UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-Q
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2026
OR
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 |
FOR THE TRANSITION PERIOD FROM ______ TO ______
Commission File Number: 001-14788
(Exact name of Registrant as specified in its charter)
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) |
(Address of principal executive offices)(Zip Code)
(212 ) 655-0220
(Registrant’s telephone number, including area code)
N/A
(Former name, former address and former fiscal year, if changed since last report)
Securities registered pursuant to Section 12(b) of the Act:
Title of each class | Trading symbol(s) | Name of each exchange on which registered | |||
Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes ☒ No ☐
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of
Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such
files). Yes ☒ No ☐
Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an
emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth
company” in Rule 12b-2 of the Exchange Act.
☒ | Accelerated filer | ☐ | ||
Non-accelerated filer | ☐ | Smaller reporting company | ||
Emerging growth company |
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new
or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒
The number of the registrant’s shares of class A common stock, par value $0.01 per share, outstanding as of October 22, 2026 was 165,987,923 .
TABLE OF CONTENTS
Page | ||
PART I. | FINANCIAL INFORMATION | |
ITEM 1. | ||
Consolidated Financial Statements (Unaudited): | ||
ITEM 2. | ||
ITEM 3. | ||
ITEM 4. | ||
PART II. | OTHER INFORMATION | |
ITEM 1. | ||
ITEM 1A. | ||
ITEM 2. | ||
ITEM 3. | ||
ITEM 4. | ||
ITEM 5. | ||
ITEM 6. | ||
TABLE OF CONTENTS
Website Disclosure
We use our website (www.blackstonemortgagetrust.com) as a channel of distribution of company information. The
information we post through this channel may be deemed material. Accordingly, investors should monitor this channel, in
addition to following our press releases, Securities and Exchange Commission, or SEC, filings and public conference calls,
and webcasts. In addition, you may automatically receive email alerts and other information about Blackstone Mortgage
Trust when you enroll your email address by visiting the “Contact Us and Email Alerts” section of our website at
http://ir.blackstonemortgagetrust.com. The contents of our website and any alerts are not, however, a part of this report.
3
PART I.
ITEM 1. FINANCIAL STATEMENTS
Blackstone Mortgage Trust, Inc.
Consolidated Balance Sheets (Unaudited)
(in thousands, except share data)
September 30, 2026 | December 31, 2025 | ||
Assets | |||
Cash and cash equivalents | $ | $ | |
Loans receivable, held-for-investment | |||
Current expected credit loss reserve | ( | ( | |
Loans receivable, held-for-investment, net | |||
Loans receivable, held-for-sale | |||
Owned real estate, net | |||
Investments in unconsolidated entities (includes $ value as of September 30, 2026 and December 31, 2025, respectively) | |||
Other assets | |||
Total Assets | $ | $ | |
Liabilities and Equity | |||
Secured debt, net | $ | $ | |
Securitized debt obligations, net | |||
Asset-specific debt, net | |||
Term loans, net | |||
Senior secured notes, net | |||
Convertible notes, net | |||
Other liabilities | |||
Total Liabilities | |||
Commitments and contingencies (Note 21) | |||
Equity | |||
Class A common stock, $ 2026 and December 31, 2025, respectively | |||
Additional paid-in capital | |||
Accumulated other comprehensive income | |||
Accumulated deficit | ( | ( | |
Total Blackstone Mortgage Trust, Inc. stockholders’ equity | |||
Non-controlling interests | |||
Total Equity | |||
Total Liabilities and Equity | $ | $ |
Note: The consolidated balance sheets as of September 30, 2026 and December 31, 2025 include assets of consolidated
variable interest entities, or VIEs, that can only be used to settle obligations of each respective VIE, and liabilities of
consolidated VIEs for which creditors do not have recourse to Blackstone Mortgage Trust, Inc. As of September 30, 2026
and December 31, 2025, assets of the consolidated VIEs totaled $3.7 billion and $3.3 billion, respectively, and liabilities of
the consolidated VIEs totaled $2.7 billion and $2.2 billion, respectively. Refer to Note 19 for further discussion of the
VIEs.
See accompanying notes to consolidated financial statements.
4
Blackstone Mortgage Trust, Inc.
Consolidated Statements of Operations (Unaudited)
(in thousands, except share and per share data)
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||
2026 | 2025 | 2026 | 2025 | ||||
Income from loans and other investments | |||||||
Interest and related income | $ | $ | $ | $ | |||
Less: Interest and related expenses | |||||||
Income from loans and other investments, net | |||||||
Revenue from owned real estate | |||||||
Total net revenue | |||||||
Expenses | |||||||
Management and incentive fees | |||||||
General and administrative expenses | |||||||
Expenses from owned real estate | |||||||
Total expenses | |||||||
(Increase) decrease in current expected credit loss reserve | ( | ( | ( | ||||
Income from unconsolidated entities | |||||||
Net loss on disposition of owned real estate | ( | ||||||
Impairment of owned real estate | ( | ( | |||||
Valuation adjustment on loans receivable, held-for-sale | ( | ( | |||||
Other income, net | |||||||
(Loss) income before income taxes | ( | ( | |||||
Income tax provision | |||||||
Net (loss) income | ( | ( | |||||
Net loss (income) attributable to non-controlling interests | ( | ( | |||||
Net (loss) income attributable to Blackstone Mortgage Trust, Inc. | $( | $ | $( | $ | |||
Net (loss) income per share of common stock, basic and diluted | $( | $ | $( | $ | |||
Weighted-average shares of common stock outstanding, basic and diluted | |||||||
See accompanying notes to consolidated financial statements.
5
Blackstone Mortgage Trust, Inc.
Consolidated Statements of Comprehensive Income (Unaudited)
(in thousands)
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||
2026 | 2025 | 2026 | 2025 | ||||
Net (loss) income | $( | $ | $( | $ | |||
Other comprehensive income (loss) | |||||||
Unrealized (loss) gain on foreign currency translation | ( | ( | ( | ||||
Realized and unrealized gain (loss) on derivative financial instruments | ( | ||||||
Unrealized gain (loss) on derivative financial instruments from unconsolidated entities | ( | ( | |||||
Other comprehensive income (loss) | ( | ||||||
Comprehensive (loss) income | ( | ( | |||||
Comprehensive loss (income) attributable to non- controlling interests | ( | ( | |||||
Comprehensive (loss) income attributable to Blackstone Mortgage Trust, Inc. | $( | $ | $( | $ | |||
See accompanying notes to consolidated financial statements.
6
Blackstone Mortgage Trust, Inc.
Consolidated Statements of Changes in Equity (Unaudited)
(in thousands)
Blackstone Mortgage Trust, Inc. | |||||||||||||
Class A Common Stock | Additional Paid- In Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Stockholders’ Equity | Non- Controlling Interests | Total Equity | |||||||
Balance at December 31, 2025 | $ | $ | $ | $( | $ | $ | $ | ||||||
Repurchases of class A common stock | ( | ( | — | — | ( | — | ( | ||||||
Restricted class A common stock earned | — | — | — | ||||||||||
Dividends reinvested | — | — | — | — | |||||||||
Deferred directors’ compensation | — | — | — | — | |||||||||
Net loss | — | — | — | ( | ( | ( | ( | ||||||
Other comprehensive loss | — | — | ( | — | ( | — | ( | ||||||
Dividends declared on common stock and deferred stock units, $ | — | — | — | ( | ( | — | ( | ||||||
Distributions to non-controlling interests | — | — | — | — | — | ( | ( | ||||||
Balance at March 31, 2026 | $ | $ | $ | $( | $ | $ | $ | ||||||
Repurchases of class A common stock | ( | ( | — | — | ( | — | ( | ||||||
Restricted class A common stock earned | — | — | — | — | |||||||||
Dividends reinvested | — | — | — | — | |||||||||
Deferred directors’ compensation | — | — | — | — | |||||||||
Net loss | — | — | — | ( | ( | ( | ( | ||||||
Other comprehensive income | — | — | — | — | |||||||||
Dividends declared on common stock and deferred stock units, $ | — | — | — | ( | ( | — | ( | ||||||
Balance at June 30, 2026 | $ | $ | $ | $( | $ | $ | $ | ||||||
Repurchases of class A common stock | ( | ( | — | — | ( | — | ( | ||||||
Restricted class A common stock earned | — | — | — | — | |||||||||
Dividends reinvested | — | — | — | — | |||||||||
Deferred directors’ compensation | — | — | — | — | |||||||||
Net loss | — | — | — | ( | ( | ( | ( | ||||||
Other comprehensive income | — | — | — | — | |||||||||
Dividends declared on common stock and deferred stock units, $ | — | — | — | ( | ( | — | ( | ||||||
Distributions to non-controlling interests | — | — | — | — | — | ( | ( | ||||||
Balance at September 30, 2026 | $ | $ | $ | $( | $ | $ | $ | ||||||
7
Blackstone Mortgage Trust, Inc.
Consolidated Statements of Changes in Equity (Unaudited)
(in thousands)
Blackstone Mortgage Trust, Inc. | |||||||||||||
Class A Common Stock | Additional Paid- In Capital | Accumulated Other Comprehensive Income (Loss) | Accumulated Deficit | Stockholders’ Equity | Non- Controlling Interests | Total Equity | |||||||
Balance at December 31, 2024 | $ | $ | $ | $( | $ | $ | $ | ||||||
Shares of class A common stock issued, net | ( | — | — | — | — | ||||||||
Repurchases of class A common stock | ( | ( | — | — | ( | — | ( | ||||||
Restricted class A common stock earned | — | — | — | ||||||||||
Dividends reinvested | — | — | — | — | |||||||||
Deferred directors’ compensation | — | — | — | — | |||||||||
Net (loss) income | — | — | — | ( | ( | ( | |||||||
Other comprehensive income | — | — | — | — | |||||||||
Dividends declared on common stock and deferred stock units, $ | — | — | — | ( | ( | — | ( | ||||||
Distributions to non-controlling interests | — | — | — | — | — | ( | ( | ||||||
Balance at March 31, 2025 | $ | $ | $ | $( | $ | $ | $ | ||||||
Repurchases of class A common stock | — | ( | — | — | ( | — | ( | ||||||
Restricted class A common stock earned | — | — | — | — | |||||||||
Dividends reinvested | — | — | — | — | |||||||||
Deferred directors’ compensation | — | — | — | — | |||||||||
Net income | — | — | — | ||||||||||
Other comprehensive income | — | — | — | — | |||||||||
Dividends declared on common stock and deferred stock units, $ | — | — | — | ( | ( | — | ( | ||||||
Balance at June 30, 2025 | $ | $ | $ | $( | $ | $ | $ | ||||||
Repurchases of class A common stock | ( | ( | — | — | ( | — | ( | ||||||
Restricted class A common stock earned | — | — | — | — | |||||||||
Dividends reinvested | — | — | — | — | |||||||||
Deferred directors’ compensation | — | — | — | — | |||||||||
Net income | — | — | — | ||||||||||
Other comprehensive loss | — | — | ( | — | ( | — | ( | ||||||
Dividends declared on common stock and deferred stock units, $ | — | — | — | ( | ( | — | ( | ||||||
Distributions to non-controlling interests | — | — | — | — | — | ( | ( | ||||||
Balance at September 30, 2025 | $ | $ | $ | $( | $ | $ | $ | ||||||
See accompanying notes to consolidated financial statements.
8
Blackstone Mortgage Trust, Inc.
Consolidated Statements of Cash Flows (Unaudited)
(in thousands)
Nine Months Ended September 30, | |||
2026 | 2025 | ||
Cash flows from operating activities | |||
Net (loss) income | $( | $ | |
Adjustments to reconcile net (loss) income to net cash provided by operating activities | |||
Non-cash compensation expense | |||
Amortization of deferred fees on loans | ( | ( | |
Amortization of deferred financing costs and premiums/discounts on debt obligations | |||
Payment-in-kind interest, net of interest received | ( | ||
Increase in current expected credit loss reserve | |||
Valuation adjustment on loans receivable, held-for-sale | |||
Straight-line rental income | ( | ( | |
Depreciation and amortization of owned real estate | |||
Net loss on disposition of owned real estate | |||
Impairment of owned real estate | |||
Income from unconsolidated entities | ( | ( | |
Distributions of earnings from unconsolidated entities | |||
Unrealized loss on derivative financial instruments, net | |||
Realized gain on derivative financial instruments, net | ( | ( | |
Changes in assets and liabilities, net | |||
Other assets | ( | ||
Other liabilities | ( | ||
Net cash provided by operating activities | |||
Cash flows from investing activities | |||
Principal fundings of loans receivable | ( | ( | |
Principal collections, sales proceeds, and cost-recovery proceeds from loans receivable | |||
Origination and other fees received on loans receivable | |||
Investment in debt securities | ( | ||
Payments under derivative financial instruments | ( | ( | |
Receipts under derivative financial instruments | |||
Collateral deposited under derivative agreements | ( | ( | |
Return of collateral deposited under derivative agreements | |||
Investment in unconsolidated entities | ( | ( | |
Return of capital from unconsolidated entities | |||
Proceeds from disposition of owned real estate | |||
Capital expenditures on owned real estate | ( | ( | |
Net cash provided by investing activities | |||
continued…
See accompanying notes to consolidated financial statements.
9
Blackstone Mortgage Trust, Inc.
Consolidated Statements of Cash Flows (Unaudited)
(in thousands)
Nine Months Ended September 30, | |||
2026 | 2025 | ||
Cash flows from financing activities | |||
Borrowings under secured debt | $ | $ | |
Repayments under secured debt | ( | ( | |
Proceeds from issuance of securitized debt obligations | |||
Repayments of securitized debt obligations | ( | ( | |
Borrowings under asset-specific debt | |||
Repayments under asset-specific debt | ( | ( | |
Repayments of loan participations | ( | ||
Net proceeds from term loan borrowings | |||
Repayments and repurchases of term loans | ( | ( | |
Proceeds from issuance of senior secured notes | |||
Payment of deferred financing costs | ( | ( | |
Distributions to non-controlling interests | ( | ( | |
Dividends paid on class A common stock | ( | ( | |
Repurchases of class A common stock | ( | ( | |
Net cash used in financing activities | ( | ( | |
Net increase in cash and cash equivalents | |||
Cash and cash equivalents at beginning of period | |||
Effects of currency translation on cash and cash equivalents | ( | ||
Cash and cash equivalents at end of period | $ | $ | |
Supplemental disclosure of cash flows information | |||
Payments of interest | $( | $( | |
Payments of income taxes | $( | $( | |
Supplemental disclosure of non-cash investing and financing activities | |||
Dividends declared, not paid | $( | $( | |
Loan principal payments held by servicer, net | $ | $ | |
Transfer of senior loans to owned real estate | $ | $ | |
Assumption of other assets and liabilities related to owned real estate | $ | $ | |
Accrued capital expenditures on owned real estate | $ | $ | |
See accompanying notes to consolidated financial statements.
10
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (Unaudited)
1. ORGANIZATION
References herein to “Blackstone Mortgage Trust,” “Company,” “we,” “us” or “our” refer to Blackstone Mortgage Trust,
Inc., a Maryland corporation, and its subsidiaries unless the context specifically requires otherwise.
Blackstone Mortgage Trust is a real estate finance company that originates, acquires, and manages senior loans and other
debt or credit-oriented investments collateralized by or relating to commercial real estate in North America, Europe, and
Australia. Our portfolio is composed primarily of senior loans secured by high-quality, institutional assets located in major
markets, and sponsored by experienced, well-capitalized real estate investment owners and operators. We finance our
investments in a variety of ways, including borrowing under secured credit facilities, issuing collateralized loan obligations,
or CLOs, other securitization transactions, syndicating senior loans and/or participations, and other forms of asset-level
financing, depending on our view of the most prudent financing option available for each of our investments. We are
externally managed by BXMT Advisors L.L.C., or our Manager, a subsidiary of Blackstone Inc., or Blackstone, and are a
real estate investment trust, or REIT, traded on the New York Stock Exchange, or NYSE, under the symbol “BXMT.” Our
principal executive offices are located at 345 Park Avenue, New York, New York 10154.
We conduct our operations as a REIT for U.S. federal income tax purposes. We generally will not be subject to U.S. federal
income taxes on our taxable income to the extent that we annually distribute all of our net taxable income to stockholders
and maintain our qualification as a REIT. We also operate our business in a manner that permits us to maintain an
exclusion from registration under the Investment Company Act of 1940, as amended. We are organized as a holding
company and conduct our business primarily through our various subsidiaries.
2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The accompanying unaudited consolidated financial statements have been prepared in accordance with accounting
principles generally accepted in the United States of America, or GAAP, for interim financial information and the
instructions to Form 10-Q and Rule 10-01 of Regulation S-X. The consolidated financial statements, including the notes
thereto, are unaudited and exclude some of the disclosures required in audited financial statements. We believe we have
made all necessary adjustments, consisting of only normal recurring items, so that the consolidated financial statements are
presented fairly and that estimates made in preparing our consolidated financial statements are reasonable and prudent. The
operating results presented for interim periods are not necessarily indicative of the results that may be expected for any
other interim period or for the entire year. The accompanying unaudited consolidated interim financial statements should
be read in conjunction with the audited consolidated financial statements included in our Annual Report on Form 10-K for
the fiscal year ended December 31, 2025 filed with the Securities and Exchange Commission, or the SEC.
The accompanying consolidated financial statements have been prepared in accordance with GAAP, and include, on a
consolidated basis, our accounts, the accounts of our wholly-owned subsidiaries, majority-owned subsidiaries, and variable
interest entities, or VIEs, of which we are the primary beneficiary. All intercompany balances and transactions have been
eliminated in consolidation.
presentation of certain income and expense captions and loans receivable disclosures.
We consolidate all entities that we control through either majority ownership or voting rights. In addition, we consolidate
all VIEs of which we are considered the primary beneficiary. VIEs are defined as entities in which equity investors (i) do
not have an interest with the characteristics of a controlling financial interest and/or (ii) do not have sufficient equity at risk
for the entity to finance its activities without additional subordinated financial support from other parties. The entity that
consolidates a VIE is known as its primary beneficiary and is generally the entity with (i) the power to direct the activities
that most significantly affect the VIE’s economic performance and (ii) the right to receive benefits from the VIE or the
obligation to absorb losses of the VIE that could be significant to the VIE. Entities that do not qualify as VIEs are generally
considered voting interest entities, or VOEs, and are evaluated for consolidation under the voting interest model. VOEs are
consolidated when we control the entity through a majority voting interest or other means.
11
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
For consolidated entities, the non-controlling partner’s share of the assets, liabilities, and operations of each joint venture is
included in non-controlling interests as a component of total equity. The non-controlling partner’s interest is generally
computed as the joint venture partner’s ownership percentage.
When the requirements for consolidation are not met and we have significant influence over the operations of the entity, the
investment is accounted for under the equity method of accounting. Investments in unconsolidated entities for which we
have not elected the fair value option, or FVO, are initially recorded at cost and subsequently adjusted for our pro rata share
of net income, contributions and distributions. When we elect the FVO, we record our share of the net asset value of the
entity and any related unrealized gains and losses.
We review our investments in unconsolidated entities for impairment each quarter or when there is an event or change in
circumstances that indicates a decrease in value. If there is a decrease in value due to a series of operating losses or other
factors, the investment is evaluated to determine if the loss in value is considered other than temporary. Although a current
fair value below the carrying value of the investment is an indicator of impairment, we will only recognize an impairment
if the loss in value is determined to be an other than temporary impairment. If an impairment is determined to be other than
temporary, we will record an impairment charge sufficient to reduce the investment’s carrying value to its fair value, which
would result in a new cost basis. This new cost basis will be used for future periods when recording subsequent income or
loss and cannot be written up to a higher value as a result of increases in fair value.
In 2017, we entered into a joint venture with Walker & Dunlop Inc., or Walker & Dunlop, to originate, hold, and finance
multifamily bridge loans, which we refer to as our Multifamily Joint Venture. Pursuant to the terms of the agreements
governing the joint venture, Walker & Dunlop contributed 15 % of the venture’s equity capital and we contributed 85 %.
We consolidate our Multifamily Joint Venture as we have a controlling financial interest. The non-controlling interests
included on our consolidated balance sheets represent the equity interests in our Multifamily Joint Venture that are owned
by Walker & Dunlop. A portion of our Multifamily Joint Venture’s consolidated equity and results of operations are
allocated to these non-controlling interests based on Walker & Dunlop’s pro rata ownership of our Multifamily Joint
Venture.
In 2024, we entered into a joint venture with a Blackstone-advised investment vehicle to invest in triple net lease
properties, which we refer to as our Net Lease Joint Venture. Our aggregate ownership interest in our Net Lease Joint
Venture was 75 % as of September 30, 2026. We do not consolidate our Net Lease Joint Venture as we do not have a
controlling financial interest. Our investment in our Net Lease Joint Venture is accounted for under the equity method, and
is recorded in investments in unconsolidated entities on our consolidated balance sheets, and our pro rata share of income
(loss) is recorded in income (loss) from unconsolidated entities on our consolidated statements of operations.
In 2025, we entered into a joint venture with a Blackstone-advised investment vehicle to acquire portfolios of performing
commercial mortgage loans, which we refer to as our Bank Loan Portfolio Joint Venture. During 2025, our Bank Loan
Portfolio Joint Venture acquired two portfolios of performing commercial mortgage loans. Our aggregate ownership
interest in our Bank Loan Portfolio Joint Venture was 35 % as of September 30, 2026. We do not consolidate our Bank
Loan Portfolio Joint Venture as we do not have a controlling financial interest. Our investment in our Bank Loan Portfolio
Joint Venture is accounted for using the FVO, and is recorded in investments in unconsolidated entities on our consolidated
balance sheets, and our pro rata share of any unrealized gains and losses is recorded in income (loss) from unconsolidated
entities on our consolidated statements of operations.
In the second quarter of 2026, we entered into a joint venture with an unaffiliated third party, alongside a Blackstone-
advised investment vehicle, to originate, acquire, and fund construction loans collateralized by single family homes located
in various markets across the United States, which we refer to as our Homebuilder Finance Joint Venture. Our aggregate
ownership interest in our Homebuilder Finance Joint Venture was 45 % as of September 30, 2026. We do not consolidate
our Homebuilder Finance Joint Venture as we do not have a controlling financial interest. Our investment in our
Homebuilder Finance Joint Venture is accounted for using the FVO, and is recorded in investments in unconsolidated
entities on our consolidated balance sheets, and our pro rata share of any unrealized gains and losses is recorded in income
(loss) from unconsolidated entities on our consolidated statements of operations.
The preparation of consolidated financial statements in conformity with GAAP requires us to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities as of
the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting
period. Actual results may ultimately differ materially from those estimates.
12
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
Interest income from our loans receivable portfolio is recognized over the life of each loan using the effective interest
method and is recorded on the accrual basis. Recognition of fees, premiums, and discounts associated with these
investments is deferred and recorded over the term of the loan as an adjustment to yield. Income accrual is generally
suspended for loans at the earlier of the date at which payments become 90 days past due or when, in our opinion, recovery
of income and principal becomes doubtful. Interest received is then recorded as income or as a reduction in the amortized
cost basis, based on the specific facts and circumstances, until accrual is resumed when the loan becomes contractually
current and performance is demonstrated to be resumed. In addition, for loans we originate, the related origination expenses
are deferred and recognized as a reduction to interest income; however, expenses related to loans we acquire are included
in general and administrative expenses as incurred.
The sources of revenue from our owned real estate assets, which are included in revenue from owned real estate on our
consolidated statements of operations, and the related revenue recognition policies are as follows:
Rental income primarily consists of base rent income arising from tenant leases at our office and multifamily properties.
We determine if an arrangement is a lease at contract inception, which is subject to the provisions of Financial Accounting
Standards Board, or FASB, Accounting Standards Codification, or ASC, Topic 842 “Leases.” Base rent is recognized on a
straight-line basis over the life of the lease, including any rent steps or abatement provisions. We begin to recognize
revenue upon the acquisition of the related property or when a tenant takes possession of the leased space.
Other operating income primarily consists of income from our hospitality properties and tenant reimbursement income.
Revenue from our hospitality properties consists primarily of room revenue and food and beverage revenue. Room revenue
is recognized when the related room is occupied and other hospitality revenue is recognized when the service is rendered.
Tenant reimbursement income primarily consists of amounts due from tenants for costs related to common area
maintenance, real estate taxes, and other recoverable costs included in lease agreements.
We evaluate the collectability of receivables related to rental revenue on an individual lease basis and exercise judgment in
assessing collectability considering the length of time a receivable has been outstanding, tenant creditworthiness, payment
history, available information about the financial condition of the tenant, and current economic trends, among other factors.
Tenant receivables that are deemed uncollectible are recognized as a reduction to rental revenue.
Cash and cash equivalents represent cash held in banks and liquid investments with original maturities of three months or
less. We may have bank balances in excess of federally insured amounts; however, we deposit our cash and cash
equivalents with high credit-quality institutions to minimize credit risk exposure. We have not experienced, and do not
expect, any losses on our cash or cash equivalents. As of both September 30, 2026 and December 31, 2025, we had no
restricted cash on our consolidated balance sheets.
We originate and purchase commercial real estate debt and related instruments generally to be held as long-term
investments at amortized cost.
The current expected credit loss, or CECL, reserve required under the ASC Topic 326 “Financial Instruments – Credit
Losses,” or ASC 326, reflects our current estimate of potential credit losses related to our loans and notes receivable
included in our consolidated balance sheets. Changes to the CECL reserves are recognized through net income on our
consolidated statements of operations. While ASC 326 does not require any particular method for determining the CECL
reserves, it does specify the reserves should be based on relevant information about past events, including historical loss
experience, current portfolio and market conditions, and reasonable and supportable forecasts for the duration of each
respective loan. In addition, other than a few narrow exceptions, ASC 326 requires that all financial instruments subject to
the CECL model have some amount of loss reserve to reflect the principle underlying the CECL model that all loans and
similar assets have some inherent risk of loss, regardless of credit quality, subordinate capital, or other mitigating factors.
We estimate our CECL reserves primarily using the Weighted-Average Remaining Maturity, or WARM method, which
has been identified as an acceptable loss-rate method for estimating CECL reserves in FASB Staff Q&A Topic 326, No. 1.
The WARM method requires us to reference historical loan loss data across a comparable data set and apply such loss rate
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Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
to each of our loans over their expected remaining term, taking into consideration expected economic conditions over the
relevant time frame. We apply the WARM method for the majority of our loan portfolio, which consists of loans that share
similar risk characteristics. In certain instances, for loans with unique risk characteristics, we may instead use a probability-
weighted model that considers the likelihood of default and expected loss given default for each such individual loan.
Application of the WARM method to estimate CECL reserves requires judgment, including (i) the appropriate historical
loan loss reference data, (ii) the expected timing and amount of future loan fundings and repayments, and (iii) the current
credit quality of our portfolio and our expectations of performance and market conditions over the relevant time period. To
estimate the historical loan losses relevant to our portfolio, we have augmented our historical loan performance with market
loan loss data licensed from Trepp LLC. This database includes commercial mortgage-backed securities, or CMBS, issued
since January 1, 1999 through August 31, 2026. Within this database, we focused our historical loss reference calculations
on the most relevant subset of available CMBS data, which we determined based on loan metrics that are most comparable
to our loan portfolio including asset type, geography, and origination loan-to-value, or LTV. We believe this CMBS data,
which includes month-over-month loan and property performance, is the most relevant, available, and comparable dataset
to our portfolio.
Our loans typically include commitments to fund incremental proceeds to our borrowers over the life of the loan. These
future funding commitments are also subject to the CECL model. The CECL reserve related to future loan fundings is
recorded as a component of other liabilities on our consolidated balance sheets. This CECL reserve is estimated using the
same process outlined above for our outstanding loan balances, and changes in this component of the CECL reserve will
similarly impact our consolidated net income. For both the funded and unfunded portions of our loans, we consider our
internal risk rating of each loan as the primary credit quality indicator underlying our assessment.
The CECL reserves are measured on a collective basis wherever similar risk characteristics exist within a pool of similar
assets. We have identified the following pools and measure the reserve for credit losses using the following methods:
•U.S. Loans: WARM method that incorporates a subset of historical loss data, expected weighted-average
remaining maturity of our loan pool, and an economic view.
•Non-U.S. Loans: WARM method that incorporates a subset of historical loss data, expected weighted-average
remaining maturity of our loan pool, and an economic view.
•Unique Loans: a probability of default and loss given default model, assessed on an individual basis. During the
three months ended June 30, 2026, we reassessed the pooling of certain loans previously classified within our
Unique Loans pool. Based on our reassessment, we determined that these loans share risk characteristics
materially similar to loans in our U.S. Loans and Non-U.S. Loans pools, as evaluated under our internal risk rating
framework. Accordingly, consistent with ASC 326, which requires assets with similar risk characteristics to be
evaluated on a collective basis wherever similar risk characteristics exist within a pool of similar assets, we have
reclassified these loans into our U.S. Loans and Non-U.S. Loans pools, as applicable based on the geographic
location of the underlying collateral. This reclassification did not have a material impact on our total CECL
reserves as of September 30, 2026.
•Impaired Loans: Impairment is indicated when it is deemed probable that we will not be able to collect all
amounts due to us pursuant to the contractual terms of the loan. Determining that a loan is impaired requires
significant judgment from management and is based on several factors including (i) the underlying collateral
performance, (ii) discussions with the borrower, (iii) borrower events of default, and (iv) other facts that impact
the borrower’s ability to pay the contractual amounts due under the terms of the loan. If a loan is determined to be
impaired, we record the impairment as a component of our CECL reserves by applying the practical expedient for
collateral dependent loans. The CECL reserves are assessed on an individual basis for these loans by comparing
the estimated fair value of the underlying collateral to the book value of the respective loan. These valuations
require significant judgments, which include assumptions regarding capitalization rates, discount rates, leasing,
creditworthiness of major tenants, occupancy rates, availability and cost of financing, exit plan, loan sponsorship,
actions of other lenders, and other factors deemed relevant by us. Actual losses, if any, could ultimately differ
materially from these estimates. We only expect to charge off the impairment losses in our consolidated financial
statements prepared in accordance with GAAP if and when such amounts are deemed non-recoverable. This is
generally at the time a loan is repaid or foreclosed, or the underlying collateral assets are otherwise consolidated.
However, non-recoverability may also be concluded if, in our determination, it is nearly certain that all amounts
due will not be collected.
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Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
Contractual Term and Unfunded Loan Commitments
Expected credit losses are estimated over the contractual term of each loan, adjusted for expected repayments. As part of
our quarterly review of our loan portfolio, we assess the expected repayment date of each loan, which is used to determine
the contractual term for purposes of computing our CECL reserves.
Additionally, the expected credit losses over the contractual period of our loans are subject to the obligation to extend
credit through our unfunded loan commitments. The CECL reserve for unfunded loan commitments is adjusted quarterly,
as we consider the expected timing of future funding obligations over the estimated life of the loan. The considerations in
estimating our CECL reserve for unfunded loan commitments are similar to those used for the related outstanding loans
receivable.
Credit Quality Indicator
Our risk rating is our primary credit quality indicator in assessing our current expected credit loss reserve. We perform a
quarterly risk review of our portfolio of loans, and assign each loan a risk rating based on a variety of factors, including,
without limitation, origination LTV, debt yield, property type, geographic and local market dynamics, physical condition,
cash flow volatility, leasing and tenant profile, loan structure and exit plan, and project sponsorship. Based on a 5-point
scale, our loans are rated “1” through “5,” from less risk to greater risk, relative to our loan portfolio in the aggregate,
which ratings are defined as follows:
1 -Very Low Risk
2 -Low Risk
3 -Medium Risk
4 -High Risk/Potential for Loss: A loan that has a risk of realizing a principal loss.
5 -Impaired/Loss Likely: A loan that has a very high risk of realizing a principal loss or has otherwise incurred a
principal loss.
Estimation of Economic Conditions
In addition to the WARM method computations and probability-weighted models described above, our CECL reserves are
also adjusted to reflect our estimation of the current and future economic conditions that impact the performance of the
commercial real estate assets securing our loans. These estimations include unemployment rates, interest rates, expectations
of inflation and/or recession, and other macroeconomic factors impacting the likelihood and magnitude of potential credit
losses for our loans during their anticipated term. In addition to the CMBS data we have licensed from Trepp LLC, we
have also licensed certain macroeconomic financial forecasts to inform our view of the potential future impact that broader
economic conditions may have on our loan portfolio’s performance. We generally also incorporate information from other
sources, including information and opinions available to our Manager, to further inform these estimations. This process
requires significant judgments about future events that, while based on the information available to us as of the balance
sheet date, are ultimately indeterminate and the actual economic condition impacting our portfolio could vary significantly
from the estimates we made as of September 30, 2026.
Loans that are under contract to be sold or otherwise disposed of in the foreseeable future are classified as held-for-sale and
carried at the lower of amortized cost or fair value. Any difference between amortized cost and fair value is recognized
through valuation adjustment on loans receivable, held-for-sale in our consolidated statements of operations.
We may assume legal title, physical possession, or control of the collateral underlying a loan through a foreclosure, a deed-
in-lieu of foreclosure transaction, or a loan modification in which we receive an equity interest in and/or control over
decision-making at the property, resulting in us consolidating the real estate assets as VIEs. These real estate acquisitions
are classified as owned real estate on our consolidated balance sheet and are initially recognized at fair value on the
acquisition date in accordance with the ASC Topic 805, “Business Combinations,” or ASC 805.
Upon acquisition of owned real estate assets, we assess the fair value of acquired tangible and intangible assets, which may
include land, buildings, tenant improvements, “above-market” and “below-market” leases, acquired in-place leases, other
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Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
identified intangible assets and assumed liabilities, as applicable, and allocate the fair value to the acquired assets and
assumed liabilities. We assess and consider fair value based on estimated cash flow projections that utilize discount and/or
capitalization rates that we deem appropriate, as well as other available market information. Estimates of future cash flows
are based on a number of factors, including the historical operating results, known and anticipated trends, and market and
economic conditions. We capitalize acquisition-related costs associated with asset acquisitions.
Real estate assets held for investment, except for land, are depreciated using the straight-line method over the assets’
estimated useful lives of up to 40 years for buildings, 15 years for land improvements, and 10 years for building and tenant
improvements. Renovations and/or replacements that improve or extend the life of the asset are capitalized and depreciated
over their estimated useful lives. Lease intangibles are amortized over the remaining term of applicable leases on a straight-
line basis. The cost of ordinary repairs and maintenance is expensed as incurred.
Real estate assets held for investment are assessed for impairment on a quarterly basis. If the depreciated cost basis of the
asset exceeds the undiscounted cash flows over the remaining holding period, the asset is considered for impairment. The
impairment loss is recognized when the carrying value of the real estate assets exceeds their fair value. The evaluation of
anticipated future cash flows is highly subjective and is based in part on assumptions regarding future occupancy, rental
rates, capital requirements and anticipated holding periods that could differ materially from actual results. Refer to Note 4
for further information.
