Starwood Property Trust Reports Results for Quarter Ended March 31, 2025
PR Newswire
MIAMI BEACH, Fla., May 9, 2025
-- Quarterly GAAP Earnings of $0.33 and Distributable Earnings (DE) of $0.45 per Diluted Share --
-- Invested $2.3 Billion, Including $1.4 Billion in Commercial Lending and Record $0.7 Billion in Infrastructure Lending --
-- Closed $1.3 Billion After Quarter End, Including $0.9 Billion in Commercial Lending --
-- Issued $500 Million of Corporate Debt, Extending Average Maturity to 3.7 Years --
-- Current Liquidity of $1.5 Billion --
-- Paid Quarterly Dividend of $0.48 per Share for Over a Decade --
MIAMI BEACH, Fla., May 9, 2025 /PRNewswire/ -- Starwood Property Trust, Inc. $(STWD)$ today announced operating results for the fiscal quarter ended March 31, 2025. The Company's first quarter 2025 GAAP net income was $112.3 million, and Distributable Earnings (a non-GAAP financial measure) was $156.3 million.
"We entered 2025 with significant financial flexibility, diversified business lines, and a solid investment portfolio that we expect to grow significantly this year, with commercial lending originations to date already surpassing all of last year. Our pipeline across businesses continues to be very active. Dislocation in securitized markets, as we are seeing today, always creates outsized opportunities for us," commented Barry Sternlicht, Chairman and CEO of Starwood Property Trust.
"With $18 billion of capital raised since our IPO, we have a demonstrated ability to access capital markets across varied market conditions. We also continue to benefit from our diverse business model, high levels of liquidity, no corporate debt maturities for over a year, $4.9 billion of unencumbered assets and $1.5 billion of unrealized property gains which we can harvest to create incremental distributable earnings," added Jeffrey DiModica, President of Starwood Property Trust.
Supplemental Schedules
The Company has published supplemental earnings schedules on its website in order to provide additional disclosure and financial information for the benefit of the Company's stakeholders. Specifically, these materials can be found on the Company's website in the Investor Relations section under "Quarterly Results" at www.starwoodpropertytrust.com.
Webcast and Conference Call Information
The Company will host a live webcast and conference call on Friday, May 9, 2025, at 10:00 a.m. Eastern Time. To listen to a live broadcast, access the site at least 15 minutes prior to the scheduled start time in order to register, download and install any necessary audio software. The webcast is available at www.starwoodpropertytrust.com in the Investor Relations section of the website. The Company encourages use of the webcast due to potential extended wait times to access the conference call via dial-in.
To Participate via Telephone Conference Call:
Dial in at least 15 minutes prior to start time.
Domestic: 1-877-407-9039
International: 1-201-689-8470
Conference Call Playback:
Domestic: 1-844-512-2921
International: 1-412-317-6671
Passcode: 13750625
The playback can be accessed through May 23, 2025.
About Starwood Property Trust, Inc.
Starwood Property Trust (NYSE: STWD), an affiliate of global private investment firm Starwood Capital Group, is a leading diversified finance company with a core focus on the real estate and infrastructure sectors. As of March 31, 2025, the Company has successfully deployed over $104 billion of capital since inception and manages a portfolio of over $26 billion across debt and equity investments. Starwood Property Trust's investment objective is to generate attractive and stable returns for shareholders, primarily through dividends, by leveraging a premiere global organization to identify and execute on the best risk adjusted returning investments across its target assets. Additional information can be found at www.starwoodpropertytrust.com.
Forward-Looking Statements
Statements in this press release which are not historical fact may be deemed forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements are developed by combining currently available information with our beliefs and assumptions and are generally identified by the words "believe," "expect," "anticipate" and other similar expressions. Although Starwood Property Trust, Inc. believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be attained. Factors that could cause actual results to differ materially from the Company's expectations include, but are not limited to, completion of pending investments and financings, continued ability to acquire additional investments, competition within the finance and real estate industries, availability of financing, and other risks detailed under the heading "Risk Factors" in the Company's Annual Report on Form 10-K for the fiscal year ended December 31, 2024, as well as other risks and uncertainties set forth from time to time in the Company's reports filed with the SEC, including its Quarterly Report on Form 10-Q for the quarter ended March 31, 2025.
In light of these risks and uncertainties, there can be no assurances that the results referred to in the forward-looking statements contained herein will in fact occur. Except to the extent required by applicable law or regulation, we undertake no obligation to, and expressly disclaim any such obligation to, update or revise any forward-looking statements to reflect changed assumptions, the occurrence of anticipated or unanticipated events, changes to future results over time or otherwise.
