CLNC - Earnings call transcript Q1 2020 | BrightSpire Capital, Inc.

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Operator

Good day and welcome to the Colony Credit Real Estate Inc.

First Quarter 2020 Earnings Call. Please note that today’s conference is being recorded.

And at this time I would now like to turn the conference over to Mr. David Palame. sir. ahead go Please

David Palame

welcome earnings Credit conference and first Estate quarter XXXX call. to afternoon Real Colony Inc.’s Good

We will or refer as this CLNC, to Colony Credit Credit call. Estate, Real Real Colony Credit the throughout Colony Company, Estate, Inc.

the on Accounting and Executive President is Officer, Officer, E.; Frank Officer, the Officer, Financial on Operating Chief and Chief Saracino, the Chief call line Mazzei. Neale Speaking questions. are Andrew Company's to today answer Mike Redington. also Chief

on expectations this call forward-looking uncertainties, the over, materially. subject and that cause company’s risks presented are please hand uncertainties to Potential certain I contains differ the call, note business statements. based Before information on and risks, statements financial These and assumptions. to could management’s and current are results

significantly the could to that COVID-XX of Coronavirus Currently and the and cause forward-looking is company, most tenants, of one its materially borrowers on differ financial cash effect result the the pandemic Novel of outcomes adverse current statement of performance potential our operations, from condition, flows, or the the actual of factors

the economy the market and global real and financial estate market.

economic are the The its uncertain predicted of impacts and among others. which COVID-XX which borrowers on cannot impact mitigate action the our pandemic our effects and the indirect will scope, the the taken including severity to the depend and future with or pandemic, development us confidence tenants be on and direct containment contain pandemic extent and pandemic highly duration measures and to

as and the be COVID-XX pandemic. periodic time statements the the could time interpretation cautioning please from recent section affect our see numerous of forward-looking results, the a in adverse XX-K heightened many factors For of SEC the risk and of of reports result risk the of risk most and ongoing company's current the filed of impacts that to discussion should other a with

not company intend on to duty and XXXX, or May update call and as events undertakes for does today, is X, All information of future no this discussed the circumstances.

financial call supplemental presentation, of this which In the GAAP release measures are addition, presented reconciliations non-GAAP certain The website, useful financial explanation is earnings company available company’s and believes company’s and measure on the appropriate represents an this to measures. why such non-GAAP was afternoon released on the investors. presents information to and financial

President And now, Executive Mazzei, Officer I’d like Estate. over Colony Mike and Credit of turn call to to the Mike? Real Chief

Mike Mazzei

you Thank David.

First like these we on well behalf CLNC by as through to wishing we would navigate of times. management everyone team begin uncertain

remote are challenging cases locations Our and virtual their I personal ethic their many warm times. especially energy, work thank want in lives these them safe working employees where the for in welcomes, in positive work lives are fused and together. to

myself integrate Xst able I and promptly to on remotely. officially was joined April

myself workplace interact a of been been engaged with fellow for transition colleagues. functional with virtual quite the use fact, meeting CLNC The with team my I allowed to have help has the seamless of In areas has fully and the technology the organization. of of me all video to all technology.

well and results working days is Neale and what business banking and our asset functions, Witt to audit, internal happening treasury will legal. Redington including are and Our the CFO of actions management on I will today our COO controls systems address kind certain our QX focus ahead. want and address Andrew accounting shortly. and

effectuate most month and very paying their others with of all was dealing asset we're communication In close certain on be schedule borrowers tenants we borrowers borrower's successful tenants. everything with with with, a in while tenants and to Our worked continue managers April light to payments. and

our on portfolio. loan made core were payments interest of XX%

some we payments. foot-long cases certain However, in to of reserves portion utilize agreed current

side strong. performance overall tenant the was the On

unprecedented to COVID-XX. circumstances help to continue comprehensive will through creative ways these resulting evaluate borrowers from tenants and We both and

current. provide principal insight balance by reserves. were April amount were loans of loans combined required accessing inclusive legacy by paid XX% loan balance portfolio this which further existing XX XX% unpaid loans non-strategic principal unpaid for the To Of into entire of there four

estate those tenants XX% and experienced portfolio. unable confined were non-strategic rent our tenants rent Our owned in to retail real collections legacy portfolio primarily pay to

