• Arbor Realty Trust Reports First Quarter 2025 Results and Declares Dividend of $0.30 per Share

    Source: Nasdaq GlobeNewswire / 02 May 2025 08:30:13   America/New_York

    Company Highlights:

    • GAAP net income of $0.16 per diluted common share
    • Distributable earnings1 of $0.28, or $0.31 per diluted common share, excluding $7.1 million of realized losses from the sale of two real estate owned properties that were previously reserved
    • Declares cash dividend on common stock of $0.30 per share
    • Closed on a new $1.15 billion repurchase facility to unwind in full two CLO vehicles; enhancing leverage, reducing pricing and generated ~$80 million of additional liquidity
    • Servicing portfolio of ~$33.48 billion, agency loan originations of $605.9 million
    • Structured loan portfolio of ~$11.49 billion, originations of $747.1 million and runoff of $421.9 million
    • Foreclosed on seven non-performing loans as real estate owned assets totaling $196.7 million

    UNIONDALE, N.Y., May 02, 2025 (GLOBE NEWSWIRE) -- Arbor Realty Trust, Inc. (NYSE: ABR), today announced financial results for the first quarter ended March 31, 2025. Arbor reported net income for the quarter of $30.4 million, or $0.16 per diluted common share, compared to net income of $57.9 million, or $0.31 per diluted common share for the quarter ended March 31, 2024. Distributable earnings for the quarter was $57.3 million, or $0.28 per diluted common share, compared to $96.7 million, or $0.47 per diluted common share for the quarter ended March 31, 2024.

    Agency Business

    Loan Origination Platform

     Agency Loan Volume (in thousands)
     Quarter Ended
     March 31, 2025 December 31, 2024
    Fannie Mae$357,811  $556,676 
    Freddie Mac 178,020   675,244 
    Private Label 44,925   27,650 
    FHA 16,041   119,050 
    SFR-Fixed Rate 9,111   — 
    Total Originations$605,908  $1,378,620 
        
    Total Loan Sales$730,854  $1,270,048 
        
    Total Loan Commitments$645,401  $1,353,527 
            

    For the quarter ended March 31, 2025, the Agency Business generated revenues of $62.9 million, compared to $78.7 million for the fourth quarter of 2024. Gain on sales, including fee-based services, net was $12.8 million for the quarter, reflecting a margin of 1.75%, compared to $22.2 million and 1.75% for the fourth quarter of 2024. Income from mortgage servicing rights was $8.1 million for the quarter, reflecting a rate of 1.26% as a percentage of loan commitments, compared to $13.3 million and 0.99% for the fourth quarter of 2024.

    At March 31, 2025, loans held-for-sale was $314.6 million, with financing associated with these loans totaling $279.4 million.

    Fee-Based Servicing Portfolio

    The Company’s fee-based servicing portfolio totaled $33.48 billion at March 31, 2025. Servicing revenue, net was $25.6 million for the quarter and consisted of servicing revenue of $43.4 million, net of amortization of mortgage servicing rights totaling $17.8 million.

     Fee-Based Servicing Portfolio ($ in thousands)
     March 31, 2025 December 31, 2024
     UPB Wtd. Avg. Fee (bps) Wtd. Avg. Life (years) UPB Wtd. Avg. Fee (bps) Wtd. Avg. Life (years)
    Fannie Mae$22,683,885  46.2 6.2 $22,730,056  46.4 6.4
    Freddie Mac 6,123,074  21.4 6.6  6,077,020  21.5 6.8
    Private Label 2,603,122  18.7 5.3  2,605,980  18.7 5.5
    FHA 1,519,675  14.0 19.0  1,506,948  14.1 19.2
    Bridge 278,293  10.4 2.8  278,494  10.4 3.0
    SFR-Fixed Rate 276,839  20.1 4.1  271,859  20.1 4.4
    Total$33,484,888  37.5 6.7 $33,470,357  37.8 6.9
                    

    Loans sold under the Fannie Mae program contain an obligation to partially guarantee the performance of the loan (“loss-sharing obligations”) and includes $34.7 million for the fair value of the guarantee obligation undertaken at March 31, 2025. The Company recorded a $1.9 million net provision for loss sharing associated with CECL for the first quarter of 2025. At March 31, 2025, the Company’s total CECL allowance for loss-sharing obligations was $50.8 million, representing 0.22% of the Fannie Mae servicing portfolio.