Additional information can be found on the Company's website at www.starwoodpropertytrust.com.
Contact:
Zachary Tanenbaum
Starwood Property Trust
Phone: 203-422-7788
Email: ztanenbaum@starwood.com
Starwood Property Trust, Inc. and Subsidiaries
Condensed Consolidated Statement of Operations by Segment
For the three months ended March 31, 2025
(Amounts in thousands)
Commercial and
Residential Infrastructure Investing
Lending Lending Property and Servicing Securitization
Segment Segment Segment Segment Corporate Subtotal VIEs Total
------------------------------ ----------------- ------------- ---------------- --------------- ---------- ------------------- ---------
Revenues:
Interest income
from loans $ 290,299 $ 60,456 $ -- $ 3,168 $ -- $ 353,923 $ -- $ 353,923
Interest income
from investment
securities 23,889 154 -- 28,174 -- 52,217 (39,996) 12,221
Servicing fees 65 -- -- 21,829 -- 21,894 (4,434) 17,460
Rental income 8,203 -- 16,315 4,665 -- 29,183 -- 29,183
Other revenues 3,010 1,015 234 1,039 95 5,393 -- 5,393
------------------------------ ----------------- ------------- ---------------- --------------- ---------- ------------------- ---------
Total revenues 325,466 61,625 16,549 58,875 95 462,610 (44,430) 418,180
------------------------------ ----------------- ------------- ---------------- --------------- ---------- ------------------- ---------
Costs and
expenses:
Management fees 180 -- -- -- 40,583 40,763 -- 40,763
Interest expense 165,551 35,154 8,977 8,133 74,538 292,353 (195) 292,158
General and
administrative 14,606 5,018 1,414 22,501 4,608 48,147 -- 48,147
Costs of rental
operations 5,518 -- 6,018 3,284 -- 14,820 -- 14,820
Depreciation and
amortization 3,607 10 5,865 1,751 251 11,484 -- 11,484
Credit loss
(reversal)
provision, net (25,759) 760 -- -- -- (24,999) -- (24,999)
Other expense (25) 1,923 (82) 35 -- 1,851 -- 1,851
------------------------------ ----------------- ------------- ---------------- --------------- ---------- ------------------- ---------
Total costs
and expenses 163,678 42,865 22,192 35,704 119,980 384,419 (195) 384,224
------------------------------ ----------------- ------------- ---------------- --------------- ---------- ------------------- ---------
Other income
(loss):
Change in net
assets related
to consolidated
VIEs -- -- -- -- -- -- 28,691 28,691
Change in fair
value of
servicing
rights -- -- -- (114) -- (114) 867 753
Change in fair
value of
investment
securities, net 7,397 -- -- (22,629) -- (15,232) 15,059 (173)
Change in fair
value of
mortgage loans,
net 42,574 -- -- 15,830 -- 58,404 -- 58,404
Income from
affordable
housing fund
investments -- -- 3,910 -- -- 3,910 -- 3,910
Earnings (loss)
from
unconsolidated
entities 1,296 (622) -- 245 -- 919 (382) 537
(Loss) gain on
derivative
financial
instruments,
net (65,838) (19) (98) (1,073) 27,339 (39,689) -- (39,689)
Foreign currency
gain (loss),
net 34,616 236 (61) -- -- 34,791 -- 34,791
Other (loss)
income, net (489) -- (828) 4 -- (1,313) -- (1,313)
------------------------------ ----------------- ------------- ---------------- --------------- ---------- ------------------- ---------
Total other
income
(loss) 19,556 (405) 2,923 (7,737) 27,339 41,676 44,235 85,911
------------------------------ ----------------- ------------- ---------------- --------------- ---------- ------------------- ---------
Income (loss)
before income
taxes 181,344 18,355 (2,720) 15,434 (92,546) 119,867 -- 119,867
Income tax
provision (294) (133) -- (3,339) -- (3,766) -- (3,766)
------------------------------ ----------------- ------------- ---------------- --------------- ---------- ------------------- ---------
Net income (loss) 181,050 18,222 (2,720) 12,095 (92,546) 116,101 -- 116,101
Net (income)
loss
attributable to
non-controlling
interests (3) -- (5,084) 1,241 -- (3,846) -- (3,846)
------------------------------ ----------------- ------------- ---------------- --------------- ---------- ------------------- ---------
Net income
(loss)
attributable to
Starwood
Property
Trust, Inc. $ 181,047 $ 18,222 $ (7,804) $ 13,336 $ (92,546) $ 112,255 $ -- $ 112,255
============================== ================= ============= ================ =============== ========== =================== =========
Definition of Distributable Earnings
Distributable Earnings, a non-GAAP financial measure, is used to compute the Company's incentive fees to its external manager and is an appropriate supplemental disclosure for a mortgage REIT. For the Company's purposes, Distributable Earnings is defined as GAAP net income (loss) excluding non-cash equity compensation expense, the incentive fee due to the Company's external manager, acquisition costs for successful acquisitions, depreciation and amortization of real estate and associated intangibles, any unrealized gains, losses or other non-cash items recorded in net income (loss) for the period and, to the extent deducted from net income (loss), distributions payable with respect to equity securities of subsidiaries issued in exchange for properties or interests therein. The amount is adjusted to exclude one-time events pursuant to changes in GAAP and certain other non-cash adjustments as determined by the Company's external manager and approved by a majority of the Company's independent directors. Refer to the Company's Quarterly Report on Form 10-Q for the quarter ended March 31, 2025 for additional information regarding Distributable Earnings.
