Multi-family Loans, at Fair Value (Tables)

6 Months Ended

Jun. 30, 2024

Schedule of Mezzanine Loans and Preferred Equity Investments

Multi-family loans consist of the following as of June 30, 2024 and December 31, 2023, respectively (dollar amounts in thousands):


	June 30, 2024		December 31, 2023
Investment amount	$	97,411	$	95,434
Unrealized (losses) gains, net	(4,414)		358
Total, at Fair Value	$	92,997	$	95,792

During the three and six months ended June 30, 2024, the Company invested in subordinated securities issued by a Freddie Mac-sponsored residential loan securitization, resulting in the initial consolidation of the VIE as shown below (dollar amounts in thousands):



Residential loans, at fair value	$	285,057
Collateralized debt obligations, at fair value	(275,200)
Net investment	$	9,857

The following table presents condensed statements of operations for non-Company-sponsored VIEs for the three months ended June 30, 2024 and 2023, respectively (dollar amounts in thousands). The following table includes net (loss) income from assets and liabilities of disposal group held for sale and intercompany balances have been eliminated for purposes of this presentation.


	Three Months Ended June 30,
	2024						2023
	Consolidated SLST		Consolidated Real Estate		Total		Consolidated SLST		Consolidated Real Estate		Total
Interest income	$	9,154	$	—	$	9,154	$	8,440	$	—	$	8,440
Interest expense	6,752		—		6,752		5,966		—		5,966
Total net interest income	2,402		—		2,402		2,474		—		2,474

Income from real estate	—		33,535		33,535		—		41,885		41,885
Expenses related to real estate	—		46,882		46,882		—		49,881		49,881
Total net loss from real estate	—		(13,347)		(13,347)		—		(7,996)		(7,996)


Unrealized gains (losses), net	542		—		542		(12,328)		—		(12,328)
Gains on derivative instruments, net	—		329		329		—		6,556		6,556
Impairment of real estate	—		(3,557)		(3,557)		—		(16,864)		(16,864)

Other income	—		4		4		—		25		25
Total other income (loss)	542		(3,224)		(2,682)		(12,328)		(10,283)		(22,611)



Net income (loss)	2,944		(16,571)		(13,627)		(9,854)		(18,279)		(28,133)
Net loss attributable to non-controlling interest in Consolidated VIEs	—		8,494		8,494		—		3,892		3,892
Net income (loss) attributable to Company	$	2,944	$	(8,077)	$	(5,133)	$	(9,854)	$	(14,387)	$	(24,241)


	Six Months Ended June 30,
	2024						2023
	Consolidated SLST		Consolidated Real Estate		Total		Consolidated SLST		Consolidated Real Estate		Total
Interest income	$	17,281	$	—	$	17,281	$	17,173	$	—	$	17,173
Interest expense	12,553		—		12,553		12,280		—		12,280
Total net interest income	4,728		—		4,728		4,893		—		4,893

Income from real estate	—		68,628		68,628		—		80,960		80,960
Expenses related to real estate	—		98,643		98,643		—		97,943		97,943
Total net loss from real estate	—		(30,015)		(30,015)		—		(16,983)		(16,983)


Unrealized gains (losses), net	506		—		506		(10,029)		—		(10,029)
Gains on derivative instruments, net	—		2,848		2,848		—		5,258		5,258
Impairment of real estate	—		(35,771)		(35,771)		—		(27,139)		(27,139)
Loss on reclassification of disposal group	—		(14,636)		(14,636)		—		—		—
Other income	—		7		7		—		41		41
Total other income (loss)	506		(47,552)		(47,046)		(10,029)		(21,840)		(31,869)



Net income (loss)	5,234		(77,567)		(72,333)		(5,136)		(38,823)		(43,959)
Net loss attributable to non-controlling interest in Consolidated VIEs	—		30,652		30,652		—		10,593		10,593
Net income (loss) attributable to Company	$	5,234	$	(46,915)	$	(41,681)	$	(5,136)	$	(28,230)	$	(33,366)

Schedule of Preferred Equity and Mezzanine Loans, Fair Value Compared to Unpaid Principal

The table below presents the fair value and aggregate unpaid principal balance of the Company's multi-family loan in non-accrual status as of June 30, 2024 and December 31, 2023, respectively (dollar amounts in thousands):


	June 30, 2024				December 31, 2023
Days Late	Fair Value (1)		Unpaid Principal Balance		Fair Value		Unpaid Principal Balance



90 +	$	—	$	3,363	$	4,753	$	3,363

(1)As of June 30, 2024, the Company has reduced the fair value of the multi-family loan to zero as a result of recent developments with respect to the property, its financing and market conditions.

