Q2 2024 Ares Commercial Real Estate Corp Earnings Call Transcript
Key Points
- Commercial real estate market sentiment is modestly improving, driven by reduced interest rate expectations and future supply dynamics.
- No negative migration in risk-rated one to three loans, which account for about three-quarters of the total $2 billion loan portfolio.
- The underlying borrowers have committed approximately $140 million of capital over the last 12 months in support of risk-rated three or better loans.
- The company declared a regular cash dividend of $0.25 per common share for the third quarter of 2024.
- The company is maintaining significant levels of liquidity and reducing leverage to strengthen its balance sheet.
- Reported a GAAP net loss of approximately $6.1 million or $0.11 per common share for the second quarter of 2024.
- Distributable earnings loss for the second quarter of 2024 was approximately $6.6 million or $0.12 per common share.
- Three loans migrated from a risk rating of four to a risk rating of five during the second quarter.
- The anticipated sale of a multifamily property securing one of their senior loans did not move forward as anticipated, leading to a nonaccrual status and revised risk rating.
- The company recorded a realized loss of $16 million on a California office property, which was classified as REO held for sale.
Good afternoon, ladies and gentlemen, and welcome to Aeris Commercial Real Estate Corporation's Second Quarter Earnings Conference Call. At this time, all participants are in a listen-only mode. And as a reminder, this conference is being recorded on Tuesday, August sixth, 2024.
I will now turn the call over to Mr. John Stilmar, partner of public markets, Investor Relations. Mr. Stilmar, please go ahead.
Good afternoon and thank you for joining us on today's conference call. In addition to our press release and the 10 Q that we filed with the SEC, we have posted an earnings presentation under the Investor Resources section of our website at www.arescre.com.
Before we begin, I would remind everyone that comments made during the course of this conference call as well as webcast and the accompanying documents contain forward-looking statements that are subject to risks and
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