Reconciliation of Net Income to Distributable Earnings
For the three months ended March 31, 2025
(Amounts in thousands except per share data)
Commercial and
Residential Infrastructure Investing
Lending Lending Property and Servicing
Segment Segment Segment Segment Corporate Total
-------------------------------------- -------------------------------------- ------------------------------------ -------------------------------------- ------------------------------------- --------------------------------------
Net income (loss)
attributable to
Starwood
Property Trust, Inc. $ 181,047 $ 18,222 $ (7,804) $ 13,336 $ (92,546) $ 112,255
Add / (Deduct):
Non-controlling
interests
attributable to
Woodstar II Class A
Units -- -- 4,659 -- -- 4,659
Non-controlling
interests
attributable to
unrealized
gains/losses -- -- (3,374) (4,503) -- (7,877)
Non-cash equity
compensation
expense 2,792 600 109 1,397 8,452 13,350
Management incentive
fee -- -- -- -- 10,061 10,061
Depreciation and
amortization 3,742 -- 5,971 1,852 -- 11,565
Interest income
adjustment for loans
and securities 6,216 -- -- 15,162 -- 21,378
Consolidated
income tax
provision associated
with fair
value adjustments 294 133 -- 3,339 -- 3,766
Other non-cash items 3 -- 295 (366) -- (68)
Reversal of GAAP
unrealized and
realized (gains) /
losses on:
Loans (42,574) -- -- (15,830) -- (58,404)
Credit loss
(reversal)
provision, net (25,759) 760 -- -- -- (24,999)
Securities (7,397) -- -- 22,629 -- 15,232
Woodstar Fund
investments -- -- (3,910) -- -- (3,910)
Derivatives 65,838 19 98 1,073 (27,339) 39,689
Foreign currency (34,616) (236) 61 -- -- (34,791)
(Earnings) loss from
unconsolidated
entities (1,296) 622 -- (245) -- (919)
Recognition of
Distributable
realized gains /
(losses) on:
Loans (180) -- -- 14,707 -- 14,527
Securities (31) -- -- (2,533) -- (2,564)
Woodstar Fund
investments -- -- 20,321 -- -- 20,321
Derivatives 29,041 53 (97) (1,024) (7,034) 20,939
Foreign currency 386 (33) (61) -- -- 292
Earnings (loss) from
unconsolidated
entities 1,296 (108) -- 606 -- 1,794
Distributable
Earnings (Loss) $ 178,802 $ 20,032 $ 16,268 $ 49,600 $ (108,406) $ 156,296
====================================== ====================================== ==================================== ====================================== ===================================== ======================================
Distributable
Earnings (Loss) per
Weighted Average
Diluted Share $ 0.51 $ 0.06 $ 0.05 $ 0.14 $ (0.31) $ 0.45
====================================== ====================================== ==================================== ====================================== ===================================== ======================================
Starwood Property Trust, Inc. and Subsidiaries
Condensed Consolidated Balance Sheet by Segment
As of March 31, 2025
(Amounts in thousands)
Commercial and
Residential Infrastructure Investing
Lending Lending Property and Servicing Securitization
Segment Segment Segment Segment Corporate Subtotal VIEs Total
------------------------- ---------------------- ---------------------- ---------------------- -------------------- -------------------- -------------------------- --------------------
Assets:
Cash and cash
equivalents $ 19,249 $ 161,387 $ 32,113 $ 22,109 $ 205,722 $ 440,580 $ -- $ 440,580
Restricted cash 96,106 19,306 1,158 349 134,852 251,771 -- 251,771
Loans
held-for-investment,
net 13,813,048 2,708,931 -- -- -- 16,521,979 -- 16,521,979
Loans held-for-sale 2,375,642 -- -- 70,994 -- 2,446,636 -- 2,446,636
Investment securities 871,299 17,158 -- 1,148,978 -- 2,037,435 (1,539,976) 497,459
Properties, net 695,579 -- 652,965 64,690 -- 1,413,234 -- 1,413,234
Investments of
consolidated affordable
housing fund -- -- 2,065,498 -- -- 2,065,498 -- 2,065,498
Investments in
unconsolidated
entities 26,612 53,483 -- 33,265 -- 113,360 (14,898) 98,462
Goodwill -- 119,409 -- 140,437 -- 259,846 -- 259,846
