8-K

UNITED STATESSECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

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CURRENT REPORT

​ Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

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Date of Report (Date of earliest event reported): August 5, 2020

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Starwood Property Trust, Inc.

(Exact name of registrant as specified in its charter)

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Maryland<br>(State or other jurisdiction <br>of incorporation)	001-34436<br>(Commission<br>File Number)	27-0247747<br>(IRS Employer<br>Identification No.)

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​<br><br>​
591 West Putnam Avenue<br><br>Greenwich , CT	06830
(Address of principal	(Zip Code)
executive offices)

Registrant’s telephone number,including area code:(203) 422-7700

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(Former name or former address, if changed since last report.)

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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

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☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

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☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

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☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

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☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

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Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, $0.01 par value per share	STWD	New York Stock Exchange

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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

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. ☐

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Item 2.02. Results of Operations and Financial Condition.

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On August 5, 2020, Starwood Property Trust, Inc. issued a press release announcing its financial results for the quarter ended June 30, 2020. A copy of the press release is attached as Exhibit 99.1 hereto and incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits.

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(d)Exhibits

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​	​<br><br>​
Exhibit<br><br>Number	​<br><br>Description
​	​
99.1	Press Release, dated August 5, 2020
​	​
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

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2

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EXHIBIT INDEX

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Exhibit<br>Number	Description
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99.1	Press Release, dated August 5, 2020

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3

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SIGNATURE

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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 hereunto duly authorized.

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Dated: August 5, 2020	STARWOOD PROPERTY TRUST, INC.
​	​
	By:	/s/ ANDREW J. SOSSEN
	Name:	Andrew J. Sossen
	Title:	Chief Operating Officer

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4

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Exhibit 99.1

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For Immediate Release

Starwood Property Trust Reports Results for the

Quarter Ended June 30, 2020

– Received 7^th^ Consecutive NAREIT Gold Award for Investor Communications and Reporting Excellence –

– Paid Dividend of $0.48 per share for the Second Quarter of 2020 –

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GREENWICH, Conn., August 5, 2020 /PRNewswire/ -- Starwood Property Trust, Inc. (NYSE: STWD) today announced operating results for the fiscal quarter ended June 30, 2020.  The Company’s second quarter 2020 GAAP net income was $139.7 million, or $0.49 per diluted share, and Core Earnings (a non-GAAP financial measure) was $126.1 million, or $0.43 per diluted share.

“It is a difficult time to figure out the right balance between playing offense and defense as this Category 5 hurricane that we call the Coronavirus sweeps through the U.S. and the global economies. Since March, we have erred on the side of caution and are only making occasional investments that we find decidedly compelling. From the outset of this pandemic, our strategy has been to solidify our fortress balance sheet. We now sit with over $800 million of cash and approved, undrawn debt capacity, after paying our full dividend the past two quarters, deleveraging our balance sheet by more than $350 million and dramatically lowering our future funding obligations by over $700 million.

All this caution has and will probably continue to reduce our earnings until our capital deployment returns to more normalized levels. Nonetheless, the breadth of our enterprise provides numerous opportunities for us to realize the significant embedded gains in our portfolio if and when we choose to do so. Our complex, but diversified, business lines have performed in line with our expectations. We are very well-positioned to carefully comb through investments in each of our business segments, work with our borrowers, and return to investing globally where the opportunity set is clearly better today than in years past,” commented Barry Sternlicht, Chairman and CEO of Starwood Property Trust.

Supplemental Schedules

The Company has published supplemental earnings schedules on its website in order to provide additional disclosure and financial information for the benefit of the Company’s stakeholders.  Specifically, these materials can be found on the Company’s website in the Investor Relations section under “Quarterly Results” at www.starwoodpropertytrust.com.

Webcast and Conference Call Information ****

The Company will host a live webcast and conference call on Wednesday, August 5, 2020, at 10:00 a.m. Eastern Time.  To listen to a live broadcast, access the site at least 15 minutes prior to the scheduled start time in order to register, download and install any necessary audio software.  The webcast is available at www.starwoodpropertytrust.com in the Investor Relations section of the website.  The Company encourages use of the webcast due to potential extended wait times to access the conference call via dial-in.

1

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​ To Participate via Telephone Conference Call:

Dial in at least 15 minutes prior to start time.

Domestic:  1-877-407-9039

International:  1-201-689-8470

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Conference Call Playback:

Domestic: 1-844-512-2921

International: 1-412-317-6671

Passcode: 13706902

The playback can be accessed through August 12, 2020.