During the three months ended September 30, 2026, we recognized $36.4 million of impairment charges related to three
owned real estate assets, which resulted from changes in the expected hold period. The aggregate fair value of such assets
at the time of impairment was $141.9 million, and was estimated utilizing a discounted cash flow methodology. The owned
real estate assets were measured at fair value on a nonrecurring basis using significant unobservable inputs and are
classified as Level 3 assets in the fair value hierarchy. The significant unobservable inputs utilized in the analysis were the
exit capitalization rate, which ranged from 6.0 % to 8.5 %, and the unlevered discount rate, which ranged from 8.0 % to
Real estate assets are classified as held-for-sale in the period when they meet the criteria under the ASC Topic 360
“Property, Plant, and Equipment.” Once a real estate asset is classified as held-for-sale, depreciation is suspended and the
asset is reported at the lower of its carrying value or fair value less costs to sell. If circumstances arise and we decide not to
sell a real estate asset previously classified as held-for-sale, the real estate asset is reclassified as held for investment. Upon
reclassification, the real estate asset is measured at the lower of (i) its carrying amount prior to classification as held-for-
sale, adjusted for depreciation expense that would have been recognized had the real estate been classified as held for
investment, and (ii) its estimated fair value at the time of reclassification.
As of September 30, 2026 and December 31, 2025, we had 15 and 12 owned real estate assets, respectively, that were all
classified as held for investment.
In 2024, we entered into an agreement with M&T Realty Capital Corporation, or MTRCC, a subsidiary of M&T Bank, that
allows our borrowers to access multifamily agency financing through MTRCC’s Fannie Mae DUS and Freddie Mac
Optigo lending platforms, or our Agency Multifamily Lending Partnership. We will receive a portion of origination,
servicing, and other fees for loans that we refer to MTRCC for origination under both the Fannie Mae and Freddie Mac
programs. Additionally, we will share in losses with MTRCC and Fannie Mae on loans that we refer to MTRCC for
origination under the Fannie Mae program.
Revenue Recognition
For loans that we refer to MTRCC for origination under both the Fannie Mae and Freddie Mac programs, we recognize our
allocable portion of origination, servicing, and other fees in other income when we have satisfied our performance
obligations in accordance with the ASC Topic 606, “Revenue from Contracts with Customers,” or ASC 606. Our
performance obligations are generally satisfied when the loan is referred by us to MTRCC and subsequently originated and
sold under the Fannie Mae and Freddie Mac programs. A portion of the fees recognized, such as servicing fees, are variable
and are reevaluated for collectability on a recurring basis.
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Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
Loss-sharing Obligation
Pursuant to our agreement with MTRCC, we are subject to a loss-sharing obligation with respect to MTRCC’s obligation
to partially guarantee the performance of loans that they originate and sell under the Fannie Mae program. This loss-
sharing agreement requires us to fund a fixed amount of cash into a segregated account based on the amount MTRCC is
required to fund under the Fannie Mae program, with respect to loans we referred to MTRCC.
In addition, we will recognize a liability for these loss-sharing obligations. This liability will be initially recognized at fair
value with a corresponding expense at inception, and it will subsequently be amortized on a straight-line basis over the life
September 30, 2026, our maximum loss-sharing obligation associated with the loans referred by us to MTRCC under the
Fannie Mae program was $5.5 29
incurred as a result of the loss-sharing obligations.
We classify all derivative financial instruments as either other assets or other liabilities on our consolidated balance sheets
at fair value.
On the date we enter into a derivative contract, we designate each contract as (i) a hedge of a net investment in a foreign
operation, or net investment hedge, (ii) a hedge of a forecasted transaction or of the variability of cash flows to be received
or paid related to a recognized asset or liability, or cash flow hedge, (iii) a hedge of a recognized asset or liability, or fair
value hedge, or (iv) a derivative instrument not to be designated as a hedging derivative, or non-designated hedge. For all
derivatives other than those designated as non-designated hedges, we formally document our hedge relationships and
designation at the contract’s inception. This documentation includes the identification of the hedging instruments and the
hedged items, its risk management objectives, strategy for undertaking the hedge transaction and our evaluation of the
effectiveness of its hedged transaction.
On a quarterly basis, we also formally assess whether the derivative we designated in each hedging relationship is expected
to be, and has been, highly effective in offsetting changes in the value or cash flows of the hedged items. If it is determined
that a derivative is not highly effective at hedging the designated exposure, hedge accounting is discontinued and the
changes in fair value of the instrument are included in net income prospectively. Our net investment hedges are assessed
using a method based on changes in spot exchange rates. Gains and losses, representing hedge components excluded from
the assessment of effectiveness, are recognized in interest and related income on our consolidated statements of operations
over the contractual term of our net investment hedges on a systematic and rational basis, as documented at hedge inception
in accordance with our accounting policy election. All other changes in the fair value of our derivative instruments that
qualify as hedges are reported as a component of accumulated other comprehensive income (loss) on our consolidated
financial statements. Deferred gains and losses are reclassified out of accumulated other comprehensive income (loss) and
into net income in the same period or periods during which the hedged transaction affects earnings, and are presented in the
same line item as the earnings effect of the hedged item. For cash flow hedges, this is typically when the periodic swap
settlements are made, while for net investment hedges, this occurs when the hedged item is sold or substantially liquidated.
To the extent a derivative does not qualify for hedge accounting and is deemed a non-designated hedge, the changes in its
fair value are included in net income concurrently.
Proceeds or payments from periodic settlements of derivative instruments are classified on our consolidated statement of
cash flows in the same section as the underlying hedged item.
Refer to Note 6 for further information.
We record investments financed with secured debt or asset-specific debt as separate assets and the related borrowings
under any secured debt or asset-specific debt are recorded as separate liabilities on our consolidated balance sheets. Interest
income earned on the investments and interest expense incurred on the secured debt or asset-specific debt are reported
separately on our consolidated statements of operations.
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Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
Term Loans
We record our term loans as liabilities on our consolidated balance sheets. Where applicable, any issue discount or
transaction expenses are deferred and amortized through the maturity date of the term loans as additional non-cash interest
expense.
Senior Secured Notes
We record our senior secured notes as liabilities on our consolidated balance sheets. Where applicable, any issue discount
or transaction expenses are deferred and amortized through the maturity date of the senior secured notes as additional non-
cash interest expense.
Convertible Notes
Convertible note proceeds, unless issued with a substantial premium or an embedded conversion feature, are classified as
debt. Additionally, shares issuable under our convertible notes are included in diluted earnings per share in our
consolidated financial statements, if the effect is dilutive, using the if-converted method, regardless of settlement intent.
Where applicable, any issue discount or transaction expenses are deferred and amortized through the maturity date of the
convertible notes as additional non-cash interest expense.
Deferred Financing Costs
The deferred financing costs that are included as a reduction in the net book value of the related liability on our
consolidated balance sheets include issuance and other costs related to our debt obligations. These costs are amortized as
Underwriting commissions and offering costs incurred in connection with common stock offerings are reflected as a
reduction of additional paid-in capital. Costs incurred that are not directly associated with the completion of a common
The ASC Topic 820, “Fair Value Measurements and Disclosures,” or ASC 820, defines fair value, establishes a framework
for measuring fair value, and requires certain disclosures about fair value measurements under GAAP. Specifically, this
guidance defines fair value based on exit price, or the price that would be received upon the sale of an asset or the transfer
of a liability in an orderly transaction between market participants at the measurement date.
ASC 820 also establishes a fair value hierarchy that prioritizes and ranks the level of market price observability used in
measuring financial instruments. Market price observability is affected by a number of factors, including the type of
financial instrument, the characteristics specific to the financial instrument, and the state of the marketplace, including the
existence and transparency of transactions between market participants. Financial instruments with readily available quoted
prices in active markets generally will have a higher degree of market price observability and a lesser degree of judgment
used in measuring fair value.
Financial instruments measured and reported at fair value are classified and disclosed based on the observability of inputs
used in the determination, as follows:
•Level 1: Generally includes only unadjusted quoted prices that are available in active markets for identical
financial instruments as of the reporting date.
•Level 2: Pricing inputs include quoted prices in active markets for similar instruments, quoted prices in less active
or inactive markets for identical or similar instruments where multiple price quotes can be obtained, and other
observable inputs, such as interest rates, yield curves, credit risks, and default rates.
•Level 3: Pricing inputs are unobservable for the financial instruments and include situations where there is little, if
any, market activity for the financial instrument. These inputs require significant judgment or estimation by
management or third parties when determining fair value and generally represent anything that does not meet the
criteria of Levels 1 and 2.
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Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
Certain of our other assets are reported at fair value, as of quarter-end, either (i) on a recurring basis or (ii) on a
nonrecurring basis, as a result of impairment or other events. Our assets that are recorded at fair value are discussed further
in Note 18. We generally value our assets recorded at fair value by either (i) discounting expected cash flows based on
assumptions regarding the collection of principal and interest and estimated market rates, or (ii) obtaining assessments from
third parties. For collateral-dependent loans that are identified as impaired, we measure impairment by comparing our
estimation of the fair value of the underlying collateral, less costs to sell, to the book value of the respective loan. These
valuations require significant judgments, which include assumptions regarding capitalization rates, discount rates, leasing,
creditworthiness of major tenants, occupancy rates, availability and cost of financing, exit plan, loan sponsorship, actions
of other lenders, and other factors.
We have elected the FVO for two of our investments in unconsolidated entities, our Bank Loan Portfolio Joint Venture and
Homebuilder Finance Joint Venture, and therefore report these investments at fair value. Given the fair value of these
investments is not readily determinable, the net asset value of the entities is used as a practical expedient.
As of September 30, 2026, we had an aggregate $444.5 million asset-specific CECL reserve related to 12 of our loans
receivable with an aggregate amortized cost basis of $1.3 billion, net of cost-recovery proceeds. The CECL reserve was
recorded based on our estimation of the fair value of the loans' aggregate underlying collateral as of September 30, 2026.
These loans receivable are therefore measured at fair value on a nonrecurring basis using significant unobservable inputs,
and are classified as Level 3 assets in the fair value hierarchy. We estimated the fair value of the collateral underlying the
loans receivable using a discounted cash flow methodology that considered a variety of inputs including property
performance, market data, and comparable sales, as applicable. The significant unobservable inputs utilized in the analysis
include the exit capitalization rate assumption used to forecast the future sale price of the underlying real estate collateral,
which ranged from 4.9 % to 8.8 %, and the unlevered discount rate assumption, which ranged from 9.0 % to 15.0 %.
During the nine months ended September 30, 2026, we acquired legal title to three owned real estate assets through
foreclosure or deed-in-lieu of foreclosure transactions. At the time of each acquisition, we determined the fair value of the
real estate assets based on a variety of inputs, as applicable, including, but not limited to, estimated cash flow projections,
leasing assumptions, required capital expenditures, market data, and comparable sales. The owned real estate assets were
measured at fair value on a nonrecurring basis using significant unobservable inputs and are classified as Level 3 assets in
the fair value hierarchy. The significant unobservable inputs employed include (i) the exit capitalization rate assumption
used to forecast the future sale price of the assets, which ranged from 5.8 % to 7.5 %, and (ii) the unlevered discount rate
assumption, which ranged from 8.0 % to 11.0 %. Refer to Notes 4 and 18 for further information.
We are also required by GAAP to disclose fair value information about financial instruments, which are not otherwise
reported at fair value in our consolidated balance sheet, to the extent it is practicable to estimate a fair value for those
instruments. These disclosure requirements exclude certain financial instruments and all non-financial instruments.
The following methods and assumptions are used to estimate the fair value of each class of financial instruments, for which
it is practicable to estimate that value:
•Cash and cash equivalents: The carrying amount of cash and cash equivalents approximates fair value.
•Loans receivable, held-for-investment, net: The fair values of these loans were estimated using a discounted cash
flow methodology, taking into consideration various factors including capitalization rates, discount rates, leasing,
creditworthiness of major tenants, occupancy rates, availability and cost of financing, exit plan, loan sponsorship,
actions of other lenders, and other factors.
•Loans receivable, held-for-sale: The fair values of these loans were estimated using executed sale agreements.
•Derivative financial instruments: The fair value of our foreign currency and interest rate contracts was estimated
using advice from a third-party derivative specialist, based on contractual cash flows and observable inputs
comprising foreign currency rates and credit spreads.
•Secured debt, net and other secured debt: The fair value of these instruments was estimated based on the rate at
which a similar credit facility would currently be priced. Other secured debt is included in other liabilities in our
consolidated balance sheets.
•Securitized debt obligations, net: The fair value of these instruments was estimated by utilizing third-party pricing
service providers. In determining the value of a particular investment, pricing service providers may use broker-
dealer quotations, reported trades, or valuation estimates from their internal pricing models to determine the
reported price.
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Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
•Asset-specific debt, net: The fair value of these instruments was estimated based on the rate at which a similar
agreement would currently be priced.
•Term loans, net: The fair value of these instruments was estimated by utilizing third-party pricing service
providers. In determining the value of a particular investment, pricing service providers may use broker-dealer
quotations, reported trades, or valuation estimates from their internal pricing models to determine the reported
price.
•Senior secured notes, net: The fair value of these instruments was estimated by utilizing third-party pricing service
providers. In determining the value of a particular investment, pricing service providers may use broker-dealer
quotations, reported trades, or valuation estimates from their internal pricing models to determine the reported
price.
•Convertible notes, net: Each series of the convertible notes is actively traded and their fair values were obtained
Our financial results generally do not reflect provisions for current or deferred income taxes on our REIT taxable income.
We believe that we operate in a manner that will continue to allow us to be taxed as a REIT and, as a result, we generally
do not expect to pay substantial corporate level taxes other than those payable by our taxable REIT subsidiaries. If we were
to fail to meet these requirements, we may be subject to federal, state, and local income tax on current and past income, and
penalties. Refer to Note 16 for further information.
Our stock-based compensation consists of awards issued to our Manager, certain individuals employed by an affiliate of
our Manager, and certain members of our board of directors that vest over the life of the awards, as well as deferred stock
units issued to certain members of our board of directors. Stock-based compensation expense is recognized for these
awards in net income on a variable basis over the applicable vesting period of the awards, based on the value of our class A
common stock. Refer to Note 17 for further information.
Basic earnings per share, or Basic EPS, is computed in accordance with the two-class method and is based on (i) the net
earnings allocable to our class A common stock, including restricted class A common stock and deferred stock units,
divided by (ii) the weighted-average number of shares of our class A common stock, including restricted class A common
stock and deferred stock units outstanding during the period. Our restricted class A common stock is considered a
participating security, as defined by GAAP, and has been included in our Basic EPS under the two-class method as these
restricted shares have the same rights as our other shares of class A common stock, including participating in any gains or
losses.
Diluted earnings per share, or Diluted EPS, is determined using the if-converted method, and is based on (i) the net
earnings, adjusted for interest expense incurred on our convertible notes during the relevant period, net of incentive fees,
allocable to our class A common stock, including restricted class A common stock and deferred stock units, divided by (ii)
the weighted-average number of shares of our class A common stock, including restricted class A common stock, deferred
stock units, and shares of class A common stock issuable under our convertible notes. Refer to Note 14 for further
In the normal course of business, we enter into transactions not denominated in United States, or U.S., dollars. Foreign
exchange gains and losses arising on such transactions are recorded as a gain or loss in our consolidated statements of
operations. In addition, we consolidate entities that have a non-U.S. dollar functional currency. Non-U.S. dollar-
denominated assets and liabilities are translated to U.S. dollars at the exchange rate prevailing at the reporting date and
income, expenses, gains, and losses are translated at the average exchange rate over the applicable period. Cumulative
translation adjustments arising from the translation of non-U.S. dollar-denominated subsidiaries are recorded in other
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Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
In December 2025, the FASB issued Accounting Standards Update, or ASU, 2025-11, “Interim Reporting (Topic 270):
Narrow-Scope Improvements,” which amends the guidance in ASC 270, Interim Reporting. The update enhances interim
disclosure requirements by clarifying the information that must be presented in quarterly periods, including improved
transparency regarding significant events, accounting policy updates, and material developments that occur between annual
reporting dates. ASU 2025-11 also aligns certain interim reporting requirements more closely with annual disclosure
objectives to promote consistency and comparability. The amendments are effective for interim periods beginning after
December 15, 2027, and early adoption is permitted. We have not early adopted ASU 2025-11 and do not expect the
adoption of ASU 2025-11 to have a material impact on our consolidated financial statements.
In November 2025, the FASB issued ASU 2025-09, “Derivatives and Hedging (Topic 815): Hedge Accounting
Improvements,” which amends the guidance in ASC 815, Derivatives and Hedging. The update refines certain hedge
accounting requirements, including clarifications to the designation and documentation criteria for hedge relationships,
improvements to the assessment of hedge effectiveness, and enhanced disclosures intended to provide greater transparency
into an entity’s risk management activities involving derivatives. ASU 2025-09 is effective for annual periods beginning
after December 15, 2026, including interim periods within those annual periods, and early adoption is permitted. We have
not early adopted ASU 2025-09 and do not expect the adoption of ASU 2025-09 to have a material impact on our
consolidated financial statements.
In November 2025, the FASB issued ASU 2025-08, “Financial Instruments—Credit Losses (Topic 326): Purchased
Loans,” which clarifies the application of the CECL model to purchased loans, including purchased credit‑deteriorated
loans, and enhances related disclosure requirements. ASU 2025-08 is effective for annual reporting periods beginning after
December 15, 2026, including interim periods within those annual periods. Early adoption is permitted. We have not early
adopted ASU 2025-08 and do not expect the adoption of ASU 2025-08 to have a material impact on our consolidated
financial statements.
In July 2025, the FASB issued ASU 2025-05, “Financial Instruments—Credit Losses (Topic 326): Measurement of Credit
Losses for Accounts Receivable and Contract Assets,” which amends the guidance in ASC 326. This update provides a
practical expedient related to the estimation of expected credit losses for current accounts receivable and current contract
assets that arise from transactions accounted for under ASC 606. The amendment notes that in developing reasonable and
supportable forecasts as part of estimating expected credit losses, all entities may elect a practical expedient that assumes
that current conditions as of the balance sheet date do not change for the remaining life of the asset. ASU 2025-05 is
effective for annual periods beginning after December 15, 2025, including interim periods within those annual periods, and
early adoption is permitted. We recognize revenue from our Agency Multifamily Lending Partnership and income from our
hospitality owned real estate assets pursuant to ASC 606. The adoption of ASU 2025-05 in 2026 did not have a material
impact on our consolidated financial statements.
In May 2025, the FASB issued ASU 2025-03, “Business Combinations (Topic 805) and Consolidation (Topic 810):
Determining the Accounting Acquirer in the Acquisition of a Variable Interest Entity,” which amends the guidance in ASC
805. This update clarifies the determination of the accounting acquirer in business combinations that are primarily effected
through the exchange of equity interests and involve the acquisition of a VIE. Specifically, entities are now required to
consider the factors outlined in ASC 805-10-55-12 through 55-15 when determining the accounting acquirer, rather than
defaulting to the primary beneficiary of the VIE as the accounting acquirer. ASU 2025-03 is effective for annual periods
beginning after December 15, 2026, including interim periods within those annual periods, and early adoption is permitted.
We have not early adopted ASU 2025-03 and do not expect the adoption of ASU 2025-03 to have a material impact on our
consolidated financial statements.
In November 2024, the FASB issued ASU 2024-04 “Debt with Conversion and Other Options (Subtopic 470-20): Induced
Conversions of Convertible Debt Instruments,” or ASU 2024-04. ASU 2024-04 clarifies the accounting treatment for
settlement of a convertible debt instrument as an induced conversion. ASU 2024-04 is effective on a prospective basis,
with the option for retrospective application, for fiscal years beginning after December 15, 2025. The adoption of ASU
2024-04 in 2026 did not have a material impact on our consolidated financial statements.
In November 2024, the FASB issued ASU 2024-03 “Expense Disaggregation Disclosures (Subtopic 220-40):
Disaggregation of Income Statement Expenses,” or ASU 2024-03. ASU 2024-03 requires disclosures in the notes to the
financial statements on specified information about certain costs and expenses for each interim and annual reporting period.
ASU 2024-03 is effective on a prospective basis, with the option for retrospective application, for annual periods beginning
after December 15, 2026, and for interim periods within fiscal years beginning after December 15, 2027, and early
21
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
adoption is permitted. We have not early adopted ASU 2024-03 and do not expect the adoption of ASU 2024-03 to have a
material impact on our consolidated financial statements.
3. LOANS RECEIVABLE
Loans receivable, held-for-investment | September 30, 2026 | December 31, 2025 | ||
Number of loans | ||||
Principal balance | $ | $ | ||
Deferred fees, cost-recovery proceeds, and other items | ( | ( | ||
Amortized cost basis | ||||
CECL reserves | ( | ( | ||
Net book value | $ | $ | ||
Unfunded loan commitments(1) | $ | $ | ||
Weighted-average cash coupon(2) | + | + | ||
Weighted-average all-in yield(2) | + | + | ||
Weighted-average maximum maturity (years)(3) | ||||
Loans receivable, held-for-sale | September 30, 2026 | December 31, 2025 | ||
Number of loans | ||||
Principal balance | $ | $ | ||
Deferred fees, cost-recovery proceeds, and other items | ( | |||
Amortized cost basis | ||||
Asset-specific CECL reserves prior to transfer to loans receivable, held-for-sale | ( | |||
Carrying value, prior to transfer to loans receivable, held-for-sale | ||||
Valuation adjustment | ( | |||
Net book value | $ | $ | ||
Unfunded loan commitments(1) | $ | $ | ||
Weighted-average cash coupon(2) | + | n/a | ||
Weighted-average all-in yield(2) | + | n/a | ||
Weighted-average maximum maturity (years)(3) | n/a |
(1)Unfunded commitments will primarily be funded to finance our borrowers’ construction or development of real
estate-related assets, capital improvements of existing assets, or lease-related expenditures. These commitments will
generally be funded over the term of each loan, subject in certain cases to an expiration date.
(2)The weighted-average cash coupon and all-in yield are expressed as a spread over the relevant floating benchmark
rates, which include SOFR, SONIA, EURIBOR, CORRA, and other indices, as applicable to each loan. As of
September 30, 2026, 96 % of our loans held-for-investment by principal balance earned a floating rate of interest,
primarily indexed to SOFR. The remaining 4 % of our loans held-for-investment by principal balance earned a fixed
rate of interest. As of December 31, 2025, 97 % of our loans by principal balance earned a floating rate of interest,
primarily indexed to SOFR. The remaining 3 % of our loans by principal balance earned a fixed rate of interest. In
addition to cash coupon, all-in yield includes the amortization of deferred origination and extension fees, loan
origination costs, and purchase discounts, as well as the accrual of exit fees. Excludes loans accounted for under the
cost-recovery and nonaccrual methods, if any.
(3)Maximum maturity assumes all extension options are exercised by the borrower; however, our loans may be repaid
prior to such date. Excludes loans accounted for under the cost-recovery and nonaccrual methods, if any. As of
September 30, 2026, 44 % of our loans held-for-investment by principal balance were subject to yield maintenance
or other prepayment restrictions and 56 % were open to repayment by the borrower without penalty. As of
December 31, 2025, 40 % of our loans by principal balance were subject to yield maintenance or other prepayment
restrictions and 60 % were open to repayment by the borrower without penalty.
22
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
Loan Sales
During the three months ended September 30, 2026, we entered into an agreement to sell eight whole mortgage loans to an
unaffiliated third party for total estimated net sales proceeds of $615.6 million, which resulted in these loans being
classified as loans receivable, held-for-sale on our consolidated balance sheets as of September 30, 2026. This resulted in a
$63.9 million valuation adjustment recognized to reduce the carrying value of these loans, which was $679.5 million prior
to the adjustment. Two of the whole loans consisted of both a performing senior loan and an impaired subordinate loan.
The two subordinate loans carried $61.9 million of previously recorded asset-specific CECL reserves. Six of the whole
loans were collateralized by office assets and two were collateralized by multifamily assets, all of which were located in the
United States. The valuation adjustment was included in valuation adjustment on loans receivable, held-for-sale on our
consolidated statements of operations during the three months ended September 30, 2026. The sale of these loans closed
subsequent to September 30, 2026.
2026 ($ in thousands):
Loans Receivable Principal Balance | ||||||
Index Rate Floors | USD | Non-USD(1) | Total | |||
Fixed Rate | $ | $ | $ | |||
0.00% or no floor(2) | ||||||
0.01% to 1.00% floor | ||||||
1.01% to 2.00% floor | ||||||
2.01% to 3.00% floor | ||||||
3.01% or more floor | ||||||
Total(3) | $ | $ | $ | |||
(1)Includes Euro, British Pound Sterling, Australian Dollar, and Canadian Dollar currencies.
(2)Includes all impaired loans.
(3)As of September 30, 2026, the weighted-average index rate floor of our floating-rate loans receivable, held-for-
investment principal balance was 1.73 %. Excluding 0.00% index rate floors and loans with no floor, the weighted-
average index rate floor was 2.28 %.
23
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
Net Book Value | |
Loans Receivable, held-for-investment, as of December 31, 2025 | $ |
Loan fundings | |
Loan repayments, sales, and cost-recovery proceeds(1) | ( |
Charge-offs(2) | ( |
Transfer to owned real estate | ( |
Transfer to other assets, net(3) | ( |
Transfer to held-for-sale | ( |
Payment-in-kind interest, net of interest received(4) | ( |
Unrealized loss on foreign currency translation | ( |
Deferred fees and other items(5) | ( |
Amortization of fees and other items(5) | |
Loans Receivable, held-for-investment, as of September 30, 2026 | $ |
CECL reserve | ( |
Loans Receivable, held-for-investment, net, as of September 30, 2026 | $ |
(1)Included in this amount are sales of $251.5 million of pari passu participations in two loans collateralized by
properties located in the United Kingdom.
(2)Excludes a $1.8 million recovery of amounts previously charged off related to a note receivable issued in 2024 that
is no longer reflected on our consolidated balance sheets. The recovery is reflected in our consolidated statements of
operations in the increase in current expected credit loss reserve and is not included in the activity presented above.
(3)This amount relates to intangible and other assets recorded in connection with a loan that was transferred to owned
real estate, net of any liabilities recorded upon acquisition. See Note 6 for further information.
(4)During the nine months ended September 30, 2026, we received $19.2 million of previously accrued payment-in-
kind interest upon repayment of a loan.
(5)Other items primarily consist of purchase and sale discounts or premiums, exit fees, and deferred origination
expenses.
24
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
receivable, held-for-investment portfolio ($ in thousands):
September 30, 2026 | ||||||||
Property Type | Number of Loans | Amortized Cost Basis | Net Loan Exposure(1) | Net Loan Exposure Percentage of Portfolio | ||||
Multifamily | $ | $ | ||||||
Industrial | ||||||||
Office | ||||||||
Hospitality | ||||||||
Retail | ||||||||
Self-storage | ||||||||
Life Sciences / Studio | ||||||||
Other | ||||||||
Total loans receivable, held-for-investment | $ | $ | ||||||
Geographic Location | Number of Loans | Amortized Cost Basis | Net Loan Exposure(1) | Net Loan Exposure Percentage of Portfolio | ||||
United States | ||||||||
Sunbelt | $ | $ | ||||||
Northeast | ||||||||
West | ||||||||
Midwest | ||||||||
Northwest | ||||||||
Subtotal | ||||||||
International | ||||||||
United Kingdom | ||||||||
Australia | ||||||||
Spain | ||||||||
Ireland | ||||||||
Canada | ||||||||
Other Europe | ||||||||
Other International | ||||||||
Subtotal | ||||||||
Total loans receivable, held-for-investment | $ | $ | ||||||
(1)Net loan exposure reflects the amount of each loan that is subject to risk of credit loss to us as of September 30,
2026, which is our principal balance of loans receivable, held-for-investment, net of (i) $989.5 million of asset-
specific debt, (ii) $4.6 million of cost-recovery proceeds, and (iii) our total loans receivable CECL reserve of
$597.3 million. Our asset-specific debt is structurally non-recourse and term-matched to the corresponding collateral
loans.
25
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
December 31, 2025 | ||||||||
Property Type | Number of Loans | Amortized Cost Basis | Net Loan Exposure(1) | Net Loan Exposure Percentage of Portfolio | ||||
Office | $ | $ | ||||||
Multifamily | ||||||||
Industrial | ||||||||
Hospitality | ||||||||
Retail | ||||||||
Self-storage | ||||||||
Life Sciences / Studio | ||||||||
Other | ||||||||
Total loans receivable, held-for-investment | $ | $ | ||||||
Geographic Location | Number of Loans | Amortized Cost Basis | Net Loan Exposure(1) | Net Loan Exposure Percentage of Portfolio | ||||
United States | ||||||||
Sunbelt | $ | $ | ||||||
West | ||||||||
Northeast | ||||||||
Midwest | ||||||||
Northwest | ||||||||
Subtotal | ||||||||
International | ||||||||
United Kingdom | ||||||||
Ireland | ||||||||
Australia | ||||||||
Spain | ||||||||
Sweden | ||||||||
Canada | ||||||||
Other Europe | ||||||||
Other International | ||||||||
Subtotal | ||||||||
Total loans receivable, held-for-investment | $ | $ | ||||||
(1)Net loan exposure reflects the amount of each loan that is subject to risk of credit loss to us as of December 31,
2025, which is our principal balance net of (i) $999.8 million of asset-specific debt, (ii) $24.5 million of cost-
recovery proceeds, and (iii) our total loans receivable CECL reserve of $284.4 million. Our asset-specific debt is
structurally non-recourse and term-matched to the corresponding collateral loans.
26
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
Loan Risk Ratings
As further described in Note 2, we evaluate our loans receivable, held-for-investment portfolio on a quarterly basis. In
conjunction with our quarterly loan portfolio review, we assess the risk factors of each loan, and assign a risk rating based
on several factors. Factors considered in the assessment include, but are not limited to, risk of loss, origination LTV, debt
yield, collateral performance, structure, exit plan, and sponsorship. Loans are rated “1” (less risk) through “5” (greater
risk), which ratings are defined in Note 2.
investment portfolio based on our internal risk ratings ($ in thousands):
September 30, 2026 | ||||||
Risk Rating | Number of Loans | Amortized Cost Basis | Net Loan Exposure(1) | |||
1 | $ | $ | ||||
2 | ||||||
3 | ||||||
4 | ||||||
5 | ||||||
Total loans receivable, held-for-investment | $ | $ | ||||
December 31, 2025 | ||||||
Risk Rating | Number of Loans | Amortized Cost Basis | Net Loan Exposure(1) | |||
1 | $ | $ | ||||
2 | ||||||
3 | ||||||
4 | ||||||
5 | ||||||
Total loans receivable, held-for-investment | $ | $ | ||||
(1)Net loan exposure reflects the amount of each loan that is subject to risk of credit loss to us as of September 30,
2026, which is our principal balance of loans receivable, held-for-investment, net of (i) $989.5 million of asset-
specific debt, (ii) $4.6 million of cost-recovery proceeds, and (iii) our total loans receivable CECL reserve of
$597.3 million. Our net loan exposure as of December 31, 2025 is our principal balance net of (i) $999.8 million of
asset-specific debt, (ii) $24.5 million of cost-recovery proceeds, and (iii) our total loans receivable CECL reserve of
$284.4 million. Our asset-specific debt is structurally non-recourse and term-matched to the corresponding collateral
loans.
Our loans receivable, held-for-investment portfolio had a weighted-average risk rating of 3.1 and 3.0 , based on net loan
exposure, as of September 30, 2026 and December 31, 2025, respectively.
27
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
Current Expected Credit Loss Reserve
The CECL reserves required under GAAP reflect our current estimate of potential credit losses related to the loans
receivable, held-for-investment portfolio included in our consolidated balance sheets. Refer to Note 2 for further discussion
of our CECL reserves. The following table presents the activity in our loans receivable CECL reserves by investment pool
for the three and nine months ended September 30, 2026 and 2025 ($ in thousands):
Loans Receivable, Held-for-Investment, Net | U.S. Loans(1) | Non-U.S. Loans | Unique Loans | Impaired Loans | Total | |||||
CECL reserves as of December 31, 2025 | $ | $ | $ | $ | $ | |||||
Increase (decrease) in CECL reserves | ( | |||||||||
Charge-offs of CECL reserves | ( | ( | ||||||||
CECL reserves as of March 31, 2026 | $ | $ | $ | $ | $ | |||||
Increase (decrease) in CECL reserves | ( | |||||||||
Charge-offs of CECL reserves | ( | ( | ||||||||
CECL reserves as of June 30, 2026 | $ | $ | $ | $ | $ | |||||
(Decrease) increase in CECL reserves | ( | |||||||||
Charge-offs of CECL reserves | ( | ( | ||||||||
Transfer to loans receivable, held-for-sale(2) | ( | ( | ||||||||
CECL reserves as of September 30, 2026 | $ | $ | $ | $ | $ | |||||
CECL reserves as of December 31, 2024 | $ | $ | $ | $ | $ | |||||
Increase in CECL reserves | ||||||||||
Charge-offs of CECL reserves | ( | ( | ||||||||
CECL reserves as of March 31, 2025 | $ | $ | $ | $ | $ | |||||
(Decrease) increase in CECL reserves | ( | ( | ||||||||
Charge-offs of CECL reserves | ( | ( | ||||||||
CECL reserves as of June 30, 2025 | $ | $ | $ | $ | $ | |||||
Increase (decrease) in CECL reserves | ( | ( | ( | |||||||
Charge-offs of CECL reserves | ( | ( | ||||||||
CECL reserves as of September 30, 2025 | $ | $ | $ | $ | $ |
(1)Includes one U.S. dollar-denominated loan that is located in Bermuda.
(2)Represents a transfer of asset-specific CECL reserves on two previously impaired subordinate loans that were
transferred to loans receivable, held-for-sale during the three months ended September 30, 2026.
During the three months ended September 30, 2026, the CECL reserves against our loans receivable, held-for-investment
portfolio increased by $199.5 million. This increase was primarily driven by a $293.8 million increase in our asset-specific
CECL reserve, partially offset by a $25.5 million decrease in our general CECL reserve. The increase in our asset-specific
reserve was primarily driven by six additional loans with an aggregate amortized cost basis of $787.8 million that were
impaired during the three months ended September 30, 2026, of which five are secured by office properties, and one is
secured by a hospitality asset. The office sector recovery in certain markets has continued to lag other commercial real
estate sectors, which has, in certain cases, extended business plans on transitional properties and impacted their
performance, affecting some borrowers’ willingness and ability to continue to support their assets. During the three months
ended September 30, 2026, we recorded $8.7 million of interest income on these loans. Upon determining that the six loans
were impaired, the income accrual was suspended, as the recovery of interest income and principal was doubtful. The
decrease in our general CECL reserve was primarily driven by changes in risk ratings, including the impact of the six
newly impaired loans moving out of the general CECL reserve pool, and a decrease in our loans receivable, held-for-
investment balance, partially offset by an increase in the historical loss rate used in reserve calculations related to the
additional reserve charge-offs.
