XML 32 R15.htm IDEA: XBRL DOCUMENT
v3.25.4

Investment Securities | 12 Months Ended
--- | ---
Dec. 31, 2025
Investments, Debt and Equity Securities [Abstract] |
Investment Securities | Investment Securities Investment securities were comprised of the following as of December 31, 2025 and 2024 (amounts in thousands):
| Carrying Value as of
| December 31, 2025 |  | December 31, 2024
RMBS, available-for-sale | $ | 88,283 |  |  | $ | 93,806 |
RMBS, fair value option (1) | 404,688 |  |  | 421,122 |
CMBS, fair value option (1), (2) | 1,284,863 |  |  | 1,225,024 |
HTM debt securities, amortized cost net of credit loss allowance of $37,369 and $24,463 | 179,567 |  |  | 406,961 |
Equity security, fair value | 628 |  |  | 5,146 |
Subtotal—Investment securities | 1,958,029 |  |  | 2,152,059 |
VIE eliminations (1) | (1,657,029) |  |  | (1,618,801) |
Total investment securities | $ | 301,000 |  |  | $ | 533,258 |
______________________________________________________________________________________________________________________ (1)Certain fair value option CMBS and RMBS are eliminated in consolidation against VIE liabilities pursuant to ASC 810. (2)Includes $146.5 million and $148.6 million of non-controlling interests in the consolidated entities which hold certain of these CMBS as of December 31, 2025 and 2024, respectively. Purchases, sales and redemptions, and principal collections for all investment securities were as follows (amounts in thousands):
| RMBS, available-for-sale |  | RMBS, fair value option |  | CMBS, fair value option |  | HTM Securities |  | Equity Security |  | Securitization VIEs (1) |  | Total
Year Ended December 31, 2025 |  |  |  |  |  |  |  |  |  |  |  |  |
Purchases/fundings | $ | — |  |  | $ | — |  |  | $ | 172,906 |  | (2) | $ | 73,308 |  |  | $ | — |  |  | $ | (164,593) |  |  | $ | 81,621 |
Sales and redemptions | — |  |  | — |  |  | 4,193 |  |  | — |  |  | 5,063 |  |  | — |  |  | 9,256 |
Principal collections | 8,071 |  |  | 39,372 |  |  | 92,071 |  |  | 295,408 |  |  | — |  |  | (130,571) |  |  | 304,351 |
Year Ended December 31, 2024 |  |  |  |  |  |  |  |  |  |  |  |  |
Purchases/fundings | $ | — |  |  | $ | — |  |  | $ | 187,531 |  |  | $ | 80,798 |  |  | $ | — |  |  | $ | (179,623) |  |  | $ | 88,706 |
Sales and redemptions | — |  |  | — |  |  | 12,923 |  |  | — |  |  | 3,690 |  |  | (12,923) |  |  | 3,690 |
Principal collections | 11,253 |  |  | 45,182 |  |  | 13,386 |  |  | 262,722 |  |  | — |  |  | (58,383) |  |  | 274,160 |
Year Ended December 31, 2023 |  |  |  |  |  |  |  |  |  |  |  |  |
Purchases/fundings | $ | — |  |  | $ | — |  |  | $ | 48,011 |  |  | $ | 11,578 |  |  | $ | — |  |  | $ | (48,011) |  |  | $ | 11,578 |
Sales and redemptions | 549 |  |  | — |  |  | — |  |  | — |  |  | 2,493 |  |  | — |  |  | 3,042 |
Principal collections | 9,475 |  |  | 53,332 |  |  | 117,100 |  |  | 80,083 |  |  | — |  |  | (169,642) |  |  | 90,348 |
______________________________________________________________________________________________________________________ (1)Represents RMBS and CMBS, fair value option amounts eliminated due to our consolidation of securitization VIEs. These amounts are reflected as issuance or repayment of debt of, or distributions from, consolidated VIEs in our consolidated statements of cash flows. (2)There was an additional $3.4 million of CMBS purchased from a consolidated partnership that is eliminated in consolidation. RMBS, Available-for-Sale The Company classified all of its RMBS not eliminated in consolidation as available-for-sale as of December 31, 2025 and 2024. These RMBS are reported at fair value in the balance sheet with changes in fair value recorded in accumulated other comprehensive income (“AOCI”). The tables below summarize various attributes of our investments in available-for-sale RMBS as of December 31, 2025 and 2024 (amounts in thousands):
|  |  |  |  |  |  | Unrealized Gains or (Losses) Recognized in AOCI |  |
| Amortized Cost |  | Credit Loss Allowance |  | Net Basis |  | Gross Unrealized Gains |  | Gross Unrealized Losses |  | Net Fair Value Adjustment |  | Fair Value
December 31, 2025 |  |  |  |  |  |  |  |  |  |  |  |  |
RMBS | $ | 76,723 |  |  | $ | — |  |  | $ | 76,723 |  |  | $ | 13,340 |  |  | $ | (1,780) |  |  | $ | 11,560 |  |  | $ | 88,283 |
December 31, 2024 |  |  |  |  |  |  |  |  |  |  |  |  |
RMBS | $ | 80,212 |  |  | $ | — |  |  | $ | 80,212 |  |  | $ | 15,163 |  |  | $ | (1,569) |  |  | $ | 13,594 |  |  | $ | 93,806 |
| Weighted Average Coupon (1) |  | WAL (Years) (2)
December 31, 2025 |  |  |
RMBS | 4.5 | % |  | 7.5