About Starwood Property Trust, Inc.

Starwood Property Trust (NYSE: STWD), is a leading diversified finance company with a core focus on the real estate and infrastructure sectors. An affiliate of global private investment firm Starwood Capital Group, the Company has successfully deployed over $63 billion of capital since inception and manages a portfolio of $17 billion across debt and equity investments. Starwood Property Trust’s investment objective is to generate attractive and stable returns for shareholders, primarily through dividends, by leveraging a premiere global organization to identify and execute on the best risk adjusted returning investments across its target assets. Additional information can be found at www.starwoodpropertytrust.com.

Forward-Looking Statements

Statements in this press release which are not historical fact may be deemed forward-looking statements within the meaning of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended.  Forward-looking statements are developed by combining currently available information with our beliefs and assumptions and are generally identified by the words “believe,” “expect,” “anticipate” and other similar expressions.  Although Starwood Property Trust, Inc. believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, it can give no assurance that its expectations will be attained.  Factors that could cause actual results to differ materially from the Company’s expectations include, but are not limited to, the severity and duration of economic disruption caused by the COVID-19 global pandemic, completion of pending investments and financings, continued ability to acquire additional investments, competition within the finance and real estate industries, availability of financing and other risks detailed under the heading “Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2019 and our quarterly report on Form 10-Q for the quarter ended June 30, 2020, as well as other risks and uncertainties set forth from time to time in the Company's reports filed with the SEC.

In light of these risks and uncertainties, there can be no assurances that the results referred to in the forward-looking statements contained herein will in fact occur. Except to the extent required by applicable law or regulation, we undertake no obligation to, and expressly disclaim any such obligation to, update or revise any forward-looking statements to reflect changed assumptions, the occurrence of anticipated or unanticipated events, changes to future results over time or otherwise.

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Additional information can be found on the Company’s website at www.starwoodpropertytrust.com.

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**Contact:**Zachary Tanenbaum

Starwood Property Trust

Phone: 203-422-7788

Email: ztanenbaum@starwood.com

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2

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​ Starwood Property Trust, Inc. and Subsidiaries

Condensed Consolidated Statement of Operations by Segment

For the three months ended June 30, 2020

(Amounts in thousands)

