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SALE OF COMMERCIAL REAL ESTATE BUSINESS
12 Months Ended
Dec. 31, 2021
Discontinued Operations and Disposal Groups [Abstract]  
SALE OF COMMERCIAL REAL ESTATE BUSINESS
9. SALE OF COMMERCIAL REAL ESTATE BUSINESS
On March 25, 2021, the Company entered into a definitive agreement to sell substantially all of the assets that comprise its CRE business to Slate Asset Management L.P. and Slate Grocery REIT (together, “Slate”) for $2.33 billion. The transaction includes equity interests, loan assets and associated liabilities, and CMBS (other than commercial CRTs). The Company also intends to sell nearly all of the remaining CRE business assets that are not included in the transaction with Slate. A real estate property that was held for sale, which is not included in the transaction with Slate, was sold during the year ended December 31, 2021 and resulted in the recognition of a gain of $4.8 million in Business divestiture-related gains (losses) in the Consolidated Statements of Comprehensive Income (Loss). In connection with the execution of the definitive agreement to sell the CRE business, during the year ended December 31, 2021, the Company performed an assessment of goodwill, which was related to the Company’s 2013 acquisition of CreXus Investment Corp., and recognized an impairment of $71.8 million. As a result of classifying the loans as held for sale, the previously recognized allowance for loan losses of $135.0 million, which includes $5.1 million on unfunded loan commitments, was reversed during the three months ended March 31, 2021. During the year ended December 31, 2021, the majority of assets held for sale and the associated liabilities were transferred to Slate, with the remaining assets expected to be transferred by the end of the first quarter of 2022 subject to regulatory approvals. The pretax income (loss) of the CRE business was ($31.6) million for the year ended December 31, 2021 and ($99.6) million for the year
ended December 31, 2020. Certain employees who primarily supported the CRE business joined Slate in connection with the sale.
The carrying value of the total assets in the disposal group was $194.1 million at December 31, 2021, primarily real estate, net. The carrying value of total liabilities in the disposal group was $154.9 million at December 31, 2021, primarily mortgages payable on the related real estate held for sale.