    Structured Business

    Portfolio and Investment Activity

     Structured Portfolio Activity ($ in thousands)
     Quarter Ended
     March 31, 2025 December 31, 2024
     UPB %  UPB %
    Bridge:       
    Multifamily$367,750   49% $371,250   54%
    SFR 356,294   48%  273,087   40%
      724,044   97%  644,337   94%
         .  
    Mezzanine/Preferred Equity 4,440   1%  35,592   5%
    Construction - Multifamily 18,637   2%  4,368   1%
    Total Originations$747,121   100% $684,297   100%
            
    Number of Loans Originated 20     28   
            
    Commitments:       
    SFR$162,400    $375,894   
    Construction - Multifamily 92,000     54,000   
    Total Commitments$254,400    $429,894   
            
    Loan Runoff$421,941    $900,583   
                


     Structured Portfolio ($ in thousands)
     March 31, 2025 December 31, 2024
     UPB %  UPB %
    Bridge:       
    Multifamily$8,637,773   75% $8,725,429   76%
    SFR 2,247,817   20%  1,993,890   18%
    Other 171,952   1%  173,787   2%
      11,057,542   96%  10,893,106   96%
            
    Mezzanine/Preferred Equity 405,770   4%  404,401   3%
    Construction - Multifamily 23,005   <1%  4,367   <1%
    SFR Permanent 3,076   <1%  3,082   <1%
    Total Portfolio$11,489,393   100% $11,304,956   100%
                    

    At March 31, 2025, the loan and investment portfolio’s unpaid principal balance ("UPB"), excluding loan loss reserves, was $11.49 billion, with a weighted average interest rate of 6.94%, compared to $11.30 billion and 6.90% at December 31, 2024. Including certain fees earned and costs associated with the loan and investment portfolio, the weighted average interest rate was 7.85% at March 31, 2025, compared to 7.80% at December 31, 2024.

    The average balance of the Company’s loan and investment portfolio during the first quarter of 2025, excluding loan loss reserves, was $11.39 billion with a weighted average yield of 8.15%, compared to $11.46 billion and 8.52% for the fourth quarter of 2024. The decrease in yield was primarily due to a decrease in the average SOFR rate in the first quarter of 2025.

    During the first quarter of 2025, the Company recorded an $8.4 million net provision for loan losses associated with CECL. At March 31, 2025, the Company’s total allowance for loan losses was $240.9 million. The Company had twenty-three non-performing loans with a UPB of $511.1 million, before related loan loss reserves of $35.3 million, compared to twenty-six loans with a UPB of $651.8 million, before loan loss reserves of $23.8 million at December 31, 2024.

    In addition, at March 31, 2025, the Company had five loans with a total UPB of $142.8 million (before related loan loss reserves of $7.3 million) that were less than 60 days past due classified as non-accrual, compared to nine loans with a total UPB of $167.4 million at December 31, 2024. Interest income on these loans is only being recorded to the extent cash is received.

    During the first quarter of 2025, the Company modified twenty-one loans with a total UPB of $949.8 million, most of which had borrowers investing additional capital to recapitalize their deals. Nineteen of these loans with a total UPB of $849.4 million, contained interest rates based on pricing over SOFR ranging from 3.10% to 4.25% and were modified to provide temporary rate relief through a pay and accrual feature. At March 31, 2025, these modified loans had a weighted average pay rate of 5.18% and a weighted average accrual rate of 2.56%. In addition, of the total modified loans for the first quarter, $16.5 million were less than 60 days past due and $38.3 million were non-performing at December 31, 2024, and are now current in accordance with their modified terms.

    Financing Activity

    The balance of debt that finances the Company’s loan and investment portfolio at March 31, 2025 was $9.49 billion with a weighted average interest rate including fees of 6.82%, as compared to $9.46 billion and a rate of 6.88% at December 31, 2024.

    The average balance of debt that finances the Company’s loan and investment portfolio for the first quarter of 2025 was $9.42 billion, as compared to $9.67 billion for the fourth quarter of 2024. The average cost of borrowings for the first quarter of 2025 was 6.96%, compared to 7.10% for the fourth quarter of 2024.

    In March 2025, the Company closed a $1.15 billion repurchase facility and transferred approximately $1.43 billion of assets into this facility, $1.34 billion of which were from two of the Company's existing CLO vehicles that were redeemed in full and at par. The facility is match funded with 80% leverage and pricing of SOFR plus 1.85%, well below the pricing of SOFR plus 2.24% and 77% leverage of the CLOs replaced at the time of redemption. Additionally, this facility is 88% non-recourse to the Company and has a 24-month reinvestment period. As a result of these transactions, the Company created approximately $80 million of additional liquidity and has increased the returns on these assets through enhanced leverage and reduced pricing.