______________________________________________________________________________________________________________________ (1)Calculated using the December 31, 2025 SOFR rate of 3.688% for floating rate securities. (2)Represents the remaining WAL of each respective group of securities as of the balance sheet date. The WAL of each individual security is calculated using projected amounts and projected timing of future principal payments. As of December 31, 2025, approximately $78.6 million, or 89%, of RMBS were variable rate. We purchased all of the RMBS at a discount, a portion of which is accreted into income over the expected remaining life of the security. The majority of the income from this strategy is earned from the accretion of this accretable discount. We have engaged a third party manager who specializes in RMBS to execute the trading of RMBS, the cost of which was $0.7 million, $0.8 million and $0.5 million for the years ended December 31, 2025, 2024 and 2023, respectively, recorded as management fees in the accompanying consolidated statements of operations. The following table presents the gross unrealized losses and estimated fair value of any available-for-sale securities that were in an unrealized loss position as of December 31, 2025 and 2024, and for which an allowance for credit losses has not been recorded (amounts in thousands):
| Estimated Fair Value |  | Unrealized Losses
| Securities with a loss less than 12 months |  | Securities with a loss greater than 12 months |  | Securities with a loss less than 12 months |  | Securities with a loss greater than 12 months
As of December 31, 2025 |  |  |  |  |  |  |
RMBS | $ | 480 |  |  | $ | 10,943 |  |  | $ | — |  |  | $ | (1,780) |
As of December 31, 2024 |  |  |  |  |  |  |
RMBS | $ | 2,076 |  |  | $ | 9,742 |  |  | $ | (178) |  |  | $ | (1,391) |
As of December 31, 2025 and 2024, there were 14 and 13 securities, respectively, with unrealized losses reflected in the table above. After evaluating the securities, we concluded that the unrealized losses reflected above were noncredit-related and would be recovered from the securities’ estimated future cash flows. We considered a number of factors in reaching this conclusion, including that we did not intend to sell the securities, it was not considered more likely than not that we would be forced to sell the securities prior to recovering our amortized cost, and there were no material credit events that would have caused us to otherwise conclude that we would not recover our cost. Credit losses, if any, are calculated by comparing (i) the estimated future cash flows of each security discounted at the yield determined as of the initial acquisition date or, if since revised, as of the last date previously revised, to (ii) our net amortized cost basis. Significant judgment is used in projecting cash flows for our non-agency RMBS. As a result, actual income and/or credit losses could be materially different from what is currently projected and/or reported. CMBS and RMBS, Fair Value Option As discussed in the “Fair Value Option” section of Note 2 herein, we elect the fair value option for certain CMBS and RMBS in an effort to eliminate accounting mismatches resulting from the current or potential consolidation of securitization VIEs. As of December 31, 2025, the fair value and unpaid principal balance of CMBS where we have elected the fair value option, excluding the notional value of interest-only securities and before consolidation of securitization VIEs, were $1.3 billion and $2.9 billion, respectively. As of December 31, 2025, the fair value and unpaid principal balance of RMBS where we have elected the fair value option, excluding the notional value of interest-only securities and before consolidation of securitization VIEs, were $404.7 million and $326.3 million, respectively. The $1.7 billion total fair value balance of CMBS and RMBS represents our economic interests in these assets. However, as a result of our consolidation of securitization VIEs, the vast majority of this fair value (all except $32.5 million at December 31, 2025) is eliminated against VIE liabilities before arriving at our GAAP balance for fair value option investment securities. As of December 31, 2025, none of our CMBS or RMBS were variable rate. HTM Debt Securities, Amortized Cost The table below summarizes our investments in HTM debt securities as of December 31, 2025 and 2024 (amounts in thousands):
| Amortized Cost Basis |  | Credit Loss Allowance |  | Net Carrying Amount |  | Gross Unrealized Holding Gains |  | Gross Unrealized Holding Losses |  | Fair Value
December 31, 2025 |  |  |  |  |  |  |  |  |  |  |
CMBS | $ | 92,629 |  |  | $ | (13) |  |  | $ | 92,616 |  |  | $ | 603 |  |  | $ | (11,436) |  |  | $ | 81,783 |
Preferred interests | 82,844 |  |  | (27,166) |  |  | 55,678 |  |  | — |  |  | (22,942) |  |  | 32,736 |
Infrastructure bonds | 41,463 |  |  | (10,190) |  |  | 31,273 |  |  | 650 |  |  | — |  |  | 31,923 |
Total | $ | 216,936 |  |  | $ | (37,369) |  |  | $ | 179,567 |  |  | $ | 1,253 |  |  | $ | (34,378) |  |  | $ | 146,442 |
December 31, 2024 |  |  |  |  |  |  |  |  |  |  |
CMBS | $ | 357,012 |  |  | $ | (85) |  |  | $ | 356,927 |  |  | $ | 315 |  |  | $ | (21,326) |  |  | $ | 335,916 |
Preferred interests | 47,069 |  |  | (14,308) |  |  | 32,761 |  |  | — |  |  | (3,568) |  |  | 29,193 |