28
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
The increase in our asset-specific reserve was reduced by (i) the transfer of $61.9 million of CECL reserves related to two
previously impaired subordinate loans that were transferred to held-for-sale as of September 30, 2026, which were sold
subsequent to September 30, 2026, and (ii) charge-offs of $6.9 million primarily related to the resolution of one previously
impaired loan as a result of our acquisition of title through a deed-in-lieu of foreclosure of a mixed-use collateral property
located in Richmond, CA, which is now included on our consolidated balance sheet as an owned real estate asset. As a
result of these changes, our total loans receivable CECL reserves increased to $597.3 million as of September 30, 2026.
As of September 30, 2026, we had an aggregate $444.5 million asset-specific CECL reserve related to 12 of our loans
receivable, held-for-investment, with an aggregate amortized cost basis of $1.3 billion, net of cost-recovery proceeds.
During the three months ended September 30, 2026, we received $4.4 million of cash proceeds from previously impaired
loans that were applied as a reduction to the amortized cost basis of each respective loan. Impairments are each determined
individually as a result of changes in the specific credit quality factors for each such loan. These factors included, among
others, (i) the underlying collateral performance, (ii) discussions with the borrower, (iii) borrower events of default, and
(iv) other facts that impact the borrower’s ability to pay the contractual amounts due under the terms of the loan. This asset-
specific CECL reserve was recorded based on our estimation of the fair value of each loan’s underlying collateral as of
September 30, 2026.
As of September 30, 2026, one of our performing loans with an amortized cost basis of $149.8 million was in payment
default, was greater than 90 days past due on its interest payment, and had a risk rating of “4.” This loan was not impaired
as of September 30, 2026 as we expect to fully recover all contractual principal and interest amounts due under the loan
agreement. All other borrowers under performing loans were in compliance with the applicable contractual terms of each
respective loan, including any required payment of interest. Refer to Note 2 for further discussion of our policies on
revenue recognition and our CECL reserves.
29
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
amortized cost basis of our loans receivable, held-for-investment portfolio as of September 30, 2026 and December 31,
2025, respectively, by year of origination and risk rating ($ in thousands):
Amortized Cost Basis of Loans Receivable by Year of Origination(1) | ||||||||||||||
As of September 30, 2026 | ||||||||||||||
Risk Rating | 2026 | 2025 | 2024 | 2023 | 2022 | Prior | Total | |||||||
1 | $ | $ | $ | $ | $ | $ | $ | |||||||
2 | ||||||||||||||
3 | ||||||||||||||
4 | ||||||||||||||
5 | ||||||||||||||
Total loans receivable, held-for-investment | $ | $ | $ | $ | $ | $ | $ | |||||||
Gross charge-offs(2) | ( | ( | $( | |||||||||||
Amortized Cost Basis of Loans Receivable by Year of Origination(1) | ||||||||||||||
As of December 31, 2025 | ||||||||||||||
Risk Rating | 2025 | 2024 | 2023 | 2022 | 2021 | Prior | Total | |||||||
1 | $ | $ | $ | $ | $ | $ | $ | |||||||
2 | ||||||||||||||
3 | ||||||||||||||
4 | ||||||||||||||
5 | ||||||||||||||
Total loans receivable, held-for-investment | $ | $ | $ | $ | $ | $ | $ | |||||||
Gross charge-offs(2) | ( | ( | ( | $( | ||||||||||
(1)Year loan was originated or acquired by us. Origination dates are subsequently updated to reflect material loan
modifications.
(2)Represents charge-offs by year of origination during the nine months ended September 30, 2026 and year ended
December 31, 2025, respectively, net of any recoveries of amounts previously charged off.
Loan Modifications Pursuant to ASC 326
During the twelve months ended September 30, 2026, we entered into one loan modification that requires disclosure
pursuant to ASC 326. This loan was collateralized by a life sciences asset.
The loan had a risk rating of “5” at the time of modification, which resulted in the bifurcation of the loan into separate
senior and subordinate loans. The loan modification also included a term extension of 4.3 years and the interest rate
decreased by 3.56 %. We are accruing all of the interest on the senior loan that is paying current, and deferring interest on
the subordinate loan, which is paid-in-kind. As of September 30, 2026, the aggregate amortized cost basis of these loans
was $122.5 million, or 0.8 % of our aggregate loans receivable, held-for-investment portfolio, with an aggregate
$34.6 million of unfunded commitments. These loans were in compliance with their modified contractual terms as of
September 30, 2026. As of September 30, 2026, the newly bifurcated senior loan had a risk rating of “4,” and the newly
bifurcated subordinate loan had a risk rating of “5,” as collection of amounts due under the loan terms was doubtful. The
loan with a risk rating of “4” is included in the determination of our general CECL reserve and the loan with a risk rating of
“5” is evaluated individually for an asset-specific CECL reserve.
Loan modifications that allow the option to pay interest in-kind increase our potential economics and the size of our
secured claim, as interest is capitalized and added to the outstanding principal balance for applicable loans. As of
30
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
September 30, 2026, no income was recorded on our loans subsequent to determining that such loans were impaired and
risk rated “5.”
4. OWNED REAL ESTATE, NET
As of September 30, 2026 and December 31, 2025, we had 15 and 12 owned real estate assets, respectively. During the
nine months ended September 30, 2026, we acquired three owned real estate assets through foreclosure or deed-in-lieu of
foreclosure transactions with an aggregate acquisition price of $273.9 million. We allocated $168.1 million to building and
building improvements, $86.1 million to land and land improvements, $14.1 million to acquired intangible assets, and
$5.6 million to other components of the purchase price, including cash held in reserves at the time of acquisition. In
aggregate, we charged off $86.1 million of CECL reserves relating to the loans that had previously been secured by these
assets, as the loans’ aggregate amortized cost basis of $360.0 million at the time of the acquisitions exceeded the
acquisition date fair value noted above. See Note 2 for further discussion of owned real estate assets.
Acquisitions
The acquisitions of three owned real estate assets during the nine months ended September 30, 2026 were accounted for as
asset acquisitions under ASC 805, and we recognized the properties as owned real estate assets held-for-investment. The
following table presents the owned real estate assets that were acquired during the nine months ended September 30, 2026
($ in thousands):
Acquisition Date | Location | Property Type | Acquisition Date Fair Value | |||
March 2026 | San Francisco, CA | Hospitality | $ | |||
June 2026 | Dallas, TX | Multifamily | ||||
September 2026 | Richmond, CA | Mixed-use | ||||
$ |
Dispositions
During the nine months ended September 30, 2026, we completed a partial sale of one owned real estate asset, a
multifamily property located in San Antonio, TX. The carrying value of the asset at the time of disposition was
$15.3 million, and we received net cash proceeds of $15.1 million, resulting in a net loss of $0.2 million, which is included
in net loss on disposition of owned real estate on our consolidated statements of operations.
31
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
consolidated balance sheets ($ in thousands):
September 30, 2026 | December 31, 2025 | ||
Assets | |||
Building and building improvements | $ | $ | |
Land and land improvements | |||
Total | $ | $ | |
Less: accumulated depreciation | ( | ( | |
Owned real estate, net | $ | $ | |
Intangible real estate assets | $ | $ | |
Less: accumulated amortization | ( | ( | |
Intangible real estate assets, net(1) | $ | $ | |
Liabilities | |||
Intangible real estate liabilities | $ | $ | |
Less: accumulated amortization | ( | ( | |
Intangible real estate liabilities, net(2) | $ | $ |
(1)Included within other assets on our consolidated balance sheets. Refer to Note 6 for further information.
(2)Included within other liabilities on our consolidated balance sheets. Refer to Note 6 for further information.
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||
2026 | 2025 | 2026 | 2025 | ||||
Rental revenue | $ | $ | $ | $ | |||
Hospitality revenue | |||||||
Other operating revenue | |||||||
Revenue from owned real estate | $ | $ | $ | $ | |||
Operating expense | $ | $ | $ | $ | |||
Depreciation and amortization expense | |||||||
Total expenses from owned real estate | $ | $ | $ | $ | |||
Loss from owned real estate | $( | $( | $( | $( | |||
32
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
September 30, 2026. Leases at our multifamily assets are short term, generally 12 months or less, and are therefore not
included ($ in thousands):
Year | Future Minimum Rents | |
2026 (remaining) | $ | |
2027 | ||
2028 | ||
2029 | ||
2030 | ||
Thereafter | ||
Total | $ |
thereafter as of September 30, 2026 ($ in thousands):
Year | In-place lease intangibles | Above-market lease intangibles | Below-market lease intangibles | |||
2026 (remaining) | $ | $ | $( | |||
2027 | ( | |||||
2028 | ( | |||||
2029 | ( | |||||
2030 | ( | |||||
Thereafter | ( | |||||
Total | $ | $ | $( |
Impairment
During the three months ended September 30, 2026, we recognized $36.4 million of aggregate impairment charges related
to three owned real estate assets, two of which were office assets and one of which was a multifamily asset. The
impairments resulted from updates to the undiscounted cash flow assumptions, primarily a shortening of the expected hold
period for the properties.
We did not recognize any impairment charges during the nine months ended September 30, 2025.
33
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
5. INVESTMENTS IN UNCONSOLIDATED ENTITIES
As of September 30, 2026, we hold certain investments in unconsolidated entities that are accounted for under the equity
method of accounting or the FVO, as our ownership interest in each entity does not meet the requirements for
consolidation. Refer to Note 2 for further details.
September 30, 2026 | ||||||
Investments in Unconsolidated Entities | Number of Assets | Ownership Interest | Book Value | |||
Unconsolidated entities carried at historical cost | ||||||
Net Lease Joint Venture | $ | |||||
Total unconsolidated entities carried at historical cost | ||||||
Unconsolidated entities carried at fair value | ||||||
Bank Loan Portfolio Joint Venture | ||||||
Homebuilder Finance Joint Venture | ||||||
Total unconsolidated entities carried at fair value | ||||||
Total | $ | |||||
December 31, 2025 | ||||||
Investments in Unconsolidated Entities | Number of Assets | Ownership Interest | Book Value | |||
Unconsolidated entities carried at historical cost | ||||||
Net Lease Joint Venture | $ | |||||
Total unconsolidated entities carried at historical cost | ||||||
Unconsolidated entities carried at fair value | ||||||
Bank Loan Portfolio Joint Venture | ||||||
Total unconsolidated entities carried at fair value | ||||||
Total | $ | |||||
(1)The number of assets represents the number of commercial real estate properties.
(2)The number of assets represents the number of commercial mortgage loans held by each entity.
(3)Represents our aggregate ownership interest in our Bank Loan Portfolio Joint Venture, which owns an initial
portfolio of commercial mortgage loans acquired during the three months ended June 30, 2025, in which we hold a
hold a 50 % interest.
September 30, 2026 ($ in thousands):
Net Lease Joint Venture | Bank Loan Portfolio Joint Venture | Homebuilder Finance Joint Venture | Total | ||||
Balance as of December 31, 2025 | $ | $ | $ | $ | |||
Contributions | |||||||
Distributions | ( | ( | ( | ||||
Income from unconsolidated entities(1) | |||||||
Accumulated other comprehensive income | |||||||
Balance as of September 30, 2026 | $ | $ | $ | $ |
(1)Includes our share of non-cash items such as (i) depreciation and amortization, and (ii) unrealized gains or losses
recorded by unconsolidated entities.
34
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
Our Net Lease Joint Venture and Bank Loan Portfolio Joint Venture have each entered into and may continue to enter into
derivative agreements where we would be required to make payment for periodic or final settlement of derivative contracts
if either our Net Lease Joint Venture or Bank Loan Portfolio Joint Venture, as applicable, is unable to fulfill its respective
obligations.
As of September 30, 2026, our Homebuilder Finance Joint Venture had unfunded commitments under certain of the loans
it holds, which primarily relate to future construction costs expected to be funded over the remaining terms of the
underlying loans, subject to the satisfaction of customary funding conditions. We expect these commitments to be funded
primarily through our Homebuilder Finance Joint Venture’s financing arrangements, with the remainder funded through
capital contributions from the joint venture partners, including us, in proportion to our respective ownership interests. As of
September 30, 2026, our share of such unfunded commitments was $69.7 million.
6. OTHER ASSETS AND LIABILITIES
Other Assets
September 30, 2026 | December 31, 2025 | ||
Debt securities, at fair value(1) | $ | $ | |
Accounts receivable and other assets(2) | |||
Accrued interest receivable | |||
Real estate intangible assets, net | |||
Other real estate assets | |||
Loan portfolio payments held by servicer(3) | |||
Collateral deposited under derivative agreements | |||
Derivative assets | |||
Prepaid expenses | |||
Total | $ | $ |
(1)Represents investments in senior secured notes and an investment in a significant risk transfer, or SRT, transaction
with a UK financial institution structured as a credit-linked note, or the UK Bank Loan Portfolio SRT. These
investments are recorded at fair value, with changes in fair value recognized in other income, net in our consolidated
statements of operations.
(2)Includes $120.8 million and $55.5 million as of September 30, 2026 and December 31, 2025, respectively, of cash
collateral held by our CLOs that was subsequently remitted by the trustee to repay a portion of the outstanding
senior CLO securities, or that was subsequently reinvested by purchasing additional collateral into our CLOs.
(3)Primarily represents loan principal repayments held by our third-party loan servicers as of the balance sheet date that
were remitted to us during the subsequent remittance cycle.
35
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
Other Liabilities
September 30, 2026 | December 31, 2025 | ||
Other real estate liabilities | $ | $ | |
Accrued dividends payable | |||
Other secured debt(1) | |||
Accrued interest payable | |||
Debt repayments pending servicer remittance(2) | |||
Derivative liabilities | |||
Accrued management fees payable | |||
Accounts payable and other liabilities | |||
Current expected credit loss reserves for unfunded loan commitments(3) | |||
Total | $ | $ |
(1)Represents financing on our retained investment in the European Loan Securitization and on an investment in debt
securities. Refer to Note 8 for further information on the European Loan Securitization.
(2)Represents pending transfers from our third-party loan servicer that were remitted to our banking counterparties
during the subsequent remittance cycle.
(3)Represents the CECL reserve related to our unfunded loan commitments.
Current Expected Credit Loss Reserves for Unfunded Loan Commitments
As of September 30, 2026, we had aggregate unfunded commitments of $915.4 million related to 42 loans receivable, held-
for-investment. The expected credit losses over the contractual period of our loans are impacted by our obligations to
extend further credit through our unfunded loan commitments. See Note 2 for further discussion of the CECL reserves
related to our unfunded loan commitments, and Note 21 for further discussion of our unfunded loan commitments. During
the three and nine months ended September 30, 2026, we recorded decreases in the CECL reserves related to our unfunded
loan commitments of $3.5 million and $2.6 million, respectively, bringing our total unfunded loan commitments CECL
reserve to $9.1 million as of September 30, 2026. During the three and nine months ended September 30, 2025, we
recorded increases in the CECL reserves related to our unfunded loan commitments of $2.0 million and $3.3 million,
respectively, bringing our total unfunded loan commitments CECL reserve to $13.7 million as of September 30, 2025.
7. SECURED DEBT, NET
Our secured debt represents borrowings under our secured credit facilities. During the nine months ended September 30,
2026, we closed $1.1 billion of new borrowings against $1.5 billion of collateral assets.
Secured Debt Borrowings Outstanding | |||
September 30, 2026 | December 31, 2025 | ||
Secured credit facilities | $ | $ | |
Deferred financing costs(1) | ( | ( | |
Net book value of secured debt | $ | $ | |
(1)Costs incurred in connection with our secured debt are recorded on our consolidated balance sheets when incurred
and recognized as a component of interest expense over the life of each related facility.
36
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
Secured Credit Facilities
Our secured credit facilities are bilateral agreements we use to finance diversified pools of senior loan and owned real
estate collateral with sufficient flexibility to accommodate our investment and asset management strategy. The facilities are
generally structured to provide currency, index, and term-matched financing without capital markets-based mark-to-market
provisions. Our credit facilities are diversified across 16 counterparties, primarily consisting of top global financial
institutions to minimize our counterparty risk exposure.
Recourse Limitation | ||||||||||||||||||||
Currency | Lenders(1) | Borrowings | Wtd. Avg. Maturity(2) | Wtd. Avg. All-in Cost(3)(4)(5) | Loan Count | Collateral(6) | Wtd. Avg. All-in Yield(3)(4) | Wtd. Avg. | Range | |||||||||||
USD | $ | Sep 2028 | + | $ | + | |||||||||||||||
GBP | Apr 2029 | + | + | |||||||||||||||||
EUR | Dec 2030 | + | + | |||||||||||||||||
Others(7) | Dec 2029 | + | + | |||||||||||||||||
Total | $ | May 2029 | + | $ | + | |||||||||||||||
(1)Represents the number of lenders with fundings advanced in each respective currency, as well as the total number of
facility lenders.
(2)Our secured debt agreements are generally term-matched to their underlying collateral. Therefore, the weighted-
average maturity is generally allocated based on the maximum maturity date of the collateral loans, assuming all
extension options are exercised by the borrower. In limited instances, the maturity date of the respective secured
credit facility is used.
(3)The spread, all-in cost, and all-in yield are expressed over the relevant floating benchmark rates, which include
SOFR, SONIA, EURIBOR, CORRA, and other indices as applicable.
(4)In addition to spread, the cost includes the associated deferred fees and expenses related to the respective
borrowings. In addition to cash coupon, all-in yield includes the amortization of deferred origination and extension
fees, loan origination costs, and purchase discounts, as well as the accrual of exit fees. All-in yield excludes loans
accounted for under the cost-recovery and nonaccrual methods, if any, and owned real estate assets.
(5)Represents the weighted-average all-in cost as of September 30, 2026 and is not necessarily indicative of the spread
applicable to recent or future borrowings.
(6)Represents the principal balance of the collateral loans receivable, held-for-investment and the carrying value of the
collateral owned real estate assets and loans receivable, held-for-sale.
(7)Includes Australian Dollar and Canadian Dollar currencies.
The availability of funding under our secured credit facilities is based on the amount of approved collateral, which
collateral is proposed by us in our discretion and approved by the respective counterparty in its discretion, resulting in a
mutually agreed collateral portfolio construction. Certain structural elements of our secured credit facilities, including the
limitation on recourse to us and facility economics, are influenced by the specific collateral portfolio construction of each
facility, and therefore vary within and among the facilities.
Our secured credit facilities generally permit us to increase or decrease the amount advanced against the pledged collateral
in our discretion within certain maximum/minimum amounts and frequency limitations. As of September 30, 2026, there
was an aggregate $782.3 million available to be drawn at our discretion under our credit facilities.
Financial Covenants
As of September 30, 2026, we are subject to the following financial covenants related to our secured debt and secured debt
of our unconsolidated entities: (i) our ratio of earnings before interest, taxes, depreciation, and amortization, or EBITDA, to
fixed charges, as defined in the agreements, shall be not less than 1.3 to 1.0; (ii) our tangible net worth, as defined in the
agreements, shall not be less than $2.8 billion as of each measurement date plus 75 % to 85 % of the net cash proceeds of
future equity issuances subsequent to September 30, 2026; (iii) cash liquidity shall not be less than the greater of (x) $10.0
million or (y) no more than 5 % of our recourse indebtedness; and (iv) our indebtedness shall not exceed 83.33 % of our
total assets. As of September 30, 2026 and December 31, 2025, we were in compliance with these covenants.
37
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
8. SECURITIZED DEBT OBLIGATIONS, NET
We have financed certain pools of our loans through CLOs and have also financed one of our loans through a securitization
vehicle, or the European Loan Securitization. The CLOs and the European Loan Securitization are consolidated in our
financial statements and have issued securitized debt obligations that are non-recourse to us. Refer to Note 19 for further
discussion of our CLOs and the European Loan Securitization. The following tables detail our securitized debt obligations
and the underlying collateral assets that are financed by our CLOs and the European Loan Securitization ($ in thousands):
September 30, 2026 | ||||||||||
Securitized Debt Obligations | Count | Principal Balance | Book Value(1) | Wtd. Avg. Yield/Cost(2) | Term(3) | |||||
CLOs | ||||||||||
2026 FL6 Collateralized Loan Obligation | ||||||||||
Senior CLO Securities Outstanding | $ | $ | + | August 2043 | ||||||
Underlying Collateral Assets | + | October 2029 | ||||||||
2025 FL5 Collateralized Loan Obligation | ||||||||||
Senior CLO Securities Outstanding | + | October 2042 | ||||||||
Underlying Collateral Assets | + | September 2029 | ||||||||
2021 FL4 Collateralized Loan Obligation | ||||||||||
Senior CLO Securities Outstanding | + | May 2038 | ||||||||
Underlying Collateral Assets | + | August 2027 | ||||||||
2020 FL2 Collateralized Loan Obligation | ||||||||||
Senior CLO Securities Outstanding | + | February 2038 | ||||||||
Underlying Collateral Assets | + | March 2027 | ||||||||
Total CLOs | ||||||||||
Senior CLO Securities Outstanding | $ | $ | + | |||||||
Underlying Collateral Assets | + | |||||||||
European Loan Securitization | ||||||||||
Financing Provided | $ | $ | + | July 2030 | ||||||
Underlying Collateral Assets(4) | + | July 2030 | ||||||||
Total | ||||||||||
Senior CLO Securities Outstanding / Financing Provided(5) | $ | $ | + | |||||||
Underlying Collateral Assets | + | |||||||||
(1)The book value of underlying collateral assets excludes any applicable CECL reserves.
(2)In addition to cash coupon, all-in yield includes the amortization of deferred origination and extension fees, loan
origination costs, purchase discounts, and accrual of exit fees, while all-in cost includes the amortization of deferred
origination fees and financing costs. The weighted-average all-in yield and cost are expressed as a spread over the
relevant floating benchmark rates, which is SOFR for the CLOs and EURIBOR for the European Loan
Securitization. All-in yield excludes loans accounted for under the cost-recovery and nonaccrual methods, if any,
owned real estate assets, and cash from repayment proceeds held in certain of our CLOs that may be used to add
new eligible collateral assets.
(3)Underlying collateral assets term represents the weighted-average final maturity of such loans, assuming all
extension options are exercised by the borrower, and excludes owned real estate assets. Repayments of securitized
debt obligations are tied to timing of the related collateral loan asset repayments. The term of these obligations
represents the rated final distribution date of the securitizations.
(4)We financed our $55.8 million retained interests in the securitization under a repurchase agreement structured
without capital markets-based mark-to-market provisions. The amount of the financing is included in other liabilities
on our consolidated balance sheets.
(5)During the three and nine months ended September 30, 2026, we recorded $39.2 million and $114.1 million,
respectively, of interest expense related to our securitized debt obligations.
38
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
December 31, 2025 | ||||||||||
Securitized Debt Obligations | Count | Principal Balance | Book Value(1) | Wtd. Avg. Yield/Cost(2)(3) | Term(4) | |||||
CLOs | ||||||||||
2025 FL5 Collateralized Loan Obligation | ||||||||||
Senior CLO Securities Outstanding | $ | $ | + | October 2042 | ||||||
Underlying Collateral Assets | + | October 2028 | ||||||||
2021 FL4 Collateralized Loan Obligation | ||||||||||
Senior CLO Securities Outstanding | + | May 2038 | ||||||||
Underlying Collateral Assets | + | February 2027 | ||||||||
2020 FL2 Collateralized Loan Obligation | ||||||||||
Senior CLO Securities Outstanding | + | February 2038 | ||||||||
Underlying Collateral Assets | + | January 2027 | ||||||||
Total CLOs | ||||||||||
Senior CLO Securities Outstanding | $ | $ | + | |||||||
Underlying Collateral Assets | + | |||||||||
European Loan Securitization | ||||||||||
Financing Provided | $ | $ | + | July 2030 | ||||||
Underlying Collateral Assets(5) | + | July 2030 | ||||||||
Total | ||||||||||
Senior CLO Securities Outstanding / Financing Provided(6) | $ | $ | + | |||||||
Underlying Collateral Assets | + | |||||||||
(1)The book value of underlying collateral assets excludes any applicable CECL reserves.
(2)In addition to cash coupon, all-in yield includes the amortization of deferred origination and extension fees, loan
origination costs, purchase discounts, and accrual of exit fees.
(3)The weighted-average all-in yield and cost are expressed as a spread over the relevant floating benchmark rates,
which is SOFR for the CLOs and EURIBOR for the European Loan Securitization. All-in yield excludes loans
accounted for under the cost-recovery and nonaccrual methods, if any, owned real estate assets, and cash from
repayment proceeds held in certain of our CLOs that may be used to add new eligible collateral assets.
(4)Underlying collateral assets term represents the weighted-average final maturity of such loans, assuming all
extension options are exercised by the borrower. Repayments of securitized debt obligations are tied to timing of the
related collateral loan asset repayments. The term of these obligations represents the rated final distribution date of
the securitizations.
(5)We financed our $55.8 million retained interests in the securitization under a repurchase agreement structured
without capital markets-based mark-to-market provisions. The amount of the financing is included in other liabilities
on our consolidated balance sheets.
(6)During the year ended December 31, 2025, we recorded $140.0 million of interest expense related to our securitized
debt obligations.
39
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
9. ASSET-SPECIFIC DEBT, NET
September 30, 2026 | ||||||||||
Asset-Specific Debt | Count | Principal Balance | Book Value(1) | Wtd. Avg. Yield/Cost(2) | Wtd. Avg. Term(3) | |||||
Financing provided | $ | $ | + | February 2030 | ||||||
Collateral assets | $ | $ | + | February 2030 | ||||||
December 31, 2025 | ||||||||||
Asset-Specific Debt | Count | Principal Balance | Book Value(1) | Wtd. Avg. Yield/Cost(2) | Wtd. Avg. Term(3) | |||||
Financing provided | $ | $ | + | February 2030 | ||||||
Collateral assets | $ | $ | + | February 2030 | ||||||
(1)The book value of underlying collateral assets excludes any applicable CECL reserves.
(2)The weighted-average all-in yield and cost are expressed as a spread over the relevant floating benchmark rates,
which include SOFR and CORRA, as applicable. These floating rate loans and related liabilities are currency and
index-matched to the applicable benchmark rate relevant in each arrangement. In addition to cash coupon, yield/cost
includes the amortization of deferred origination fees and financing costs.
(3)The weighted-average term is determined based on the maximum maturity of the corresponding loans, assuming all
extension options are exercised by the borrower. Our non-recourse, asset-specific debt is term-matched in each case
to the corresponding collateral loans.
10. TERM LOANS, NET
During the nine months ended September 30, 2026, we borrowed an additional $770.8 million under a B-9 Term Loan, the
proceeds of which were used, among other things, to repay all $695.8 million in principal outstanding under the B-6 Term
Loan.
balance sheets ($ in thousands):
Face Value | ||||||||||
Term Loans | September 30, 2026 | December 31, 2025 | Interest Rate(1) | All-in Cost(1)(2) | Maturity | |||||
B-6 Term Loan | $ | $ | + | + | December 10, 2030 | |||||
B-7 Term Loan | + | + | May 9, 2029 | |||||||
B-8 Term Loan | + | + | December 19, 2032 | |||||||
B-9 Term Loan | + | + | December 10, 2030 | |||||||
Total face value | $ | $ | ||||||||
Deferred financing costs and unamortized discounts | ( | ( | ||||||||
Net book value | $ | $ | ||||||||
(1)The B-7 Term Loan and B-9 Term Loan borrowings are subject to a benchmark interest rate floor of 0.50
Term Loans are indexed to one-month SOFR.
(2)Includes issue discount and transaction expenses that are amortized through interest expense over the life of the
applicable Term Loans.
The Term Loans are partially amortizing, with an amount equal to 1.0 % per annum of the aggregate initial principal
balance due in quarterly installments.
40
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||
2026 | 2025 | 2026 | 2025 | ||||
Cash coupon | $ | $ | $ | $ | |||
Discount and issuance cost amortization | |||||||
Total interest expense | $ | $ | $ | $ | |||
The Term Loans contain the financial covenant that our indebtedness shall not exceed 83.33
September 30, 2026 and December 31, 2025, we were in compliance with this covenant. Refer to Note 2 for further
discussion of our accounting policies for the Term Loans.
11. SENIOR SECURED NOTES, NET
During the nine months ended September 30, 2026, we issued an additional $450.0 million principal amount of senior
secured notes, or Senior Secured Notes, the proceeds of which were used, among other things, to repay existing secured
debt.
thousands):
Face Value | ||||||||||||
Senior Secured Notes Issuance | September 30, 2026 | December 31, 2025 | Interest Rate | Swapped Rate(1) | All-in Cost(2) | Maturity | ||||||
October 2021 | $ | $ | n/a | January 15, 2027 | ||||||||
December 2024 | + | December 1, 2029 | ||||||||||
May 2026 | + | June 1, 2031 | ||||||||||
Total face value | $ | $ | ||||||||||
Deferred financing costs and unamortized discounts | ( | ( | ||||||||||
Hedging adjustments(3) | ( | |||||||||||
Net book value | $ | $ | ||||||||||
(1)For certain of the Senior Secured Notes, we have entered into interest rate swaps that effectively convert our fixed
rate exposure to floating rate exposure. The interest rate swaps are indexed to one-month SOFR. Refer to Note 13
for further discussion.
(2)Includes transaction expenses that are amortized through interest expense over the life of the Senior Secured Notes.
(3)Represents the aggregate fair value of interest rate swaps that we entered into to convert the fixed rate exposure of
both the December 2024 and May 2026 Senior Secured Notes into floating rate. Refer to Note 13 for further
discussion.
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||
2026 | 2025 | 2026 | 2025 | ||||
Cash coupon | $ | $ | $ | $ | |||
Discount and issuance cost amortization | |||||||
Total interest expense | $ | $ | $ | $ | |||
The Senior Secured Notes contain the financial covenant that our indebtedness shall not exceed 83.33
As of September 30, 2026 and December 31, 2025, we were in compliance with this covenant. Under certain
circumstances, we may, at our option, release all of the collateral securing our Senior Secured Notes, in which case we
would also be required to maintain a total unencumbered assets to total unsecured indebtedness ratio of 1.20 or greater.
This covenant is not currently in effect as the collateral securing our Senior Secured Notes has not been released.
41
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
12. CONVERTIBLE NOTES, NET
balance sheets ($ in thousands):
Face Value | ||||||||||||
Convertible Notes | September 30, 2026 | December 31, 2025 | Interest Rate | All-in Cost(1) | Conversion Price(2) | Maturity | ||||||
Face value | $ | $ | $ | March 15, 2027 | ||||||||
Deferred financing costs and unamortized discount | ( | ( | ||||||||||
Net book value | $ | $ | ||||||||||
(1)Includes issuance costs that are amortized through interest expense over the life of the Convertible Notes using the
effective interest method.
(2)Represents the price of class A common stock per share based on a conversion rate of 27.5702 for the Convertible
Notes. The conversion rate represents the number of shares of class A common stock issuable per $1,000 principal
amount of Convertible Notes. The cumulative dividend threshold has not been exceeded as of September 30, 2026.
Other than as provided by the optional redemption provisions with respect to our Convertible Notes, we may not redeem
the Convertible Notes prior to maturity. The Convertible Notes are convertible at the holders’ option into shares of our
class A common stock, only under specific circumstances, prior to the close of business on December 14, 2026 at the
applicable conversion rate in effect on the conversion date. Thereafter, the Convertible Notes are convertible at the option
of the holder at any time until the second scheduled trading day immediately preceding the maturity date. The last reported
sale price of our class A common stock of $11.45 on September 30, 2026, the last trading day in the nine months ended
September 30, 2026, was less than the per share conversion price of the Convertible Notes.
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||
2026 | 2025 | 2026 | 2025 | ||||
Cash coupon | $ | $ | $ | $ | |||
Discount and issuance cost amortization | |||||||
Total interest expense | $ | $ | $ | $ | |||
Accrued interest payable for the Convertible Notes was $0.6 million and $4.3 million as of September 30, 2026 and
December 31, 2025, respectively. Refer to Note 2 for further discussion of our accounting policies for the Convertible
13. DERIVATIVE FINANCIAL INSTRUMENTS
The objective of our use of derivative financial instruments is to minimize the risks and/or costs associated with our
investments and/or financing transactions. These derivatives may or may not qualify as net investment, cash flow, or fair
value hedges under the hedge accounting requirements of the ASC Topic 815, “Derivatives and Hedging.” Derivatives not
designated as hedges are not speculative and are used to manage our exposure to interest rate movements and other
identified risks. Refer to Note 2 for further discussion of the accounting for designated and non-designated hedges.
The use of derivative financial instruments involves certain risks, including the risk that the counterparties to these
contractual arrangements do not perform as agreed. To mitigate this risk, we only enter into derivative financial
instruments with counterparties that have appropriate credit ratings and are major financial institutions with which we and
our affiliates also have other financial relationships.
42
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
Net Investment Hedges of Foreign Currency Risk
Certain of our international investments expose us to fluctuations in foreign interest rates and currency exchange rates.
These fluctuations may impact the value of our cash receipts and payments in terms of our functional currency, the U.S.
dollar. We use foreign currency forward contracts to protect the value or fix the amount of certain investments or cash
flows in terms of the U.S. dollar.
Designated Hedges of Foreign Currency Risk
foreign currency risk (notional amounts in thousands):
September 30, 2026 | December 31, 2025 | |||||||||
Foreign Currency Derivatives | Number of Instruments | Notional Amount | Foreign Currency Derivatives | Number of Instruments | Notional Amount | |||||
Buy USD / Sell EUR Forward | € | Buy USD / Sell SEK Forward | kr | |||||||
Buy USD / Sell GBP Forward | £ | Buy USD / Sell GBP Forward | £ | |||||||
Buy USD / Sell AUD Forward | A$ | Buy USD / Sell EUR Forward | € | |||||||
Buy USD / Sell CAD Forward | C$ | Buy USD / Sell AUD Forward | A$ | |||||||
Buy USD / Sell SEK Forward | kr | Buy USD / Sell CAD Forward | C$ | |||||||
Buy USD / Sell CHF Forward | CHF | Buy USD / Sell CHF Forward | CHF | |||||||
Non-designated Hedges of Foreign Currency Risk
currency risk (notional amounts in thousands):
September 30, 2026 | December 31, 2025 | |||||||||
Non-designated Hedges | Number of Instruments | Notional Amount | Non-designated Hedges | Number of Instruments | Notional Amount | |||||
Buy GBP / Sell USD Forward | £ | Buy GBP / Sell USD Forward | £ | |||||||
Buy USD / Sell GBP Forward | £ | Buy USD / Sell GBP Forward | £ | |||||||
Buy EUR / Sell USD Forward | € | Buy EUR / Sell USD Forward | € | |||||||
Buy USD / Sell EUR Forward | € | Buy USD / Sell EUR Forward | € | |||||||
Buy AUD / Sell USD Forward | A$ | Buy AUD / Sell USD Forward | A$ | |||||||
Buy USD / Sell AUD Forward | A$ | Buy USD / Sell AUD Forward | A$ | |||||||
Cash Flow Hedges of Interest Rate Risk
Certain of our financing transactions expose us to a fixed versus floating rate mismatch between our assets and liabilities.
