[Management View]
Safehold emphasized its expansion within the affordable housing segment, originating eight multifamily ground leases in California across the third and fourth quarters to date. The company reported a total portfolio value of $7 billion and maintained stable Ground Lease-to-Value (GLTV) and liquidity levels, with 41% of multifamily exposure dedicated to affordable assets. Management described a well-diversified transaction pipeline exceeding $300 million under LOI, with momentum in both affordable and conventional deals. Active litigation regarding the Park Hotel master lease, covering five hotels, presents unresolved legal and financial uncertainty.

[Outlook]
Management expects continued growth in the affordable housing sector and anticipates closing more deals in the coming quarters. They also foresee expansion into larger states outside California, specifically the Sunbelt and coastal regions. The company aims to maintain a strong balance sheet and liquidity position to support future growth.

[Financial Performance]
Revenue for Q3 2025 was $96.2 million, net income was $29.3 million, and earnings per share were $0.41. Excluding a prior-year $6.8 million noncash provision, earnings per share increased by $0.04 or approximately 12%, primarily from new investment activity. The GAAP portfolio cash yield was 3.8%, annualized yield was 5.4%, and economic yield was 5.9%.

[Q&A Highlights]
Question 1: Just starting with the originations, I noticed the rent coverage ticked down a little bit. Can you talk through that and the potential for more affordable housing deals?
Answer: The assets were in California on the affordable side. The team is expanding this throughout the country, and we expect results in the quarters ahead. The coverage metrics are conservative due to development deals taking time to stabilize. We see great momentum with more transactions under LOI currently.

Question 2: Any color on the timing of the Park Hotel litigation resolution?
Answer: Litigation is unfortunate but necessary to protect shareholder value. It will take some time to resolve.

Question 3: What exactly did you claim was breached in the Park Hotel lease?
Answer: It's not a rent issue but a standard of care and maintenance issue. The contract is clear, and we couldn't find an agreement on that.

Question 4: Are you seeing more office, industrial, and other types of transactions coming back to the market?
Answer: Yes, we are seeing a diversified pipeline, including hospitality, retail, and office, in addition to affordable housing.

Question 5: Expectations for economic yields going forward?
Answer: Economic yields depend on the timing of closings and the long-term bond rates. We expect yields to be consistent with current treasury rates.

Question 6: Factors driving extended timeframes for deal closings?
Answer: Development deals, especially in affordable housing, take more time to close. Nothing abnormal in the market.

Question 7: Is the Park Hotel litigation against all five hotels in the master lease?
Answer: Yes, the litigation is around all five hotels. We aim to continue hotel operations smoothly.

Question 8: Are larger transactions starting to come back?
Answer: Yes, we see larger transactions in the pipeline, especially in conventional multifamily and office sectors.

Question 9: What is the forward pipeline in dollar terms?
Answer: Over 15 deals and over $300 million of transactions are expected to close in the coming quarters.

Question 10: Does the Park Hotel litigation impact your interest in hotel originations?
Answer: No, this is an anomalous outcome and does not impact our view on the ground lease ecosystem.

Question 11: Impact of recent New York City Merrill win on affordable housing deals?
Answer: We follow supply and demand. Government regulations create friction costs, but we believe ground leases can be a major part of the solution.

Question 12: How much of your multifamily portfolio is affordable housing?
Answer: 41% of gross book value. We aim to grow this segment significantly.

Question 13: Are any of your New York City multifamily units rent stabilized?
Answer: We haven't cracked the New York market yet. We aim to play in the land part of the solution, not the equity part.

Question 14: Sensitivity of your pipeline to treasury rate moves?
Answer: The market chatter increases when rates dip, leading to more transactions. Stability in rates is beneficial for our business.

Question 15: Common criticism of ground leases regarding end-of-term investment incentives?
Answer: We look for solutions that create value. Extensions and good operators meeting lease terms can create win-win solutions.

[Sentiment Analysis]
The tone of the analysts was inquisitive and focused on understanding the company's strategic direction and the impact of ongoing litigation. Management maintained a confident and proactive tone, emphasizing growth opportunities and addressing concerns transparently.

[Quarterly Comparison]
| Metric | Q3 2025 | Q2 2025 | YoY Change |
|-------------------------|---------------|---------------|--------------|
| Revenue | $96.2 million | $94.5 million | +1.8% |
| Net Income | $29.3 million | $28.7 million | +2.1% |
| Earnings Per Share | $0.41 | $0.40 | +2.5% |
| GAAP Portfolio Cash Yield| 3.8% | 3.7% | +0.1% |
| Annualized Yield | 5.4% | 5.3% | +0.1% |
| Economic Yield | 5.9% | 5.8% | +0.1% |

[Risks and Concerns]
- Litigation regarding the Park Hotel master lease presents legal and financial uncertainty.
- Regulatory friction in affordable housing expansion.
- Sensitivity to treasury rate fluctuations impacting deal flow and economic yields.

[Final Takeaway]
Safehold continues to expand its footprint in the affordable housing sector, demonstrating strong growth and a well-diversified transaction pipeline. The company maintains a robust financial position with stable yields and liquidity. However, ongoing litigation related to the Park Hotel master lease poses potential risks. Management remains confident in navigating these challenges and capitalizing on future growth opportunities.