Infrastructure bonds | 27,343 |  |  | (10,070) |  |  | 17,273 |  |  | 21 |  |  | (9) |  |  | 17,285 |
Total | $ | 431,424 |  |  | $ | (24,463) |  |  | $ | 406,961 |  |  | $ | 336 |  |  | $ | (24,903) |  |  | $ | 382,394 |
The following table presents the activity in our credit loss allowance for HTM debt securities (amounts in thousands):
| CMBS |  | Preferred Interests |  | Infrastructure Bonds |  | Total HTM Credit Loss Allowance
Credit loss allowance at December 31, 2022 | $ | 172 |  |  | $ | — |  |  | $ | 3,010 |  |  | $ | 3,182 |
Credit loss (reversal) provision, net | (8) |  |  | 2,898 |  |  | 7,071 |  |  | 9,961 |
Credit loss allowance at December 31, 2023 | 164 |  |  | 2,898 |  |  | 10,081 |  |  | 13,143 |
Credit loss (reversal) provision, net | (79) |  |  | 11,410 |  |  | (11) |  |  | 11,320 |
Credit loss allowance at December 31, 2024 | 85 |  |  | 14,308 |  |  | 10,070 |  |  | 24,463 |
Credit loss (reversal) provision, net | (72) |  |  | 12,858 |  |  | 120 |  |  | 12,906 |
Credit loss allowance at December 31, 2025 | $ | 13 |  |  | $ | 27,166 |  |  | $ | 10,190 |  |  | $ | 37,369 |
As of December 31, 2025 and 2024, we had a $10.0 million specific credit loss allowance on a $19.2 million infrastructure bond that is collateralized by a first priority lien on a coal-fired power plant in Mississippi. It was deemed credit deteriorated when we acquired the Infrastructure Lending Segment in 2018 and was placed on nonaccrual under the cost recovery method in 2023 due to a forbearance and restructuring plan agreed between the lenders and borrower that was necessitated by operating shortfalls at the plant. We also had seven commercial lending preferred interests with a combined amortized cost basis of $65.0 million on nonaccrual that were not 90 days or greater past due as of December 31, 2025, with total unfunded commitments of $76.4 million. As of December 31, 2024, we had five commercial lending preferred interests with a combined amortized cost basis of $29.3 million on nonaccrual that were not 90 days or greater past due, with total unfunded commitments of $57.3 million. All of these investments were made in connection with loan modifications, but are not considered credit deteriorated. The table below summarizes the maturities of our HTM debt securities by type as of December 31, 2025 (amounts in thousands):
| CMBS |  | Preferred Interests |  | Infrastructure Bonds |  | Total
Less than one year | $ | 25,453 |  |  | $ | 23,994 |  |  | $ | — |  |  | $ | 49,447 |
One to three years | — |  |  | 15,359 |  |  | 6,437 |  |  | 21,796 |
Three to five years | 67,163 |  |  | 16,325 |  |  | 4,938 |  |  | 88,426 |
Thereafter | — |  |  | — |  |  | 19,898 |  |  | 19,898 |
Total | $ | 92,616 |  |  | $ | 55,678 |  |  | $ | 31,273 |  |  | $ | 179,567 |
Equity Security, Fair Value During 2012, we acquired 9,140,000 ordinary shares from a related-party in Starwood European Real Estate Finance Limited (“SEREF”), a debt fund that is externally managed by an affiliate of our Manager and is listed on the London Stock Exchange. During the years ended December 31, 2025, 2024 and 2023, 3,944,520, 2,767,038 and 1,892,313 shares were redeemed by SEREF, for proceeds of $5.1 million, $3.7 million and $2.5 million, respectively, leaving 536,129 shares held as of December 31, 2025. The fair value of the investment remeasured in USD was $0.6 million and $5.1 million as of December 31, 2025 and 2024, respectively. As of December 31, 2025, our shares represent an approximate 2.3% interest in SEREF.

X
- References No definition available. + Details
Name: | us-gaap_InvestmentsDebtAndEquitySecuritiesAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for investments in certain debt and equity securities. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 940 -SubTopic 320 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/940-320/tableOfContent Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Name Regulation S-K (SK) -Number 229 -Section 1403 -Paragraph b -Publisher SEC Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Topic 320 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/320/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 320 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 10 -Subparagraph (d) -Publisher FASB -URI https://asc.fasb.org/1943274/2147481800/320-10-50-10 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6B -Subparagraph (b) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6B Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Topic 820 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 6B -Subparagraph (c) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482106/820-10-50-6B Reference 7: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 942 -SubTopic 320 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/942-320/tableOfContent + Details
Name: | us-gaap_InvestmentsInDebtAndMarketableEquitySecuritiesAndCertainTradingAssetsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration