BrightSpire Capital, Inc. Q1 FY2026 earnings call

• New loan production: Reinitiated new loan production with 37 closed loans totaling $1.1B and 9 in execution for $283M, combined over $1.4B. • Loan portfolio growth: Target to grow loan book to $3.5B by year end, with aim to reach $3B by mid-year. • CLO execution: Plan to execute fifth CLO in second half of the year. • Portfolio management: Resolved loans, reduced watch list exposure, with REO properties having some in sale or value-add plans. • Market conditions: Real estate spreads resilient, multifamily loan pricing around mid 200s, capital markets good with CLO transactions at tighter prices, Sunbelt markets facing challenges but still lending at reset basis, Bay Area showing good rent growth in residential and office.

The company reported first quarter GAAP net income attributable to common stockholders of $4.8 million, or 3 cents per share, distributable earnings of $15.6 million, or 12 cents per share, and adjusted distributable earnings of $18.2 million, or 14 cents per share. Current liquidity stands at $206 million, of which $58 million is unrestricted cash. As of March 31st, 2026, gap net book value is $7.05 per share and undepreciated book value is $8.24 per share. Since reinitiating new loan production, 37 loans totaling $1.1 billion have been closed with an additional nine loans in execution for $283 million, combined total just over $1.4 billion. Loan book stands at $2.7 billion with an average loan size of approximately $27 million, predominantly multifamily loans, office loan exposure reducing, and aim to grow loan book to $3.5 billion by year end to cover dividend.

• Aim to cross $3 billion in loans by approximately halfway through 2026. • Target at least $3.5 billion loan portfolio by year end. • Plan to execute fifth CLO in second half of 2026. • Position to cover dividend by year end through loan portfolio growth.

• Geopolitical issues causing short-term market pause. • Sunbelt markets facing headwinds from market fundamentals and policy, including immigration impact on border states. • Delays in REO asset sales. • Market spread compression potentially affecting loan pricing. • Credit uncertainties in loan portfolio growth process.

Q: How is the investment landscape in the second quarter compared to the first quarter and is the pipeline growing?

A: Market recovered after private credit and geopolitical events, pipeline good with over $300M in loans in execution, expecting to hit $3B mid-year.

Q: How is the performance of different asset classes in the San Francisco area?

A: Residential and office in San Francisco performing well with positive rent growth, hotel still needing pickup in transient business traveler but plans to market asset by end of year or start of next year.

Q: Regarding REO sales and five-rated loan repayment, is that correct and will there be realized losses in second quarter?

A: Bids on REO properties due this week and next week, remaining five-rated loans being handled with Dallas office and Austin multifamily having specific plans.

Q: Are industrial and hotel loans areas for incremental investment?

A: Selectively investing in these sectors, predominantly focusing on multifamilies but seeing opportunities in industrial (selective) and hotel (very selective) with unique transaction circumstances.

Q: Regarding dividend coverage, any change in path?

A: Expect to cover dividend by year end, affected by timing of asset resolutions, but confident mid-year will get close to $300 and year end reach coverage.

Q: All-in financing spread for new loans and spread compression impact?

A: Generally maintain about 100 basis points spread between loans and financing source, bias towards making new loans as attractive with current capital levels.

Q: Regional preference for deploying new capital?

A: Generally looking at all areas, including Sunbelt and Bay Area, with focus on reset basis lending in areas like Texas and expecting opportunities in Arizona and Nevada as markets recover.