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Commercial and		​	​		​	​		​	​		​	​		​	​		​	​		​	​
​	​	Residential		​	Infrastructure		​	​		​	Investing		​	​		​	​		​	​		​	​
​	​	Lending		​	Lending		​	Property		​	and Servicing		​	​		​	​		​	Securitization		​	​
​	​	Segment		​	Segment		​	Segment		​	Segment		​	Corporate		​	Subtotal		​	VIEs		​	Total
Revenues:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Interest income from loans	​	$	150,136	​	$	19,126	​	$	—	​	$	1,841	​	$	—	​	$	171,103	​	$	—	​	$	171,103
Interest income from investment securities	​		17,345	​		683	​		—	​		24,924	​	​	—	​		42,952	​		(28,308)	​		14,644
Servicing fees	​		142	​		—	​		—	​		8,591	​	​	—	​		8,733	​		(2,075)	​		6,658
Rental income	​	​	690	​	​	—	​	​	63,566	​	​	8,454	​	​	—	​	​	72,710	​	​	—	​	​	72,710
Other revenues	​		54	​		100	​		58	​		280	​	​	—	​		492	​		(1)	​		491
Total revenues	​	****	168,367	​	****	19,909	​	****	63,624	​	****	44,090	​	****	—	​	****	295,990	​	****	(30,384)	​	****	265,606
Costs and expenses:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Management fees	​		339	​		—	​		—	​		220	​		22,554	​		23,113	​		2	​		23,115
Interest expense	​		41,871	​		9,678	​		15,942	​		6,177	​	​	27,825	​		101,493	​		—	​		101,493
General and administrative	​		8,615	​		4,337	​		1,281	​		14,993	​	​	3,368	​		32,594	​		83	​		32,677
Acquisition and investment pursuit costs	​		578	​		1,100	​		—	​		(88)	​	​	—	​		1,590	​		—	​		1,590
Costs of rental operations	​	​	988	​	​	—	​	​	24,703	​	​	3,941	​	​	—	​	​	29,632	​	​	—	​	​	29,632
Depreciation and amortization	​		430	​		89	​		19,153	​		3,749	​	​	—	​		23,421	​		—	​		23,421
Credit loss provision, net	​		11,294	​		(1,092)	​		—	​		—	​	​	—	​		10,202	​		—	​		10,202
Other expense	​		76	​		—	​		26	​		—	​	​	—	​		102	​		—	​		102
Total costs and expenses	​	****	64,191	​	****	14,112	​	****	61,105	​	****	28,992	​	​	53,747	​	****	222,147	​	****	85	​	****	222,232
Other income (loss):	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Change in net assets related to consolidated VIEs	​		—	​		—	​		—	​		—	​		—	​		—	​		51,261	​		51,261
Change in fair value of servicing rights	​		—	​		—	​		—	​		5,328	​	​	—	​		5,328	​		(7,897)	​		(2,569)
Change in fair value of investment securities, net	​		5,454	​		—	​		—	​		7,941	​	​	—	​		13,395	​		(12,568)	​		827
Change in fair value of mortgage loans, net	​		33,010	​		—	​		—	​		1,440	​	​	—	​		34,450	​		—	​		34,450
Earnings (loss) from unconsolidated entities	​		671	​		(1,118)	​		—	​		29,526	​	​	—	​		29,079	​		(303)	​		28,776
(Loss) gain on sale of investments and other assets, net	​		(961)	​		—	​		—	​		7,433	​	​	—	​		6,472	​		—	​		6,472
(Loss) gain on derivative financial instruments, net	​		(11,736)	​		(437)	​		(4,614)	​		(3,828)	​	​	4,517	​		(16,098)	​		—	​		(16,098)
Foreign currency gain (loss), net	​		6,942	​		310	​		(48)	​		(31)	​	​	—	​		7,173	​		—	​		7,173
Loss on extinguishment of debt	​	​	(22)	​	​	—	​	​	(2,185)	​	​	—	​	​	—	​	​	(2,207)	​	​	—	​	​	(2,207)
Other income, net	​		—	​		—	​		191	​		13	​	​	—	​		204	​		—	​		204
Total other income (loss)	​	****	33,358	​	****	(1,245)	​	****	(6,656)	​	****	47,822	​	​	4,517	​	****	77,796	​	****	30,493	​	****	108,289
Income (loss) before income taxes	​	****	137,534	​	****	4,552	​	****	(4,137)	​	****	62,920	​	​	(49,230)	​	****	151,639	​	****	24	​	****	151,663
Income tax (provision) benefit	​		(3,257)	​		(56)	​		—	​		4,611	​	​	—	​		1,298	​		—	​		1,298
Net income (loss)	​	****	134,277	​	****	4,496	​	****	(4,137)	​	****	67,531	​	​	(49,230)	​	****	152,937	​	****	24	​	****	152,961
Net income attributable to non-controlling interests	​		(4)	​		—	​		(5,111)	​		(8,166)	​	​	—	​		(13,281)	​		(24)	​		(13,305)
Net income (loss) attributable to Starwood Property Trust, Inc.	​	$	134,273	​	$	4,496	​	$	(9,248)	​	$	59,365	​	$	(49,230)	​	$	139,656	​	$	—	​	$	139,656

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​ Definition of Core Earnings

Core Earnings, a non-GAAP financial measure, is used to compute the Company’s incentive fees to its external manager and is an appropriate supplemental disclosure for a mortgage REIT.  For the Company’s purposes, Core Earnings is defined as GAAP net income (loss) excluding non-cash equity compensation expense, the incentive fee due to the Company’s external manager, acquisition costs from successful acquisitions, depreciation and amortization of real estate and associated intangibles and any unrealized gains, losses or other non-cash items recorded in net income for the period, regardless of whether such items are included in other comprehensive income or loss, or in net income and, to the extent deducted from net income (loss), distributions payable with respect to equity securities of subsidiaries issued in exchange for properties or interests therein. The amount is adjusted to exclude one-time events pursuant to changes in GAAP and certain other non-cash adjustments as determined by the Company’s external manager and approved by a majority of the Company’s independent directors.