We use derivative financial instruments, which include interest rate swaps (and may also include interest rate caps, interest
rate options, floors, and other interest rate derivative contracts) to hedge interest rate risk associated with our borrowings
where there is potential for an index mismatch.
43
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
risk (notional amounts in thousands):
September 30, 2026 | ||||||||||
Interest Rate Derivatives | Number of Instruments | Notional Amount | Fixed Rate | Index | Maturity (Years) | |||||
Interest Rate Swaps | $ | SOFR | ||||||||
December 31, 2025 | ||||||||||
Interest Rate Derivatives | Number of Instruments | Notional Amount | Fixed Rate | Index | Maturity (Years) | |||||
Interest Rate Swaps | $ | SOFR | ||||||||
Fair Value Hedges of Interest Rate Risk
Certain of our corporate financings expose us to fluctuations in the fair value of our outstanding fixed rate debt. We use
derivative financial instruments, which include interest rate swaps, to hedge interest rate risk associated with changes in the
fair value of our fixed rate debt. The changes in the value of the interest rate swaps are recognized in earnings and offset
the corresponding changes in the fair value of the debt.
Designated Hedges of Interest Rate Risk
risk (notional amount in thousands):
September 30, 2026 | ||||||||||
Interest Rate Derivatives | Number of Instruments | Aggregate Notional Amount | Fixed Rate | Index | Maturity (Years) | |||||
Interest Rate Swaps | $ | SOFR | ||||||||
December 31, 2025 | ||||||||||
Interest Rate Derivatives | Number of Instruments | Notional Amount | Fixed Rate | Index | Maturity (Years) | |||||
Interest Rate Swaps | $ | SOFR | ||||||||
hedges ($ in thousands):
September 30, 2026 | ||||
Line Item in the Consolidated Balance Sheets in which the Hedged Item is Included | Carrying Amount of the Hedged Assets/ Liabilities | Cumulative Amount of Fair Value Hedging Adjustment Included in Carrying Amount | ||
Senior secured notes, net | $ | $( | ||
December 31, 2025 | ||||
Line Item in the Consolidated Balance Sheets in which the Hedged Item is Included | Carrying Amount of the Hedged Assets/ Liabilities | Cumulative Amount of Fair Value Hedging Adjustment Included in Carrying Amount | ||
Senior secured notes, net | $ | $ | ||
44
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
Non-designated Hedges of Interest Rate Risk
The following table details our outstanding interest rate derivatives that were not designated as hedges of interest rate risk
(notional amount in thousands):
September 30, 2026 | ||||||||||
Interest Rate Derivatives | Number of Instruments | Aggregate Notional Amount | Fixed Rate | Index | Maturity (Years) | |||||
Interest Rate Swap | $ | SOFR | ||||||||
There were no non-designated interest rate derivatives outstanding as of December 31, 2025.
Financial Statement Impact of Hedges of Foreign Currency and Interest Rate Risks
($ in thousands):
Increase (Decrease) to Net Interest Income Recognized from Derivatives | ||||||||||
Three Months Ended September 30, | Nine Months Ended September 30, | |||||||||
Derivatives in Hedging Relationships | Location of Income (Expense) Recognized | 2026 | 2025 | 2026 | 2025 | |||||
Designated Hedges | Interest Income(1) | $ | $ | $ | $ | |||||
Designated Hedges | Interest Expense(2) | ( | ( | |||||||
Non-Designated Hedges | Interest Income(1) | ( | ( | |||||||
Non-Designated Hedges | Interest Expense(3) | ( | ( | ( | ||||||
Total | $ | $ | $ | $ | ||||||
(1)Represents (i) the forward points earned on our foreign currency forward contracts, which reflect the interest rate
differentials between the applicable base rate for our foreign currency investments and prevailing U.S. interest rates.
These forward contracts effectively convert the foreign currency rate exposure for such investments to
USD-equivalent interest rates, and (ii) the index rate movement in our non-designated interest rate hedges, which are
marked-to-market. Both are recognized in interest and related income in our consolidated statements of operations.
(2)Represents the financial statement impact of proceeds (payments) from periodic settlements related to our interest
rate swaps.
(3)Represents the spot rate movement in our non-designated foreign currency hedges, which are marked-to-market and
recognized in interest and related expenses in our consolidated statements of operations. The amounts in the nine
months ended September 30, 2025 also include a realized loss on an interest rate swap related to our Bank Loan
Portfolio Joint Venture that was entered into during the three months ended June 30, 2025 and subsequently
terminated.
Fair Value Hedges
relationships ($ in thousands):
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||
2026 | 2025 | 2026 | 2025 | ||||
Total interest and related expenses presented in the consolidated statements of operations | $ | $ | $ | $ | |||
Gains (losses) on fair value hedging relationships | |||||||
Total (loss) gain on derivative instruments | $( | $ | $( | $ | |||
Fair value basis adjustment on hedged items | ( | ( | |||||
Derivative settlements and accruals | |||||||
Net (loss) gain on fair value hedging relationships(1) | $( | $ | $ | $ | |||
(1)Included within interest and related expenses presented in the consolidated statements of operations.
45
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
Valuation and Other Comprehensive Income
Fair Value of Derivatives in an Asset Position(1) as of | Fair Value of Derivatives in a Liability Position(2) as of | |||||||
September 30, 2026 | December 31, 2025 | September 30, 2026 | December 31, 2025 | |||||
Derivatives designated as hedging instruments | ||||||||
Foreign exchange contracts | $ | $ | $ | $ | ||||
Interest rate derivatives | ||||||||
Total derivatives designated as hedging instruments | $ | $ | $ | $ | ||||
Derivatives not designated as hedging instruments | ||||||||
Foreign exchange contracts | $ | $ | $ | $ | ||||
Interest rate derivatives | ||||||||
Total derivatives not designated as hedging instruments | $ | $ | $ | $ | ||||
Total derivatives | $ | $ | $ | $ | ||||
(1)Included in other assets in our consolidated balance sheets.
(2)Included in other liabilities in our consolidated balance sheets.
comprehensive income and operations ($ in thousands):
Derivatives in Hedging Relationships | Amount of Gain (Loss) Recognized in OCI on Derivatives | Location of Gain (Loss) Reclassified from Accumulated OCI into Income | Amount of Gain (Loss) Reclassified from Accumulated OCI into Income | ||||||
Three Months Ended September 30, 2026 | Nine Months Ended September 30, 2026 | Three Months Ended September 30, 2026 | Nine Months Ended September 30, 2026 | ||||||
Net Investment Hedges | |||||||||
Foreign exchange contracts(1) | $ | $ | Interest Expense | $ | $ | ||||
Cash Flow Hedges | |||||||||
Interest rate derivatives(2) | Interest Expense(3) | ||||||||
Total | $ | $ | $ | $ | |||||
(1)During the three and nine months ended September 30, 2026, we received net cash settlements of $31.3 million and
$8.8 million, respectively, on our foreign currency forward contracts. Those amounts are included as a component of
accumulated other comprehensive income on our consolidated balance sheets.
(2)During the three and nine months ended September 30, 2026, we received net cash settlements of $0.1 million and
$0.3 million, respectively, on our interest rate swaps. Those amounts are included within interest and related
expenses in the consolidated statements of operations.
(3)During the three and nine months ended September 30, 2026, we recorded total interest and related expenses of
$216.2 million and $664.1 million, respectively, which was reduced by $16 thousand and $44 thousand,
respectively, related to income generated by our cash flow hedges.
There were no cash flow hedges outstanding during the three and nine months ended September 30, 2025.
46
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
Credit-Risk-Related Contingent Features
We have entered into agreements with certain of our derivative counterparties that contain provisions where if we were to
default on any of our indebtedness, including default where repayment of the indebtedness has not been accelerated by the
lender, we may also be declared in default on our derivative obligations. In addition, certain of our agreements with our
derivative counterparties require that we post collateral to secure net liability positions. As of September 30, 2026, we were
in a net asset position with one of our counterparties and in a liability position with our other counterparty related to our
foreign exchange hedges, and had $2.9 million of collateral posted with such counterparty. As of September 30, 2026, we
were in a net asset position with one of our counterparties and in a net liability position with our other two counterparties
related to our interest rate swaps and had $31.9 million of collateral posted with such counterparties. As of December 31,
2025, we were in a net asset position with one of our counterparties and in a net liability position with our other two
counterparties related to our foreign exchange hedges and had $25.3 million of collateral posted with such counterparties.
14. EQUITY
Stock and Stock Equivalents
Authorized Capital
As of September 30, 2026, we had the authority to issue up to 500,000,000 shares of stock, consisting of 400,000,000
shares of class A common stock and 100,000,000 shares of preferred stock. Subject to applicable NYSE listing
requirements, our board of directors is authorized to cause us to issue additional shares of authorized stock without
stockholder approval. In addition, to the extent not issued, currently authorized stock may be reclassified between class A
common stock and preferred stock. As of both September 30, 2026 and December 31, 2025, we did not
preferred stock issued and outstanding.
Share Repurchase Program
In October 2025, our board of directors authorized the repurchase of up to $150.0 million of shares of our class A common
stock under our repurchase program. Repurchases may be made from time to time in open market transactions, in privately
negotiated transactions, in agreements and arrangements structured in a manner consistent with Rules 10b-18 and 10b5-1
under the Exchange Act or otherwise. The timing and the actual amounts repurchased will depend on a variety of factors,
including legal requirements, price and economic and market conditions. The repurchase program may be changed,
suspended or discontinued at any time and does not have a specified expiration date.
During the nine months ended September 30, 2026, we repurchased 2,766,237 shares of class A common stock at a
weighted-average price per share of $14.39 , for a total cost of $39.8 million. During the nine months ended September 30,
2025, we repurchased 2,653,583 shares of class A common stock at a weighted-average price per share of $17.97 , for a
total cost of $47.7 million. As of September 30, 2026, the amount remaining available for repurchases under the program
was $109.8 million.
Class A Common Stock and Deferred Stock Units
Holders of shares of our class A common stock are entitled to vote on all matters submitted to a vote of stockholders and
are entitled to receive dividends authorized by our board of directors and declared by us, in all cases subject to the rights of
the holders of shares of outstanding preferred stock, if any.
We also issue restricted class A common stock under our stock-based incentive plans. Refer to Note 17 for further
discussion of these long-term incentive plans. In addition to our class A common stock, we also issue deferred stock units
to certain members of our board of directors for services rendered. These deferred stock units are non-voting, but carry the
right to receive dividends in the form of additional deferred stock units in an amount equivalent to the cash dividends paid
to holders of shares of class A common stock. Each vested deferred stock unit is settled by delivery of one share of class A
common stock upon the non-employee director’s separation from service.
47
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
common stock and deferred stock units:
Nine Months Ended September 30, | ||||
Common Stock Outstanding(1) | 2026 | 2025 | ||
Beginning balance | ||||
Issuance of class A common stock(2) | ||||
Repurchase of class A common stock | ( | ( | ||
Issuance of restricted class A common stock, net(3)(4) | ||||
Issuance of deferred stock units | ||||
Ending balance | ||||
(1)Includes 379,690 and 331,611 deferred stock units held by members of our board of directors as of September 30,
2026 and 2025, respectively.
(2)Represents shares issued under our dividend reinvestment program during the nine months ended September 30,
2025.
(3)Includes 32,985 and 29,140 shares of restricted class A common stock issued to our board of directors during the
nine months ended September 30, 2026 and 2025, respectively.
(4)Net of 27,534 and 43,832 shares of restricted class A common stock forfeited under our stock-based incentive plans
during the nine months ended September 30, 2026 and 2025, respectively.
Dividend Reinvestment and Direct Stock Purchase Plan
We have adopted a dividend reinvestment and direct stock purchase plan under which an aggregate of 10,000,000 shares of
class A common stock are available for sale. Under the dividend reinvestment component of the plan, our class A common
stockholders can designate all or a portion of their cash dividends to be reinvested in additional shares of class A common
stock. Such shares may, at our option, be newly issued shares from us, shares purchased by the plan administrator on the
open market, or a combination thereof. The direct stock purchase component of the plan allows stockholders and new
investors, subject to our approval, to purchase shares of class A common stock directly from us. During the nine months
ended September 30, 2026, 26,653 shares of class A common stock were purchased on the open market by the plan
administrator under the dividend reinvestment component of the plan. During the nine months ended September 30, 2025,
we issued 1,778 shares of class A common stock and 652 shares of class A common stock were purchased on the open
market by the plan administrator under the dividend reinvestment component of the plan. As of September 30, 2026, a total
of 9,938,472 shares of class A common stock remained available under the dividend reinvestment and direct stock
purchase plan.
At the Market Stock Offering Program
As of September 30, 2026, we are party to seven equity distribution agreements, or ATM Agreements, pursuant to which
we may sell, from time to time, up to an aggregate sales price of $699.1 million of our class A common stock. Sales of
class A common stock made pursuant to our ATM Agreements may be made in negotiated transactions or transactions that
are deemed to be “at the market” offerings as defined in Rule 415 under the Securities Act of 1933, as amended. Actual
sales depend on a variety of factors including market conditions, the trading price of our class A common stock, our capital
needs, and our determination of the appropriate sources of funding to meet such needs. During the nine months ended
September 30, 2026 and 2025, we did no
September 30, 2026, shares of our class A common stock with an aggregate sales price of $480.9 million remained
available for issuance and sale under our ATM Agreements.
Dividends
We generally intend to distribute substantially all of our taxable income, which does not necessarily equal net income as
calculated in accordance with GAAP, to our stockholders each year to comply with the REIT provisions of the Internal
Revenue Code of 1986, as amended, or the Internal Revenue Code. Our dividend policy remains subject to revision at the
discretion of our board of directors. All distributions will be made at the discretion of our board of directors and will
depend upon our taxable income, our financial condition, our maintenance of REIT status, applicable law, and other factors
as our board of directors deems relevant.
48
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
On September 15, 2026, we declared a dividend of $0.47 per share, or $78.0 million in aggregate, that was paid on October
15, 2026 to stockholders of record as of September 30, 2026.
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||
2026 | 2025 | 2026 | 2025 | ||||
Dividends declared per share of common stock | $ | $ | $ | $ | |||
Class A common stock dividends declared | $ | $ | $ | $ | |||
Deferred stock unit dividends declared | |||||||
Total dividends declared | $ | $ | $ | $ | |||
Earnings Per Share
We calculate our basic and diluted earnings per share using the two-class method for all periods presented as the unvested
shares of our restricted class A common stock qualify as participating securities, as defined by GAAP. These restricted
shares have the same rights as our other shares of class A common stock, including participating in any dividends, and
therefore have been included in our basic and diluted net income per share calculation. The shares issuable under our
Convertible Notes are included in diluted earnings per share using the if-converted method when the effect is not
antidilutive.
based on the weighted-average of both restricted and unrestricted class A common stock outstanding ($ in thousands,
except per share data):
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||
2026 | 2025 | 2026 | 2025 | ||||
Basic and Diluted Earnings | |||||||
Net (loss) income(1) | $( | $ | $( | $ | |||
Weighted-average shares outstanding, basic and diluted(2) | |||||||
Per share amount, basic and diluted | $( | $ | $( | $ | |||
(1)Represents net (loss) income attributable to Blackstone Mortgage Trust, Inc.
(2)For both the three and nine months ended September 30, 2026 and 2025, our Convertible Notes were no
the calculation of diluted earnings per share, as the impact is antidilutive. Refer to Note 12 for further discussion of
our convertible notes.
Other Balance Sheet Items
Accumulated Other Comprehensive Income
As of September 30, 2026, total accumulated other comprehensive income was $21.7 million, representing $125.5 million
of net realized and unrealized gains related to changes in the fair value of derivative instruments and $9.6 million of
unrealized gains related to the changes in the fair value of derivative instruments held by unconsolidated entities, offset by
$113.4 million of cumulative unrealized currency translation adjustments on assets and liabilities denominated in foreign
currencies. As of December 31, 2025, total accumulated other comprehensive income was $12.1 million, primarily
representing $86.6 million of net realized and unrealized gains related to changes in the fair value of derivative instruments
offset by $73.6 million of cumulative unrealized currency translation adjustments on assets and liabilities denominated in
foreign currencies and $0.8 million of unrealized losses related to the changes in the fair value of derivative instruments
held by unconsolidated entities.
49
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
Non-Controlling Interests
The non-controlling interests included on our consolidated balance sheets represent the equity interests in our Multifamily
Joint Venture that are not owned by us. A portion of our Multifamily Joint Venture’s consolidated equity and results of
operations are allocated to these non-controlling interests based on their pro rata ownership of our Multifamily Joint
Venture. As of September 30, 2026, our Multifamily Joint Venture’s total equity was $13.8 million, of which $11.7 million
was owned by us, and $2.1 million was allocated to non-controlling interests. As of December 31, 2025, our Multifamily
Joint Venture’s total equity was $36.5 million, of which $31.0 million was owned by us, and $5.5 million was allocated to
non-controlling interests.
15. OTHER EXPENSES
Our other expenses consist of the management and incentive fees we pay to our Manager and our general and
administrative expenses.
Management and Incentive Fees
Pursuant to a management agreement between our Manager and us, or our Management Agreement, our Manager earns a
base management fee in an amount equal to 1.50 % per annum multiplied by our Equity, as defined in the Management
Agreement. In addition, our Manager is entitled to an incentive fee in an amount equal to the product of (i) 20 % and (ii) the
excess of (a) our Core Earnings (as defined in our Management Agreement) for the previous 12-month period over (b) an
amount equal to 7.00 % per annum multiplied by our Equity, provided that our Core Earnings over the prior three-year
period is greater than zero . Core Earnings, as defined in our Management Agreement, is generally equal to our GAAP net
income (loss), including realized gains and losses not otherwise recognized in current period GAAP net income (loss), and
excluding (i) non-cash equity compensation expense, (ii) depreciation and amortization, (iii) unrealized gains (losses), (iv)
net income (loss) attributable to our legacy portfolio, (v) certain non-cash items, and (vi) incentive management fees.
During the three and nine months ended September 30, 2026, we incurred $14.5 million and $43.9 million, respectively, of
management fees payable to our Manager compared with $16.8 million and $51.1 million, respectively, during the same
periods in 2025. During the three and nine months ended September 30, 2026 and 2025, we did not
payable to our Manager.
As of September 30, 2026 and December 31, 2025, we had accrued management fees payable to our Manager of
$14.5 million and $16.4 million, respectively.
General and Administrative Expenses
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||
2026 | 2025 | 2026 | 2025 | ||||
Professional services | $ | $ | $ | $ | |||
Operating and other costs | |||||||
Subtotal | |||||||
Non-cash compensation expenses | |||||||
Restricted class A common stock earned | |||||||
Director stock-based compensation | |||||||
Subtotal | |||||||
Total general and administrative expenses | $ | $ | $ | $ | |||
16. INCOME TAXES
We have elected to be taxed as a REIT under the Internal Revenue Code for U.S. federal income tax purposes. We
generally must distribute annually at least 90% of our net taxable income, subject to certain adjustments and excluding any
net capital gain, in order for U.S. federal income tax not to apply to our earnings. To the extent that we satisfy this
distribution requirement, but distribute less than 100% of our net taxable income, we will be subject to U.S. federal income
tax on our undistributed taxable income. In addition, we will be subject to a 4% nondeductible excise tax if the actual
50
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
amount that we pay out to our stockholders in a calendar year is less than a minimum amount specified under U.S. federal
tax laws.
Our qualification as a REIT also depends on our ability to meet various other requirements imposed by the Internal
Revenue Code, which relate to organizational structure, diversity of stock ownership, and certain restrictions with regard to
the nature of our assets and the sources of our income. Even if we qualify as a REIT, we may be subject to certain U.S.
federal income and excise taxes and state and local taxes on our income and assets. If we fail to maintain our qualification
as a REIT for any taxable year, we may be subject to material penalties as well as federal, state, and local income tax on
our taxable income at regular corporate rates and we would not be able to qualify as a REIT for the subsequent four full
taxable years. As of September 30, 2026 and December 31, 2025, we were in compliance with all REIT requirements.
Securitization transactions could result in the creation of taxable mortgage pools for federal income tax purposes. As a
REIT, so long as we own 100% of the equity interests in a taxable mortgage pool, we generally would not be adversely
affected by the characterization of the securitization as a taxable mortgage pool. Certain categories of stockholders,
however, such as foreign stockholders eligible for treaty or other benefits, stockholders with net operating losses, and
certain tax-exempt stockholders that are subject to unrelated business income tax, or UBTI, could be subject to increased
taxes on a portion of their dividend income from us that is attributable to the taxable mortgage pool. We have not made
UBTI distributions to our common stockholders and do not intend to make such UBTI distributions in the future.
During the three and nine months ended September 30, 2026, we recorded a current income tax provision of $1.3 million
and $4.9 million, respectively, compared with $1.5 million and $3.1 million, respectively, during the same periods of 2025,
all of which primarily related to activities of our U.S. and foreign taxable subsidiaries and various state and local taxes. We
did not have any deferred tax assets or liabilities as of September 30, 2026 or December 31, 2025.
We have net operating losses, or NOLs, generated by our predecessor business that may be carried forward and utilized in
current or future periods. As a result of our issuance of 25,875,000 shares of class A common stock in May 2013, the
availability of our NOLs is generally limited to $2.0 million per annum by change of control provisions promulgated by the
Internal Revenue Service with respect to the ownership of Blackstone Mortgage Trust. As of September 30, 2026, we had
estimated NOLs of $159.0 million that will expire in 2029, unless they are utilized by us prior to expiration. Previously, we
recorded a full valuation allowance against such NOLs as we expected that they would expire unutilized. However,
although uncertain, we may utilize a portion of NOLs prior to expiration. We do not expect the utilization of NOLs to have
a material impact on our consolidated financial statements. We have recorded a full valuation allowance against such NOLs
as it is probable that they will expire unutilized.
17. STOCK-BASED INCENTIVE PLANS
We are externally managed by our Manager and do not currently have any employees. However, as of September 30, 2026,
our Manager, certain individuals employed by an affiliate of our Manager, and certain members of our board of directors
were compensated, in part, through our issuance of stock-based instruments.
Under our two current stock incentive plans, a maximum of 10,400,000 shares of our class A common stock may be issued
to our Manager, our directors and officers, and certain employees of affiliates of our Manager. As of September 30, 2026,
there were 4,540,172 shares available under our current stock incentive plans.
average grant date fair value per share:
Restricted Class A Common Stock | Weighted-Average Grant Date Fair Value Per Share | ||
Balance as of December 31, 2025 | $ | ||
Granted | |||
Vested | ( | ||
Forfeited | ( | ||
Balance as of September 30, 2026 | $ |
51
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
These shares generally vest in installments over a period of three years , pursuant to the terms of the respective award
agreements and the terms of our current stock incentive plans. The 1,681,917 shares of restricted class A common stock
outstanding as of September 30, 2026 will vest as follows: 318,352 shares will vest in 2026; 901,071 shares will vest in
2027; and 462,494 shares will vest in 2028. As of September 30, 2026, total unrecognized compensation cost relating to
unvested share-based compensation arrangements was $31.7 million based on the grant date fair value of shares granted.
This cost is expected to be recognized over a weighted-average period of 1.0 years from September 30, 2026.
18. FAIR VALUE MEASUREMENTS
Assets and Liabilities Measured at Fair Value
thousands):
September 30, 2026 | December 31, 2025 | ||||||||||||||
Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | Total | ||||||||
Assets | |||||||||||||||
Loans receivable, held-for-sale(1) | $ | $ | $ | $ | $ | $ | $ | $ | |||||||
Derivatives | |||||||||||||||
Debt securities | |||||||||||||||
Total | $ | $ | $ | $ | $ | $ | $ | $ | |||||||
Liabilities | |||||||||||||||
Derivatives | $ | $ | $ | $ | $ | $ | $ | $ | |||||||
(1)Measured at fair value on a nonrecurring basis. Loans held-for-sale are carried at the lower of amortized cost or fair
value.
This table excludes $151.5 million and $111.0 million of investments in unconsolidated entities that are measured at fair
value using net asset value as a practical expedient and not classified in the fair value hierarchy as of September 30, 2026
and December 31, 2025, respectively. Refer to Note 5 for further information.
Our investments in debt securities are measured at fair value on a recurring basis and are classified as Level 3 in the fair
value hierarchy. As of September 30, 2026, we determined that the recent purchase prices remained representative of fair
value and, accordingly, no fair value adjustment had been recorded.
Certain of our assets are not measured at fair value on an ongoing basis but are subject to fair value adjustments under
certain circumstances and, therefore, are measured at fair value on a nonrecurring basis. As of September 30, 2026, loans
receivable, held-for-sale with a carrying value of $615.6 million were measured at fair value on a nonrecurring basis and
classified as Level 3 within the fair value hierarchy. Fair value was determined using the executed purchase agreement,
considering estimated costs to sell. Refer to Note 3 for further discussion on loans receivable, held-for-sale. Refer to Note 2
for further discussion regarding impairment of owned real estate assets, which are measured at fair value on a nonrecurring
basis.
Refer to Note 2 for further discussion regarding fair value measurement.
Fair Value of Financial Instruments
As discussed in Note 2, GAAP requires disclosure of fair value information about financial instruments, whether or not
recognized at fair value in the statement of financial position, for which it is practicable to estimate that value.
52
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
($ in thousands):
September 30, 2026 | December 31, 2025 | ||||||||||
Book Value | Face Amount | Fair Value | Book Value | Face Amount | Fair Value | ||||||
Financial assets | |||||||||||
Cash and cash equivalents | $ | $ | $ | $ | $ | $ | |||||
Loans receivable, held-for- investment, net | |||||||||||
Loans receivable, held-for-sale | |||||||||||
Financial liabilities | |||||||||||
Secured debt, net | |||||||||||
Other secured debt(1) | |||||||||||
Securitized debt obligations, net | |||||||||||
Asset-specific debt, net | |||||||||||
Secured term loans, net | |||||||||||
Senior secured notes, net | |||||||||||
Convertible notes, net | |||||||||||
(1)Included within other liabilities on our consolidated balance sheets. See Note 6 for further information.
Estimates of fair value for cash and cash equivalents and convertible notes are measured using observable, quoted market
prices, or Level 1 inputs. Estimates of fair value for securitized debt obligations, the Term Loans, and the Senior Secured
Notes are measured using observable, quoted market prices, in inactive markets, or Level 2 inputs. All other fair value
significant estimates are measured using unobservable inputs, or Level 3 inputs. See Note 2 for further discussion regarding
fair value measurement of certain of our assets and liabilities.
19. VARIABLE INTEREST ENTITIES
We have financed a portion of our loans through the CLOs and the European Loan Securitization, all of which are VIEs.
We are the primary beneficiary of, and therefore consolidate, the CLOs and the European Loan Securitization on our
balance sheet as we (i) control the relevant interests of the CLOs and the European Loan Securitization that give us power
to direct the activities that most significantly affect the CLOs and the European Loan Securitization, and (ii) have the right
to receive benefits and obligation to absorb losses of the CLOs and the European Loan Securitization through the
subordinate interests we own.
During 2025, we modified three loans that included, among other changes, control over decision-making at the respective
properties. Similarly, during 2024, we modified two other loans that included, among other changes, an equity interest in
and/or control over decision-making at the property. As a result of these modifications, our investments in these loans are
VIEs. As of September 30, 2026, we are the primary beneficiary of, and therefore consolidated the assets of these VIEs on
our balance sheet as we (i) have the power to direct the activities that most significantly affect the property, and (ii) have
the right to receive excess sale proceeds upon exit.
53
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
September 30, 2026 | December 31, 2025 | ||
Assets | |||
Cash and cash equivalents | $ | $ | |
Loans receivable, held-for-investment | |||
Current expected credit loss reserve | ( | ( | |
Loans receivable, held-for-investment, net | |||
Loans receivable, held-for-sale | |||
Owned real estate, net | |||
Other assets | |||
Total assets | $ | $ | |
Liabilities | |||
Securitized debt obligations, net | $ | $ | |
Other liabilities | |||
Total liabilities | $ | $ |
Assets held by these VIEs are restricted and can be used only to settle obligations of the VIEs, including the subordinate
interests of the securitized debt obligations owned by us. The liabilities of these VIEs are non-recourse to us and can only
be satisfied from the assets of the VIEs. The consolidation of these VIEs results in an increase in our gross assets,
liabilities, revenues and expenses; however, it does not affect our stockholders’ equity or net income. We are not obligated
20. TRANSACTIONS WITH RELATED PARTIES
Our Manager
We are managed by our Manager pursuant to the Management Agreement. The current term of the Management
Agreement expires on December 19, 2026, and it will be automatically renewed for a one-year term upon such date and
each anniversary thereafter unless earlier terminated.
As of September 30, 2026 and December 31, 2025, our consolidated balance sheets included $14.5 million and
$16.4 million, respectively, of accrued management fees payable to our Manager. During the three and nine months ended
September 30, 2026, we paid management fees of $14.6 million and $45.9 million, respectively, to our Manager, compared
to $17.0 million and $52.8 million, respectively, during the same periods in 2025. We did not pay any incentive fees to our
Manager during the three and nine months ended September 30, 2026 and 2025. In addition, during the three and nine
months ended September 30, 2026, we incurred expenses of $1.8 million and $2.6 million, respectively, that were paid by
our Manager and have been or will be reimbursed by us, compared to $0.4 million and $0.9 million, respectively, of such
expenses during the same periods in 2025.
As of September 30, 2026, our Manager held 840,503 shares of unvested restricted class A common stock, which had an
aggregate grant date fair value of $17.0 million. These shares vest in installments over three years from the date of
issuance. During the three and nine months ended September 30, 2026, we recorded non-cash expenses related to shares
held by our Manager of $3.5 million and $10.5 million, respectively, compared to $3.6 million and $10.9 million,
respectively, during the same periods in 2025. Refer to Note 17 for further details on our restricted class A common stock.
As of September 30, 2026, our Manager, its affiliates (including Blackstone and Blackstone-advised investment vehicles),
Blackstone employees, and our directors held an aggregate 13,754,343 shares, or 8.3 %, of our class A common stock, of
which 8,916,412 shares, or 5.4 %, were held by Blackstone and its subsidiaries. Additionally, our directors held 379,690
deferred stock units as of September 30, 2026. Certain of the parties listed above have in the past purchased or sold shares
of our class A common stock in open market transactions, and such parties may in the future purchase or sell additional
shares of our class A common stock and/or engage in derivatives transactions related to our class A common stock. Any
such transactions would be made in the sole discretion of the relevant party based on market conditions and other
considerations relevant to such parties.
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Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
Affiliate Services
We have engaged certain portfolio companies owned by Blackstone-advised investment vehicles to provide, as applicable,
management, corporate support, and transaction support services. The following table details the costs incurred (refunded)
for these services ($ in thousands):
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||||
Primary Asset Class | 2026 | 2025 | 2026 | 2025 | |||||
Perform Properties, LLC | Office | $ | $ | $ | $ | ||||
Brio Real Estate Services, LLC, Brio Real Estate (UK) Ltd., and Brio Real Estate (AUS) Pty Ltd. | n/a | ||||||||
BRE Hotels & Resorts, LLC | Hospitality | ||||||||
Revantage Corporate Services, LLC and Revantage Global Services Europe S.à r.l. | n/a | ||||||||
LivCor, LLC | Multifamily | ||||||||
LendingOne, LLC(1) | Multifamily | ||||||||
Total | $ | $ | $ | $ | |||||
(1)Provides loan origination services related to certain of our investments.
During the nine months ended September 30, 2026, we entered into an agreement with another Blackstone-advised
investment vehicle to fund our pro rata share of any payments required under a guaranty agreement with a lending
institution. The guaranty relates to a revolving credit facility with a portfolio company owned by Blackstone-advised
investment vehicles that provides services to us, and our participation reflects our share of the associated costs based on
services rendered. As of September 30, 2026, our maximum potential obligation under the arrangement was $0.9 million.
No events through the date of these consolidated financial statements required performance under the guaranty, and no
liability was recorded as of September 30, 2026.
55
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
We have engaged other affiliates of our Manager to provide various services. The following table details the costs incurred
for these services ($ in thousands):
Three Months Ended September 30, | Nine Months Ended September 30, | ||||||
2026 | 2025 | 2026 | 2025 | ||||
Gryphon Mutual Property Americas IC(1) | $ | $ | $ | $ | |||
Blackstone Securities Partners L.P.(2) | |||||||
Lexington National Land Services(3) | |||||||
Total | $ | $ | $ | $ | |||
(1)In order to provide insurance for our owned real estate assets, we became a member of Gryphon Mutual Property
Americas IC, or Gryphon, a captive insurance company owned by us and other Blackstone-advised investment
vehicles. A Blackstone affiliate provides oversight and management services to Gryphon and receives fees based on
a percentage of premiums paid for such policies. The fees and expenses of Gryphon, including insurance premiums
and fees paid to its manager, are borne by us and the other Blackstone-advised investment vehicles that are members
of Gryphon pro rata based on insurance premiums paid for each member’s respective properties. During the nine
months ended September 30, 2026 and 2025, we paid $2.9 million and $1.4 million, respectively, to Gryphon for
insurance costs, inclusive of premiums, capital surplus contributions, taxes, and our pro rata share of other expenses.
Of these amounts, $0.1 million was attributable to the fees paid to a Blackstone affiliate to provide oversight and
management services to Gryphon for both the nine months ended September 30, 2026 and 2025. The amounts
included in the table above reflect the amortization of the insurance expense over the relevant periods of the
respective policies.
(2)During the nine months ended September 30, 2026, Blackstone Securities Partners L.P., or BSP, an affiliate of our
Manager, was engaged as a member of the syndicate for our May 2026 Senior Secured Notes. During the nine
months ended September 30, 2025, BSP was also engaged as a member of the syndicate for our B-6 Term Loan and
our B-7 Term Loan. These engagements were on terms equivalent to those of unaffiliated third parties.
(3)Lexington National Land Services, or LNLS, is a Blackstone affiliate that (i) acts as a title agent in facilitating and
issuing title insurance, (ii) provides title support services for title insurance underwriters, (iii) in certain
circumstances, provides courtesy title settlement services and (iv) acts as escrow agent in connection with certain
investments by Blackstone-advised vehicles, including us, Blackstone-advised investment vehicles and portfolio
companies owned by Blackstone-advised investment vehicles, affiliates and related parties, and third parties,
including, in certain cases, Blackstone’s borrowers. In exchange for such services, LNLS earns fees which would
have otherwise been paid to third parties. Blackstone receives distributions from LNLS in connection with
investments made by us based on its equity interest in LNLS. In each case, there will be no related expense offset to
us.
