X.X acquisition to The entered at our $XXX Since to transition ongoing We our agreement we the generate accelerate total of XXXX, end help definitive platform approximately will of digital investors million. of which billion. significant will compelling a profits and Cobalt other infrastructure. shareholders also Blackstone into to our into estate a Colony sell to returns real

NRE. Next

to of per for we $XX.XX access addition, NRE the share. In completed sale

transaction, our generated result inception their realized a management an from importantly, from million contract. the of gross XX% should position, NRE proceeds the of ownership of the sale the XX% And of in investment. $XXX shareholders Colony As approximate monetization IRR most and of the receive

segment, Equity completing continued monetizations monetizations amount this of the quarter’s million. accelerated this in our asset to Equity and progress and made and monetization Debt. just quarter. $XXX year-to-date monetizations, We $XXX Other Inclusive of Other OED million OED total Debt

Management. our capital total Investment million. Real Estate the of Credit We first closing commitments of $XXX with Global fifth Credit held Fund,

G&A reduction. Next

During the by early XXXX. to $XX of announced million $XX our rate savings the XX% basis quarter, are to million exceed on we on previously the a meet track target expected total and of run or achieved cost approximately

into be the into its new segment a CLNC will into core the This balance new non-strategic which night, segment Last bifurcate segment. asset core liquidity core drive legacy overall a the CLNC. from portfolio business. investments. reinvested earnings and of and simplify rotation segment a the will sale reported assets, new the earnings legacy generate and to and growth non-strategic into core out of third its announced strategic plan The will core plan CLNC significant quarter for non-strategic

for covered core planned reflection its in of non-strategic of impairments concurrently, hold meaningful the periods dividend by and did level And company’s book believe a the a quarter, on a is level we that third was in-place is GAAP NAV assets, earnings. to to As reset based undepreciated the down asset a sales. good that now the value recognize which CLNC this result reduced new strategy brings

for actions, growth CLNC’s position improved significantly with long-term better we disclosure taken believe together, Combined company the creation. assets, these shareholder and value regarding

the positioned transaction Estate we growth the for as initiated a Colony Independent and strategy Capital regarding and and Additionally, internally with REIT, profit Colony create Directors disclosed credit last a of with clearly greater has defined Real managed a Credit, to discussion preeminent night, maximization.

business Colony management for as Estate lanes representing of digital each internally credit both established involve and and real Capital’s platform another a REIT. specific Real and Credit, shareholder This definable into and Real align managed strategic simplify a estate to leading in infrastructure to transaction a potential Capital yet repositioning businesses, step Colony Colony would Capital’s mortgage market-leading Colony as Colony leading for Credit Estate transfer interest

may Colony what assurance While or potential can that with to may a no a Capital an looks be potential engaging CLNC closely be agreement on forward transaction, reached there agreement take. form of

do update transaction and became significant are you stated CEO I we the our will this We’ve executed we on with with management the months. when pleased would to internalization date. coming what of detail and We progress in proposed at on CLNC more potential we

Capital, is and looking to to $X.X Now expect ahead. net to billion year-end. roughly Sale anticipated by of close proceeds transaction this equity we generate industrial of Colony

As with be very of sale be a we what other referenced a result appropriate quantum a the equipped of at liquidity think Colony Capital time. and monetizations substantial will earlier, will

strategic are We Colony in presentation look in targeting sharing you the with posted and we we stroke then. mid-December, and plan, speaking of on September which in forward the digital details broad our to X.X’s outlined website sometime

drive value believe growth team Capital we Colony to are And to long-term all in available we summary, for right management steps and prospects stakeholders. In are compelling the the taking the us. Board confident