real course level will Of CLNC's all owned borrowings. core remain estate current on portfolio our investment

the worked counterparties and base agreement. to happy asset been been master banking and all have productive of regards report repurchase our dialogue closely and partners for update our With constructive. bank the to we them providing borrowing have that I'm has with

in We will massive continue providing to be updates. with our lenders the bank actively engaged

to and maintaining to and enhancing essential some case been be navigate and we we are and have time. to markets is our volatile programs lows many of clear counterparties equity March we difficult to is real commercial our economic of challenges banking since help this The event aspects in a capital be the sectors top in feds stabilize meet to market possible an whatever equity with COVID-XX on unknowable. This markets. remain the unprecedented the we debt especially Working that are faced that continue will estate has while liquidity the multi ability market To face. trillion-dollar continue will through still priority as feel witnessing and cooperatively

slower commercial recovery for a sector business are investments. estate type had been pause. type The under hospitality into in payoffs. variation the the which sheet of a region Lenders real for mortgage generally loan forecasting GSP planning and too every such asset we plans lenders Therefore management. property on has entities balance our with also taken for focused by pressure particular except are As incorporated we company commercial have is and slower REIT

been capital. context this that on we've within preserving is our focused It

we As

our We’ve the we monthly serious dividend our and dividend of in taken of preserve suspending step a shareholders. effort have maintain disclosed to realized to an importance previously the liquidity.

and of asset. circumstances to and support term prudent company its to step balance long unprecedented this the the COVID-XX was given However, the a of incremental sheet maximize value

that margin for it meaningful When our needs comes error the economic focus on we world a the policy. into the dividend and environment liquidity visit with is clear

commercial Looking estate. impact real of broader the economy challenges given be there on for ahead the COVID-XX will

continue months to coming management be the will liquidity. our asset and and In liability on emphasis

will shareholders, gradually dialogue to continue transition we controls workplace. tenants continue an the open borrowers, our We'll and with maintaining back to in vigilant procedures and be maintain We to constituents. as banking

and is been as and work It has impact on But any come to we every will industry the impossible our right know day be predict reasonable with with our business. to a certainty now of it COVID-XX backdrop. substantial that we and on

smaller fit low well the CLO sized $X XXXX. origination CLO billion we structures moderate experienced which within recent of Finally most with substantial execution of in activities mortgages as business of pay terms our majority model been our late in have our in to

and an together environment seek reach owner today look COVID-XX side advantage attractive their when forward We as are a taking take we the to operators growing to this lending of to conservative of we other asset. business posture capitalize model

With to Operating that turn Chief Andy? Officer, to Witt. I now would like over Andy the call our

Andrew Witt

Thank you, Mike.

highlighted current the and liability circumstances and focus organization of on the particular under As the management is liquidity. attention primary previously with on asset

both of may funding select come resources high-priority through sales our and we've from reorganized legacy, sources and obligations future our portfolios. and that non-strategic core financing As around liquidity asset, asset such

coming to on monetize continue towards quarters. balance eye opportunities with examine sheet in investment our enhancing an to We the will liquidity

legacy, a onset Prior COVID-XX a process of we proceeds. of as corporate significant assets result non generated initiative selling initiated the broader which strategic of to the has

We our also issued our of to warehouse as CLNC line reduced billion result in exposure XXXX. CLO a $X late

of in which XXXX reported loans originated approximately we resulted the transaction sale office senior on XX participation As securitization with executed a and in and million of pool that CLO XX% by multifamily a loans previously of $XXX October [indiscernible]. we collateralized

financing on $X held to to in we billion of CLO removed of Most by collateralized positions. home XX securitization. have financing loan on $XXX importantly, the the collateral senior market executing recourse the partial million Currently exposure mark loan repurchase

minimize related with banks taken return have in agreed terms various during the we by established holidays voluntary certain for margin a cases encompass risk which or margin repo to April to our loan of negotiating exposure. four counterparty holiday. largest advancement, In We our on reduction hospitality margin steps

been work modification also expanded counterparty uncertain our has and these navigate with the agreements with banks with to borrowers [indiscernible] permitted The collaboratively our Cadence together. bank managed with times periods counterparty. provides

deteriorated margin calls received portfolio. securities CLNC utilized total Turning financing strategy CMBS first CLNC has margin repurchase down In its these began since security. our security the in across quarter COVID-XX. liquidity finance played million paid with calls to on pay result of a XXXX or $XX QX as