CT Investment Management Co., LLC, or CTIMCO, serves as the special servicer of all of our CLOs, and the Manager
serves as the collateral manager and benchmark agent for our FL6 and FL5 CLOs issued in the first quarter of 2026 and
2025, respectively. As of September 30, 2026, three of our assets were in special servicing under CLOs. CTIMCO and our
Manager have waived any fees that would be payable to a third party serving in such roles pursuant to the applicable
agreements, and no such fees have been paid or will become payable to CTIMCO or our Manager.
Other Transactions
During the nine months ended September 30, 2026, we invested $502.6 million in four senior loans, $32.6 million in two
mezzanine loans to unaffiliated third parties, and $144.4 million in debt securities (see Note 6 for further discussion) in
which Blackstone-advised investment vehicles also invested at the same level of the capital structure on a pari passu basis.
Included in the $144.4 million of debt securities investments discussed above, in the third quarter of 2026, we purchased
$50.0 million of senior secured notes in a $3.9 billion issuance by a portfolio company owned by other Blackstone-advised
investment vehicles. The notes were acquired on terms equivalent with those of unaffiliated third-party purchasers of the
notes. We have forgone all non-economic rights under these notes, including voting rights, so long as the issuer is owned
by a Blackstone-advised investment vehicle.
In the first quarter of 2026, Blackstone-advised investment vehicles acquired an aggregate $71.4 million participation in
our $770.8 million B-9 Term Loan. In the fourth quarter of 2025, Blackstone-advised investment vehicles acquired an
aggregate $63.0 million participation in our $700.0 million B-8 Term Loan. In the third quarter of 2025, Blackstone-
advised investment vehicles acquired an aggregate $33.0 million participation in our $453.1 million B-7 Term Loan. In the
56
Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
second quarter of 2025, Blackstone-advised investment vehicles acquired an aggregate $83.9 million participation in our
$1.0 billion B-6 Term Loan, which has subsequently been repaid in full. All of these transactions were part of broad
syndications led by third-party banks, and were on terms equivalent to those of unaffiliated third parties. BSP was engaged
as a member of the syndicate for these transactions. Our engagements of BSP are on terms equivalent to those of
unaffiliated third parties. See “—Affiliate Services” for further information.
As part of broad syndications led by third-party banks, Blackstone-advised investment vehicles acquired an aggregate
$11.0 million of notes in our $1.0 billion FL6 CLO offering in the first quarter of 2026, and $75.0 million of notes in our
$1.0 billion FL5 CLO offering in the first quarter of 2025. Both of these transactions were on terms equivalent to those of
unaffiliated third parties.
In the second quarter of 2026, we entered into our Homebuilder Finance Joint Venture with an unaffiliated third party,
alongside a Blackstone-advised investment vehicle, that concurrently acquired a $286.7 million portfolio of single family
construction loans in which we made an equity investment of $28.5 million representing our aggregate ownership interest
of 45 %.
In the fourth quarter of 2025, we made a $75.0 million capital commitment at the initial closing of a fund managed by
Blackstone Real Estate Debt Strategies, or BREDS, or the BREDS-advised private fund, formed to invest in Core+ real
estate debt investments in the U.S. and Canada. Blackstone affiliates, including us, do not pay management fees or carried
interest with respect to their investments in the BREDS-advised private fund. Our capital commitment represented a
minority of the total capital commitments the BREDS-advised private fund had received as of September 30, 2026. As of
September 30, 2026, the BREDS-advised private fund had not called any capital. To fund its investments, the BREDS-
advised private fund will draw down on capital commitments made by its investors, including us, on a pro rata basis.
In the second quarter of 2025, we entered into our Bank Loan Portfolio Joint Venture with a Blackstone-advised
investment vehicle that concurrently acquired a $1.4 billion portfolio of performing commercial mortgage loans in which
we made an equity investment of $57.6 million and our ownership interest was 29 %. In the third quarter of 2025, our Bank
Loan Portfolio Joint Venture acquired a $606.0 million portfolio of performing commercial mortgage loans in which we
made an equity investment of $44.7 million and our ownership interest was 50 %. In the fourth quarter of 2024, we entered
into our Net Lease Joint Venture with a Blackstone-advised investment vehicle to invest in triple net lease properties.
We do not consolidate our Bank Loan Portfolio Joint Venture, our Net Lease Joint Venture, our Homebuilder Finance Joint
Venture, or the BREDS-advised private fund, as we do not have a controlling financial interest. As of September 30, 2026,
the aggregate value of our equity investment in our Bank Loan Portfolio Joint Venture was $92.3 million and our
ownership interest was 35 %, and the aggregate value of our equity investment in our Net Lease Joint Venture was
$219.3 million and our ownership interest was 75 %. As of September 30, 2026, we had not made an equity investment in
the BREDS-advised private fund. We, these joint ventures, these Blackstone-advised investment vehicles, and other
Blackstone affiliates have engaged and may in the future engage in certain investment, financing, derivative and/or hedging
arrangements related to these unconsolidated entities.
In the second quarter of 2026, one of our senior loans to a borrower controlled by Blackstone-advised investment vehicles
was modified. The terms of the modification (including, among other changes, an extension of the maturity date, a
reduction in the contractual interest rate, and a meaningful additional commitment and credit support from the borrower)
were negotiated by our third-party co-lenders. We continue to forgo all non-economic rights under the loan, including
voting rights, so long as the Blackstone-advised investment vehicles control the borrower.
21. COMMITMENTS AND CONTINGENCIES
Unfunded Commitments Under Loans Receivable
As of September 30, 2026, we had aggregate unfunded commitments of $951.0 million across 47 loans receivable, and
$539.6 million of committed or identified financings for those commitments, resulting in net unfunded commitments of
$411.4 million. The unfunded commitments above include $35.6 million related to five loans receivable, held-for-sale that
were sold subsequent to September 30, 2026. The unfunded loan commitments comprise funding for capital expenditures
and construction, leasing costs, and interest and carry costs. Loan funding commitments are generally subject to certain
conditions, including, without limitation, the progress of capital projects, leasing, and cash flows at the properties securing
our loans. Therefore, the exact timing and amounts of such future loan fundings are uncertain and will depend on the
current and future performance of the underlying collateral assets. We expect to fund our loan commitments over the
remaining term of the related loans, which have a weighted-average future funding period of 1.6 years.
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Blackstone Mortgage Trust, Inc.
Notes to Consolidated Financial Statements (continued)
Principal Debt Repayments
Year | Secured Debt(1) | Asset-Specific Debt(1) | Term Loans(2) | Senior Secured Notes | Convertible Notes(3) | Other Secured Debt(4) | Total(5) | |||||||
2026 (remaining) | $ | $ | $ | $ | $ | $ | $ | |||||||
2027 | ||||||||||||||
2028 | ||||||||||||||
2029 | ||||||||||||||
2030 | ||||||||||||||
Thereafter | ||||||||||||||
Total obligation | $ | $ | $ | $ | $ | $ | $ |
(1)Our secured debt and asset-specific debt agreements are generally term-matched to their underlying collateral.
Therefore, the allocation of payments under such agreements is generally based on the maximum maturity date of
the collateral loans, assuming all extension options are exercised by the borrower. In limited instances, the maturity
date of the respective debt agreement is used.
(2)The Term Loans are partially amortizing, with an amount equal to 1.0 % per annum of the initial principal balance
due in quarterly installments. Refer to Note 10 for further details on our Term Loans.
(3)Reflects the outstanding principal balance of Convertible Notes, excluding any potential conversion premium. Refer
to Note 12 for further details on our Convertible Notes.
(4)Amounts are included in other liabilities on our consolidated balance sheets.
(5)Total does not include $2.7 billion of consolidated securitized debt obligations, as the satisfaction of these liabilities
will not require cash outlays from us.
Board of Directors’ Compensation
As of September 30, 2026, our seven non-employee directors are entitled to annual compensation of $210,000 each, of
which $95,000 is paid in cash and $115,000 is paid in the form of deferred stock units or, at their election, shares of
restricted common stock. As of September 30, 2026, the other two board members are employees of affiliates of our
Manager who also serve as executive officers and they are not compensated by us for their service as directors. In addition,
(i) the lead independent director receives additional annual cash compensation of $30,000 , (ii) the chairs of our audit,
compensation, and corporate governance committees receive additional annual cash compensation of $20,000 , $15,000 ,
and $10,000 , respectively, and (iii) the members of our audit and investment risk management committees receive
additional annual cash compensation of $10,000 and $7,500 , respectively.
Litigation
From time to time, we may be involved in various claims and legal actions arising in the ordinary course of business. As of
22. SEGMENT REPORTING
Operating segments are defined as components of a business that can earn revenues and incur expenses for which discrete
financial information is available that is evaluated on a regular basis by the chief operating decision maker, or CODM. Our
CODM is, collectively, our Chief Executive Officer and Chief Financial Officer, who decide how to allocate resources and
assess performance. A single management team reports to the CODM, who manages the entire business.
We have determined that we have one
which originates and acquires commercial mortgage loans and related investments.
Our CODM reviews, among other things, consolidated net income (loss) that is reported on the consolidated statements of
operations to make decisions, allocate resources and assess performance and does not evaluate the net income (loss) from
any separate geography or product line. The measure of segment assets is reported on the consolidated balance sheets as
total consolidated assets.
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ITEM 2.MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS
References herein to “Blackstone Mortgage Trust,” “Company,” “we,” “us,” or “our” refer to Blackstone Mortgage
Trust, Inc. and its subsidiaries unless the context specifically requires otherwise.
The following discussion and analysis of our financial condition and results of operations should be read in conjunction
with the unaudited consolidated financial statements and notes thereto appearing elsewhere in this Quarterly Report on
Form 10-Q and with our Annual Report on Form 10-K for the year ended December 31, 2025. In addition to historical
data, this discussion and analysis contains forward-looking statements within the meaning of Section 27A of the Securities
Act of 1933, as amended, or the Securities Act, and Section 21E of the Securities Exchange Act of 1934, as amended, or the
Exchange Act, which reflect our current views with respect to, among other things, our business, operations and financial
performance. You can identify these forward-looking statements by the use of words such as “intend,” “goal,” “estimate,”
“expect,” “project,” “projections,” “plans,” “seeks,” “anticipates,” “should,” “could,” “may,” “designed to,”
“foreseeable future,” “believe,” “scheduled,” and similar expressions. Such forward-looking statements are subject to
various risks, uncertainties and assumptions. Our actual results or outcomes may differ materially from those in this
discussion and analysis as a result of various factors, including but not limited to those discussed in Item 1A. Risk Factors
in our Annual Report on Form 10-K for the year ended December 31, 2025 and elsewhere in this Quarterly Report on
Form 10-Q.
Introduction
Blackstone Mortgage Trust is a real estate finance company that originates, acquires, and manages senior loans and other
debt or credit-oriented investments collateralized by or relating to commercial real estate in North America, Europe, and
Australia. Our portfolio is composed primarily of senior loans secured by high-quality, institutional assets located in major
markets, and sponsored by experienced, well-capitalized real estate investment owners and operators. We finance our
investments in a variety of ways, including borrowing under secured credit facilities, issuing collateralized loan obligations,
or CLOs, other securitization transactions, syndicating senior loans and/or participations, and other forms of asset-level
financing, depending on our view of the most prudent financing option available for each of our investments. We are
externally managed by BXMT Advisors L.L.C., or our Manager, a subsidiary of Blackstone Inc., or Blackstone, and are a
real estate investment trust, or REIT, traded on the New York Stock Exchange, or NYSE, under the symbol “BXMT.”
We benefit from the deep knowledge, experience and information advantages of our Manager, which is a part of
Blackstone Real Estate. Blackstone Real Estate was founded in 1991 and is the world’s largest owner of commercial real
estate. Blackstone Real Estate operates as one globally integrated business with investments in North America, Europe,
Asia and Latin America. In the United States, Blackstone Real Estate is one of the largest owners of rental housing,
industrial, office, hospitality and retail assets. The market-leading real estate expertise derived from the strength of the
Blackstone platform deeply informs our credit and underwriting process, and we believe it gives us the tools to manage the
assets in our portfolio and work with our borrowers throughout periods of economic stress and uncertainty.
We conduct our operations as a REIT for U.S. federal income tax purposes. We generally will not be subject to U.S. federal
income taxes on our taxable income to the extent that we annually distribute all of our net taxable income to stockholders
and maintain our qualification as a REIT. We also operate our business in a manner that permits us to maintain an
exclusion from registration under the Investment Company Act of 1940, as amended. We are organized as a holding
company and conduct our business primarily through our various subsidiaries.
Recent Developments
Loan Portfolio Sale
During the three months ended September 30, 2026, we entered into an agreement to sell eight whole mortgage loans to an
unaffiliated third party for total estimated net sales proceeds of $615.6 million, which resulted in these loans being
classified as loans receivable, held-for-sale on our consolidated balance sheets as of September 30, 2026. This resulted in a
$63.9 million valuation adjustment recognized to reduce the carrying value of these loans, which was $679.5 million prior
to the adjustment. Two of the whole loans consisted of both a performing senior loan and an impaired subordinate loan.
The two subordinate loans carried $61.9 million of previously recorded asset-specific CECL reserves. Six of the loans were
collateralized by office assets and two were collateralized by multifamily assets, all of which were located in the United
States. The valuation adjustment was included in valuation adjustment on loans receivable, held-for-sale on our
consolidated statements of operations during the three months ended September 30, 2026. The sale of these loans closed
subsequent to September 30, 2026.
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Fourth Quarter Dividend
In October 2026, we declared a dividend of $0.30 per share of common stock for the fourth quarter of 2026, which is
payable on January 15, 2027 to stockholders of record as of December 31, 2026.
I. Key Financial Measures and Indicators
As a real estate finance company, we believe the key financial measures and indicators for our business are earnings per
share, dividends declared, Distributable Earnings, Distributable Earnings prior to realized gains and losses, and book value
per share. For the three months ended September 30, 2026, we recorded basic net loss per share of $1.95, declared a
dividend of $0.47 per share, reported $0.38 per share of Distributable Earnings, and reported $0.42 per share of
Distributable Earnings prior to realized gains and losses. In addition, our book value as of September 30, 2026 was $17.06
per share, which is net of cumulative CECL reserves of $3.64 per share, and accumulated depreciation and amortization of
owned real estate assets, including our share related to unconsolidated entities, of $0.93 per share.
As further described below, Distributable Earnings and Distributable Earnings prior to realized gains and losses are
measures that are not prepared in accordance with accounting principles generally accepted in the United States of
America, or GAAP. Distributable Earnings and Distributable Earnings prior to realized gains and losses help us to evaluate
our performance, excluding the effects of certain transactions and GAAP adjustments that we believe are not necessarily
indicative of our current investments and operations. In addition, Distributable Earnings and Distributable Earnings prior to
realized gains and losses are performance metrics we consider when declaring our dividends.
Earnings Per Share and Dividends Declared
The following table sets forth the calculation of basic net loss per share and dividends declared per share ($ in thousands,
except per share data):
Three Months Ended | |||
September 30, 2026 | June 30, 2026 | ||
Net loss(1) | $(327,005) | $(81,222) | |
Weighted-average shares outstanding, basic | 167,959,467 | 168,964,515 | |
Net loss per share, basic | $(1.95) | $(0.48) | |
Dividends declared per share | $0.47 | $0.47 | |
(1)Represents net loss attributable to Blackstone Mortgage Trust, Inc. Refer to Note 14 to our consolidated financial
statements for the calculation of diluted net loss per share.
Distributable Earnings and Distributable Earnings Prior to Realized Gains and Losses
Distributable Earnings and Distributable Earnings prior to realized gains and losses are non-GAAP measures. We define
Distributable Earnings as GAAP net income (loss), including realized gains and losses not otherwise recognized in current
period GAAP net income (loss), and excluding (i) non-cash equity compensation expense, (ii) depreciation and
amortization, (iii) unrealized gains (losses), and (iv) certain non-cash items. Distributable Earnings may also be adjusted
from time to time to exclude one-time events pursuant to changes in GAAP and certain other non-cash charges as
determined by our Manager, subject to approval by a majority of our independent directors. Distributable Earnings mirrors
the terms of our management agreement between our Manager and us, or our Management Agreement, for purposes of
calculating our incentive fee expense. Therefore, Distributable Earnings prior to realized gains and losses is calculated net
of the incentive fee expense that would have been recognized if such realized gains or losses had not occurred.
60
Our CECL reserves have been excluded from Distributable Earnings consistent with other unrealized gains (losses)
pursuant to our existing policy for reporting Distributable Earnings. We expect to only recognize such potential credit
losses in Distributable Earnings if and when such amounts are realized and deemed non-recoverable upon a realization
event. This is generally at the time a loan is repaid, or in the case of foreclosure, when the underlying asset is sold, but
realization and non-recoverability may also be concluded if, in our determination, it is nearly certain that all amounts due
will not be collected. The timing of any such credit loss realization in our Distributable Earnings may differ materially from
the timing of CECL reserves or charge-offs in our consolidated financial statements prepared in accordance with GAAP.
The realized loss amount reflected in Distributable Earnings will equal the difference between the cash received, or
expected to be received, and the book value of the asset, and is reflective of our economic experience as it relates to the
ultimate realization of the loan.
We believe that Distributable Earnings provides meaningful information to consider in addition to our net income (loss)
and cash flow from operating activities determined in accordance with GAAP. We believe Distributable Earnings is a
useful financial metric for existing and potential future holders of our class A common stock as historically, over time,
Distributable Earnings has been a strong indicator of our dividends per share. As a REIT, we generally must distribute
annually at least 90% of our net taxable income, subject to certain adjustments, and therefore we believe our dividends are
one of the principal reasons stockholders may invest in our class A common stock. Refer to Note 16 to our consolidated
financial statements for further discussion of our distribution requirements as a REIT. Further, Distributable Earnings helps
us to evaluate our performance, excluding the effects of certain transactions and GAAP adjustments that we believe are not
necessarily indicative of our current investment portfolio and operations, and is a performance metric we consider when
declaring our dividends.
Furthermore, we believe it is useful to present Distributable Earnings prior to realized gains and losses, which include but
are not limited to charge-offs of CECL reserves, to reflect our direct operating results and help existing and potential future
holders of our class A common stock assess the performance of our business excluding such realized gains or losses. We
may make similar adjustments with respect to other types of investments, if and when applicable transactions occur. During
the period from the first quarter of 2024 to the fourth quarter of 2025, we reported this metric as Distributable Earnings
prior to charge-offs of CECL reserves, as the only applicable realized gains or losses during such period were charge-offs
of CECL reserves. We utilize Distributable Earnings prior to realized gains and losses as an additional performance metric
to consider when declaring our dividends. Distributable Earnings mirrors the terms of our Management Agreement for
purposes of calculating our incentive fee expense. Therefore, Distributable Earnings prior to realized gains and losses is
calculated net of the incentive fee expense that would have been recognized if such realized gains or losses had not
occurred.
Distributable Earnings and Distributable Earnings prior to realized gains and losses do not represent net income (loss) or
cash generated from operating activities and should not be considered as alternatives to GAAP net income (loss), or
indicators of our GAAP cash flows from operations, measures of our liquidity, or indicators of funds available for our cash
needs. In addition, our methodology for calculating Distributable Earnings and Distributable Earnings prior to realized
gains and losses may differ from the methodologies employed by other companies to calculate the same or similar
supplemental performance measures, and accordingly, our reported Distributable Earnings and Distributable Earnings prior
to realized gains and losses may not be comparable to similar metrics reported by other companies.
61
The following table provides a reconciliation of Distributable Earnings and Distributable Earnings prior to realized gains
and losses to GAAP net loss ($ in thousands, except per share data):
Three Months Ended | |||
September 30, 2026 | June 30, 2026 | ||
Net loss(1) | $(327,005) | $(81,222) | |
Valuation adjustment on loans receivable, held-for-sale(2) | 63,909 | — | |
Charge-offs of CECL reserves(3) | (6,874) | (28,620) | |
Increase in CECL reserves | 264,766 | 134,403 | |
Depreciation and amortization of owned real estate(4) | 23,199 | 21,104 | |
Impairment of owned real estate(5) | 36,371 | — | |
Non-cash compensation expense | 6,677 | 6,675 | |
Realized hedging and foreign currency loss, net(6) | (2,900) | (1,098) | |
Allocable share of adjustments related to unconsolidated entities(7) | 7,013 | 508 | |
Cash income from Agency Multifamily Lending Partnership, net(8) | 30 | 30 | |
Adjustments attributable to non-controlling interests, net | (30) | (26) | |
Other items | (1,052) | (18) | |
Distributable Earnings | $64,104 | $51,736 | |
Charge-offs of CECL reserves(3) | 6,874 | 28,620 | |
Allocable share of adjustments related to unconsolidated entities(7) | 265 | 51 | |
Distributable Earnings prior to realized gains and losses | $71,243 | $80,407 | |
Weighted-average shares outstanding, basic(9) | 167,959,467 | 168,964,515 | |
Distributable Earnings per share, basic | $0.38 | $0.31 | |
Distributable Earnings prior to realized gains and losses per share, basic | $0.42 | $0.48 | |
(1)Represents net loss attributable to Blackstone Mortgage Trust, Inc.
(2)Represents unrealized losses recognized on loans that were classified as held-for-sale to reduce them to their fair
value.
(3)Represents realized losses related to loan principal amounts deemed non-recoverable.
(4)Represents depreciation of owned real estate assets and amortization of intangible real estate assets and liabilities.
(5)Represents non-cash valuation adjustments recognized to reduce the carrying values of owned real estate assets to
their estimated fair value.
(6)Represents realized losses on the repatriation of unhedged foreign currency. These amounts were not included in
GAAP net loss, but rather as a component of other comprehensive income in our consolidated financial statements.
(7)Allocable share of adjustments related to unconsolidated entities for the three months ended September 30, 2026
reflects our share of non-cash items such as (i) $2.1 million of unrealized losses recorded by such unconsolidated
entities, (ii) $5.2 million of depreciation and amortization, and (iii) $(0.3) million of related adjustments for realized
gains. For the three months ended June 30, 2026, reflects our share of non-cash items such as (i) $(3.8) million of
unrealized gains recorded by such unconsolidated entities, (ii) $4.3 million of depreciation and amortization, and
(iii) related adjustments for realized gains, if any.
(8)Represents (i) the non-cash income recognized under GAAP related to our Agency Multifamily Lending
Partnership, in which we receive a portion of origination, servicing, and other fees for loans we refer to MTRCC for
origination, offset by the related loss-sharing obligation accruals, and (ii) the cash received related to such income
previously recognized under GAAP. Refer to Note 2 to our consolidated financial statements for further information
on our Agency Multifamily Lending Partnership.
(9)The weighted-average shares outstanding, basic, exclude shares issuable from a potential conversion of our
Convertible Notes then outstanding. Consistent with the treatment of other unrealized adjustments to Distributable
Earnings, these potentially issuable shares are excluded until a conversion occurs. Refer to Note 14 to our
consolidated financial statements for the calculation of diluted net income per share.
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Book Value Per Share
The following table calculates our book value per share ($ in thousands, except per share data):
September 30, 2026 | June 30, 2026 | ||
Stockholders’ equity | $2,837,609 | $3,261,540 | |
Shares | |||
Class A common stock | 165,988,840 | 168,543,591 | |
Deferred stock units | 379,690 | 369,548 | |
Total outstanding | 166,368,530 | 168,913,139 | |
Book value per share(1) | $17.06 | $19.31 |
(1)The book value per share excludes shares issuable from a potential conversion of our Convertible Notes then
outstanding. Refer to Note 14 to our consolidated financial statements for the calculation of diluted net income per
share.
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II. Investments
Investment Portfolio
Our Investment Portfolio consists of our Loan Portfolio, our investments in our Bank Loan Portfolio Joint Venture, Net
Lease Joint Venture and Homebuilder Finance Joint Venture, our owned real estate assets, and our investments in debt
securities. The chart below details the composition of our Investment Portfolio as of September 30, 2026:
Investment Portfolio(1)(2)
Included in our Loan Portfolio(3)
(1)Our Investment Portfolio reflects the gross amount of our investments as of September 30, 2026, which consists of
(i) our Loan Portfolio, which represents net book value of loans held-for-investment, which reflects our total loans
receivable CECL reserves, (ii) our share of the carrying value of investments held by our Net Lease Joint Venture,
(iii) our share of the fair value of the loans held by both our Bank Loan Portfolio Joint Venture and Homebuilder
Finance Joint Venture, (iv) the aggregate carrying value of our owned real estate assets, and (v) the fair value of our
investments in debt securities.
(2)Assets in our Loan Portfolio with multiple components are proportioned into the relevant property types based on
the allocated value of each property type.
(3)Represents the types of properties securing the loans in our Loan Portfolio.
Refer to section VII of this Item 2 for details of our Loan Portfolio, on a loan-by-loan basis.
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Loan Portfolio
Loan Originations
During the three months ended September 30, 2026, we originated or acquired $264.2 million of loans, inclusive of
additional commitments made under existing loans.
Loan Portfolio Activity
During the three months ended September 30, 2026, loan fundings totaled $366.3 million and loan repayments and sales
totaled $2.3 billion.
The following table details our Loan Portfolio activity ($ in thousands):
Three Months Ended September 30, 2026 | Nine Months Ended September 30, 2026 | ||
Loan fundings(1) | $366,277 | $1,826,981 | |
Loan repayments and sales(1)(2) | (2,303,252) | (4,122,531) | |
Total net repayments | $(1,936,975) | $(2,295,550) |
(1)Excludes amounts for loans held by our Bank Loan Portfolio Joint Venture and Homebuilder Finance Joint Venture,
which are included in investments in unconsolidated entities on our consolidated balance sheets.
(2)Included in these amounts are sales of $251.5 million of pari passu participations in two loans collateralized by
properties located in the United Kingdom.
The following table details overall statistics for our Loan Portfolio as of September 30, 2026 ($ in thousands):
September 30, 2026 | |
Number of loans | 114 |
Principal balance | $14,612,118 |
Net book value | $13,966,510 |
Unfunded loan commitments(1) | $915,385 |
Weighted-average cash coupon(2) | + 3.08% |
Weighted-average all-in yield(2) | + 3.43% |
Weighted-average maximum maturity (years)(3) | 3.0 |
Origination loan-to-value (LTV)(4) | 64% |
(1)Unfunded commitments will primarily be funded to finance our borrowers’ construction or development of real
estate-related assets, capital improvements of existing assets, or lease-related expenditures. These commitments will
generally be funded over the term of each loan, subject in certain cases to an expiration date.
(2)The weighted-average cash coupon and all-in yield are expressed as a spread over the relevant floating benchmark
rates, which include SOFR, SONIA, EURIBOR, CORRA, and other indices as applicable to each loan. As of
September 30, 2026, 96% of our loans by principal balance earned a floating rate of interest, primarily indexed to
SOFR. The remaining 4% of our loans by principal balance earned a fixed rate of interest.
(3)Maximum maturity assumes all extension options are exercised by the borrower; however, our loans and other
investments may be repaid prior to such date. Excludes loans accounted for under the cost-recovery and nonaccrual
methods, if any. As of September 30, 2026, 44% of our loans by principal balance were subject to yield maintenance
or other prepayment restrictions and 56% were open to repayment by the borrower without penalty.
(4)Based on LTV as of the dates loans were originated or acquired by us, excluding any loans that are impaired.
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The following table details the index rate floors for our Loan Portfolio as of September 30, 2026 ($ in thousands):
Loan Portfolio Principal Balance | ||||||
Index Rate Floors | USD | Non-USD(1) | Total | |||
Fixed Rate | $399,485 | $135,303 | $534,788 | |||
0.00% or no floor(2) | 1,199,356 | 3,203,643 | 4,402,999 | |||
0.01% to 1.00% floor | 649,822 | 819,567 | 1,469,389 | |||
1.01% to 2.00% floor | 778,083 | 1,042,018 | 1,820,101 | |||
2.01% to 3.00% floor | 5,343,828 | 408,157 | 5,751,985 | |||
3.01% or more floor | 325,141 | 307,715 | 632,856 | |||
Total(3) | $8,695,715 | $5,916,403 | $14,612,118 | |||
(1)Includes Euro, British Pound Sterling, Australian Dollar, and Canadian Dollar currencies.
(2)Includes all impaired loans.
(3)As of September 30, 2026, the weighted-average index rate floor of our floating-rate Loan Portfolio principal
balance was 1.73%. Excluding 0.00% index rate floors and loans with no floor, the weighted-average index rate
floor was 2.28%.
The following table details the floating benchmark rates for our Loan Portfolio as of September 30, 2026 (Loan Portfolio
principal balance amounts in thousands):
Loan Count | Currency | Loan Portfolio Principal Balance | Floating Rate Index(1) | Cash Coupon(2) | All-in Yield(2) | |||||
81 | $ | $8,695,715 | SOFR | + 3.01% | + 3.41% | |||||
15 | £ | £1,655,894 | SONIA | + 2.75% | + 3.00% | |||||
13 | € | €1,814,831 | EURIBOR | + 2.63% | + 2.98% | |||||
5 | Various | $1,663,655 | Other(3) | + 4.32% | + 4.55% | |||||
114 | $14,612,118 | + 3.08% | + 3.43% |
(1)We use foreign currency forward contracts to protect the value or fix the amount of certain investments or cash
flows in terms of the U.S. dollar. We earn forward points on our forward contracts that reflect the interest rate
differentials between the applicable base rate for our foreign currency investments and prevailing U.S. interest rates.
These forward contracts effectively convert the foreign currency rate exposure for such investments to USD-
equivalent interest rates.
(2)In addition to cash coupon, all-in yield includes the amortization of deferred origination and extension fees, loan
origination costs, and purchase discounts, as well as the accrual of exit fees. Excludes loans accounted for under the
cost-recovery and nonaccrual methods, if any.
(3)Includes floating rate loans indexed to CORRA and BBSY indices.
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The charts below detail the geographic distribution and types of properties securing our Loan Portfolio, as of
September 30, 2026:
Geographic Diversification
(Net Loan Exposure)(1)
Collateral Diversification
(Net Loan Exposure)(1)(2)
(1)Net loan exposure reflects the amount of each loan that is subject to risk of credit loss to us as of September 30,
2026, which is our principal balance of loans receivable, held-for-investment, net of (i) $989.5 million of asset-
specific debt, (ii) $4.6 million of cost-recovery proceeds, and (iii) our total loans receivable CECL reserve of
$597.3 million. Our asset-specific debt is structurally non-recourse and term-matched to the corresponding collateral
loans. Geographic locations that represent less than 1% of net loan exposure are excluded from the chart.
(2)Assets with multiple components are proportioned into the relevant property types based on the allocated value of
each property type.
Refer to section VII of this Item 2 for details of our Loan Portfolio, on a loan-by-loan basis.
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Portfolio Management
As of September 30, 2026, 93% of our loans, based on net loan exposure, were performing with risk ratings of “1” through
“4,” and the remaining 7% were impaired with a risk rating of “5.” As of September 30, 2026, one of our performing loans
with an amortized cost basis of $149.8 million was in payment default, was greater than 90 days past due on its interest
payment, and had a risk rating of “4.” This loan was not impaired as of September 30, 2026 as we expect to fully recover
all contractual principal and interest amounts due under the loan agreement. All other borrowers under performing loans
were in compliance with the applicable contractual terms of each respective loan, including any required payment of
interest. We believe this demonstrates the overall strength of our loan portfolio and the commitment and financial
wherewithal of our borrowers generally, which are primarily affiliated with large real estate private equity funds and other
strong, well-capitalized, and experienced sponsors.
We maintain a robust asset management relationship with our borrowers and utilize these relationships to maximize the
performance of our portfolio, including during periods of volatility. We believe that we benefit from these relationships and
from our long-standing core business model of originating senior loans collateralized by large assets in major markets with
experienced, well-capitalized institutional sponsors. While we believe the principal amounts of our loans are generally
adequately protected by underlying collateral value, there is a risk that we will not realize the entire principal value of
certain investments. As of September 30, 2026, we had an aggregate $444.5 million asset-specific CECL reserve related to
12 of our loans receivable, with an aggregate amortized cost basis of $1.3 billion, net of cost-recovery proceeds. This
CECL reserve was recorded based on our estimation of the fair value of each of the loan's underlying collateral as of
September 30, 2026.
We benefit from the deep knowledge, experience and information advantages of our Manager, which is a part of
Blackstone Real Estate. Blackstone Real Estate was founded in 1991 and is the world’s largest owner of commercial real
estate with investments in North America, Europe, Asia and Latin America. In the United States, Blackstone Real Estate is
one of the largest owners of rental housing, industrial, office, hospitality and retail assets.
As discussed in Note 2 to our consolidated financial statements, we perform a quarterly review of our loan portfolio, assess
the performance of each loan, and assign it a risk rating between “1” and “5,” from less risk to greater risk. As of
September 30, 2026, our loan portfolio had a weighted-average risk rating of 3.1, based on net loan exposure.
The following table allocates the amortized cost basis and net loan exposure balances of our Loan Portfolio based on our
internal risk ratings as of September 30, 2026 ($ in thousands):
September 30, 2026 | ||||||
Risk Rating | Number of Loans | Amortized Cost Basis | Net Loan Exposure(1) | |||
1 | 1 | $60,952 | $60,986 | |||
2 | 17 | 1,970,144 | 1,802,276 | |||
3 | 76 | 10,314,438 | 9,414,183 | |||
4 | 8 | 893,154 | 864,194 | |||
5 | 12 | 1,325,146 | 879,095 | |||
Loans receivable, held-for-investment | 114 | $14,563,834 | $13,020,734 | |||
(1)Net loan exposure reflects the amount of each loan that is subject to risk of credit loss to us as of September 30,
2026, which is our principal balance of loans receivable, held-for-investment, net of (i) $989.5 million of asset-
specific debt, (ii) $4.6 million of cost-recovery proceeds, and (iii) our total loans receivable CECL reserve of
$597.3 million. Our asset-specific debt is structurally non-recourse and term-matched to the corresponding collateral
loans.
Current Expected Credit Loss Reserve
The CECL reserves required by GAAP reflect our current estimate of potential credit losses related to our loans included in
our consolidated balance sheets. Other than a few narrow exceptions, GAAP requires that all financial instruments subject
to the CECL model have some amount of loss reserve to reflect the principle underlying the CECL model that all loans and
similar assets have some inherent risk of loss, regardless of credit quality, subordinate capital, or other mitigating factors.