I’ll Hedstrom. turn our over CFO And now, and to it COO, Mark? Mark

Mark Hedstrom

everyone. morning, good and Tom, you, Thank

supplemental earnings, documents filed we reminder, Public report our third Both a to of website. and this quarter the of of available within Shareholders As in addition financial overview the a section are corporate release morning. these our

our the status quarter and the of the business the after of quarter. I cost reduction transactions, will important of during several end third provide call segment results, which On today, performance, a initiatives and review occurred

of Turning $XXX charge goodwill, per result stockholders share. this to attributable total, provisions and to certain the totaling share, million primarily loss a largely of for million, the real quarter industrial the for quarter. of financial fourth of for the charges to third sale attributable company’s portfolio. as and result $X.XX $XXX third in was was pending loan our quarter GAAP platform or million the $XXX Of results for estate the losses, net the a common reduction

portfolio of impairment which fees decrease to ongoing company’s components strategic discuss the critical related future in repositioning. portfolio resulting management goodwill of will more to the CLNC, are later, value, I from there addition, reductions in of carrying detail In its bifurcation all and was from which

performance and the per quarter, very execution strong in FFO Reflecting core share. $X.XX or was million, $XXX

primarily $X.XX FFO per $X of million, equity losses losses the in to been by million, from agreement related net other $XXX NRE, and net fee termination management Excluding or would have share. investment debt, offset received core

our of have business discussed, the we and During had progress cost initiatives, across segments, Tom well continued a operational quarter exception, six make being to just our which as strategic our as continued we against existing reduction the towards objectives. strong progress also reportable healthcare most quarter,

X% quarter Healthcare same-store Starting portfolio XXXX. segment, with NOI second the Real decreased to Estate compared

receivables quarter portfolio. operating XXXX rent a income included net in tenant Third same-store the certain write-off Hospitals one-time of

Excluding same-store only portfolio one-time operating items quarter-to-quarter have NOI, from the healthcare, decreased the comparable X%. sequential would income net same-store

the refinancing of loan million along UK estate pound pound, maturities. near-term previously This completed of rate. senior healthcare new housing transactions $XXX on a all portfolio loan front, year, On British assets, financing reduced five-year addresses refinanced substantially million a extended interest refinancing, we with loan this British $XXX with real at fully a

XXXX was notional swap the December of assumed the required $X new maturing swap XXXX healthcare The in interest connection equity company rate unwound was resulting healthcare entered and in mortgage the potential June in refinancing forward rates January a the initiative, Colony, the to NorthStar hedge for certain part merger. billion XXXX completion for increases potential As into that legacy originally against with in of XXXX. debt interest financing

healthcare the unwound the swap amount largest in $XXX company entire June of refinancing million. aggregate XXXX the to the of Subsequent the loan,

the the portfolio purposes, gains an realized swap Management losses estate core risk within real company was healthcare For because the losses debt our refinancing realized hedge in core excluded not swap, the does to against businesses. or reflect or Investment of any FFO the maturing the economic FFO verticals, has and related

slightly segment, Turning to Real still the quarter better assets to in The performed than of the XXXX. for close previously fourth substantially Estate quarter. anticipated operationally announced all of industrial planned the Industrial is which sale

for results discontinued as Industrial and the liabilities as and statement assets consolidated the Accordingly, balance on operating operations held related sale sheet and from liabilities presented, consolidated prior the all income assets for of and operations. related the periods are presented are on the segment current of presented

the included sales sale, the As income from interest contractual for the $XX million with price, a fund accrued and of of to earn expect we XX% FFO carried share. loss that management’s net based a core open-end charge result the GAAP corresponding pending on for quarter industrial

the at Additional the are transaction. expected closing of amounts

one-time a Moving Compared FF&E taxes XXXX to last Reserves, NOI year, third accrued reversal the to to X%, that property period on XXXX. to same of before the Hospitality prior were portfolio Estate segment. primarily increased quarter Real same-store due

the a will reversal, Yesterday, reinvested quarter with portfolio, plan one-time last core FF&E flat which XXXX before be assets same CLNC compared portfolio, legacy the which a proceeds a its Excluding and third strategic generally to will announced into bifurcate year. core to NOI the monetized into grow period non-strategic was portfolio. Reserves

its in anticipation of meaningfully carrying portfolio of of of the non-strategic part reduced its to CLNC better these legacy sales. value portfolio value As its represent rationalization, certain market

reflect the million, core reset third core to million, of earnings core which $XX quarter. current its core quarter immediately or in $X.XX in-place only be reported share levels, per CLNC CLNC portfolio. $XX share amended covered the prior its dividend $X.XX and definition earnings Further, can the versus of or per of by to earnings results