$XXX for its the in XX%. on the agreed approximately we lender buy working borrowings in the underlying consolidated the June. one down advance rate end term million, together are collateral through the with second extending bank of our advance counterparty quarter outstanding Current the repo financing CLNC blended Early our to of rate debt exchange with is

margin triple addition the until term reaches portfolio. on bonds which extending the will XX% such rate. value calls advance The rollover B XX to XX financing B. of B finance the rate the to securities and XX% triple In the double of consist positions on of be not subject By it's

Following bond have mid-April the relatively prices Feds action since been stable.

the potential underlying We the and context reports COVID-XX portfolio continue review the in the analyze impact. to of monitor remittance related collateral,

terms. condition repayment to meet to The loan abilities most Failure compliance to our to with bank borrowers remain their to may payments their facilities. notable trigger borrowers of our impacts master in monthly financial and our and mortgage covenants the relate their repurchase obligations make including of credit loan

As our XX% portfolio of current. borrowers core Mike pay the of noted during previously April, month

XX% lease will our our the meet In our rent to addition in on the month term the of liquidity. that paid within service obligation. portfolio are current our core focus sufficient we in tenants In actively liquidity ensure management of which and was to of sources near debt managing the net uses be environment April

at our ahead. to unknowns continue the approximately and million to stands liquidity $XXX prepare enhance we liquidity will for Our position

of side balance resolved legacy primarily to-date measured We are non-strategic asset generating with assets held as XXX estate for approximately portfolio have classified sold point carrying we million sale quarter year of by net end. now as as legacy value. our value XX% portfolio legacy total the We this owned XX of proceeds currently a sheet million. of or net real non-strategic managing XX have the non-strategic net At and disposed $XXX the properties carrying within at

these to term. Given near the COVID-XX properties the sell we medium pandemic, in not may

our collateral transact with portfolio. to from consistent sales of the asset sales core select evaluating We our are on are view intend only or we bids value. Additionally, underlying

not we term. in activity do anticipate ahead new the any meaningful deployment short Looking

uncertainty borrowers, working to organization tenants, collectively favorable focus At reorganized lenders navigate this have existing and a to believe ultimately the to we are we committed to give squarely these the counterparties However, with unprecedented other investments moment way will lending our and on environment. time.

Now I call our Chief the to over Officer Neale turn Redington. Financial will

Neale Redington

Thank you everyone. Mike and good afternoon

items few in underscore will to like would filing XX-Q be Form I results tomorrow. included that quarter first our discussing Before our

We judgment details an the in impacted and liquidity. where have further balance provided areas sheet [indiscernible] COVID-XX most

We hotel and as loans mezzanine will equity. our our well provide loans tables [XX] preferred as identifying

about There's some April future. the also a loan interest receipts material further larger may will and with in information COVID-XX investments that details provide we impact have level specific

your also description want joint core our investments losses provision report from incremental website. preferred business I losses. and including core It on loan for additional of each equity draw available define CECL unconsolidated is to a which real we include gains, will our will or impairments earnings. ventures This definition of on reserves segments our in to supplemental attention exclude on to changes earnings, how estate and information financial includes addition in and

come will will non-strategic portfolio from separately. earnings earnings core our However, legacy we solely while report core

continue help analyst segments. asset We the detail XX-Q. will Form of holdings provide two investors details in it business about by report our and supplemental of all our added for given well assets the research our additional specially as to asset addition, transparency believe provides financial understand company In our this and as we a value

of legacy non-strategic and the assets. mission mezzanine it around estate. the Delineating our we securities to at real portfolios facilitate include greater loans, core the the and net believe portfolio preferred vision core senior and clarity within commercial, real company our estate pro investments debt creates will embedded understanding Further between value lease and and core forma equity,

share. earnings quarter, losses of $X.X the $X.X CLNC's million quarter core to and million provisions or realized core share earnings hedges and per the for FX $XX $XX.X for turning gains or per net of per loss of excluding Now loan $XX $X.XX million, on core million portfolio reported first was of or million GAAP $X.XX $X.XX share