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During the three months ended September 30, 2026, the CECL reserves against our loans receivable, held-for-investment
portfolio increased by $199.5 million. This increase was primarily driven by a $293.8 million increase in our asset-specific
CECL reserve, partially offset by a $25.5 million decrease in our general CECL reserve. The increase in our asset-specific
reserve was primarily driven by six additional loans with an aggregate amortized cost basis of $787.8 million that were
impaired during the three months ended September 30, 2026, of which five are secured by office properties, and one is
secured by a hospitality asset. The office sector recovery in certain markets has continued to lag other commercial real
estate sectors, which has, in certain cases, extended business plans on transitional properties and impacted their
performance, affecting some borrowers’ willingness and ability to continue to support their assets. During the three months
ended September 30, 2026, we recorded $8.7 million of interest income on these loans. Upon determining that the six loans
were impaired, the income accrual was suspended, as the recovery of interest income and principal was doubtful. The
decrease in our general CECL reserve was primarily driven by changes in risk ratings, including the impact of the six
newly impaired loans moving out of the general CECL reserve pool, and a decrease in our loans receivable, held-for-
investment balance, partially offset by an increase in the historical loss rate used in reserve calculations related to the
additional reserve charge-offs.
The increase in our asset-specific reserve was reduced by (i) the transfer of $61.9 million of CECL reserves related to two
previously impaired subordinate loans that were transferred to held-for-sale as of September 30, 2026, which were sold
subsequent to September 30, 2026, and (ii) charge-offs of $6.9 million primarily related to the resolution of one previously
impaired loan as a result of our acquisition of title through a deed-in-lieu of foreclosure of a mixed-use collateral property
located in Richmond, CA, which is now included on our consolidated balance sheet as an owned real estate asset. As a
result of these changes, our total loans receivable CECL reserves increased to $597.3 million as of September 30, 2026.
As of September 30, 2026, we had an aggregate $444.5 million asset-specific CECL reserve related to 12 of our loans
receivable, held-for-investment, with an aggregate amortized cost basis of $1.3 billion, net of cost-recovery proceeds.
During the three months ended September 30, 2026, we received $4.4 million of cash proceeds from previously impaired
loans that were applied as a reduction to the amortized cost basis of each respective loan. Impairments are each determined
individually as a result of changes in the specific credit quality factors for each such loan. These factors included, among
others, (i) the underlying collateral performance, (ii) discussions with the borrower, (iii) borrower events of default, and
(iv) other facts that impact the borrower’s ability to pay the contractual amounts due under the terms of the loan. This asset-
specific CECL reserve was recorded based on our estimation of the fair value of each loan’s underlying collateral as of
September 30, 2026.
Refer to Note 2 to our consolidated financial statements for further discussion of our policies on revenue recognition and
our CECL reserves.
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Owned Real Estate
As part of our portfolio management strategy to maximize economic outcomes, we may hold certain owned real estate
assets, resulting from transactions in which we assume legal title, physical possession, or control of the collateral
underlying a loan through a foreclosure, a deed-in-lieu of foreclosure transaction, or a loan modification in which we
receive an equity interest in and/or control over decision-making at the property. As of September 30, 2026, we had 15
owned real estate assets with an aggregate carrying value of $1.5 billion.
The following table provides details of our owned real estate assets as of September 30, 2026 ($ in thousands):
Acquisition Date | Location | Property Type | Acquisition Date Fair Value | SQFT / Units / Keys | ||||||
1 | September 2025 | New York, NY | Hospitality | $228,253 | 933 keys | |||||
2 | December 2024 | San Francisco, CA | Hospitality | 201,530 | 686 keys | |||||
3 | June 2026 | Dallas, TX | Multifamily | 149,906 | 1,530 units | |||||
4 | December 2024 | El Segundo, CA | Office | 145,363 | 494,532 sqft | |||||
5 | December 2025 | New York, NY | Mixed-use | 133,313 | 709,204 sqft | |||||
6 | September 2025 | Atlanta, GA | Office | 132,974 | 1,184,916 sqft | |||||
7 | November 2025 | Denver, CO | Office | 114,748 | 538,179 sqft | |||||
8 | October 2024 | Washington, DC | Office | 107,016 | 892,480 sqft | |||||
9 | September 2026 | Richmond, CA | Mixed-use | 82,901 | 486,804 sqft | |||||
10 | September 2024 | Burlington, MA | Office | 64,628 | 379,018 sqft | |||||
11 | March 2024 | Mountain View, CA | Office | 60,203 | 150,507 sqft | |||||
12 | February 2025 | Chicago, IL | Office | 45,045 | 517,115 sqft | |||||
13 | March 2026 | San Francisco, CA | Hospitality | 41,082 | 459 keys | |||||
14 | December 2024 | Denver, CO | Office | 33,337 | 170,304 sqft | |||||
15 | July 2024 | San Antonio, TX | Multifamily | 17,491 | 198 units | |||||
$1,557,790 |
Bank Loan Portfolio Joint Venture
In the second quarter of 2025, we entered into a joint venture with a Blackstone-advised investment vehicle to acquire
portfolios of performing commercial mortgage loans, or our Bank Loan Portfolio Joint Venture. In the second quarter of
2025, the Bank Loan Portfolio Joint Venture acquired a $1.4 billion portfolio of 171 performing senior commercial real
estate loans from a regional bank. The loans are secured primarily by retail and multifamily properties located across
various markets in the Mid-Atlantic region, are primarily fixed rate, and were acquired at a discount to par. In the third
quarter of 2025, the Bank Loan Portfolio Joint Venture acquired a $606.0 million portfolio of 425 performing senior
commercial real estate loans from a regional bank. The loans are secured primarily by net lease retail assets located
throughout the United States, are fixed rate, and were acquired at a discount to par. We have an aggregate 35% ownership
interest in the joint venture as of September 30, 2026. As of September 30, 2026, our share of the fair value of the loans
held by our Bank Loan Portfolio Joint Venture was $451.9 million.
Our Bank Loan Portfolio Joint Venture is recorded on our consolidated balance sheets in investments in unconsolidated
entities. As of September 30, 2026, our investment in the joint venture totaled $92.3 million. During the nine months ended
September 30, 2026, we did not make any contributions to the joint venture, received $29.6 million of distributions, and
recorded $10.9 million of income from unconsolidated entities in our consolidated statements of operations.
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Net Lease Joint Venture
In the fourth quarter of 2024, we entered into a joint venture with a Blackstone-advised investment vehicle to invest in
triple net lease properties, or our Net Lease Joint Venture. Our investment in the joint venture is recorded on our
consolidated balance sheets in investments in unconsolidated entities. As of September 30, 2026, our investment in the
joint venture totaled $219.3 million. During the nine months ended September 30, 2026, we contributed $129.6 million to
the joint venture, received $29.2 million of distributions, and recorded $2.0 million of income from unconsolidated entities
in our consolidated statements of operations, inclusive of $12.7 million of depreciation and amortization expense. We have
an aggregate 75% ownership interest in the joint venture as of September 30, 2026. As of September 30, 2026, our share of
the carrying value of investments held by our Net Lease Joint Venture was $747.2 million.
The following table details the tenant industries and the geographic location of the assets held by our Net Lease Joint
Venture as of September 30, 2026:
Tenant Industry | Number of Properties | % of Annualized Base Rent | ||
Medical / Dental | 64 | 20% | ||
Early Childhood Education | 42 | 15 | ||
Car Washes | 32 | 15 | ||
Restaurants - Quick Service | 73 | 14 | ||
Automotive Service | 51 | 13 | ||
Pet Care | 50 | 10 | ||
Industrial | 4 | 3 | ||
Home Improvement | 9 | 3 | ||
Convenience Stores | 13 | 2 | ||
Wholesale Trade | 1 | 1 | ||
Grocery | 3 | 1 | ||
Other | 6 | 3 | ||
Total | 348 | 100% | ||
State | Number of Properties | % of Annualized Base Rent | ||
Texas | 44 | 13% | ||
Florida | 28 | 12 | ||
Illinois | 30 | 8 | ||
Georgia | 20 | 7 | ||
California | 9 | 6 | ||
Missouri | 18 | 5 | ||
South Carolina | 11 | 5 | ||
Minnesota | 17 | 4 | ||
Indiana | 15 | 4 | ||
Arizona | 9 | 4 | ||
Other (26 states) | 147 | 32 | ||
Total | 348 | 100% |
As of September 30, 2026, our Net Lease Joint Venture’s leases had a weighted-average remaining lease term of over 15
years (based on annualized base rent), with weighted-average annual rent increases of approximately 2%, and a rent
coverage ratio of approximately 3x.
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Homebuilder Finance Joint Venture
In the second quarter of 2026, we entered into a joint venture with an unaffiliated third party, alongside a Blackstone-
advised investment vehicle, to originate, acquire, and fund construction loans collateralized by single family homes located
in various markets across the United States, which we refer to as our Homebuilder Finance Joint Venture. Our aggregate
ownership interest in our Homebuilder Finance Joint Venture was 45% as of September 30, 2026. Our Homebuilder
Finance Joint Venture initially acquired a seed portfolio of 36 loans with an aggregate outstanding balance of
$286.7 million, and has since originated and acquired additional loans. As of September 30, 2026, our share of fair value of
the loans held by this joint venture was $191.2 million.
Our Homebuilder Finance Joint Venture is recorded on our consolidated balance sheets in investments in unconsolidated
entities. As of September 30, 2026, our investment in the joint venture totaled $59.1 million. During the nine months ended
September 30, 2026, we made $56.6 million of contributions to the joint venture, did not receive any distributions, and
recorded $2.6 million of income from unconsolidated entities in our consolidated statements of operations.
Core+ Real Estate Debt Fund Investment
In the fourth quarter of 2025, we made a $75.0 million capital commitment at the initial closing of a new BREDS-advised
private fund formed to invest in Core+ real estate debt investments in the U.S. and Canada. Blackstone affiliates, including
us, do not pay management fees or carried interest with respect to their investments in the BREDS-advised private fund.
Our capital commitment represented a minority of the total capital commitments the BREDS-advised private fund had
received as of September 30, 2026. As of September 30, 2026, the BREDS-advised private fund had not called any capital.
To fund its investments, the BREDS-advised private fund will draw down on capital commitments made by its investors,
including us, on a pro rata basis.
Investments in Debt Securities
The following table details our investments in debt securities ($ in thousands):
Investment | Issuance Date | Asset Class | Credit Rating | Face Value | Fair Value | Interest Rate(1) | Swapped Rate | All-in Yield | Maturity | |||||||||
UK Bank Loan Portfolio SRT(2) | Mar 27, 2026 | Various | n/a | $66,325 | $66,325 | + 7.00% | n/a | + 7.00% | Oct 30, 2037 | |||||||||
Senior secured notes | Aug 27, 2026 | Data Center | BBB- | 50,000 | 48,750 | (3) | 6.63% | + 2.58% | (4) | + 3.07% | Sep 1, 2031 | |||||||
Senior secured notes | Aug 27, 2026 | Home Building | BBB | 28,980 | 28,980 | + 3.25% | n/a | + 3.25% | Dec 20, 2030 | |||||||||
Total debt securities | $145,305 | $144,055 |
(1)The UK Bank Loan Portfolio SRT is indexed to SONIA and the Home Building senior secured notes are indexed to
one-month SOFR.
(2)Represents an investment in a significant risk transfer, or SRT, transaction with a UK financial institution structured
as a credit-linked note, or the UK Bank Loan Portfolio SRT. The investment constitutes the first-loss tranche of a
reference portfolio comprising a diversified, granular portfolio of low-leverage commercial real estate loans held by
the UK financial institution. As of September 30, 2026, no realized credit losses have been incurred with respect to
the underlying reference loan portfolio.
(3)These senior secured notes were issued at 97.5% of par.
(4)In connection with this investment, we entered into an interest rate swap to effectively convert our fixed-rate
exposure to floating-rate exposure, indexed to one-month SOFR. Refer to Note 13 to our consolidated financial
statements for additional information.
Agency Multifamily Lending Partnership
In the second quarter of 2024, we entered into an agreement with M&T Realty Capital Corporation, or MTRCC, a
subsidiary of M&T Bank, that allows our borrowers to access multifamily agency financing through MTRCC’s Fannie
Mae DUS and Freddie Mac Optigo lending platforms, or our Agency Multifamily Lending Partnership. We will receive a
portion of origination, servicing, and other fees for loans that we refer to MTRCC for origination under both the Fannie
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Mae and Freddie Mac programs. Additionally, we will share in losses with MTRCC and Fannie Mae on loans that we refer
to MTRCC for origination under the Fannie Mae program. During the nine months ended September 30, 2026, we did not
refer any loans to MTRCC.
III. Financings
Loan Portfolio Financings
Our loan portfolio financing consists of secured debt, securitizations, and asset-specific debt. The following table details
our portfolio financing ($ in thousands):
Portfolio Financing Outstanding Principal Balance | |||
September 30, 2026 | December 31, 2025 | ||
Secured debt | $7,192,910 | $10,125,839 | |
Securitizations | 2,653,545 | 2,149,496 | |
Asset-specific debt | 989,504 | 999,810 | |
Total loan portfolio financing | $10,835,959 | $13,275,145 | |
Secured Debt
The following table details our secured credit facilities by currency as of September 30, 2026 ($ in thousands):
Recourse Limitation | ||||||||||||||||||||
Currency | Lenders(1) | Borrowings | Wtd. Avg. Maturity(2) | Wtd. Avg. All-in Cost(3)(4)(5) | Loan Count | Collateral(6) | Wtd. Avg. All-in Yield(3)(4) | Wtd. Avg. | Range | |||||||||||
USD | 14 | $3,159,868 | Sep 2028 | +1.74% | 70 | $5,524,804 | +2.83% | 37% | 25% - 100% | |||||||||||
GBP | 6 | 1,708,884 | Apr 2029 | +1.67% | 13 | 2,153,769 | +2.92% | 25% | 25% | |||||||||||
EUR | 6 | 1,164,756 | Dec 2030 | +1.61% | 13 | 1,818,916 | +2.97% | 41% | 10% - 100% | |||||||||||
Others(7) | 4 | 1,159,402 | Dec 2029 | +2.36% | 5 | 1,470,430 | +4.69% | 27% | 25% - 50% | |||||||||||
Total | 16 | $7,192,910 | May 2029 | +1.80% | 101 | $10,967,919 | +3.17% | 33% | 10% - 100% | |||||||||||
(1)Represents the number of lenders with fundings advanced in each respective currency, as well as the total number of
facility lenders.
(2)Our secured debt agreements are generally term-matched to their underlying collateral. Therefore, the weighted-
average maturity is generally allocated based on the maximum maturity date of the collateral loans, assuming all
extension options are exercised by the borrower. In limited instances, the maturity date of the respective secured
credit facility is used.
(3)The spread, all-in cost, and all-in yield are expressed over the relevant floating benchmark rates, which include
SOFR, SONIA, EURIBOR, CORRA, and other indices as applicable.
(4)In addition to spread, the cost includes the associated deferred fees and expenses related to the respective
borrowings. In addition to cash coupon, all-in yield includes the amortization of deferred origination and extension
fees, loan origination costs, and purchase discounts, as well as the accrual of exit fees. All-in yield excludes loans
accounted for under the cost-recovery and nonaccrual methods, if any, and owned real estate assets.
(5)Represents the weighted-average all-in cost as of September 30, 2026 and is not necessarily indicative of the spread
applicable to recent or future borrowings.
(6)Represents the principal balance of the collateral loans receivable, held-for-investment and the carrying value of the
collateral owned real estate assets and loans receivable, held-for-sale.
(7)Includes Australian Dollar and Canadian Dollar currencies.
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Securitizations
We have financed certain pools of our loans through CLOs and have also financed one of our loans through a securitization
vehicle, or the European Loan Securitization. The following table details our securitized debt obligations and the
underlying collateral assets that are financed by our CLOs and the European Loan Securitization ($ in thousands):
September 30, 2026 | ||||||||||
Securitized Debt Obligations | Count | Principal Balance | Book Value(1) | Wtd. Avg. Yield/Cost(2) | Term(3) | |||||
CLOs | ||||||||||
2026 FL6 Collateralized Loan Obligation | ||||||||||
Senior CLO Securities Outstanding | 1 | $880,000 | $872,928 | + 1.84% | August 2043 | |||||
Underlying Collateral Assets | 19 | 999,379 | 999,379 | + 3.03% | October 2029 | |||||
2025 FL5 Collateralized Loan Obligation | ||||||||||
Senior CLO Securities Outstanding | 1 | 831,250 | 823,848 | + 2.15% | October 2042 | |||||
Underlying Collateral Assets | 18 | 939,000 | 939,000 | + 3.35% | September 2029 | |||||
2021 FL4 Collateralized Loan Obligation | ||||||||||
Senior CLO Securities Outstanding | 1 | 376,967 | 376,967 | + 1.88% | May 2038 | |||||
Underlying Collateral Assets | 10 | 446,529 | 443,144 | + 3.18% | August 2027 | |||||
2020 FL2 Collateralized Loan Obligation | ||||||||||
Senior CLO Securities Outstanding | 1 | 377,313 | 377,313 | + 1.98% | February 2038 | |||||
Underlying Collateral Assets | 8 | 570,241 | 570,241 | + 3.07% | March 2027 | |||||
Total CLOs | ||||||||||
Senior CLO Securities Outstanding | 4 | $2,465,530 | $2,451,056 | + 1.97% | ||||||
Underlying Collateral Assets | 55 | 2,955,149 | 2,951,764 | + 3.17% | ||||||
Securitizations | ||||||||||
European Loan Securitization | ||||||||||
Financing Provided | 1 | $188,015 | $185,814 | + 1.71% | July 2030 | |||||
Underlying Collateral Assets(4) | 1 | 242,399 | 240,192 | + 2.97% | July 2030 | |||||
Total | ||||||||||
Senior CLO Securities Outstanding / Financing Provided(5) | 5 | $2,653,545 | $2,636,870 | + 1.95% | ||||||
Underlying Collateral Assets | 56 | 3,197,548 | 3,191,956 | + 3.15% | ||||||
(1)The book value of underlying collateral assets excludes any applicable CECL reserves.
(2)In addition to cash coupon, all-in yield includes the amortization of deferred origination and extension fees, loan
origination costs, purchase discounts, and accrual of exit fees, while all-in cost includes the amortization of deferred
origination fees and financing costs. The weighted-average all-in yield and cost are expressed as a spread over the
relevant floating benchmark rates, which is SOFR for the CLOs and EURIBOR for the European Loan
Securitization. All-in yield excludes loans accounted for under the cost-recovery and nonaccrual methods, if any,
owned real estate assets, and cash from repayment proceeds held in certain of our CLOs that may be used to add
new eligible collateral assets.
(3)Underlying collateral assets term represents the weighted-average final maturity of such loans, assuming all
extension options are exercised by the borrower, and excludes owned real estate assets. Repayments of securitized
debt obligations are tied to timing of the related collateral loan asset repayments. The term of these obligations
represents the rated final distribution date of the securitizations.
(4)We financed our $55.8 million retained interests in the securitization under a repurchase agreement structured
without capital markets-based mark-to-market provisions. The amount of the financing is included in other liabilities
on our consolidated balance sheets.
(5)During the nine months ended September 30, 2026, we recorded $114.1 million of interest expense related to our
securitized debt obligations.
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Refer to Note 8 and Note 19 to our consolidated financial statements for additional details of our securitized debt
obligations.
Asset-Specific Debt
The following table details our asset-specific debt ($ in thousands):
September 30, 2026 | ||||||||||
Asset-Specific Debt | Count | Principal Balance | Book Value(1) | Wtd. Avg. Yield/Cost(2) | Wtd. Avg. Term(3) | |||||
Financing provided | 4 | $989,504 | $988,546 | + 2.75% | February 2030 | |||||
Collateral assets | 4 | $1,230,842 | $1,224,637 | + 4.12% | February 2030 | |||||
(1)The book value of underlying collateral assets excludes any applicable CECL reserves.
(2)The weighted-average all-in yield and cost are expressed as a spread over the relevant floating benchmark rates,
which include SOFR and CORRA, as applicable. These floating rate loans and related liabilities are currency and
index-matched to the applicable benchmark rate relevant in each arrangement. In addition to cash coupon, yield/cost
includes the amortization of deferred origination fees and financing costs.
(3)The weighted-average term is determined based on the maximum maturity of the corresponding loans, assuming all
extension options are exercised by the borrower. Our non-recourse, asset-specific debt is term-matched in each case
to the corresponding collateral loans.
Corporate Financing
The following table details our outstanding corporate financing ($ in thousands):
Corporate Financing Outstanding Principal Balance | |||
September 30, 2026 | December 31, 2025 | ||
Term loans | $1,910,224 | $1,847,726 | |
Senior secured notes | 1,235,316 | 785,316 | |
Convertible notes | 266,157 | 266,157 | |
Total corporate financings | $3,411,697 | $2,899,199 | |
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The following table details our outstanding senior term loan facilities, or Term Loans, our outstanding senior secured notes,
or Senior Secured Notes, and convertible senior notes, or Convertible Notes, as of September 30, 2026 ($ in thousands):
Corporate Financing | Face Value | Interest Rate(1) | Swapped Rate(2) | All-in Cost(1)(3) | Maturity | |||||
Term Loans | ||||||||||
B-7 Term Loan | $448,574 | + 2.50% | n/a | + 3.10% | May 9, 2029 | |||||
B-8 Term Loan | 694,750 | + 2.50% | n/a | + 2.95% | December 19, 2032 | |||||
B-9 Term Loan | 766,900 | + 2.50% | n/a | + 2.97% | December 10, 2030 | |||||
Total term loans | $1,910,224 | |||||||||
Senior Secured Notes | ||||||||||
October 2021 | $335,316 | 3.75% | n/a | 4.06% | January 15, 2027 | |||||
December 2024 | 450,000 | 7.75% | + 3.95% | 8.14% | December 1, 2029 | |||||
May 2026 | 450,000 | 6.25% | + 2.50% | 6.68% | June 1, 2031 | |||||
Total senior secured notes | $1,235,316 | |||||||||
Convertible Notes | ||||||||||
Convertible Notes(4) | $266,157 | 5.50% | n/a | 5.79% | March 15, 2027 | |||||
Total corporate financings | $3,411,697 |
(1)The B-7 Term Loan and B-9 Term Loan borrowings are subject to a benchmark interest rate floor of 0.50%.
(2)For certain of the Senior Secured Notes, we have entered into interest rate swaps that effectively convert our fixed
rate exposure to floating rate exposure. Refer to Note 11 and Note 13 to our consolidated financial statements for
further information.
(3)Includes issue discounts, transaction expenses, and/or issuance costs, as applicable, that are amortized through
interest expense over the life of each respective financing.
(4)The conversion price of the Convertible Notes is $36.27, which represents the price of class A common stock per
share based on a conversion rate of 27.5702. The conversion rate represents the number of shares of class A
common stock issuable per $1,000 principal amount of Convertible Notes. The cumulative dividend threshold has
not been exceeded as of September 30, 2026.
Refer to Notes 2, 10, 11, and 12 to our consolidated financial statements for further discussion of our Term Loans, Senior
Secured Notes, and Convertible Notes.
Floating Rate Loan Portfolio
Generally, our business model is such that rising interest rates will increase our net income, while declining interest rates
will decrease net income. However, in periods in which our floating rate liabilities exceed our floating rate assets, including
as a result of floating rate corporate debt or a greater concentration in owned real estate, loans on nonaccrual status, or
similar assets that do not generate floating rate interest income, rising interest rates may decrease our net income. As of
September 30, 2026, 96% of our loans by principal balance earned a floating rate of interest, primarily indexed to SOFR,
and were financed with liabilities that pay interest at floating rates, which resulted in an amount of net equity that is
positively correlated to rising interest rates, subject to the impact of interest rate floors on certain of our floating rate loans.
Our liabilities are generally currency and index-matched to each collateral asset, resulting in a net exposure to movements
in benchmark rates that varies by currency silo based on the relative proportion of floating rate assets and liabilities.
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The following table details our investment portfolio’s exposure to interest rates by currency as of September 30, 2026
(amounts in thousands):
USD | GBP | EUR | All Other(1) | ||||
Floating rate loans(2)(3)(4)(5) | $7,887,109 | £1,543,544 | €1,613,478 | $1,663,655 | |||
Floating rate portfolio financings(2)(5)(6)(7) | (6,419,891) | (1,288,265) | (1,193,972) | (1,318,814) | |||
Floating rate corporate financings(8) | (2,810,224) | — | — | — | |||
Net floating rate exposure | $(1,343,006) | £255,279 | €419,506 | $344,841 | |||
Net floating rate exposure in USD(9) | $(1,343,006) | $338,627 | $475,301 | $344,841 |
(1)Includes Australian Dollar and Canadian Dollar currencies.
(2)Our floating rate loans and related liabilities are currency and index-matched to the applicable benchmark rate
relevant in each arrangement.
(3)Excludes $1.3 billion of principal balance on floating rate impaired loans.
(4)Our loan agreements generally require our borrowers to purchase interest rate caps, which mitigates our borrowers’
exposure to an increase in interest rates.
(5)Excludes amounts related to our investments in unconsolidated entities and investments in debt securities.
(6)Includes amounts outstanding under secured debt, securitizations, and asset-specific debt. Excludes amounts related
to the indebtedness of unconsolidated entities.
(7)Excludes an interest rate swap with a $35.6 million notional amount that effectively converts our floating rate
liability to a fixed rate liability to align with the financed fixed rate loan exposure.
(8)Includes amounts outstanding under Term Loans, the Senior Secured Notes due 2029, and the Senior Secured Notes
due 2031. In connection with the issuance of the Senior Secured Notes due 2029 and Senior Secured Notes due
2031, we entered into interest rate swaps with an aggregate notional amount of $900.0 million to effectively convert
our fixed rate exposure to floating rate exposure for such notes.
(9)Represents the U.S. dollar equivalent as of September 30, 2026.
In addition to the risks related to fluctuations in cash flows and asset values associated with movements in interest rates,
there is also the risk of non-performance on floating rate assets. In the case of a significant increase in interest rates, the
cash flows of the collateral real estate assets may not be sufficient to pay debt service due under our loans, which may
contribute to non-performance or, in severe cases, default. This risk is partially mitigated by our consideration of rising rate
stress-testing during our underwriting process, which generally includes a requirement for our borrower to purchase an
interest rate cap contract with an unaffiliated third party, provide an interest reserve deposit, and/or provide interest
guarantees or other structural protections.
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IV. Our Results of Operations
Operating Results
The following table sets forth information regarding our consolidated results of operations for the three months ended
September 30, 2026 and June 30, 2026 ($ in thousands, except per share data):
Three Months Ended | Change | ||||
September 30, 2026 | June 30, 2026 | $ | |||
Income from loans and other investments | |||||
Interest and related income | $280,614 | $309,748 | $(29,134) | ||
Less: Interest and related expenses | 216,192 | 227,182 | (10,990) | ||
Income from loans and other investments, net | 64,422 | 82,566 | (18,144) | ||
Revenue from owned real estate | 77,481 | 75,497 | 1,984 | ||
Total net revenue | 141,903 | 158,063 | (16,160) | ||
Expenses | |||||
Management and incentive fees | 14,481 | 14,641 | (160) | ||
General and administrative expenses | 13,034 | 14,918 | (1,884) | ||
Expenses from owned real estate | 81,222 | 81,440 | (218) | ||
Total expenses | 108,737 | 110,999 | (2,262) | ||
Increase in current expected credit loss reserve | (264,766) | (134,403) | (130,363) | ||
Income from unconsolidated entities | 5,489 | 8,570 | (3,081) | ||
Impairment of owned real estate | (36,371) | — | (36,371) | ||
Valuation adjustment on loans receivable, held-for-sale | (63,909) | — | (63,909) | ||
Other income, net | 2 | 3 | (1) | ||
Loss before income taxes | (326,389) | (78,766) | (247,623) | ||
Income tax provision | 1,256 | 2,501 | (1,245) | ||
Net loss | (327,645) | (81,267) | (246,378) | ||
Net loss attributable to non-controlling interests | 640 | 45 | 595 | ||
Net loss attributable to Blackstone Mortgage Trust, Inc. | $(327,005) | $(81,222) | $(245,783) | ||
Net loss per share of common stock, basic and diluted | $(1.95) | $(0.48) | $(1.47) | ||
Weighted-average shares of common stock outstanding, basic and diluted | 167,959,467 | 168,964,515 | (1,005,048) | ||
Dividends declared per share | $0.47 | $0.47 | $— | ||
Income from loans and other investments, net
Income from loans and other investments, net decreased $18.1 million during the three months ended September 30, 2026
compared to the three months ended June 30, 2026. The decrease was primarily driven by (i) a decrease in interest income
due to a $1.9 billion decrease in the weighted-average principal balance of our loan portfolio, and (ii) a decline in interest
income related to additional loans accounted for under the cost-recovery method during the three months ended
September 30, 2026. These decreases were partially offset by a decrease in interest expense due to a $1.5 billion decrease
in the weighted-average principal balance of our outstanding financing arrangements during the three months ended
September 30, 2026.
Revenue from owned real estate
Revenue from owned real estate increased by $2.0 million during the three months ended September 30, 2026 compared to
the three months ended June 30, 2026. The increase was primarily due to the three months ended September 30, 2026
representing the first full quarter of revenue from one additional owned real estate asset that was acquired during the three
months ended June 30, 2026. This increase was partially offset by the seasonality of the operations at our hospitality assets.
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Expenses
Expenses include management and incentive fees payable to our Manager, general and administrative expenses, and
expenses from owned real estate. Expenses decreased by $2.3 million during the three months ended September 30, 2026
compared to the three months ended June 30, 2026, primarily due to (i) a $1.9 million decrease in general and
administrative expenses driven by costs incurred in connection with the formation of our Homebuilder Finance Joint
Venture during the three months ended June 30, 2026, and (ii) a $0.2 million decrease in expenses from owned real estate,
primarily due to a $6.1 million decrease in tax expense from the benefit of a property tax abatement received by one of our
owned real estate assets during the three months ended September 30, 2026, which was mostly offset by the three months
ended September 30, 2026 representing the first full quarter of expenses from one additional owned real estate asset that
was acquired during the three months ended June 30, 2026.
Changes in current expected credit loss reserve
During the three months ended September 30, 2026, we recorded a $264.8 million increase in our CECL reserves, as
compared to a $134.4 million increase during the three months ended June 30, 2026. The increase during the three months
ended September 30, 2026 was primarily due to an increase in our asset-specific CECL reserves, driven by six additional
loans that were impaired during the three months ended September 30, 2026. This was partially offset by a decrease in our
general CECL reserves driven by changes in risk ratings, including the impact of the six newly impaired loans moving out
of the general CECL reserve pool, and a decrease in our loans receivable, held-for-investment balance, partially offset by
an increase in the historical loss rate used in reserve calculations related to the additional reserve charge-offs.
We may be required to record further increases to our CECL reserves in the future, depending on the performance of our
loan portfolio and changes in broader market conditions, and there may be volatility in the level of our CECL reserves.
Any such reserve increases are difficult to predict, but are expected to be primarily the result of incremental loan
impairments resulting from changes in the specific credit quality factors of such loans and to be concentrated in our loans
receivable with a risk rating of “4” as of September 30, 2026.
Income from unconsolidated entities
During the three months ended September 30, 2026, we recorded income from unconsolidated entities of $5.5 million
compared to $8.6 million during the three months ended June 30, 2026. This decrease was primarily due to lower income
from our Bank Loan Portfolio Joint Venture as a result of unrealized losses on the fair value adjustment of the portfolio
during the three months ended September 30, 2026, compared to unrealized gains during the three months ended June 30,
2026.
Impairment of owned real estate
During the three months ended September 30, 2026, we recognized an aggregate $36.4 million of impairment charges
related to three owned real estate assets as a result of updated undiscounted cash flow assumptions, primarily to account for
shorter expected hold periods. We did not recognize impairment charges during the three months ended June 30, 2026.
Valuation adjustment on loans receivable, held-for-sale
During the three months ended September 30, 2026, we recognized a $63.9 million valuation adjustment on loans
receivable, held-for-sale related to eight whole loans that were transferred to held-for-sale as of September 30, 2026. The
adjustment reflects the difference between the loans’ carrying value and fair value. We did not recognize such a valuation
adjustment during the three months ended June 30, 2026.
Income tax provision
The income tax provision decreased by $1.2 million during the three months ended September 30, 2026 compared to the
three months ended June 30, 2026, primarily due to a decrease in the income tax provisions related to our taxable REIT
subsidiaries.
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Dividends per share
During the three months ended September 30, 2026, we declared dividends of $0.47 per share, or $78.0 million in
aggregate. During the three months ended June 30, 2026, we declared dividends of $0.47 per share, or $79.2 million in
aggregate.
The following table sets forth information regarding our consolidated results of operations for the nine months ended
September 30, 2026 and 2025 ($ in thousands, except per share data):
Nine Months Ended September 30, | Change | ||||
2026 | 2025 | $ | |||
Income from loans and other investments | |||||
Interest and related income | $895,919 | $1,037,553 | $(141,634) | ||
Less: Interest and related expenses | 664,110 | 754,015 | (89,905) | ||
Income from loans and other investments, net | 231,809 | 283,538 | (51,729) | ||
Revenue from owned real estate | 227,572 | 109,578 | 117,994 | ||
Total net revenue | 459,381 | 393,116 | 66,265 | ||
Expenses | |||||
Management and incentive fees | 43,935 | 51,120 | (7,185) | ||
General and administrative expenses | 41,933 | 38,937 | 2,996 | ||
Expenses from owned real estate | 244,637 | 137,198 | 107,439 | ||
Total expenses | 330,505 | 227,255 | 103,250 | ||
Increase in current expected credit loss reserve | (454,224) | (94,111) | (360,113) | ||
Income from unconsolidated entities | 15,442 | 1,035 | 14,407 | ||
Net loss on disposition of owned real estate | (160) | — | (160) | ||
Impairment of owned real estate | (36,371) | — | (36,371) | ||
Valuation adjustment on loans receivable, held-for-sale | (63,909) | — | (63,909) | ||
Other income, net | 9 | 389 | (380) | ||
(Loss) income before income taxes | (410,337) | 73,174 | (483,511) | ||
Income tax provision | 4,915 | 3,133 | 1,782 | ||
Net (loss) income | (415,252) | 70,041 | (485,293) | ||
Net loss (income) attributable to non-controlling interests | 728 | (32) | 760 | ||
Net (loss) income attributable to Blackstone Mortgage Trust, Inc. | $(414,524) | $70,009 | $(484,533) | ||
Net (loss) income per share of common stock, basic and diluted | $(2.46) | $0.41 | $(2.87) | ||
Weighted-average shares of common stock outstanding, basic and diluted | 168,663,353 | 171,903,127 | (3,239,774) | ||
Dividends declared per share | $1.41 | $1.41 | $— | ||
Income from loans and other investments, net
Income from loans and other investments, net decreased $51.7 million during the nine months ended September 30, 2026
compared to the nine months ended September 30, 2025. The decrease was primarily due to (i) a $1.8 billion decrease in
the weighted-average principal balance of our loan portfolio, and (ii) a decline in interest income related to additional loans
accounted for under the cost-recovery method or loans that are now accounted for as owned real estate assets during the
nine months ended September 30, 2026. These decreases were partially offset by a decrease in interest expense due to (i) a
$261.9 million decrease in the weighted-average principal balance of our outstanding financing arrangements, and (ii)
declines in floating-rate indices.