its CLNC base alignment with a in million the with $XX in to in agreement the in quarter. the results portfolio management of make million fourth Also newly $XX decrease which to fees amended in beginning the management CLNC’s reduced effective the the company fourth the rationalization, base annual quarter connection value, fee book with from

billion Management OED plan $X.X time. alongside is we grow our OED carrying into economics separated portfolio third-party strategic value equity over which capital, Debt, OED our and we Equity non-strategic or includes earned and Other Next and Strategic segment, Investment investments to OED. where a

the the by the XX%, first carrying During the quarter, NRE Credit due undepreciated warehouse which for and company’s strategic closing capital company previously to the decreased completion by primarily returned Fund, investments of to of the the in of the fifth sale Global fund. advanced value OED third

business. We not Management which OED, also non-strategic to legacy current managing core and investments, Investment includes are liquidating which the are actively

$XXX During million. value carrying in million, by non-strategic to or declined OED the third quarter, equity X% undepreciated $XX

the Our Investment XXXX NRE during Digital quarter. the the Management due during business the only segment partially grew certain which quarter of Bridge, July acquisition and offset assets significantly was sale to other by of

billion, compared $XX.X quarter. up third-party ended last Colony compared quarter AUM under XX% management $X.XX, third to to fee-earning billion, last increased up to $XX with billion and $XX.X the quarter, billion of $XX.X equity

on restructuring the fourth and Next, an the XXXX. during announced provide quarter update reorganization I’ll corporate plan of

approximately since the reduction year, cost rate the of through basis the the million company plan, savings the During run XX% including the the XX% $XX at $XX initiation million time company’s various was on of than announced. the to has of expected in restructuring achieved existing more of the workforce same-store initiatives,

or target over original to or expect next savings We meet exceed the quarters. cost one two the

will financial together of in-process the with increasingly statements in see reductions sales the the savings transactions. impact You cost these GAAP G&A impact and FFO, of completion core following our of

July in to principally sale significant However, of comparisons the the NRE due are difficult period-to-period of costs transition employee Bridge related and addition to XXXX. Digital one-time

$XX to of was grossed while million representing paid third of in example, $XX or amount, up that totaling in million by were reimbursed an income As NRE relating compensation included costs costs, employee sale separation NRE. the by other quarter, amounts the

Third core FFO I and on reported non-cash comparison. G&A just those one-time quarter basis, year-over-year mentioned, the costs declined adjusts on same-store including XX% a which costs, for

finishing pleased nine the months we the following up results to and XXXX. of And plan. detailed In the and strategic are strategic with soon very look progress with operating summary, we strongly first year our company’s during forward

like the the I’d to that, With call Operator? begin to operator Q&A. over turn to

Operator

question. Please the we Jade At with session. KBW. your conducting Our of you. question-and-answer comes question first [Operator a will Instructions] Thank proceed with this be time, Rahmani from line

Jade Rahmani

with two to you’ve a can transaction Thanks party that guess, if over or with with take very kind management start some a related how such company, I like regarding between the entities? as of Blackstone, internalization I’d to considered proposal. or compare off the would contract, know and the consider a who acquired CLNC would third-party Brookfield much. a a transaction

Thomas Barrack

with question. simple. Thanks it’s Obviously, details. specific Tom. generally, Jade, for deal unbelievably But and complex, it’s it’s the we can’t

We are since all and we’re execution yes. will best the really majority do of is that’s interest to the largest continue whatever shareholders, shareholder and the and the we the shareholder,

the because the for that co-invest that times entity reach management and entity, of other a external and credit complexity third-party. So vehicles a with the at of Colony contract, the complicated

We have own belief in team. management our man

be of We have yesterday the in did REIT. we think assets best-in-class belief we mortgage a the for what was creation what step will forward

is the when other look complexity But So here, we at and the we’ll best options. obviously all really available only of what’s you [indiscernible]. get probably this think into vehicle Any comments?

Mark Hedstrom

Tom. stakeholders coming said. No, the think the this we I the there’s would to And best in all solution agree day, work here with Tom that involved. as for But that at of months, think completely, I end is do the

Jade Rahmani

consider I the we a since you Yes. format if these to mortgage make hear are now that and followed that I I mean, highly I weigh want seen also I’ve and that third-party vehicles transactions. there whether a think permanent say right that, that to are sense company this it’s REIT evaluated? because also now private XXXX and multitude interesting numerous of debt be would would you And might value-destroying to in interest capital materialize. such of value benefit a offers, were should a believe that cost I think think

Thomas Barrack

the we’re what object that’s doing. of Obviously,

shareholders the of appropriately of So lots we there’s lots they ideas great we as for hope and And right. who you’re them entertain all participants have hope, we’ll arise.