Intangible assets 9,914 -- 21,438 63,323 -- 94,675 (34,878) 59,797
Derivative assets 82,602 -- 17 4 2,349 84,972 -- 84,972
Accrued interest
receivable 128,296 14,029 -- 338 28 142,691 -- 142,691
Other assets 213,713 3,478 54,472 9,033 129,108 409,804 -- 409,804
VIE assets, at fair
value -- -- -- -- -- -- 37,470,618 37,470,618
------------------------- ---------------------- ---------------------- ---------------------- -------------------- -------------------- -------------------------- --------------------
Total Assets $ 18,332,060 $ 3,097,181 $ 2,827,661 $ 1,553,520 $ 472,059 $ 26,282,481 $ 35,880,866 $ 62,163,347
========================= ====================== ====================== ====================== ==================== ==================== ========================== ====================
Liabilities and Equity
Liabilities:
Accounts payable,
accrued expenses
and other liabilities $ 297,370 $ 36,186 $ 13,966 $ 29,395 $ 102,978 $ 479,895 $ -- $ 479,895
Related-party payable -- -- -- -- 36,538 36,538 -- 36,538
Dividends payable -- -- -- -- 165,039 165,039 -- 165,039
Derivative liabilities 52,248 -- -- -- 20,727 72,975 -- 72,975
Secured financing
agreements, net 8,942,642 961,524 480,322 527,359 1,546,810 12,458,657 (20,219) 12,438,438
Collateralized loan
obligations and single
asset securitization,
net 1,935,109 1,230,187 -- -- -- 3,165,296 -- 3,165,296
Unsecured senior notes,
net -- -- -- -- 2,747,330 2,747,330 -- 2,747,330
VIE liabilities, at fair
value -- -- -- -- -- -- 35,901,085 35,901,085
------------------------- ---------------------- ---------------------- ---------------------- -------------------- -------------------- -------------------------- --------------------
Total Liabilities 11,227,369 2,227,897 494,288 556,754 4,619,422 19,125,730 35,880,866 55,006,596
------------------------- ---------------------- ---------------------- ---------------------- -------------------- -------------------- -------------------------- --------------------
Temporary Equity:
Redeemable non-controlling
interests -- -- 426,835 -- -- 426,835 -- 426,835
Permanent Equity:
Starwood Property
Trust, Inc.
Stockholders' Equity:
Common stock -- -- -- -- 3,468 3,468 -- 3,468
Additional paid-in capital 834,079 591,500 (395,292) (746,610) 6,060,216 6,343,893 -- 6,343,893
Treasury stock -- -- -- -- (138,022) (138,022) -- (138,022)
Retained earnings
(accumulated deficit) 6,257,767 277,784 2,094,585 1,626,488 (10,073,025) 183,599 -- 183,599
Accumulated other
comprehensive income 12,727 -- -- -- -- 12,727 -- 12,727
------------------------- ---------------------- ---------------------- ---------------------- -------------------- -------------------- -------------------------- --------------------
Total Starwood Property
Trust, Inc.
Stockholders' Equity 7,104,573 869,284 1,699,293 879,878 (4,147,363) 6,405,665 -- 6,405,665
Non-controlling interests
in
consolidated subsidiaries 118 -- 207,245 116,888 -- 324,251 -- 324,251
------------------------- ---------------------- ---------------------- ---------------------- -------------------- -------------------- -------------------------- --------------------
Total Permanent Equity 7,104,691 869,284 1,906,538 996,766 (4,147,363) 6,729,916 -- 6,729,916
------------------------- ---------------------- ---------------------- ---------------------- -------------------- -------------------- -------------------------- --------------------
Total Liabilities and
Equity $ 18,332,060 $ 3,097,181 $ 2,827,661 $ 1,553,520 $ 472,059 $ 26,282,481 $ 35,880,866 $ 62,163,347
========================= ====================== ====================== ====================== ==================== ==================== ========================== ====================
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SOURCE Starwood Property Trust, Inc.
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May 09, 2025 07:00 ET (11:00 GMT)
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