loan other or $XX.X In $X.X addition, for the company's legacy GAAP per million non-strategic total loss net After excluding earnings provision of $X.XX generated share realized million million $X.X $XX.X $X.XX portfolio per and losses and [indiscernible] gains. million or share. of of

more During gains of fully The for per February the and $X.XX core paid quarter were monthly covered first quarter we the cash January, dividend losses. months first paid of and dividends in share March. of earnings one-time a the XXX% common excluding than

extraordinary that XX conserve previously have the available is volatility market in of company company's to best As the prudent we concluded noted cash due period to unprecedented XXXX. liquidity the with monthly and the April dividend sustain beginning interest ending and and conditions monthly of

The customary considerations. future based periods on board will evaluate in dividends

company monitor a Importantly, to the status its company ensure distribution meets REIT. continues income the taxable requirements to maintain that minimum its the as to

gross along proceeds. has not so of included any partial far full loan prior five closed In $XX gross three million investment terms of activity repayments with in the for totaling new deployment, company repayments of of $XX proceeds XXXX, million quarter

resolutions been legacy this $XXX quicker uncertainty. and proceeds XXXX, $X million representing sold X% period LNS net XX assets value. than we result have approximately been premium strategic have proceeds sale gross the of in year-end there gain a net non Overall GAAP previously to or of liquidity for for an been announcing or In asset strategy $XXX $XXX approximately addition, and projected million XX net have million approximately sales embedded the November Since proceeds in source LNS gross portfolio asset and our million $XXX within million dispositions an proceeds. sale since carrying have of

a net contract. portfolio XXX addition, million represents proceeds carrying sale. approximately two assets value assets of now of now that are on this GAAP gross the the million XX based approximately for LNS under net it's XX% for $ carrying contract been listed and sales with In resolved the of Altogether and value $XX by has

in and impact in to detrimental CECL discuss steps of evaluate reserves our implementation of immediate which addition will loan Given COVID-XX a loss specific to taken assets on have additional I significant moment. we

I described to we exposure our of entered XXnd portfolio and faced payoff. permit loans. the combined industry an to have hotel loan X,XXX-room is hospitality we While a U.S. the previously and discounted XX% April challenges collateralizing only hotel hospitality York by the that owners into New the with operators agreement On

against asset impairment $XX.X reflecting loan. to resolution area Minneapolis we result recorded revised the a hotel share Further or million million recovery reserves value As per reflect recorded loss of $X.XX loan estimate we a loan. have this this $X.X that against loan of from

Heading the approximately and appreciated at or $XX.XX core share. billion stands to book portfolio our per $X.X value

blended Our approximately be loan book segment largest continues at to billion an the end. $XX our $X.X approximately of of The of carrying loan size is loan million. quarter on average with yield un-weathered book value X.X%

type portfolio Furthermore remains geography. of size, and in the diversified collateral terms well loan

and million [core] to of the value And Moving CLE XX a grade-rated securities portfolio. portfolio debt $XXX of the had caring at March predominantly with consists securities. investment

financed by $XXX XXXX, XX, securities March facilities. were debt of such As master million of CRE repurchase

most securities paid timely have March XXXX. call the We XX, financing CMBS recent on under the on to all met calls arrangements house margin and received

an margin in XXXX June on recently rollover just addressed that his the Andy mostly agreed subjects remarks. to extension buffers [indiscernible] the through

core real X.X estate a portfolio and portfolio, office of core our average of had of billion value end years. a at lease of XX% within of the quarter. the net carrying and with Also term properties first comprises lease This portfolio industrial weighted consists $X the

portfolio year, last regarding profile our we order risk enhanced on our more our provide introduced As all disclosures the implemented part in corporate ratings loans within credit of detail business. core of and risk to

was of Our X.X the prior resulting increased reflecting the primarily the compared the in related from the first X.X risk end to overall risk COVID-XX. uncertainty at to quarter quarter rating

operational predominantly estate, composed real and of retail non-strategic at portfolio, stands owned million intensive originated legacy of this legacy our this other certain all value the formation statement approximately per for share. $X.XX book or to net loans prior $XXX CLNC. GAAP is portfolio And Total