Jade Rahmani

a owns that vote that of shareholder I credit? required, reason believe technical the Colony what’s And be Colony not XX% would because Capital

Thomas Barrack

then that Colony’s there private not If it’s stock contracts and be contract. is an consideration if under Jade, and by transaction and the associated management shareholder CLNC, being the cash sold credit would of internalization structure, involved scenario issuance the necessary is So, vote. of that not a is what businesses with the

Jade Rahmani

assets portion, Okay. the Is or majority OED there would some sold any of if transferred CLNC? to also not contemplation that Colony be Capital’s

Thomas Barrack

with entities let entities It’s that there’s not. viable there determine captured what’s Along co-investing too because process to of private CLNY. we’ll is of the make right? road, early CLNC complexity, to And determination, and what’s some that other

was Of early thought management what’s was it’s and process to are course, I interests. by align too not, the But silos those we’ll managed for us to viable dictate an which some process of group, let know. what same the those internalization what’s

Jade Rahmani

is you – that the sale Turning do understand industrial, can explain? to timing can delayed, provide sale any us for it on of the to and that? When the anticipate was closing and color you you

Thomas Barrack

will all. always by it’s be year-end, Yes. And year-end to We’ve The by and all continue sale executed timing and is at delayed of portion going the we the than A the is of that of anticipate things of be not middle the December. X%... in tiny overall target. on not entire context portion a the less the portion portfolio, to bulk same transaction it’s are said

Mark Hedstrom

million. $XXX

Thomas Barrack

…$XXX million, target is on No but issues. to close. everything

Jade Rahmani

Okay.

and Ventas could somewhat scenarios that portfolio with side, expectations about Does healthcare how to their that? for the that disappointing On you’re healthcare growth curtailed reported results respect play thinking XXXX. and the change out any

Thomas Barrack

does mean, best-of-class. transitions for headwinds industry dealing an looking everybody Not Ventas really. in Debby job. the She’s amazing as I does. transparency is the and she’s industry as with

of continue are And our affect to practices or she’s going and her them refinancing We what pivotal. this and doesn’t car out I going a to fight policies way be it forward. view as to our stakeholder valued victory think

Jade Rahmani

privatization of the you Capital would X.X the you. do then toward transition view of to digital company, you the – do Thank in consideration company And being give public? any just potential value of company, and benefits of focused the you or lastly, terms transformation Colony a highly

Thomas Barrack

explain to business market. that are not is the are benefits works regarded effect. this of – public evaluated something being setting. is the the that in Every in that’s assets private And Management Investment – really well day the when trying your a we’re to frustration the value it obviously we value in when sometimes public Look, a of market public

through REIT public a we’ve last market and market is of doesn’t And talk in as and manger new abundance swimming the So benefits. lane. single clear investment about this [ph] struggled this buy of we want an then What idea that you equity a the that. year, diversified realize issuing offers

The that as because investment talk public that sheet it can we’ve it. think the is the the And side business hence used that generating handled we’re markets we is be about opulent, tool. balance in liquidity here more setting, best little a a is a of can the management great digital and categories the and and liquid across seen digital the in as went business

As on balance we creates owner. as add? relate to legacy anything And to on or a functionally balance opinion, interesting financially for potential total physically side, have assets, really as investment sheet us and on that the on At basis return from sheet high-growth kind more the that our accretion with hand, Marc, to an which universe. assets and in before, we obsolescent. I said one sheet limited partner the the management balance alignment obsolescent obsolescent of leading transitioned is

Marc Ganzi

it deploy an to there’s think like across capital unprecedented new I and platforms. opportunity you Tom, valuable correctly. No, feel We really synthesized our platforms very

in We’re infrastructure digital opportunity the across seeing $XXX over billion investment ecosystem.

our mission-critical of Over XG years it, by investing we our as figure next to traditional sort we customers. bigger Everything, of what tenants at call of five market the in when opportunity side that side and estate opportunities traditional look sort networks, IoT real and we set that of and the estate, a as we real against just Internet see networks, for deploy in pool

Jade Rahmani

considered consider something is to INXN potential on this would even follow-up a that, you stage just deal And as or that at the transaction?