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Revenue from owned real estate
Revenue from owned real estate increased by $118.0 million during the nine months ended September 30, 2026 compared
to the nine months ended September 30, 2025, primarily due to the acquisition or consolidation of five additional owned
real estate assets.
Expenses
Expenses include management and incentive fees payable to our Manager, general and administrative expenses, and
expenses from owned real estate. Expenses increased by $103.3 million during the nine months ended September 30, 2026
compared to the nine months ended September 30, 2025 primarily due to (i) a $107.4 million increase in expenses from
owned real estate due to the acquisition or consolidation of five additional owned real estate assets, and (ii) a $3.0 million
increase in general and administrative expenses due to an increase in professional service fees, partially offset by lower
restricted stock amortization. These increases were partially offset by a $7.2 million decrease in management fees payable
to our Manager, due to lower Equity, as defined in our Management Agreement, primarily resulting from charge-offs of
CECL reserves and repurchases of class A common shares.
Changes in current expected credit loss reserve
During the nine months ended September 30, 2026, we recorded a $454.2 million increase in our CECL reserves, as
compared to a $94.1 million increase during the nine months ended September 30, 2025. The increase during the nine
months ended September 30, 2026 was primarily due to an increase in our asset-specific CECL reserves, driven by 11
additional loans that were impaired during the nine months ended September 30, 2026. This was partially offset by a
decrease in our general CECL reserves driven by changes in risk ratings, including the impact of the 11 newly impaired
loans moving out of the general CECL reserve, partially offset by an increase in the historical loss rate used in reserve
calculations related to the additional CECL charge-offs.
We may be required to record further increases to our CECL reserves in the future, depending on the performance of our
loan portfolio and changes in broader market conditions, and there may be volatility in the level of our CECL reserves.
Any such reserve increases are difficult to predict, but are expected to be primarily the result of incremental loan
impairments resulting from changes in the specific credit quality factors of such loans and to be concentrated in our loans
receivable with a risk rating of “4” as of September 30, 2026.
Income from unconsolidated entities
During the nine months ended September 30, 2026, we recorded income from unconsolidated entities of $15.4 million
compared to income of $1.0 million during the nine months ended September 30, 2025. The increase was primarily due to
(i) higher earnings from our Bank Loan Portfolio Joint Venture, primarily due to realized gains on loan repayments within
the portfolio, (ii) higher earnings from our Net Lease Joint Venture reflecting growth in the portfolio, and (iii) earnings
generated by our Homebuilder Finance Joint Venture, which was formed during the nine months ended September 30,
2026.
Impairment of owned real estate
During the nine months ended September 30, 2026, we recognized an aggregate $36.4 million of impairment charges
related to three owned real estate assets as a result of updated undiscounted cash flow assumptions, primarily to account for
shorter expected hold periods. We did not recognize impairment charges during the nine months ended September 30,
2025.
Valuation adjustment on loans receivable, held-for-sale
During the nine months ended September 30, 2026, we recognized a $63.9 million valuation adjustment on loans
receivable, held-for-sale related to eight whole loans that were transferred to held-for-sale as of September 30, 2026. The
adjustment reflects the difference between the loans’ carrying value and fair value. We did not recognize such a valuation
adjustment during the nine months ended September 30, 2025.
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Income tax provision
The income tax provision increased by $1.8 million during the nine months ended September 30, 2026 as compared to the
nine months ended September 30, 2025, due to an increase in the income tax provisions related to our taxable REIT
subsidiaries.
Dividends per share
During the nine months ended September 30, 2026, we declared dividends of $1.41 per share, or $236.5 million in
aggregate. During the nine months ended September 30, 2025, we declared dividends of $1.41 per share, or $241.5 million
in aggregate.
V. Liquidity and Capital Resources
Capitalization
We have capitalized our business to date primarily through the issuance and sale of shares of our class A common stock,
corporate debt, and asset-level financings. As of September 30, 2026, our capitalization structure included $2.8 billion of
common equity, $3.4 billion of corporate debt, and $10.8 billion of asset-level financings. Our $3.4 billion of corporate
debt includes $1.9 billion of Term Loan borrowings, $1.2 billion of Senior Secured Notes, and $266.2 million of
Convertible Notes. Our $10.8 billion of asset-level financings includes $7.2 billion of secured debt, $2.7 billion of
securitizations, and $989.5 million of asset-specific debt. Our asset-level financings are generally structured to provide
currency, index and term-matched financing without capital markets-based mark-to-market provisions.
As of September 30, 2026, we had $1.3 billion of liquidity that can be used to satisfy our short-term cash requirements and
as working capital for our business.
Refer to Notes 6, 7, 8, 9, 10, 11, and 12 to our consolidated financial statements for additional details regarding our other
secured debt, secured debt, securitized debt obligations, asset-specific debt, Term Loans, Senior Secured Notes, and
Convertible Notes, respectively.
Debt-to-Equity Ratio and Total Leverage Ratio
The following table presents our debt-to-equity ratio and total leverage ratio:
September 30, 2026 | December 31, 2025 | ||
Debt-to-equity ratio(1)(2) | 3.9x | 3.9x | |
Total leverage ratio(1)(3) | 4.9x | 4.5x |
(1)The debt and leverage amounts included in the calculations above use gross outstanding principal balances,
excluding any unamortized deferred financing costs and discounts.
(2)Represents, in each case at period end, the ratio of (i) total outstanding secured debt, other secured debt, asset-
specific debt, Term Loans, Senior Secured Notes, and convertible notes, less cash, to (ii) total equity.
(3)Represents, in each case at period end, the ratio of (i) total outstanding secured debt, other secured debt,
securitizations, asset-specific debt, Term Loans, Senior Secured Notes, and convertible notes, less cash, to (ii) total
equity.
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Sources of Liquidity
Our primary sources of liquidity include cash and cash equivalents, available borrowings under our secured debt facilities,
and net receivables from servicers related to loan repayments, which are set forth in the following table ($ in thousands):
September 30, 2026 | December 31, 2025 | ||
Cash and cash equivalents | $511,504 | $452,526 | |
Available borrowings under secured debt | 782,280 | 551,552 | |
Loan principal payments held by servicer, net(1) | 8,576 | 15,626 | |
$1,302,360 | $1,019,704 |
(1)Represents loan principal payments held by our third-party servicers as of the balance sheet date, which were
remitted to us during the subsequent remittance cycle, net of the related secured debt balance.
During the nine months ended September 30, 2026, we generated cash flow from operating activities of $216.5 million and
received $4.0 billion from loan principal collections, sales proceeds, and cost-recovery proceeds. Furthermore, we are able
to generate incremental liquidity through provisions of certain of our CLOs, which allow us to effectively replace, for a
period of time, a repaid loan in the CLO with additional eligible CLO collateral to maintain the aggregate amount of
collateral assets in the CLO, and the related financing outstanding.
We have access to further liquidity through public and private offerings of equity and debt securities, syndicated term
loans, asset sales, and similar transactions. To facilitate public offerings of securities, in July 2025, we filed a shelf
registration statement with the SEC that is effective for a term of three years and expires in July 2028. The amount of
securities to be issued pursuant to this shelf registration statement was not specified when it was filed and there is no
specific dollar limit on the amount of securities we may issue. The securities covered by this registration statement include:
(i) class A common stock; (ii) preferred stock; (iii) depositary shares representing preferred stock; (iv) debt securities; (v)
warrants; (vi) subscription rights; (vii) purchase contracts; and (viii) units consisting of one or more of such securities or
any combination of these securities. The specifics of any future offerings, along with the use of proceeds of any securities
offered, will be described in detail in a prospectus supplement, or other offering materials, at the time of any offering.
We may also access liquidity through our dividend reinvestment plan and direct stock purchase plan, under which
9,938,472 shares of class A common stock were available for issuance as of September 30, 2026, and our “at the market”
common stock offering program, pursuant to which we may sell, from time to time, up to $480.9 million of additional
shares of our class A common stock as of September 30, 2026. Refer to Note 14 to our consolidated financial statements
for additional details.
Uses of Liquidity
In addition to funding our lending and other investment activity and our general operating expenses, our primary uses of
liquidity include interest and principal payments with respect to our outstanding borrowings under secured debt, our asset-
specific debt, our Term Loans, our Senior Secured Notes, and our Convertible Notes. From time to time, we have
repurchased and may continue to repurchase our outstanding debt or shares of our class A common stock. Such
repurchases, if any, will depend on prevailing market conditions, our liquidity requirements, contractual restrictions, and
other factors. The amounts involved in any such purchase transactions, individually or in the aggregate, may be material.
In October 2025, our board of directors authorized the repurchase of up to $150.0 million of shares of our class A common
stock under our repurchase program. Repurchases may be made from time to time in open market transactions, in privately
negotiated transactions, in agreements and arrangements structured in a manner consistent with Rules 10b-18 and 10b5-1
under the Exchange Act or otherwise. The timing and the actual amounts repurchased will depend on a variety of factors,
including legal requirements, price and economic and market conditions. The repurchase program may be changed,
suspended or discontinued at any time and does not have a specified expiration date.
During the nine months ended September 30, 2026, we repurchased 2,766,237 shares of class A common stock at a
weighted-average price per share of $14.39, for a total cost of $39.8 million. As of September 30, 2026, the amount
remaining available for repurchases under the program was $109.8 million.
As of September 30, 2026, we had unfunded commitments of $951.0 million related to 47 loans receivable and $539.6
million of committed or identified financing for those commitments resulting in net unfunded commitments of $411.4
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million. The unfunded loan commitments comprise funding for capital expenditures and construction, leasing costs, and
interest and carry costs. Loan funding commitments are generally subject to certain conditions, including, without
limitation, the progress of capital projects, leasing, and cash flows at the properties securing our loans. Therefore, the exact
timing and amounts of such future loan fundings are uncertain and will depend on the current and future performance of
the underlying collateral assets. We expect to fund our loan commitments over the remaining term of the related loans,
which have a weighted-average future funding period of 1.6 years.
Contractual Obligations and Commitments
Our contractual obligations and commitments as of September 30, 2026 were as follows ($ in thousands):
Payment Timing | |||||||||
Total Obligation | Less Than 1 Year(1) | 1 to 3 Years | 3 to 5 Years | More Than 5 Years | |||||
Unfunded loan commitments(2) | $950,970 | $270,084 | $577,599 | $103,287 | $— | ||||
Principal repayments under secured debt(3) | 7,192,910 | 1,942,173 | 1,890,157 | 3,058,834 | 301,746 | ||||
Principal repayments under asset-specific debt(3) | 989,504 | — | 460,957 | 528,547 | — | ||||
Principal repayments of term loans(4) | 1,910,224 | 19,239 | 473,458 | 757,778 | 659,749 | ||||
Principal repayments of senior secured notes | 1,235,316 | 335,316 | — | 900,000 | — | ||||
Principal repayments of convertible notes(5) | 266,157 | 266,157 | — | — | — | ||||
Principal repayments of other secured debt(6) | 72,639 | — | — | 72,639 | — | ||||
Interest payments(3)(7) | 2,001,024 | 606,959 | 920,373 | 399,192 | 74,500 | ||||
Total(8) | $14,618,744 | $3,439,928 | $4,322,544 | $5,820,277 | $1,035,995 | ||||
(1)Represents known and estimated short-term cash requirements related to our contractual obligations and
commitments. Refer to “Sources of Liquidity” above for information about our sources of funds to satisfy our short-
term cash requirements.
(2)The allocation of our unfunded loan commitments is based on the earlier of the commitment expiration date or the
final loan maturity date; however, we may be obligated to fund these commitments earlier than such date.
(3)Our secured debt and asset-specific debt agreements are generally term-matched to their underlying collateral.
Therefore, the allocation of both principal and interest payments under such agreements is generally allocated based
on the maximum maturity date of the collateral loans, assuming all extension options are exercised by the borrower.
In limited instances, the maturity date of the respective debt agreement is used.
(4)The Term Loans are partially amortizing, with an amount equal to 1.0% per annum of the initial principal balance
due in quarterly installments. Refer to Note 10 to our consolidated financial statements for further details on our
Term Loans.
(5)Reflects the outstanding principal balance of Convertible Notes, excluding any potential conversion premium. Refer
to Note 12 to our consolidated financial statements for further details on our Convertible Notes.
(6)Amounts are included in other liabilities on our consolidated balance sheets.
(7)Represents interest payments on our secured debt, asset-specific debt, Term Loans, Senior Secured Notes,
Convertible Notes, and other secured debt. Future interest payment obligations are estimated assuming the interest
rates in effect as of September 30, 2026 will remain constant into the future. This is only an estimate as actual
amounts borrowed and interest rates will vary over time.
(8)Total does not include $2.7 billion of consolidated securitized debt obligations, as the satisfaction of these liabilities
will not require cash outlays from us.
We are also required to settle our foreign exchange and interest rate derivatives with our derivative counterparties upon
maturity which, depending on foreign currency exchange and interest rate movements, may result in cash received from or
due to such counterparties. The table above does not include these amounts as they are not fixed and determinable. Refer to
Note 13 to our consolidated financial statements for details regarding our derivative contracts.
We are required to pay our Manager a base management fee, an incentive fee, and reimbursements for certain expenses
pursuant to our Management Agreement. The table above does not include the amounts payable to our Manager under our
Management Agreement as they are not fixed and determinable. Refer to Note 15 to our consolidated financial statements
for additional terms and details of the fees payable under our Management Agreement.
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As a REIT, we generally must distribute substantially all of our net taxable income to stockholders in the form of dividends
to comply with the REIT provisions of the Internal Revenue Code. Our taxable income does not necessarily equal our net
income as calculated in accordance with GAAP, or our Distributable Earnings as described above.
Cash Flows
The following table provides a breakdown of the net change in our cash and cash equivalents ($ in thousands):
Nine Months Ended September 30, | |||
2026 | 2025 | ||
Cash flows provided by operating activities | $216,483 | $139,565 | |
Cash flows provided by investing activities | 1,934,529 | 601,564 | |
Cash flows used in financing activities | (2,089,077) | (694,160) | |
Net increase in cash and cash equivalents | $61,935 | $46,969 | |
We experienced a net increase in cash and cash equivalents of $61.9 million for the nine months ended September 30,
2026, compared to a net increase of $47.0 million for the nine months ended September 30, 2025. During the nine months
ended September 30, 2026, we (i) received $4.0 billion from loan principal collections, sales proceeds, and cost-recovery
proceeds, (ii) received $880.0 million of net proceeds from the issuance of a securitized debt obligation, (iii) received
$450.0 million of net proceeds from the issuance of Senior Secured Notes, (iv) received a net $72.1 million under our
secured term loan borrowings, and (v) received aggregate distributions of $58.8 million from unconsolidated entities, from
both our Bank Loan Portfolio Joint Venture as a result of repayments, and our Net Lease Joint Venture as a result of
refinancing its portfolio through an asset-backed securitization transaction. Also, during the nine months ended
September 30, 2026, we (i) funded $1.8 billion of loans, (ii) repaid a net $2.8 billion of secured debt borrowings and asset-
specific financings, (iii) repaid $371.3 million of securitized debt obligations, (iv) paid $237.6 million of dividends on our
class A common stock, and (v) invested $186.2 million in unconsolidated entities.
Refer to Note 3 to our consolidated financial statements for further discussion of our loan activity. Refer to Notes 5, 7, 8,
and 14 to our consolidated financial statements for further discussion of our investments in unconsolidated entities, secured
debt, securitized debt obligations, and equity, respectively.
VI. Other Items
Income Taxes
We have elected to be taxed as a REIT under the Internal Revenue Code for U.S. federal income tax purposes. We
generally must distribute annually at least 90% of our net taxable income, subject to certain adjustments and excluding any
net capital gain, in order for U.S. federal income tax not to apply to our earnings. To the extent that we satisfy this
distribution requirement, but distribute less than 100% of our net taxable income, we will be subject to U.S. federal income
tax on our undistributed taxable income. In addition, we will be subject to a 4% nondeductible excise tax if the actual
amount that we pay out to our stockholders in a calendar year is less than a minimum amount specified under U.S. federal
tax laws.
Our qualification as a REIT also depends on our ability to meet various other requirements imposed by the Internal
Revenue Code, which relate to organizational structure, diversity of stock ownership, and certain restrictions with regard to
the nature of our assets and the sources of our income. Even if we qualify as a REIT, we may be subject to certain U.S.
federal income and excise taxes and state and local taxes on our income and assets. If we fail to maintain our qualification
as a REIT for any taxable year, we may be subject to material penalties as well as federal, state, and local income tax on
our taxable income at regular corporate rates and we would not be able to qualify as a REIT for the subsequent four full
taxable years. As of September 30, 2026 and December 31, 2025, we were in compliance with all REIT requirements.
Furthermore, our taxable REIT subsidiaries are subject to federal, state, and local income tax on their net taxable income.
Refer to Note 16 to our consolidated financial statements for further discussion of our income taxes.
85
Critical Accounting Policies
Our discussion and analysis of our financial condition and results of operations is based upon our consolidated financial
statements, which have been prepared in accordance with GAAP. The preparation of these financial statements requires us
to make estimates and assumptions that affect the reported amounts of assets, liabilities, revenue and expenses, and related
disclosure of contingent assets and liabilities. Actual results could differ from these estimates. We evaluated our critical
accounting policies and believe them to be appropriate. The following is a summary of our significant accounting policies
that we believe are the most affected by our judgments, estimates, and assumptions:
Current Expected Credit Losses
The current expected credit loss, or CECL, reserve required under the FASB Accounting Standards Codification, or ASC,
Topic 326 “Financial Instruments – Credit Losses,” or ASC 326, reflects our current estimate of potential credit losses
related to our portfolio. We estimate our CECL reserves primarily using the Weighted-Average Remaining Maturity, or
WARM method, which has been identified as an acceptable loss-rate method for estimating CECL reserves in the Financial
Accounting Standards Board Staff Q&A Topic 326, No. 1. Estimating the CECL reserve requires judgment, including the
following assumptions:
•Historical loan loss reference data: To estimate the historical loan losses relevant to our portfolio, we have
augmented our historical loan performance with market loan loss data licensed from Trepp LLC. This database
includes commercial mortgage-backed securities, or CMBS, issued since January 1, 1999 through August 31,
2026. Within this database, we focused our historical loss reference calculations on the most relevant subset of
available CMBS data, which we determined based on loan metrics that are most comparable to our loan portfolio,
including asset type, geography, and origination loan-to-value, or LTV. We believe this CMBS data, which
includes month-over-month loan and property performance, is the most relevant, available, and comparable
dataset to our portfolio.
•Expected timing and amount of future loan fundings and repayments: Expected credit losses are estimated over
the contractual term of each loan, adjusted for expected repayments. As part of our quarterly review of our loan
portfolio, we assess the expected repayment date of each loan, which is used to determine the contractual term for
purposes of computing our CECL reserves. Additionally, the expected credit losses over the contractual period of
our loans are subject to the obligation to extend credit through our unfunded loan commitments. The CECL
reserve for unfunded loan commitments is adjusted quarterly, as we consider the expected timing of future
funding obligations over the estimated life of the loan. The considerations in estimating our CECL reserve for
unfunded loan commitments are similar to those used for the related outstanding loans receivable.
•Current credit quality of our portfolio: Our risk rating is our primary credit quality indicator in assessing our
CECL reserves. We perform a quarterly risk review of our portfolio of loans and assign each loan a risk rating
based on a variety of factors, including, without limitation, origination LTV, debt yield, property type, geographic
and local market dynamics, physical condition, cash flow volatility, leasing and tenant profile, loan structure and
exit plan, and project sponsorship.
•Expectations of performance and market conditions: Our CECL reserves are adjusted to reflect our estimation of
the current and future economic conditions that impact the performance of the commercial real estate assets
securing our loans. These estimations include unemployment rates, interest rates, expectations of inflation and/or
recession, and other macroeconomic factors impacting the likelihood and magnitude of potential credit losses for
our loans during their anticipated term. In addition to the CMBS data we have licensed from Trepp LLC, we have
also licensed certain macroeconomic financial forecasts to inform our view of the potential future impact that
broader economic conditions may have on our loan portfolio’s performance. We generally also incorporate
information from other sources, including information and opinions available to our Manager, to further inform
these estimations. This process requires significant judgments about future events that, while based on the
information available to us as of the balance sheet date, are ultimately indeterminate and the actual economic
condition impacting our portfolio could vary significantly from the estimates we made as of September 30, 2026.
•Impairment: Impairment is indicated when it is deemed probable that we will not be able to collect all amounts
due to us pursuant to the contractual terms of the loan. Determining that a loan is impaired requires significant
judgment from management and is based on several factors including (i) the underlying collateral performance,
(ii) discussions with the borrower, (iii) borrower events of default, and (iv) other facts that impact the borrower’s
ability to pay the contractual amounts due under the terms of the loan. If a loan is determined to be impaired, we
record the impairment as a component of our CECL reserves by applying the practical expedient for collateral
dependent loans. The CECL reserves are assessed on an individual basis for these loans by comparing the
estimated fair value of the underlying collateral to the book value of the respective loan. These valuations require
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significant judgments, which include assumptions regarding capitalization rates, discount rates, leasing,
creditworthiness of major tenants, occupancy rates, availability and cost of financing, exit plan, loan sponsorship,
actions of other lenders, and other factors deemed relevant by us. Actual losses, if any, could ultimately differ
materially from these estimates. We only expect to charge off the impairment losses in our consolidated financial
statements prepared in accordance with GAAP if and when such amounts are deemed non-recoverable. This is
generally at the time a loan is repaid or foreclosed, or the underlying collateral assets are otherwise consolidated.
However, non-recoverability may also be concluded if, in our determination, it is nearly certain that all amounts
due will not be collected.
These assumptions vary from quarter-to-quarter as our loan portfolio changes and market and economic conditions evolve.
The sensitivity of each assumption and its impact on the CECL reserves may change over time and from period to period.
During the nine months ended September 30, 2026, our CECL reserves increased by $310.3 million, bringing our total
reserves to $606.4 million as of September 30, 2026. Refer to Notes 2, 3, and 6 to our consolidated financial statements for
further discussion of our CECL reserves.
Revenue Recognition
Interest income from our loans receivable portfolio is recognized over the life of each loan using the effective interest
method and is recorded on the accrual basis. Recognition of fees, premiums, and discounts associated with these
investments is deferred and recorded over the term of the loan as an adjustment to yield. Income accrual is generally
suspended for loans at the earlier of the date at which payments become 90 days past due or when, in our opinion, recovery
of income and principal becomes doubtful. Interest received is then recorded as income or as a reduction in the amortized
cost basis, based on the specific facts and circumstances, until accrual is resumed when the loan becomes contractually
current and performance is demonstrated to be resumed. In addition, for loans we originate, the related origination expenses
are deferred and recognized as a reduction to interest income; however, expenses related to loans we acquire are included
in general and administrative expenses as incurred.
The sources of revenue from our owned real estate assets, which are included in revenue from owned real estate on our
consolidated statements of operations, and the related revenue recognition policies are as follows:
Rental income primarily consists of base rent income arising from tenant leases at our office and multifamily properties.
We determine if an arrangement is a lease at contract inception, which is subject to the provisions of Financial Accounting
Standards Board, or FASB, Accounting Standards Codification, or ASC, Topic 842 “Leases.” Base rent is recognized on a
straight-line basis over the life of the lease, including any rent steps or abatement provisions. We begin to recognize
revenue upon the acquisition of the related property or when a tenant takes possession of the leased space.
Other operating income primarily consists of income from our hospitality properties and tenant reimbursement income.
Revenue from our hospitality properties consists primarily of room revenue and food and beverage revenue. Room revenue
is recognized when the related room is occupied and other hospitality revenue is recognized when the service is rendered.
Tenant reimbursement income primarily consists of amounts due from tenants for costs related to common area
maintenance, real estate taxes, and other recoverable costs included in lease agreements.
We evaluate the collectability of receivables related to rental revenue on an individual lease basis and exercise judgment in
assessing collectability considering the length of time a receivable has been outstanding, tenant creditworthiness, payment
history, available information about the financial condition of the tenant, and current economic trends, among other factors.
Tenant receivables that are deemed uncollectible are recognized as a reduction to rental revenue.
Owned Real Estate
We may assume legal title, physical possession, or control of the collateral underlying a loan through a foreclosure, a deed-
in-lieu of foreclosure transaction, or a loan modification in which we receive an equity interest in and/or control over
decision-making at the property, resulting in us consolidating the real estate assets as VIEs. These real estate acquisitions
are classified as owned real estate on our consolidated balance sheet and are initially recognized at fair value on the
acquisition date in accordance with the ASC Topic 805, “Business Combinations,” or ASC 805.
Upon acquisition of owned real estate assets, we assess the fair value of acquired tangible and intangible assets, which may
include land, buildings, tenant improvements, “above-market” and “below-market” leases, acquired in-place leases, other
identified intangible assets and assumed liabilities, as applicable, and allocate the fair value to the acquired assets and
assumed liabilities. We assess and consider fair value based on estimated cash flow projections that utilize discount and/or
capitalization rates that we deem appropriate, as well as other available market information. Estimates of future cash flows
87
are based on a number of factors, including the historical operating results, known and anticipated trends, and market and
economic conditions. We capitalize acquisition-related costs associated with asset acquisitions.
Real estate assets held for investment, except for land, are depreciated using the straight-line method over the assets’
estimated useful lives of up to 40 years for buildings, 15 years for land improvements, and 10 years for building and tenant
improvements. Renovations and/or replacements that improve or extend the life of the asset are capitalized and depreciated
over their estimated useful lives. Lease intangibles are amortized over the remaining term of applicable leases on a straight-
line basis. The cost of ordinary repairs and maintenance is expensed as incurred.
Real estate assets held for investment are assessed for impairment on a quarterly basis. If the depreciated cost basis of the
asset exceeds the undiscounted cash flows over the remaining holding period, the asset is considered for impairment. The
impairment loss is recognized when the carrying value of the real estate assets exceeds their fair value. The evaluation of
anticipated future cash flows is highly subjective and is based in part on assumptions regarding future occupancy, rental
rates, capital requirements and anticipated holding periods that could differ materially from actual results.
Real estate assets are classified as held-for-sale in the period when they meet the criteria under the ASC Topic 360
“Property, Plant, and Equipment.” Once a real estate asset is classified as held-for-sale, depreciation is suspended and the
asset is reported at the lower of its carrying value or fair value less costs to sell. If circumstances arise and we decide not to
sell a real estate asset previously classified as held-for-sale, the real estate asset is reclassified as held for investment. Upon
reclassification, the real estate asset is measured at the lower of (i) its carrying amount prior to classification as held-for-
sale, adjusted for depreciation expense that would have been recognized had the real estate been classified as held for
investment, and (ii) its estimated fair value at the time of reclassification.
As of September 30, 2026, we had 15 owned real estate assets that were all classified as held for investment.