March balance total our to XXst, Moving at assets XXXX. stood as our of billion $X.X sheet, approximately at-share

the current at XX% was at facility. availability stands on ratio and of assets cash quarter under $XXX hand million the between approximately revolving to debt credit Our liquidity end our and

be foreseeable will with for bank a the liquidity our revolving currently and of renegotiating the are the our of revolver source of credit facility continue terms to we future Use syndicate.

size, and a limitations and facility and originations repurchases dividends, in reduction reduction the in terms capabilities on These requirement certain on loan our net the worth a a senior to support include stock tangible portfolio. focus existing

We believe near the will allow we and new our business manage need arrangement us liquidity to in this the the flexibility term.

expected January to our standard the company would on CECL the accounting credit comment current which losses XXXX. on adopted like was Xst, I by Lastly,

million of one share. change XXXX combined portfolio $X.XX this reserve XXst of quarter size by recorded on $XX to first and a our during as new on caused book and per CECL economy of composition, the reserve we an COVID-XX. an impact result day is our a the million of approximately standard The additional a $XX value Based significant impact March

will and during portfolio CECL weaken. conditions modulate improve future decline income by risk contracts our expands The or the adjustments as quality attributes overall or or in credit net in strengthen periods market loans or

with That prepared Operator? for let's up and our that concludes open the remarks call questions.

Operator

Thank our Stephen. Laws. question comes our Instructions] go first will question from you. Stephen We [Operator ahead, and Please take first

Stephen Laws

to Yes. role. Mike, joining congratulations do XX but good the it's afternoon. off on I an that company. And know been Hi, congratulations days first interesting your on guess, first or I so new

Mike Mazzei

you. Thank

Stephen Laws

outlook question given do Andy, been two maybe you've probably able think to unfair kind I kind kind I the environment. an that's of Typically, road wanted that of of and or once the year you would how a Mike see And to asked I things question this. Mike follow-up. ask and the current have down

and is that do process possibly see and LNS into being assets to senior or that going, review mentioned to the portfolio. of given mess and that going simply get we're it the revolver look you preferred you then equity we're on to shifting re-designating Andy, core the going lease. net at under reevaluate from But rid focus even How

is how go that and and we're investment in group LNS. make place should going reevaluate process other and one it real give see be take new what will to us you do the some timeline and process Or a the how the even it loan going think and the every you clarity Can then? with way move one by take what certainly to it you senior big

Mike Mazzei

Thank Actually Mike. that, answer the I'll Stephen. you this is for question,

thing In we commentary, asset suggesting Andy's make moving wasn't let meant First of I'm are all, LNS. clear. me what sure we he into you one but that were that's not looking at so. terms experience in good do that like portfolio half portfolio date had certainly the of almost that we'll the LNS executing continue on we've on to a of and

and might so. enhancing to portfolio more Separately, drag asset-by-asset considering also our asset on we're we bit basis. longer and that in our continue heard but do as that and do to a we'll timeline so an very we're you little liquidity remarks, will do on in creating focused prepared core The

not a is question a long-term value value question on aside, aside, liquidity. is about This this holding

at marketable asset, good we'll on an and we'll selling can asset. current So, our asset externally at when an garner liquidity, then financed look consider and we is look how it's if look think internally its we it's and that a that size, at impact

the we'll and price at well. that some be the its goes which in of or could liquidity market could it for value value And discount place there out be as

of REIT. are lease we're considering that some net mortgage our the assets assets doing of good larger really So, are which some assets

stages an with but But and I are certainly can't so assets discussions. very we assets. promise in we discussions potential think on marketable buyers in are outcome we're of various these

are Also in those in marketing our as discussions some preferred well. equity of in we some positions,

biggest capturing sales loans we'll in have are well. where these positions liquidity. think think the potentially I as at And they'll earlier, said I core look also we As more impact on the some potentially portfolio

Stephen Laws

prepared was I me. the that at core in my of pull looked notes correcting out here, for thanks remarks the Great, mean, I stated portfolio. it

other seems base mark-to-market So, gives thanks our covenants on but that on I of term options to you amounts like it flexibility and significant touch of couple there. by I putting revolver, and it like a facility for the want think some correction changed the eliminating seems risk.

can allows or bit more a But permitted in prepared the already do what this been mentioned then that to have and preapproved think the you modifications you give now remarks you of kind or preapproved presentation piggybacking detail I permitted. of little from us

those already So, us you examples from give some permitted yet your are what preapproved offerings going through of that or borrowers the counterparty? to you're could you're then but

Neale Redington

I Stephen, a couple of things you different think there, covered right.