Schedule of Geographic Concentration of Credit Risk Exceeding 5% of Balances

The geographic concentrations of credit risk exceeding 5% of the unpaid principal balance of residential loans, at fair value as of June 30, 2024 and December 31, 2023, respectively, are as follows:


	June 30, 2024						December 31, 2023
	Residential loans		Consolidated SLST		Residential loans held in securitization trusts		Residential loans		Consolidated SLST		Residential loans held in securitization trusts
California	19.7	%	11.5	%	20.6	%	22.4	%	10.7	%	18.4	%
Florida	11.7	%	9.2	%	13.9	%	15.5	%	10.3	%	11.0	%
New York	8.6	%	10.6	%	7.3	%	7.0	%	10.0	%	8.5	%
New Jersey	6.0	%	6.7	%	5.2	%	4.9	%	7.6	%	6.0	%
Texas	5.3	%	4.3	%	8.1	%	8.1	%	3.9	%	7.1	%
Massachusetts	5.2	%	2.7	%	2.6	%	1.8	%	2.6	%	2.7	%
Illinois	3.1	%	6.3	%	3.0	%	3.0	%	7.2	%	3.5	%

The geographic concentrations of credit risk exceeding 5% of the total multi-family loan investment amounts as of June 30, 2024 and December 31, 2023, respectively, are as follows:


	June 30, 2024		December 31, 2023
Texas	32.7	%	32.6	%
Tennessee	15.4	%	15.2	%
Florida	10.5	%	10.5	%
Arkansas	9.5	%	9.5	%
Louisiana	7.8	%	7.5	%
Alabama	6.7	%	6.7	%
North Carolina	5.7	%	5.8	%
Indiana	5.2	%	5.3	%

- Definition

Tabular disclosure of the significant judgments and assumptions made in determining whether a variable interest (as defined) held by the entity requires the variable interest entity (VIE) (as defined) to be consolidated and (or) disclose information about its involvement with the VIE, individually or in aggregate (as applicable); the nature of restrictions, if any, on the consolidated VIE's assets and on the settlement of its liabilities reported by an entity in its statement of financial position, including the carrying amounts of such assets and liabilities; the nature of, and changes in, the risks associated with involvement in the VIE; how involvement with the VIE affects the entity's financial position, financial performance, and cash flows; the lack of recourse if creditors (or beneficial interest holders) of the consolidated VIE have no recourse to the general credit of the primary beneficiary (if applicable); the terms of arrangements, giving consideration to both explicit arrangements and implicit variable interests, if any, that could require the entity to provide financial support to the VIE, including events or circumstances that could expose the entity to a loss; the methodology used by the entity for determining whether or not it is the primary beneficiary of the variable interest entity; the significant factors considered and judgments made in determining that the power to direct the activities of a VIE that most significantly impact the VIE's economic performance are shared (as defined); the carrying amounts and classification of assets and liabilities of the VIE included in the statement of financial position; the entity's maximum exposure to loss, if any, as a result of its involvement with the VIE, including how the maximum exposure is determined and significant sources of the entity's exposure to the VIE; a comparison of the carrying amounts of the assets and liabilities and the entity's maximum exposure to loss; information about any liquidity arrangements, guarantees, and (or) other commitments by third parties that may affect the fair value or risk of the entity's variable interest in the VIE; whether or not the entity has provided financial support or other support (explicitly or implicitly) to the VIE that it was not previously contractually required to provide or whether the entity intends to provide that support, including the type and amount of the support and the primary reasons for providing the support; and supplemental information the entity determines necessary to provide.

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