Thomas Barrack

business? you question. of the sorry, the the privatization about Are I’m talking IM clarify

Jade Rahmani

I wondering considered at – under transaction, which Interxion was stage Digital Realty something have this is would acquire. Trust if Digital still or could agreement that’s Colony to Colony The consider?

Thomas Barrack

don’t that being We market is rumors Sure. Thank transactions honestly comment you. related name in the press circulated. to on that our

as being, related to So Interxion. an for no the say comment time I’ll

Jade Rahmani

the taking Thanks questions. for

Thomas Barrack

Thank you.

Mark Hedstrom

Jade. Thanks,

Operator

Please with from proceed question comes Germain next question. Mitch JMP Our line Securities. the your of with

Mitch Germain

the at. Maybe I about as this What company today things comments to gives Marc where you $X OP Ganzi, that appreciate your stock your units turn $X.XX confidence can vest now on around? that here, price

Marc Ganzi

the things Thanks, allow the to pruning we’ve the we playing do. clarify say, clear to promise industrial, side our to of Sure. made are likes on of and defense. us are and we sale as the our Mitch. singular of defensive Listen, market, we’re that to Tom for commit components us want essential ball, our portfolio, what what to the NRE, The to offense, Mitch, OED mission those objectives of the a to we’re story be do playing very sale

behind executives deliver think On side to very want the been businesses, in the capital, to we’ve shareholder take logos, We total offensive where our sheet about to best clear we it work return. we put of want our football, what balance can more best places do. best our we

Now, assets of effectively cheaper let’s buy selling to unpack comment shareholder want assets. return. total the we One, where we’re than

Second, we employee yield. want hire to

that to higher in resident we today. operate and businesses are businesses Third, of involved own that be growth, we the have already in double-digit some want organic which

which you lot As of assets, of XX owns today the in most digital Colony. those you there third in give be highlights within I manages great did very things of domain will relates as Colony digital assets, it the happy the were what to of to some which down a think we happening quarter valuable and/or know,

industrial, use balance done a businesses superior to of can either it in portions three, can every transactions we’ve our as to portions also sheet, what one, balance economy funds; you all when up balance weaponize acquire ever where that can effectively or and Partners; sheet, the facet, and to sheet you the GP and take partners, and like in balance majority perform into We that we digital we Mitch, deploy which with successful Andean in did relates able warehouse sheet Tower and you’re or commitments, step we believe first-time was two, either that most traditionally the where we use capital to healthcare metric SEC logic.

raise use we of capital If that using balance able will deploying so Mitch, effective and sheet different One, avenues will mentioned, clear capital. the And be we that you to is strategy we’re two this the doing to we investment very, in capital, the happen. abundantly more believe that balance platform. the so, and in three have across It a going three of just world early December. we our unveil rest sheet we’re to will I That’ll management third-party ways And capital. those grow very to things make there’s clear.

lower because premium, think we and grow the leases, when why manage, the own a it’s it’s business, importantly, we cash about own no operate and/or today. higher have we can much about concentration a investment-grade, Colony, that secret growth. businesses organic much fundamental And if at Second, at stronger how most longer-term flow premium we that digital higher we they assets to at and trade traded where to today churn, trade think

REIT, grow most cash doing and flow factor, At whether space, by rates. the assets businesses REIT, free get higher [ph] that confidence digital way or ability the to it’s have end we by of continue is growth, your vacant the is implied that, owning [excellent to organic way growth back, the we your day, the important an whether to Mitch, and turn owning REIT ship, any tariff] it’s lease the a

people draft becomes believe the company. plan you businesses XX operate, we the that. apparent in do this to that more of and demonstrated over the that this world, years the will we want to we’ve business as and managed rest last we’ve And plan, to this own own and And as

and we be give And And very in that we and first will specific the when investment want others haven’t people with that able a that And own That’s shares REIT been join who you to to journey assure can want believe whilst that who that, unveil we something these I be digital digital partake you we’re truly to manager. today, going. us. it transparent. color diversified is will it do that where

Mitch Germain

other that. you or whether sales pursuing to or from be the you Thank course XX healthcare Are lodging? covenants XX balance next there sheet any over it and prohibit of of months debt for that considerations,

Thomas Barrack

No, not.