I likes. about the and Andy I address and to and with So, it as the margin some move that to the talking might he can and here one revolver you of holidays is said perhaps was start

prepared we today So, I we're that. in remarks terms that fact pleased and on in working of the in very revolver, arrangement. completed yes, that have we're with mentioned my

So, have we things. of couple a moved

fairly has come One declined what tangible X) don’t think don’t bit the may potential know and is we think well that and to net flexibility as transactions Mike requirement that know. worth we he some us usually relates down it a will give -- I little

a liquidity. is million facility of for lot things side preserve that borrowing XXX over the gives XXX And reduce to the about some liquidity, could to to With million. of that few look compares And and that we as XXX us opportunities next flexibility that, we the from around happen There whole months. million

that we me overall some terms dividend all frankly, my in friends with it that at of pleased the are we've and to looking that preserve banks with And and that. had stock anyway principle around in limitations from are come wanting there of repurchases. We liquidity. So, been liquidity, and buy as facility

talk to about of arrangements? little Hopefully the with you the some the that bit around retail answers Andy revolver would and a like that question

Andrew Witt

you Sure, thank Neale.

down of for the loan rate it of the the we've finalized terms repo holiday. principle margin home number exchange agreements And our as with a the lenders. agreed to in pay holidays, of a been to margin relates basic think I or agreements, those advance with there's

predetermined period work they a to waving under include of interest; time may And modifications. include a is to forbearing in with use the included may of set may our the keep property that's reserves; operating. which those covenants of include borrowers what they generally, And certain

And are few we counterparty worked out other essentially. things those our so, banks have a that with

Stephen Laws

And I missed then, last the holding didn’t think, but Right, structure didn't on have I comp comments for considered a any definitely management I that may my lot should thanks material, Mike, of or it can back queue this Andy. point. at maybe I but in hear question thanks is just be but comp

the still you going of on or the on or there's Can discussion Or with we at stand color the Colony any progress board? that? where today us any update or level as give with

Mike Mazzei

for I I on capital this. clear it's have pretty put release clear, to more that a press add. Thanks was Colony out pause the now. question, The press nothing regarding they release got pretty really it. is

environment I strategy in that's of sense; common separately, Now think put a this on that these lot things are pause.

to I that press a release there that consistent but think the with effect. it's was market overall So,

Stephen Laws

to make fall where out No, there's been and change. sure Yes. no

you and the there time I guys. comments So, appreciate the thank for

Mike Mazzei

Thank you for your questions.

Andrew Witt

Thanks, Stephen.

Operator

our Randy question B. from And Binner from Riley. comes next

Mike Mazzei

Hi, Randy.

Randy Binner

Hey, good evening.

last number lower? the I the is which lower describe Can yes, is caused just So think getting or the little I these bit move update million. to XXX than first believe on that's million, that questions. I'm on I a guess XXX cash what you the

Neale Redington

We made on pay revolver. some the downs

from was situation. think main I our that last the movement

sure I'm pieces lot Randy, evolving here. As there's you know a of

of our are main the in to And outlays. various short of number a existing investments. period that fundings that involves happened ones projection have time liquidity our So,

downs That's we have extensions numbers also combination Andy of on the described, deals where then, days commitments the fund three the those we've holding repo which And negotiated revolver pay the have downs there of it. small to is part the on small future. pay been of those margin some that and some quite in So, things. as of

Randy Binner

XX And think number margin a to be going then, mid-March call you downs. Is all in that you to I committed that since quoted pay that's correct call? million to-date number Great.

Neale Redington

Yes.

margin pay what described associated with that's combination downs and yes repo either CMBS facility of I had on that's think that's the and the or extension the calls side. Andy

Randy Binner

book? XX the the CMBS All in

Neale Redington

Yes, that's right.