    Dividend

    The Company announced today that its Board of Directors has declared a quarterly cash dividend of $0.30 per share of common stock for the quarter ended March 31, 2025. The dividend is payable on May 30, 2025 to common stockholders of record on May 16, 2025.

    Earnings Conference Call

    The Company will host a conference call today at 10:00 a.m. Eastern Time. A live webcast and replay of the conference call will be available at www.arbor.com in the investor relations section of the Company’s website, or you can access the call telephonically at least ten minutes prior to the conference call. The dial-in numbers are (800) 579-2543 for domestic callers and (785) 424-1789 for international callers. Please use participant passcode ABRQ125 when prompted by the operator.

    A telephonic replay of the call will be available until May 9, 2025. The replay dial-in numbers are (800) 934-2127 for domestic callers and (402) 220-1139 for international callers.

    About Arbor Realty Trust, Inc.

    Arbor Realty Trust, Inc. (NYSE: ABR) is a nationwide real estate investment trust and direct lender, providing loan origination and servicing for multifamily, single-family rental (SFR) portfolios, and other diverse commercial real estate assets. Headquartered in New York, Arbor manages a multibillion-dollar servicing portfolio, specializing in government-sponsored enterprise products. Arbor is a leading Fannie Mae DUS® lender and Freddie Mac Optigo® Seller/Servicer, and an approved FHA Multifamily Accelerated Processing (MAP) lender. Arbor’s product platform also includes bridge, CMBS, mezzanine and preferred equity loans. Rated by Standard and Poor’s and Fitch Ratings, Arbor is committed to building on its reputation for service, quality, and customized solutions with an unparalleled dedication to providing our clients excellence over the entire life of a loan.

    Safe Harbor Statement

    Certain items in this press release may constitute forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations and beliefs and are subject to a number of trends and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Arbor can give no assurance that its expectations will be attained. Factors that could cause actual results to differ materially from Arbor’s expectations include, but are not limited to, changes in economic conditions generally, and the real estate markets specifically, continued ability to source new investments, changes in interest rates and/or credit spreads, and other risks detailed in Arbor’s Annual Report on Form 10-K for the year ended December 31, 2024 and its other reports filed with the SEC. Such forward-looking statements speak only as of the date of this press release. Arbor expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in Arbor’s expectations with regard thereto or change in events, conditions, or circumstances on which any such statement is based.

    Notes

    1. During the quarterly earnings conference call, the Company may discuss non-GAAP financial measures as defined by SEC Regulation G. In addition, the Company has used non-GAAP financial measures in this press release. A supplemental schedule of non-GAAP financial measures and the comparable GAAP financial measure can be found on the last two pages of this release.
    Contact:     Arbor Realty Trust, Inc.
    Investor Relations
    516-506-4200
    InvestorRelations@arbor.com
       


    ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
    Consolidated Statements of Income - (Unaudited)
    ($ in thousands—except share and per share data)
     
     Quarter Ended March 31,
      2025   2024 
    Interest income$240,693  $321,292 
    Interest expense 165,251   217,676 
    Net interest income 75,442   103,616 
    Other revenue:   
    Gain on sales, including fee-based services, net 12,781   16,666 
    Mortgage servicing rights 8,131   10,199 
    Servicing revenue, net 25,603   31,526 
    Property operating income 4,387   1,570 
    Gain (loss) on derivative instruments, net 3,400   (5,257)
    Other income, net 4,419   2,333 
    Total other revenue 58,721   57,037 
    Other expenses:   
    Employee compensation and benefits 46,036   47,694 
    Selling and administrative 16,312   13,933 
    Property operating expenses 3,474   1,678 
    Depreciation and amortization 3,744   2,571 
    Provision for loss sharing (net of recoveries) 1,786   273 
    Provision for credit losses (net of recoveries) 9,075   19,118 
    Total other expenses 80,427   85,267 
    Income before extinguishment of debt, loss on real estate, (loss) income from equity affiliates and income taxes 53,736   75,386 
    Loss on extinguishment of debt (2,319)  — 
    Loss on real estate (2,810)  — 
    (Loss) income from equity affiliates (1,634)  1,418 
    Provision for income taxes (3,591)  (3,592)
    Net income 43,382   73,212 
    Preferred stock dividends 10,342   10,342 
    Net income attributable to noncontrolling interest 2,602   4,997 
    Net income attributable to common stockholders$30,438  $57,873 
        
    Basic earnings per common share$0.16  $0.31 
    Diluted earnings per common share$0.16  $0.31 
        
    Weighted average shares outstanding:   
    Basic 190,060,776   188,710,390 
    Diluted 206,862,320   222,926,076 
        
    Dividends declared per common share$0.43  $0.43 
            


    ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
    Consolidated Balance Sheets
    ($ in thousands—except share and per share data)
     