Mitch Germain

elaborate turned the can of the just – you’re bulk to Can And demand it the, bidding? process sale, industrial there? after going like the previously you size just how kind holding A, regards industrial of terms what’s in that. back guess, looks the you’re you now, announcing sale it on I What socialize Okay. with maybe out holding then back of

Thomas Barrack

here comment Yes. Darren on and Darren, to process. do ran want the Darren is you that?

Darren Tangen

Hey, it’s Mitch, Yes. Darren.

So the on a In was robust, process to submissions several might we Blackstone had the you I mean, think, know, XX prevail. over itself mean, billion tremendous process I you – second. first I imagine. a sale groups interest, was And, through as of there amount we incredibly portfolio. the $X-plus round, now as brought

announced back September, deal to the there’s the And relates a we it consents As interest in a is in XX% because component which announced, bulk portfolio when there some selling were that we the $XXX associated component. billion a – million as were is was that, of third-party the $X.X printed, that was with originally partnership.

from are terms of could engaged so the we be February billion to It we end still year. in to type size. it’s something quickly. be the closing, a delayed trade, the discussions may immaterial it of So portfolio, $X.X bulk somewhat expect that it’s in January, $XXX other somewhat but of million happen related pretty that a But expectation sale again,

Mitch Germain

sale is those And Blackstone? third-party as go new process it does consents launched, it a is that are or to that realized,

Darren Tangen

the deal in interest to was was buy Blackstone partnership. going the I the original – so Blackstone, that XX% not

to in the process No, deal launched. involving But going parties to that’s sold up it’s a So today. it’s some being party. it’s of end different new the sale being not entirely an affiliated

that and something it’s So we document close quite we expect can quickly.

Mitch Germain

me, Hedstrom. You’ve whole How Mark you. a clean think bunch NRE maybe for of noise. run got Got I of a should rate? Last

every noise in segment. so single almost What’s one timers? core in bunch of one You’ve OED, got whole a absent earnings timers

Mark Hedstrom

think other that a the are sale rates economics. run how in investments, the the platform with quarter we’re down benefit industrial Management this as those of rate going I and quickly digital of looking capital at at and that deploy the to a as investments, to slightly be and Investment sale on be the basis are of digital Those going from we get NRE, well creative.

So I think We we quarter. quarter you don’t really think of a have this now. a for guidance lot right good is there

We quarter lot be going do real think to number develop as for a there’s the runway expect to well. I that. a plan fourth forward, quarter firm good with a Street for the strategic But still us to

Mitch Germain

Okay.

Thank you. what know the don’t we number is. real So

Operator

next with Our Riley proceed question your Please from Randy Binner B. comes the question. line FBR. with of

Randy Binner

Hi, good morning.

and wanted So December, things mid-December, of these said it- out to Is event. planning for early December just scope I helpful. think, you I understanding better try is this a

So, what there a out format to timeframe otherwise firmer plan resegment us, restate lay you can is Do financials? you the going give or the to is be? you can

Thomas Barrack

format to our with does in liquidity created terrific, the most is of on do sources everybody Randy, The is Has is to and definitive strategic we’re where it go? of to going interested uses do website Yes, what post going a which tremendous and for be it’s Tom. that’s to restating have anything plan. and we you’re a capital, amount saying financials. setting with It be doesn’t going to the

got number a for We’ve options, digital We management acquisitions. of capital balance side. the got course. of on liability one new We’ve deployment of have and sheet

we’re going have partner that what timing frameworks stock launch. new to about dividend, the deployment digital all we buyback, special the on, legacy LNG existing the means we have businesses. of at And of we’re limited the liquidity of that between that least, forward. of capital and what products not But We to with discern silos abandoning three do usual

got bird’s and you a eye legacy fronts. substantial with forward. going market moving where of the hospitality shareholders, business, healthcare, legacy cash in third-party limited of middle we the and we’re view do we’re those on of partners all have growth we’ve that going to go. And things we’ll is digital and And balance by the acquisitions flow got that of sheet assets we’ve December. optionality the give hates, from capital like So And those