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VII. Loan Portfolio Details
The following table provides details of our loan portfolio, on a loan-by-loan basis, as of September 30, 2026 ($ in millions):
Senior Loan Portfolio, Held-For-Investment(1) | ||||||||||||||||||||||||||
Property Type | Location | Origination Date(2) | Total Commitment(3) | Principal Balance | Amortized Cost Basis(4) | Cash Coupon(5) | All-in Yield(5) | Maximum Maturity(6) | Loan Per SQFT / Unit / Key / Acre / MW | Origination LTV(2) | Risk Rating | |||||||||||||||
1 | Hospitality | Diversified, AU | 6/24/2022 | $917 | $917 | $914 | +4.75 | % | +4.93 | % | 6/21/2030 | $417 / sqft | 59% | 3 | ||||||||||||
2 | Mixed-Use | Austin | 6/28/2022 | 675 | 576 | 574 | +4.60 | % | +5.08 | % | 7/9/2029 | $479 / sqft | 53% | 3 | ||||||||||||
3 | Mixed-Use | Diversified, Spain | 3/22/2018 | 449 | 449 | 449 | +2.00 | % | +2.00 | % | 3/15/2036 | n / a | 71% | 3 | ||||||||||||
4 | Self-Storage | Diversified, CAN | 2/20/2025 | 439 | 439 | 439 | +3.50 | % | +3.50 | % | 2/9/2030 | $151 / sqft | 58% | 2 | ||||||||||||
5 | Industrial | Diversified, US | 10/28/2025 | 419 | 419 | 416 | +2.65 | % | +3.01 | % | 11/9/2030 | $100 / sqft | 78% | 3 | ||||||||||||
6 | Mixed-Use | New York | 12/9/2021 | 385 | 385 | 384 | +2.76 | % | +3.00 | % | 12/9/2026 | $132 / sqft | 50% | 3 | ||||||||||||
7 | Office | Chicago | 12/11/2018 | 356 | 346 | 344 | +1.75 | % | +1.75 | % | 12/9/2026 | $293 / sqft | n/m | 5 | ||||||||||||
8 | Office | Seattle | 1/26/2022 | 338 | 314 | 313 | +4.10 | % | +6.14 | % | 2/9/2027 | $640 / sqft | 56% | 3 | ||||||||||||
9 | Office | Dublin, IE | 8/14/2019 | 310 | 301 | 306 | +3.20 | % | +4.17 | % | 1/29/2027 | $190 / sqft | 74% | 3 | ||||||||||||
10 | Industrial | Diversified, UK | 5/15/2025 | 300 | 300 | 300 | +2.70 | % | +2.89 | % | 5/15/2028 | $142 / sqft | 69% | 3 | ||||||||||||
11 | Office | Washington, DC | 9/29/2021 | 293 | 293 | 293 | +2.81 | % | +3.05 | % | 10/9/2026 | $382 / sqft | 66% | 2 | ||||||||||||
12 | Industrial | Diversified, UK | 8/15/2025 | 322 | 270 | 268 | +2.63 | % | +3.10 | % | 10/1/2030 | $207 / sqft | 70% | 3 | ||||||||||||
13 | Office | New York | 4/11/2018 | 243 | 243 | 243 | +2.25 | % | +2.62 | % | 3/7/2028 | $307 / sqft | 52% | 4 | ||||||||||||
14 | Industrial | Diversified, EUR | 6/5/2025 | 242 | 242 | 240 | +2.70 | % | +2.97 | % | 7/19/2030 | $66 / sqft | 70% | 3 | ||||||||||||
15 | Office | Berlin, DEU | 6/27/2019 | 251 | 228 | 228 | +1.00 | % | +1.00 | % | 6/6/2030 | $472 / sqft | n/m | 5 | ||||||||||||
16 | Industrial | Diversified, US | 2/13/2025 | 224 | 224 | 222 | +3.10 | % | +3.44 | % | 3/9/2030 | $786,827 / acre | 62% | 3 | ||||||||||||
17 | Multifamily | Charlotte | 9/29/2026 | 214 | 214 | 212 | +2.75 | % | +3.11 | % | 10/9/2031 | $259,080 / unit | 74% | 3 | ||||||||||||
18 | Industrial | Diversified, UK | 3/28/2025 | 203 | 203 | 202 | +2.45 | % | +2.74 | % | 3/28/2030 | $127 / sqft | 69% | 3 | ||||||||||||
19 | Multifamily | New York | 5/4/2026 | 212 | 202 | 201 | +2.05 | % | +2.32 | % | 5/9/2031 | $423,214 / unit | 57% | 3 | ||||||||||||
20 | Industrial | Diversified, UK | 4/11/2025 | 199 | 199 | 198 | +2.40 | % | +2.77 | % | 4/11/2030 | $115 / sqft | 69% | 3 | ||||||||||||
21 | Office | New York | 7/23/2021 | 244 | 188 | 188 | +0.00 | % | (7) | +0.00 | % | 8/9/2028 | $598 / sqft | n/m | 5 | |||||||||||
22 | Retail | Diversified, UK | 3/9/2022 | 179 | 179 | 179 | +2.75 | % | +2.88 | % | 8/15/2028 | $152 / sqft | 55% | 2 | ||||||||||||
23 | Industrial | Diversified, UK | 4/7/2025 | 172 | 172 | 173 | +2.55 | % | +2.71 | % | 4/7/2030 | $343 / sqft | 67% | 3 | ||||||||||||
24 | Industrial | Diversified, EUR | 12/17/2025 | 170 | 170 | 169 | +3.25 | % | +3.61 | % | 12/17/2030 | $87 / sqft | 66% | 3 | ||||||||||||
25 | Hospitality | Los Angeles | 6/22/2026 | 159 | 159 | 158 | +3.00 | % | +3.35 | % | 6/9/2031 | $634,640 / key | 58% | 3 | ||||||||||||
26 | Industrial | Diversified, US | 4/9/2026 | 174 | 155 | 154 | +2.55 | % | +2.97 | % | 4/9/2031 | $1,034,346 / acre | 52% | 3 | ||||||||||||
27 | Self-Storage | London, UK | 11/18/2021 | 150 | 150 | 150 | +3.25 | % | +3.51 | % | 11/18/2026 | $190 / sqft | 65% | 2 | ||||||||||||
28 | Multifamily | San Jose | 4/2/2025 | 182 | 150 | 149 | +2.35 | % | +2.76 | % | 4/9/2030 | $319,691 / unit | 67% | 3 | ||||||||||||
29 | Multifamily | Melbourne, AU | 1/10/2025 | 149 | 149 | 150 | +3.85 | % | +4.52 | % | 1/10/2028 | $449,881 / unit | 76% | 4 | ||||||||||||
30 | Mixed-Use | New York | 1/17/2020 | 183 | 141 | 141 | +3.12 | % | +3.44 | % | 2/9/2028 | $111 / sqft | 43% | 3 | ||||||||||||
89
Senior Loan Portfolio, Held-For-Investment(1) | ||||||||||||||||||||||||||
Property Type | Location | Origination Date(2) | Total Commitment(3) | Principal Balance | Amortized Cost Basis(4) | Cash Coupon(5) | All-in Yield(5) | Maximum Maturity(6) | Loan Per SQFT / Unit / Key / Acre / MW | Origination LTV(2) | Risk Rating | |||||||||||||||
31 | Multifamily | Dublin, IE | 12/15/2021 | $142 | $140 | $140 | +2.75 | % | +3.05 | % | 12/9/2026 | $351,349 / unit | 79% | 3 | ||||||||||||
32 | Multifamily | Manchester, UK | 6/30/2025 | 138 | 138 | 138 | +2.30 | % | +2.65 | % | 6/30/2029 | $296,043 / unit | 63% | 3 | ||||||||||||
33 | Office | London, UK | 12/20/2019 | 135 | 135 | 135 | 4.00 | % | 4.00 | % | 3/31/2029 | $687 / sqft | 68% | 4 | ||||||||||||
34 | Industrial | Diversified, US | 2/2/2026 | 134 | 134 | 133 | +2.32 | % | +2.68 | % | 2/9/2031 | $126 / sqft | 70% | 3 | ||||||||||||
35 | Retail | Diversified, Spain | 4/8/2026 | 145 | 132 | 131 | +2.55 | % | +2.78 | % | 4/8/2031 | $141 / sqft | 71% | 3 | ||||||||||||
36 | Office | Houston | 7/15/2019 | 136 | 128 | 127 | +3.01 | % | +3.21 | % | 8/9/2028 | $231 / sqft | 58% | 3 | ||||||||||||
37 | Office | Diversified, UK | 11/23/2018 | 128 | 128 | 127 | +3.50 | % | +3.74 | % | 11/15/2029 | $1,065 / sqft | 50% | 3 | ||||||||||||
38 | Industrial | Diversified, US | 5/19/2026 | 140 | 126 | 125 | +2.50 | % | +2.88 | % | 6/9/2031 | $1,061,500 / acre | 54% | 3 | ||||||||||||
39 | Multifamily | Miami | 11/27/2024 | 125 | 125 | 125 | +2.80 | % | +3.17 | % | 12/9/2029 | $260,417 / unit | 71% | 3 | ||||||||||||
40 | Multifamily | Dallas | 6/4/2026 | 125 | 125 | 124 | +2.35 | % | +2.86 | % | 6/9/2031 | $137,280 / unit | 71% | 3 | ||||||||||||
41 | Life Sciences/ Studio | Boston | 5/13/2021 | 143 | 122 | 122 | 3.25 | % | 3.25 | % | 9/9/2030 | $608 / sqft | 80% | 4 | ||||||||||||
42 | Multifamily | Melbourne, AU | 6/13/2025 | 254 | 122 | 120 | +4.75 | % | +5.70 | % | 8/8/2029 | $255,399 / unit | 76% | 3 | ||||||||||||
43 | Multifamily | Denver | 11/26/2025 | 120 | 120 | 119 | +2.35 | % | +2.71 | % | 12/9/2030 | $469,762 / unit | 65% | 2 | ||||||||||||
44 | Multifamily | Miami | 6/1/2021 | 120 | 120 | 120 | +2.65 | % | +2.95 | % | 6/9/2029 | $298,507 / unit | 61% | 3 | ||||||||||||
45 | Multifamily | Diversified, UK | 3/29/2021 | 115 | 115 | 115 | +4.52 | % | +4.52 | % | 12/17/2026 | $50,269 / unit | 61% | 4 | ||||||||||||
46 | Multifamily | Phoenix | 12/29/2021 | 110 | 110 | 110 | +2.85 | % | +3.11 | % | 7/9/2027 | $189,003 / unit | 64% | 3 | ||||||||||||
47 | Industrial | Diversified, US | 5/22/2025 | 115 | 108 | 107 | +3.00 | % | +3.36 | % | 6/9/2030 | $914,351 / acre | 56% | 3 | ||||||||||||
48 | Office | Chicago | 9/30/2021 | 106 | 106 | 106 | 5.00 | % | 5.00 | % | 10/9/2029 | $118 / sqft | 43% | 3 | ||||||||||||
49 | Multifamily | Tampa | 2/15/2022 | 106 | 106 | 105 | +2.85 | % | +3.09 | % | 3/9/2027 | $241,972 / unit | 73% | 3 | ||||||||||||
50 | Life Sciences/ Studio | Los Angeles | 6/28/2019 | 106 | 106 | 106 | +8.75 | % | +8.75 | % | 2/1/2026 | $531 / sqft | n/m | 5 | ||||||||||||
51 | Multifamily | Washington, DC | 11/17/2025 | 105 | 105 | 104 | +2.50 | % | +2.83 | % | 12/9/2030 | $295,775 / unit | 72% | 3 | ||||||||||||
52 | Multifamily | Various, TX | 10/15/2025 | 105 | 104 | 103 | +2.60 | % | +2.93 | % | 11/9/2030 | $232,053 / unit | 73% | 3 | ||||||||||||
53 | Industrial | Diversified, FR | 12/11/2025 | 103 | 103 | 103 | +2.65 | % | +2.99 | % | 12/11/2030 | $68 / sqft | 68% | 3 | ||||||||||||
54 | Mixed-Use | New York | 3/10/2020 | 103 | 103 | 103 | +3.00 | % | +3.01 | % | 7/11/2029 | $630 / sqft | 48% | 2 | ||||||||||||
55 | Retail | New York | 9/24/2025 | 121 | 102 | 102 | +3.35 | % | +3.76 | % | 10/9/2030 | $137 / sqft | 56% | 3 | ||||||||||||
56 | Hospitality | Honolulu | 1/30/2020 | 99 | 99 | 100 | +3.50 | % | +3.50 | % | 2/9/2027 | $270,109 / key | n/m | 5 | ||||||||||||
57 | Office | Washington, DC | 12/21/2021 | 103 | 98 | 98 | +2.70 | % | +2.70 | % | 1/9/2027 | $336 / sqft | n/m | 5 | ||||||||||||
58 | Multifamily | San Antonio | 3/20/2025 | 97 | 97 | 97 | +2.80 | % | +3.16 | % | 4/9/2030 | $449,074 / unit | 72% | 3 | ||||||||||||
59 | Multifamily | Diversified, NL | 3/27/2025 | 97 | 97 | 97 | +2.70 | % | +2.97 | % | 3/31/2028 | $114,641 / unit | 62% | 2 | ||||||||||||
60 | Multifamily | Seattle | 9/13/2024 | 94 | 94 | 94 | +3.25 | % | +3.49 | % | 11/9/2027 | $509,389 / unit | 68% | 3 | ||||||||||||
90
Senior Loan Portfolio, Held-For-Investment(1) | ||||||||||||||||||||||||||
Property Type | Location | Origination Date(2) | Total Commitment(3) | Principal Balance | Amortized Cost Basis(4) | Cash Coupon(5) | All-in Yield(5) | Maximum Maturity(6) | Loan Per SQFT / Unit / Key / Acre / MW | Origination LTV(2) | Risk Rating | |||||||||||||||
61 | Multifamily | Orlando | 10/27/2021 | $93 | $93 | $93 | +2.61 | % | +2.85 | % | 11/9/2026 | $155,612 / unit | 75% | 3 | ||||||||||||
62 | Multifamily | Philadelphia | 10/28/2021 | 91 | 91 | 90 | +2.80 | % | +3.10 | % | 11/9/2029 | $336,019 / unit | 79% | 3 | ||||||||||||
63 | Hospitality | Boston | 3/3/2022 | 89 | 89 | 89 | +2.75 | % | +3.09 | % | 3/9/2027 | $404,364 / key | 64% | 3 | ||||||||||||
64 | Multifamily | Charlotte | 7/29/2021 | 82 | 82 | 82 | +2.76 | % | +3.23 | % | 8/9/2027 | $223,735 / unit | 78% | 3 | ||||||||||||
65 | Hospitality | Honolulu | 3/13/2018 | 79 | 79 | 79 | +3.11 | % | +3.66 | % | 4/9/2029 | $122,594 / key | 50% | 3 | ||||||||||||
66 | Multifamily | Miami | 4/10/2026 | 78 | 78 | 78 | +2.05 | % | +2.35 | % | 5/9/2031 | $433,180 / unit | 73% | 3 | ||||||||||||
67 | Industrial | Diversified, BE | 3/7/2025 | 82 | 77 | 77 | +2.75 | % | +3.29 | % | 3/7/2030 | $40 / sqft | 57% | 2 | ||||||||||||
68 | Mixed-Use | New York | 6/25/2025 | 221 | 74 | 73 | +3.75 | % | +4.30 | % | 12/25/2028 | $124,949 / unit | 44% | 3 | ||||||||||||
69 | Multifamily | Tampa | 12/21/2021 | 74 | 74 | 74 | +2.70 | % | +2.94 | % | 1/9/2027 | $217,353 / unit | 77% | 3 | ||||||||||||
70 | Industrial | Diversified, UK | 11/12/2025 | 76 | 74 | 73 | +2.80 | % | +3.15 | % | 11/7/2029 | $128 / sqft | 72% | 2 | ||||||||||||
71 | Retail | Utrecht, NL | 5/30/2025 | 71 | 71 | 71 | +2.80 | % | +3.16 | % | 5/30/2030 | $167 / sqft | 62% | 2 | ||||||||||||
72 | Multifamily | Miami | 7/31/2025 | 68 | 68 | 68 | +2.60 | % | +2.96 | % | 8/9/2030 | $229,730 / unit | 72% | 3 | ||||||||||||
73 | Multifamily | Las Vegas | 3/31/2022 | 67 | 67 | 67 | +2.90 | % | +3.26 | % | 4/9/2027 | $146,519 / unit | 71% | 3 | ||||||||||||
74 | Industrial | Berlin, DEU | 4/21/2026 | 65 | 65 | 64 | +2.65 | % | +2.99 | % | 4/9/2031 | $135 / sqft | 65% | 3 | ||||||||||||
75 | Office | Nashville | 6/30/2021 | 65 | 63 | 62 | +2.95 | % | +2.95 | % | 7/9/2026 | $259 / sqft | n/m | 5 | ||||||||||||
76 | Office | Los Angeles | 4/6/2021 | 62 | 62 | 62 | 6.00 | % | 6.00 | % | 1/9/2030 | $254 / sqft | 65% | 2 | ||||||||||||
77 | Office | New York | 5/28/2025 | 68 | 61 | 61 | +3.25 | % | +3.66 | % | 6/9/2030 | $399 / sqft | 60% | 1 | ||||||||||||
78 | Hospitality | Bermuda | 4/26/2024 | 69 | 61 | 61 | +4.95 | % | +5.62 | % | 5/9/2029 | $693,780 / key | 39% | 2 | ||||||||||||
79 | Hospitality | Napa Valley | 4/29/2022 | 60 | 60 | 60 | +2.65 | % | +2.93 | % | 4/9/2028 | $626,382 / key | 66% | 2 | ||||||||||||
80 | Multifamily | Seattle | 10/28/2021 | 59 | 59 | 58 | +2.95 | % | +3.18 | % | 11/9/2027 | $177,550 / unit | 70% | 3 | ||||||||||||
81 | Industrial | Minneapolis | 12/12/2024 | 61 | 59 | 58 | +2.85 | % | +3.23 | % | 1/9/2030 | $83 / sqft | 59% | 3 | ||||||||||||
82 | Multifamily | Phoenix | 12/17/2021 | 58 | 58 | 58 | +2.70 | % | +2.97 | % | 1/9/2028 | $209,601 / unit | 69% | 3 | ||||||||||||
83 | Office | Miami | 6/14/2021 | 58 | 58 | 58 | +2.30 | % | +2.30 | % | 3/9/2027 | $122 / sqft | 65% | 2 | ||||||||||||
84 | Multifamily | Salt Lake City | 7/30/2021 | 56 | 56 | 56 | +2.95 | % | +3.22 | % | 8/9/2027 | $204,253 / unit | 73% | 3 | ||||||||||||
85 | Multifamily | Atlanta | 10/17/2025 | 57 | 56 | 56 | +2.30 | % | +2.57 | % | 11/9/2030 | $212,121 / unit | 64% | 3 | ||||||||||||
86 | Industrial | Diversified, US | 12/14/2018 | 54 | 54 | 54 | +3.51 | % | +3.91 | % | 1/9/2027 | $40 / sqft | 57% | 3 | ||||||||||||
87 | Self-Storage | Diversified, US | 2/18/2025 | 53 | 53 | 52 | +3.10 | % | +3.47 | % | 3/9/2030 | $90 / sqft | 67% | 3 | ||||||||||||
88 | Multifamily | Denver | 3/19/2025 | 51 | 51 | 51 | +2.60 | % | +2.92 | % | 5/9/2030 | $221,739 / unit | 64% | 4 | ||||||||||||
89 | Hospitality | Waimea | 2/27/2025 | 50 | 50 | 50 | +2.80 | % | +2.92 | % | 2/9/2030 | $823,353 / key | 52% | 2 | ||||||||||||
90 | Office | Los Angeles | 8/22/2019 | 47 | 47 | 47 | +2.66 | % | +2.66 | % | 3/9/2027 | $277 / sqft | n/m | 5 | ||||||||||||
91
Senior Loan Portfolio, Held-For-Investment(1) | ||||||||||||||||||||||||||
Property Type | Location | Origination Date(2) | Total Commitment(3) | Principal Balance | Amortized Cost Basis(4) | Cash Coupon(5) | All-in Yield(5) | Maximum Maturity(6) | Loan Per SQFT / Unit / Key / Acre / MW | Origination LTV(2) | Risk Rating | |||||||||||||||
91 | Multifamily | Dallas | 12/23/2025 | 45 | 45 | 44 | 5.74 | % | 6.45 | % | 1/1/2031 | $148,333 / unit | 77% | 3 | ||||||||||||
92 | Multifamily | Columbus | 12/8/2021 | 44 | 44 | 44 | +2.75 | % | +2.99 | % | 12/9/2026 | $144,479 / unit | 69% | 2 | ||||||||||||
93 | Multifamily | Dublin, IE | 12/8/2025 | 40 | 40 | 40 | +2.65 | % | +2.83 | % | 12/2/2030 | $344,826 / unit | 73% | 3 | ||||||||||||
94 | Multifamily | Las Vegas | 3/31/2022 | 38 | 38 | 38 | +2.90 | % | +3.26 | % | 4/9/2027 | $149,984 / unit | 72% | 3 | ||||||||||||
95 | Multifamily | Savannah | 10/10/2025 | 40 | 38 | 37 | +2.85 | % | +2.94 | % | 11/9/2030 | $241,935 / unit | 69% | 3 | ||||||||||||
96 | Office | Canberra, AU | 5/8/2025 | 37 | 37 | 37 | +3.80 | % | +3.98 | % | 5/8/2028 | $411 / sqft | 75% | 3 | ||||||||||||
97 | Office | Atlanta | 5/27/2025 | 51 | 36 | 36 | +3.65 | % | +4.03 | % | 6/9/2030 | $124 / sqft | 39% | 2 | ||||||||||||
98 | Retail | Hamburg, DEU | 3/19/2026 | 41 | 33 | 32 | +2.90 | % | +3.20 | % | 3/4/2030 | $106 / sqft | 65% | 3 | ||||||||||||
99 | Mixed-Use | New York | 2/21/2025 | 24 | 24 | 24 | +3.25 | % | +3.52 | % | 3/9/2030 | $775 / sqft | 59% | 3 | ||||||||||||
100 | Multifamily | Las Vegas | 8/4/2021 | 22 | 22 | 22 | +2.70 | % | +2.94 | % | 8/9/2029 | $180,000 / unit | 73% | 3 | ||||||||||||
101 | Multifamily | Atlanta | 5/9/2025 | 21 | 21 | 21 | +2.85 | % | +2.94 | % | 5/9/2030 | $205,882 / unit | 65% | 4 | ||||||||||||
Subtotal: senior loan portfolio, held-for-investment | $14,984 | $14,186 | $14,142 | +2.99 | % | +3.33 | % | 3.0 yrs | 64% | 3.1 | ||||||||||||||||
Subordinate Loan Portfolio, Held-For-Investment(8) | ||||||||||||||||||||||||||
Property Type | Location | Origination Date(2) | Total Commitment(3) | Principal Balance | Amortized Cost Basis(4) | Cash Coupon(5) | All-in Yield(5) | Maximum Maturity(6) | Loan Per SQFT / Unit / Key / Acre / MW | Origination LTV(2) | Risk Rating | |||||||||||||||
102 | Office | Los Angeles | 11/22/2019 | 133 | 126 | 126 | +2.50 | % | +2.50 | % | 12/9/2027 | $827 / sqft | n/m | 5 | ||||||||||||
103 | Life Sciences/ Studio | San Francisco | 11/10/2021 | 72 | 57 | 57 | +8.71 | % | +8.95 | % | 12/9/2026 | $448 / sqft | 66% | 4 | ||||||||||||
104 | Industrial | Diversified, US | 3/10/2025 | 56 | 56 | 56 | +5.00 | % | +5.12 | % | 3/9/2030 | $111 / sqft | 70% | 3 | ||||||||||||
105 | Multifamily | Los Angeles | 12/30/2021 | 42 | 39 | 39 | +8.80 | % | +9.00 | % | 1/9/2030 | $575,531 / unit | 50% | 3 | ||||||||||||
106 | Multifamily | London, UK | 7/18/2025 | 29 | 29 | 29 | +8.98 | % | +9.38 | % | 7/5/2030 | $741,890 / unit | 69% | 3 | ||||||||||||
107 | Other | Manassas, VA | 1/9/2026 | 26 | 26 | 25 | 12.98 | % | 14.23 | % | 1/9/2031 | $9,840,909 / MW | 64% | 3 | ||||||||||||
108 | Industrial | New York | 1/8/2026 | 23 | 23 | 20 | 5.79 | % | 9.67 | % | 1/9/2031 | $12 / sqft | 63% | 3 | ||||||||||||
109 | Hospitality | Miami | 5/2/2025 | 23 | 21 | 21 | +9.50 | % | +10.15 | % | 5/9/2030 | $946,478 / key | 53% | 3 | ||||||||||||
110 | Mixed-Use | New York | 5/20/2025 | 28 | 17 | 17 | 10.00 | % | 10.06 | % | 10/1/2034 | $1,038 / sqft | 59% | 3 | ||||||||||||
111 | Office | London, UK | 12/20/2019 | 14 | 14 | 14 | n/m | (9) | n/m | 3/31/2029 | $832 / sqft | n/m | 5 | |||||||||||||
112 | Office | Chicago | 9/30/2021 | 44 | 11 | 11 | n/m | (9) | n/m | 10/9/2029 | $162 / sqft | n/m | 5 | |||||||||||||
113 | Other | Honolulu | 3/2/2026 | 41 | 7 | 6 | +9.72 | % | +11.17 | % | 3/9/2032 | $186,759 / unit | 69% | 3 | ||||||||||||
114 | Life Sciences/ Studio | Boston | 5/13/2021 | 15 | 1 | 1 | n/m | (9) | n/m | 9/9/2030 | $646 / sqft | n/m | 5 | |||||||||||||
Subtotal: subordinate loan portfolio, held-for-investment | $544 | $426 | $421 | +7.43 | % | +8.07 | % | 3.3 yrs | 63% | 3.9 | ||||||||||||||||
Subtotal: loans receivable, held-for-investment portfolio | $15,528 | $14,613 | $14,564 | |||||||||||||||||||||||
Total loans receivable CECL reserve | (597) | |||||||||||||||||||||||||
Total loans receivable, held-for-investment portfolio | $15,528 | $14,613 | $13,966 | +3.08 | % | +3.43 | % | 3.0 yrs | 64% | 3.1 | ||||||||||||||||
92
Loans Held-For-Sale | ||||||||||||||||||||||||||
Property Type | Location | Origination Date(2) | Total Commitment(3) | Principal Balance | Net Book Value | Cash Coupon(5)(10) | All-in Yield(5)(10) | Maximum Maturity(6)(10) | Loan Per SQFT / Unit / Key / Acre / MW | Origination LTV(2) | Risk Rating | |||||||||||||||
115 - 124 | Various | Various, US | Various | $797 | $761 | $616 | +2.83 | % | +3.11 | % | 1.8 yrs | n/m | n/m | n/a | ||||||||||||
Subtotal: loans receivable, held-for-sale portfolio | $797 | $761 | $616 | |||||||||||||||||||||||
Total: loans receivable portfolio | $16,324 | $15,374 | $14,582 | +3.07 | % | +3.41 | % | 2.9 yrs | 64% | 3.1 | ||||||||||||||||
(1)Senior loans include senior mortgages and similar credit quality loans, including related contiguous subordinate loans and pari passu participations in senior mortgage
loans.
(2)Date loan was originated or acquired by us, and the LTV as of such date, excluding any loans that are impaired.
(3)Total commitment reflects outstanding principal balance as well as any related unfunded loan commitment.
(4)Amortized cost basis represents outstanding principal balance, net of purchase and sale discounts or premiums, exit fees, deferred origination expenses, and cost-recovery
proceeds.
(5)The weighted-average cash coupon and all-in yield are expressed as a spread over the relevant floating benchmark rates, which include SOFR, SONIA, EURIBOR,
CORRA, and other indices as applicable to each loan. As of September 30, 2026, 96% of our loans by principal balance earned a floating rate of interest, primarily
indexed to SOFR. The remaining 4% of our loans by principal balance earned a fixed rate of interest. In addition to cash coupon, all-in yield includes the amortization of
deferred origination and extension fees, loan origination costs, and purchase discounts, as well as the accrual of exit fees. Excludes loans accounted for under the cost-
recovery and nonaccrual methods, if any.
(6)Maximum maturity assumes all extension options are exercised; however, our loans may be repaid prior to such date. Excludes loans accounted for under the cost-
recovery and nonaccrual methods, if any.
(7)This loan has an interest rate of SOFR plus 0.00% with a SOFR floor of 3.50%, for an all-in rate of 3.91% as of September 30, 2026.
(8)Subordinate loans include: (i) loans in which we have previously originated a whole loan and sold a senior mortgage interest to a third party, resulting in these subordinate
interests in mortgages, (ii) mezzanine loans, and (iii) the subordinate portion of loans that have been modified that have resulted in a restructured senior loan and a
subordinate loan.
(9)These subordinate loans are the result of a loan modification which resulted in a restructured senior loan and a subordinate loan. Each of the subordinate loans is
accounted for under the cost-recovery method.
(10)The cash coupon, all-in yield, and maximum maturity of held-for-sale loans represent the weighted-average of all loans classified as held-for-sale as of September 30,
2026.
93
ITEM 3.QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
Interest Rate Risk
Loan Portfolio Net Interest Income
Generally, our business model is such that rising interest rates will increase our net income, while declining interest rates
will decrease net income. However, in periods in which our floating rate liabilities exceed our floating rate assets, including
as a result of floating rate corporate debt or a greater concentration in owned real estate, loans on nonaccrual status, or
similar assets that do not generate floating rate interest income, rising interest rates may decrease our net income. As of
September 30, 2026, 96% of our loans by principal balance earned a floating rate of interest, primarily indexed to SOFR,
and were financed with liabilities that pay interest at floating rates, which resulted in an amount of net equity that is
positively correlated to changing interest rates, subject to the impact of interest rate floors on certain of our floating rate
loans.
The following table projects the impact on our net interest income, presented net of implied changes in incentive fees, for
the twelve-month period following September 30, 2026, of an increase or decrease in the various floating-rate indices
referenced by our portfolio, assuming no change in credit spreads, portfolio composition, or asset performance, relative to
the average indices during the three months ended September 30, 2026 ($ in thousands):
Assets (Liabilities) Sensitive to Changes in Interest Rates(1) | Interest Rate Sensitivity as of September 30, 2026(2)(3) | |||||||||
Increase in Rates | Decrease in Rates | |||||||||
50 Basis Points | 100 Basis Points | 50 Basis Points | 100 Basis Points | |||||||
Floating rate assets(4)(5)(6)(7) | $13,426,346 | $53,705 | $107,411 | $(53,326) | $(99,342) | |||||
Floating rate liabilities(5)(6)(7)(8) | (13,610,583) | (54,442) | (108,885) | 54,442 | 108,885 | |||||
Net exposure | $(184,237) | $(737) | $(1,474) | $1,116 | $9,543 | |||||
(1)Reflects the USD equivalent value of floating rate assets and liabilities denominated in foreign currencies.
(2)Increases (decreases) in interest income and expense are presented net of theoretical impact of incentive fees. Refer
to Note 15 to our consolidated financial statements for additional details of our incentive fee calculation.
(3)Excludes income from loans accounted for under the cost-recovery method.
(4)Excludes $1.3 billion of principal balance on floating rate impaired loans.
(5)Our loan agreements generally require our borrowers to purchase interest rate caps, which mitigates our borrowers’
exposure to an increase in interest rates.
(6)Excludes amounts related to our investments in unconsolidated entities.
(7)Excludes amounts related to our investments in debt securities.
(8)Includes amounts outstanding under our secured debt, securitizations, asset-specific debt, Term Loans, Senior
Secured Notes due 2029, and Senior Secured Notes due 2031. We entered into interest rate swaps with an aggregate
notional amount of $900.0 million that effectively convert our fixed rate exposure to floating rate exposure for the
Senior Secured Notes due 2029 and Senior Secured Notes due 2031. Excludes amounts related to the indebtedness
of our unconsolidated entities.
Loan Portfolio Value
As of September 30, 2026, 96% of our loans by principal balance earned a floating rate of interest, so the value of such
investments is generally not impacted by changes in market interest rates. Additionally, we generally intend to hold all of
our loans to maturity and so do not generally expect to realize gains or losses resulting from any mark-to-market valuation
adjustments on our loan portfolio.
Risk of Non-Performance
In addition to the risks related to fluctuations in cash flows and asset values associated with movements in interest rates,
there is also the risk of non-performance on floating rate assets. In the case of a significant increase in interest rates, the
cash flows of the collateral real estate assets may not be sufficient to pay debt service due under our loans, which may
contribute to non-performance or, in severe cases, default. This risk is partially mitigated by our consideration of rising rate
stress-testing during our underwriting process, which generally includes a requirement for our borrower to purchase an
94
interest rate cap contract with an unaffiliated third party, provide an interest reserve deposit, and/or provide interest
guarantees or other structural protections.
Credit Risks
Our loans are subject to credit risk, including the risk of default. The performance and value of our loans depend upon the
borrowers’ ability to operate the properties that serve as our collateral so that they produce cash flows adequate to pay
interest and principal due to us. To monitor this risk, our asset management team reviews our loan portfolios and, in certain
instances, is in regular contact with our borrowers, monitoring performance of the collateral and enforcing our rights as
necessary.
In addition, we are exposed to the risks generally associated with the commercial real estate market, including changes in
occupancy rates, capitalization rates, absorption rates, and other macroeconomic factors beyond our control. We seek to
manage these risks through our underwriting and asset management processes.
We maintain a robust asset management relationship with our borrowers and utilize these relationships to maximize the
performance of our portfolio, including during periods of volatility. We believe that we benefit from these relationships and
from our long-standing core business model of originating senior loans collateralized by large assets in major markets with
experienced, well-capitalized institutional sponsors. While we believe the principal amounts of our loans are generally
adequately protected by underlying collateral value, there is a risk that we will not realize the entire principal value of
certain loans. As of September 30, 2026, we had an aggregate $444.5 million asset-specific CECL reserve related to 12 of
our loans receivable, with an aggregate amortized cost basis of $1.3 billion, net of cost-recovery proceeds. This CECL
reserve was recorded based on our estimation of the fair value of each of the loan’s underlying collateral as of
September 30, 2026.
Our portfolio monitoring and asset management operations benefit from the deep knowledge, experience, and information
advantages derived from our position as part of Blackstone’s real estate platform. Blackstone has built the world's
preeminent global real estate business, with a proven track record of successfully navigating market cycles and emerging
stronger through periods of volatility. The market-leading real estate expertise derived from the strength of the Blackstone
platform deeply informs our credit and underwriting process, and we believe gives us the tools to expertly asset manage
our portfolio and work with our borrowers throughout periods of economic stress and uncertainty.
Capital Market Risks
We are exposed to risks related to the equity capital markets, and our related ability to raise capital through the issuance of
our class A common stock or other equity instruments. We are also exposed to risks related to the debt capital markets, and
our related ability to finance our business through borrowings under credit facilities or other debt instruments. As a REIT,
we are required to distribute a significant portion of our taxable income annually, which constrains our ability to
accumulate operating cash flow and therefore requires us to utilize debt or equity capital to finance our business. We seek
to mitigate these risks by monitoring the debt and equity capital markets to inform our decisions on the amount, timing, and
terms of capital we raise.
Our master repurchase agreements and secured credit facilities are generally structured without capital markets-based
mark-to-market provisions, which means the margin call provisions do not permit valuation adjustments based on capital
markets events. The majority of our master repurchase agreements and secured credit facilities are non-mark-to-market,
which means the margin call provisions only permit valuation adjustments if the loan or collateral pledged or sold by us
becomes defaulted, and the margin call provisions for the remainder are limited to collateral-specific credit marks generally
determined on a commercially reasonable basis. There can be no assurance we will not experience margin calls under any
asset-level financing that contains margin call provisions.
Counterparty Risk
The nature of our business requires us to hold our cash and cash equivalents and obtain financing from various financial
institutions. This exposes us to the risk that these financial institutions may not fulfill their obligations to us under these
various contractual arrangements. We mitigate this exposure by depositing our cash and cash equivalents and entering into
financing agreements with high credit-quality institutions.
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The nature of our loans also exposes us to the risk that our counterparties do not make required interest and principal
payments on scheduled due dates. We seek to manage this risk through a comprehensive credit analysis prior to making a
loan and active monitoring of the asset portfolios that serve as our collateral, as further discussed above.
Currency Risk
Our loans that are denominated in a foreign currency are also subject to risks related to fluctuations in currency rates. We
generally mitigate this exposure by matching the currency of our assets to the currency of the financing for our assets. As a
result, we substantially reduce our exposure to changes in portfolio value related to changes in foreign currency rates. In
addition, substantially all of our net asset exposure to foreign currencies has been hedged with foreign currency forward
contracts as of September 30, 2026.
The following table outlines our assets and liabilities that are denominated in a foreign currency (amounts in thousands):
September 30, 2026 | |||||
GBP | EUR | All Other(1) | |||
Foreign currency assets | £1,732,395 | €1,843,618 | $1,710,216 | ||
Foreign currency liabilities | (1,295,100) | (1,233,593) | (1,327,036) | ||
Foreign currency contracts – notional | (433,513) | (649,527) | (375,839) | ||
Net exposure to exchange rate fluctuations | £3,782 | €(39,502) | $7,341 | ||
Net exposure to exchange rate fluctuations in USD(2) | $5,016 | $(44,755) | $7,341 | ||
(1)Includes Australian Dollar, Canadian Dollar, Swedish Krona, Swiss Franc, and Danish Krone currencies.
(2)Represents the U.S. Dollar equivalent as of September 30, 2026.
ITEM 4.CONTROLS AND PROCEDURES
Evaluation of Disclosure Controls and Procedures
We maintain disclosure controls and procedures (as that term is defined in Rules 13a–15(e) and 15d–15(e) under the
Exchange Act) that are designed to ensure that information required to be disclosed in our reports under the Exchange Act
is recorded, processed, and summarized and reported within the time periods specified in the SEC’s rules and forms, and
that such information is accumulated and communicated to our management, including our Chief Executive Officer and
Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosures. Any controls and
procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired
control objectives. An evaluation of the effectiveness of the design and operation of our disclosure controls and procedures
as of the end of the period covered by this Quarterly Report on Form 10-Q was made under the supervision and with the
participation of our management, including our Chief Executive Officer and Chief Financial Officer. Based upon this
evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls and
procedures (a) are effective to ensure that information required to be disclosed by us in reports filed or submitted under the
Exchange Act is recorded, processed, summarized and reported within the time periods specified by SEC rules and forms
and (b) include, without limitation, controls and procedures designed to ensure that information required to be disclosed by
us in reports filed or submitted under the Exchange Act is accumulated and communicated to our management, including
our Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required
disclosure.
Changes in Internal Control Over Financial Reporting
There have been no changes in our “internal control over financial reporting” (as defined in Rule 13a–15(f) of the
Exchange Act) that occurred during our most recent quarter that have materially affected, or are reasonably likely to
materially affect, our internal control over financial reporting.
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PART II. OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
From time to time, we may be involved in various claims and legal actions arising in the ordinary course of business. As of
September 30, 2026, we were not involved in any material legal proceedings.
ITEM 1A. RISK FACTORS
There have been no material changes to the risk factors previously disclosed under “Part I, Item 1A. Risk Factors” of our
Annual Report on Form 10-K for the year ended December 31, 2025.
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ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
The following table sets forth information regarding repurchases of shares of our class A common stock during the three
months ended September 30, 2026:
Period | Total Number of Shares Purchased | Average Price Paid per Share(1) | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs(2) | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program ($ in thousands)(2) | ||||
July 1 - July 31, 2026 | — | $— | — | $145,792 | ||||
August 1 - August 31, 2026 | 1,748,597 | 14.20 | 1,748,597 | 120,958 | ||||
September 1 - September 30, 2026 | 804,765 | 13.85 | 804,765 | 109,816 | ||||
Total | 2,553,362 | $14.09 | 2,553,362 | $109,816 |
(1)The average price paid per share is calculated on a trade date basis and excludes associated commissions.
(2)In October 2025, our board of directors authorized the repurchase of up to $150.0 million of shares of our class A
common stock under our repurchase program. Repurchases may be made from time to time in open market
transactions, in privately negotiated transactions, in agreements and arrangements structured in a manner
consistent with Rules 10b-18 and 10b5-1 under the Exchange Act or otherwise. The timing and the actual amounts
repurchased will depend on a variety of factors, including legal requirements, price and economic and market
conditions. The repurchase program may be changed, suspended or discontinued at any time and does not have a
specified expiration date. See Note 14 to our consolidated financial statements and “Part I. Item 2. Management’s
Discussion and Analysis of Financial Condition and Results of Operations — Liquidity and Capital Resources —
Uses of Liquidity” for further information regarding this repurchase program.
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ITEM 3. DEFAULTS UPON SENIOR SECURITIES
None.
ITEM 4. MINE SAFETY DISCLOSURES
Not applicable.
ITEM 5. OTHER INFORMATION
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ITEM 6. | EXHIBITS |
31.1 | * | ||
31.2 | * | ||
32.1 + | |||
32.2 + | |||
101.INS | XBRL Instance Document – the instance document does not appear in the interactive data file because its XBRL tags are embedded within the inline XBRL document | ||
101.SCH | Inline XBRL Taxonomy Extension Schema Document With Embedded Linkbase Documents | ||
101.CAL | Inline XBRL Taxonomy Extension Calculation Linkbase Document | ||
101.DEF | Inline XBRL Taxonomy Extension Definition Linkbase Document | ||
101.LAB | Inline XBRL Taxonomy Extension Label Linkbase Document | ||
101.PRE | Inline XBRL Taxonomy Extension Presentation Linkbase Document | ||
104 | Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101) | ||
___________
* Filed herewith.
+ This exhibit shall not be deemed “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the
liability of that Section. Such exhibit shall not be deemed incorporated into any filing under the Securities Act or the
Exchange Act.
The agreements and other documents filed as exhibits to this report are not intended to provide factual information or other
disclosure other than with respect to the terms of the agreements or other documents themselves, and you should not rely
on them for that purpose. In particular, any representations and warranties made by us in these agreements or other
documents were made solely within the specific context of the relevant agreement or document and may not describe the
actual state of affairs as of the date they were made or at any other time.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be
signed on its behalf by the undersigned thereunto duly authorized.
BLACKSTONE MORTGAGE TRUST, INC. | ||
October 29, 2026 | /s/ Timothy S. Johnson | |
Date | Timothy S. Johnson | |
Chief Executive Officer | ||
(Principal Executive Officer) | ||
October 29, 2026 | /s/ Marcin Urbaszek | |
Date | Marcin Urbaszek | |
Chief Financial Officer | ||
(Principal Financial Officer and Principal Accounting Officer) |