     March 31, 2025
    (Unaudited)    		 December 31, 2024
    Assets:   
    Cash and cash equivalents$308,842  $503,803 
    Restricted cash 40,563   156,376 
    Loans and investments, net (allowance for credit losses of $240,937 and $238,967) 11,215,625   11,033,997 
    Loans held-for-sale, net 314,635   435,759 
    Capitalized mortgage servicing rights, net 357,220   368,678 
    Securities held-to-maturity, net (allowance for credit losses of $10,767 and $10,846) 158,658   157,154 
    Investments in equity affiliates 77,095   76,312 
    Real estate owned, net 302,158   176,543 
    Due from related party 9,605   12,792 
    Goodwill and other intangible assets 87,727   88,119 
    Other assets 495,221   481,448 
    Total assets$13,367,349  $13,490,981 
        
    Liabilities and Equity:   
    Credit and repurchase facilities$4,780,753  $3,559,490 
    Securitized debt 3,286,395   4,622,489 
    Senior unsecured notes 1,237,160   1,236,147 
    Convertible senior unsecured notes 286,555   285,853 
    Junior subordinated notes to subsidiary trust issuing preferred securities 144,890   144,686 
    Mortgage notes payable — real estate owned 123,851   74,897 
    Due to related party 1,458   4,474 
    Due to borrowers 52,062   47,627 
    Allowance for loss-sharing obligations 85,515   83,150 
    Other liabilities 239,251   280,198 
    Total liabilities 10,237,890   10,339,011 
        
    Equity:   
    Arbor Realty Trust, Inc. stockholders' equity:   
    Preferred stock, cumulative, redeemable, $0.01 par value: 100,000,000 shares authorized, shares issued and outstanding by period: 633,682   633,684 
    Special voting preferred shares - 16,173,761 shares   
    6.375% Series D - 9,200,000 shares   
    6.25% Series E - 5,750,000 shares   
    6.25% Series F - 11,342,000 shares   
    Common stock, $0.01 par value: 500,000,000 shares authorized - 192,161,707 and 189,259,435 shares issued and outstanding 1,922   1,893 
    Additional paid-in capital 2,410,499   2,375,469 
    (Accumulated deficit) retained earnings (38,600)  13,039 
    Total Arbor Realty Trust, Inc. stockholders' equity 3,007,503   3,024,085 
    Noncontrolling interest 121,956   127,885 
    Total equity 3,129,459   3,151,970 
    Total liabilities and equity$13,367,349  $13,490,981 
            


    ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
    Statement of Income Segment Information - (Unaudited)
    (in thousands)
     
     Quarter Ended March 31, 2025
     Structured
    Business    		 Agency
    Business    		 Other (1) Consolidated
    Interest income$230,087  $10,606  $—  $240,693 
    Interest expense 161,579   3,672   —   165,251 
    Net interest income 68,508   6,934   —   75,442 
    Other revenue:       
    Gain on sales, including fee-based services, net —   12,781   —   12,781 
    Mortgage servicing rights —   8,131   —   8,131 
    Servicing revenue —   43,361   —   43,361 
    Amortization of MSRs —   (17,758)  —   (17,758)
    Property operating income 4,387   —   —   4,387 
    Gain on derivative instruments, net —   3,400   —   3,400 
    Other income, net 2,078   2,341   —   4,419 
    Total other revenue 6,465   52,256   —   58,721 
    Other expenses:       
    Employee compensation and benefits 18,157   27,879   —   46,036 
    Selling and administrative 8,932   7,380   —   16,312 
    Property operating expenses 3,474   —   —   3,474 
    Depreciation and amortization 3,352   392   —   3,744 
    Provision for loss sharing —   1,786   —   1,786 
    Provision for credit losses (net of recoveries) 9,154   (79)  —   9,075 
    Total other expenses 43,069   37,358   —   80,427 
    Income before extinguishment of debt, loss on real estate, loss from equity affiliates and income taxes 31,904   21,832   —   53,736 
    Loss on extinguishment of debt (2,319)  —   —   (2,319)
    Loss on real estate (2,810)  —   —   (2,810)
    Loss from equity affiliates (1,634)  —   —   (1,634)
    Benefit from (provision for) income taxes 639   (4,230)  —   (3,591)
    Net income 25,780   17,602   —   43,382 
    Preferred stock dividends 10,342   —   —   10,342 
    Net income attributable to noncontrolling interest —   —   2,602   2,602 
    Net income attributable to common stockholders$15,438  $17,602  $(2,602) $30,438 
                    

    (1) Includes income allocated to the noncontrolling interest holders not allocated to the two reportable segments.

    ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
    Balance Sheet Segment Information - (Unaudited)
    (in thousands)
     
     March 31, 2025
     Structured Business Agency Business Consolidated
    Assets:     
    Cash and cash equivalents$55,328  $253,514  $308,842 
    Restricted cash 15,943   24,620   40,563 
    Loans and investments, net 11,215,625   —   11,215,625 
    Loans held-for-sale, net —   314,635   314,635 
    Capitalized mortgage servicing rights, net —   357,220   357,220 
    Securities held-to-maturity, net —   158,658   158,658 
    Investments in equity affiliates 77,095   —   77,095 
    Real estate owned, net 302,158   —   302,158 
    Goodwill and other intangible assets 12,500   75,227   87,727 
    Other assets and due from related party 249,904   254,922   504,826 
    Total assets$11,928,553  $1,438,796  $13,367,349 
          
    Liabilities:     
    Debt obligations$9,580,201  $279,403  $9,859,604 
    Allowance for loss-sharing obligations —   85,515   85,515 
    Other liabilities and due to related parties 206,181   86,590   292,771 
    Total liabilities$9,786,382  $451,508  $10,237,890 
                


    ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
    Reconciliation of Distributable Earnings to GAAP Net Income - (Unaudited)
    ($ in thousands—except share and per share data)
     
     Quarter Ended March 31,
      2025   2024 
    Net income attributable to common stockholders$30,438  $57,873 
        
    Adjustments:   
    Net income attributable to noncontrolling interest 2,602   4,997 
    Income from mortgage servicing rights (8,131)  (10,199)
    Deferred tax benefit (137)  (3,952)
    Amortization and write-offs of MSRs 20,864   18,418 
    Depreciation and amortization 4,568   3,193 
    Loss on extinguishment of debt 2,319   — 
    Provision for credit losses, net 756   14,804 
    (Gain) loss on derivative instruments, net (4,697)  5,523 
    Loss on real estate 2,810   — 
    Stock-based compensation 5,935   6,020 
        
    Distributable earnings (1)$57,327  $96,677 
        
    Diluted distributable earnings per share (1)$0.28  $0.47 
        
    Diluted weighted average shares outstanding (1) (2) 206,862,320   205,511,529 
            

    (1) Amounts are attributable to common stockholders and OP Unit holders. The OP Units are redeemable for cash, or at the Company's option for shares of the Company's common stock on a one-for-one basis.

    (2) The diluted weighted average shares outstanding exclude the potential shares issuable upon conversion and settlement of the Company's convertible senior notes principal balance.

    The Company is presenting distributable earnings because management believes it is an important supplemental measure of the Company's operating performance and is useful to investors, analysts and other parties in the evaluation of REITs and their ability to provide dividends to stockholders. Dividends are one of the principal reasons investors invest in REITs. To maintain REIT status, REITs are required to distribute at least 90% of their REIT-taxable income. The Company considers distributable earnings in determining its quarterly dividend and believes that, over time, distributable earnings is a useful indicator of the Company's dividends per share.

    The Company defines distributable earnings as net income (loss) attributable to common stockholders computed in accordance with GAAP, adjusted for accounting items such as depreciation and amortization (adjusted for unconsolidated joint ventures), non-cash stock-based compensation expense, income from MSRs, amortization and write-offs of MSRs, gains/losses on derivative instruments primarily associated with Private Label loans not yet sold and securitized, changes in fair value of GSE-related derivatives that temporarily flow through earnings, deferred tax provision (benefit), CECL provisions for credit losses (adjusted for realized losses as described below) and gains/losses on the receipt of real estate from the settlement of loans (prior to the sale of the real estate). The Company also adds back one-time charges such as acquisition costs and one-time gains/losses on the early extinguishment of debt and redemption of preferred stock.

    The Company reduces distributable earnings for realized losses in the period management determines that a loan is deemed nonrecoverable in whole or in part. Loans are deemed nonrecoverable upon the earlier of: (1) when the loan receivable is settled (i.e., when the loan is repaid, or in the case of foreclosure, when the underlying asset is sold); or (2) when management determines that it is nearly certain that all amounts due will not be collected. The realized loss amount is equal to the difference between the cash received, or expected to be received, and the book value of the asset.

    Distributable earnings is not intended to be an indication of the Company's cash flows from operating activities (determined in accordance with GAAP) or a measure of its liquidity, nor is it entirely indicative of funding the Company's cash needs, including its ability to make cash distributions. The Company's calculation of distributable earnings may be different from the calculations used by other companies and, therefore, comparability may be limited.


    Primary Logo

Share on,