Mike Mazzei

Yes.

then Okay, -- go thanks Randy, yes please. ahead and

Randy Binner

like that pushing lot said a have again, We Yes. --. we there been in

debt a have -- and So, CRE that's correct? CMBS, we delay. described you securities I all and just just

Neale Redington

is That correct.

Randy Binner

you Okay. that And then, CMBS? $XX to the the in going say were

Neale Redington

Yes.

Randy Binner

just detail. Okay. taking talked little through, kind kind all this of of in And of XX% Can capital then the step of all you I'm so that debt back, you range? company about a is I of good to bit have the the really think XX%

So, me the going of Is helpful together. think toggle to will a but for is like framework the seems of right way still levels that to that a to sheet kind if come balance where you from debt perspective?

Neale Redington

I that's right, Randy. think

As we XX% numerous in described calls a in we're to, you range this with mean of try we that to mathematically. I XX% total discussions and

still be in that This quarter range. expect line that increased because we conceptually of the draw down on same the but over and just to

Randy Binner

--. another just And Okay.

Neale Redington

draw just why out just this drawing one play the play as Randy, well down. on. it's if numbers you down resulted -- Sorry off that's the same the to sorry denominator, to and out more I'm those going numerator at to math by the the math But And period. up had

took have you I concept, sort to of net think more been look If it would debt a consistent.

Randy Binner

of around heard I And David, I heard Alright, fair thus far. think XX% enough. then I you kind of legacy disclose your

I XX% bigger they're the resolved but contract heard two contract those XX% this? they're maybe for was number under of think a or number under and I numbers

way resolved? the started that in legacy, been has were right XX% think of that is Yes, it already all that is to

David Palame

about or now XX% resolved. that's the Yes, it; think XX% to that's been approximately way exactly

Randy Binner

yes deck improved provided credit in a credit out bit maybe comments you flush Okay, that's then, great. you well. disclosures little because And that as can disclosures it enhanced around seems the Neale XX-Q, in the the like slide

-- detail that further what be in expect the other the So, might to we queue? is

Neale Redington

that. address actually I'll

Okay fine. great, thanks,

COVID by that more some the First if use that things provide we are driven whatever we interest that shows type. of reserves like and all environment, now think property tables table by

So, you out in will see some the of that filing. flushed

then a larger call the make with also on see more ranking on those. that larger the move this of some on out listing could because moved you the see time. want -- you this around we that assets you about so and disclosures risk XX and insight there and that brought those we sure that narrative we few risk rating shows loan some the We give current of We rating, we previous give to when more some assets to the also risk to have

Randy Binner

Okay, that's is it the correct? XX XXX% it term, hospitality loan, newer that great. And final was as then resolved,

Neale Redington

That is resolved. absolutely XXX%

Randy Binner

is resolution and said after of end hospitality go the still forward right then, hospitality book? the in this book the XX% that's that that's legacy the overall to plant sizing is share your core or you Okay. And new hospitality, the

Neale Redington

is. it's as generally we is the prepared loan. core thinking And in that my about That XX about as is we XXX said go once That remarks, listen I the forward an margin see million book, get then you'll more liquidity, pass orientation million million. we and XX feel maybe loans the this have like of the toward to moderately COVID-XX speaking, a we sized ample of XX buffer

suited as toward tripe and conduit loan type structures loans loans More and well now. orientation securitization CMBS better net that or and larger senior for equity CLO as are liability less preferred

Randy Binner

Have answers. it good leave I'll all night. a there. the Thanks great, that's Alright for

Neale Redington

Randy. Thanks,

Randy Binner

Thank you.

Operator

Chief for today. like that Mazzei, Ladies conclude our to back over to and I would time session Mike Officer. the At turn gentlemen, question-and-answer call this Executive

Mike Mazzei

call thank be sometime for for our that me earnings second Colony today. you We next look Credit should and Well, the early team my in forward you with August. quarter to call with joining us for

we meantime, you well. safe in and you. please Thank wish And the stay

Operator

a Credit, time, call this does today. Ladies Thanks. we behalf great you participation. conclude this do and On gentlemen, appreciate disconnect. Colony of may Have At your night. our

BrightSpire Capital (BRSP) 7 May 202020 Q1 Earnings call transcript