Randy Binner

that, to yes? other and with And can there’ll Okay. I around interact then a be presume management call ways

Thomas Barrack

absolutely. Well,

once we’re age you’re do to we we’re do that, start digital what a we’re but program. going have to – we’re of – company and a have new to calls We’re and is digital – and phone going the we going text, series

a what So in halls, of give communication Bridge. of we’re will a all highway. events road that webinars, addition you better view Digital of town this anticipating digital is non-deal shows, also What to this series is

what’s REITs which make new hard for the digital And digital kind in these that defined of like happening investor complicated. counterparty that us, knows within their of what’s nation them is lanes. everybody are somebody asset is all happening states own best Now

the So going. to of math strategic our in here’s plan and here’s addition saying, where we’re

acquired Here’s that businesses the of buying. we’re assets on timeframe how really is the the a businesses, there existing the getting adding Colony churn two Colony we’re key and

part the last the next We anticipated and it first year of out we will plan. So and roll communications this think format year to be… a quarter of new

Randy Binner

of hearing from it comments, know this. Yes, your to that I to Is digital guess, if transparency feels likely non-core the core you’re it commit less that separation more take what’s versus it’s I’m and then of fair? and be will I correctly, then be then saying be business likely But the I’d with like can’t it’s you addition to it a And welcomed. the pivot. going existing kind on and

Mark Hedstrom

Yes.

Thomas Barrack

parts with of what’s And to gauge. monetizations? that’s that’s what but it of and are dividend And of the specificity, to what we’re And are Yes, the what you’re return? trying trying gauge. right? gauging total The balance always initial

look one the investor. and it’s day are difficult every be not much foot an one to And what, So on it on you say, easier be These it’s easy to we hiccups for foot an and owner, understand. brake at to asset.

vote of don’t you like you can it, you you’re and all more buy feet your like, with As out.

We’re decisions the across owner making four-year, consequences. and an Board five-year have as three-year,

that’s – typical, sometimes that’s we’ve And that been. where

the you’re assets, not a of distortion on have, and the the have to do see we we’re the going cash our flow plan, a envisioning deployment in So balance, that carefully with capital X.X, is the of liabilities legacy strategic calling strategic that moves realignment, what gigantic which very view we we logical that thought way.

investor, seen some short-term our do cause to not that these that’s our value. way back book interests you’ve shareholder get confusing how desirable. in in to what we CLNC we of But an share going can as turbulence to is a we’re Again, price. view saying, streamline And know

to we chalk, team soon love we As on and in get have we a our the day as value, we the we are back book management different because love where space.

there, So It’s because, to you to that we’re simple. to going go as to it’s you not the give taken good know, a much while questions us the asking. get you, all arithmetic think, I you’re want

Randy Binner

rate lot than a on you money, another correctly, a had – million I The it better was that question. and just understand took expected. we $XX interest I is swap, that of if loss somewhat but actually this the of

resolved, I And some matter if or just there’s wanted that if entirely so exposure? ongoing is to clarify

Thomas Barrack

million, is our matter reflected is of settled financials. The entirely of think closed. that of accrued There payment was about the in the due current but purposes out getting a that small that GAAP some $XXX that’s was of The I December, and reflected total of The was dissolved. which swap beginning $XXX XXXX. in cost and There’s is in taken in swap million year. for

So in and financials cash occurs the completed. transfer that December. closed all It’s this early except it reflected for is out,

Randy Binner

all That’s now. better I you. had. that understand I Okay. Thank

Thomas Barrack

you. Thank

Operator

are any there would in questions no If I further floor for back to the queue, management to remarks. like left over the turn closing

Thomas Barrack

mid-December a talked be Have on participation we to Thanks, And your good of will to patience. more what and put weekend. you thanks in Thanks, for about. skeleton flesh for the everybody, your back everybody. we

Operator

concludes This today’s teleconference.

wonderful participation now may for and day. disconnect have a this you Thank You your at time. your lines

DigitalBridge (DBRG) 8 Nov 192019 Q3 Earnings call transcript