Reconciliation of Net Income to Core Earnings

For the three months ended June 30, 2020

(Amounts in thousands except per share data)

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	****	Commercial and		****	​		****	​		****	​		****	​		****	​
​	​	Residential		​	Infrastructure		​	​		​	Investing		​	​		​	​
​	​	Lending		​	Lending		​	Property		​	and Servicing		​	​		​	​
​	​	Segment		​	Segment		​	Segment		​	Segment		​	Corporate		​	Total
Net income (loss) attributable to Starwood Property Trust, Inc.	​	$	134,273	​	$	4,496	​	$	(9,248)	​	$	59,365	​	$	(49,230)	​	$	139,656
Add / (Deduct):	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Non-controlling interests attributable to Woodstar II Class A Units	​	​	—	​	​	—	​	​	5,111	​	​	—	​	​	—	​		5,111
Non-cash equity compensation expense	​	​	1,436	​	​	481	​	​	58	​	​	1,247	​	​	4,130	​		7,352
Acquisition and investment pursuit costs	​	​	206	​	​	—	​	​	(88)	​	​	(72)	​	​	—	​		46
Depreciation and amortization	​	​	370	​	​	79	​	​	19,236	​	​	3,337	​	​	—	​		23,022
Credit loss provision, net	​	​	11,294	​	​	(1,092)	​	​	—	​	​	—	​	​	—	​		10,202
Interest income adjustment for securities	​	​	1,149	​	​	—	​	​	—	​	​	1,627	​	​	—	​		2,776
Extinguishment of debt, net	​	​	—	​	​	—	​	​	—	​	​	—	​	​	(247)	​	​	(247)
Income tax provision (benefit) associated with fair value adjustments	​	​	1,914	​	​	—	​	​	—	​	​	(392)	​	​	—	​	​	1,522
Other non-cash items	​	​	4	​	​	—	​	​	(485)	​	​	230	​	​	156	​		(95)
Reversal of GAAP unrealized (gains) / losses on:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Loans	​	​	(33,010)	​	​	—	​	​	—	​	​	(1,440)	​	​	—	​		(34,450)
Securities	​	​	(5,454)	​	​	—	​	​	—	​	​	(7,941)	​	​	—	​	​	(13,395)
Derivatives	​	​	11,043	​	​	420	​	​	3,401	​	​	3,524	​	​	(240)	​		18,148
Foreign currency	​	​	(6,942)	​	​	(310)	​	​	48	​	​	31	​	​	—	​		(7,173)
(Earnings) loss from unconsolidated entities	​	​	(671)	​	​	1,118	​	​	—	​	​	(29,526)	​	​	—	​		(29,079)
Recognition of Core realized gains / (losses) on:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Loans	​	​	(5,663)	​	​	—	​	​	—	​	​	(1)	​	​	—	​	​	(5,664)
Securities	​	​	—	​	​	—	​	​	—	​	​	(181)	​	​	—	​		(181)
Derivatives	​	​	4,522	​	​	—	​	​	(369)	​	​	(10)	​	​	—	​		4,143
Foreign currency	​	​	(1,969)	​	​	52	​	​	(50)	​	​	(31)	​	​	—	​		(1,998)
(Loss) earnings from unconsolidated entities	​	​	(24)	​	​	(733)	​	​	—	​	​	12,992	​	​	—	​		12,235
Sales of properties	​	​	—	​	​	—	​	​	—	​	​	(5,789)	​	​	—	​		(5,789)
Core Earnings (Loss)	​	$	112,478	​	$	4,511	​	$	17,614	​	$	36,970	​	$	(45,431)	​	$	126,142
Core Earnings (Loss) per Weighted Average Diluted Share	​	$	0.38	​	$	0.02	​	$	0.06	​	$	0.12	​	$	(0.15)	​	$	0.43

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4

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​ Starwood Property Trust, Inc. and Subsidiaries

Condensed Consolidated Statement of Operations by Segment

For the six months ended June 30, 2020

(Amounts in thousands)

​

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Commercial and		​	​		​	​		​	​		​	​		​	​		​	​		​	​
​	****	Residential		****	Infrastructure		****	​		****	Investing		****	​		****	​		****	​		****	​
​	​	Lending		​	Lending		​	Property		​	and Servicing		​	​		​	​		​	Securitization		​	​
​	​	Segment		​	Segment		​	Segment		​	Segment		​	Corporate		​	Subtotal		​	VIEs		​	Total
Revenues:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Interest income from loans	​	$	342,517	​	$	41,539	​	$	—	​	$	4,474	​	$	—	​	$	388,530	​	$	—	​	$	388,530
Interest income from investment securities	​		35,973	​		1,384	​		—	​		49,724	​	​	—	​		87,081	​		(57,197)	​		29,884
Servicing fees	​		314	​		—	​		—	​		15,033	​	​	—	​		15,347	​		(3,896)	​		11,451
Rental income	​	​	768	​	​	—	​	​	127,527	​	​	18,561	​	​	—	​	​	146,856	​	​	—	​	​	146,856
Other revenues	​		232	​		243	​		180	​		793	​	​	—	​		1,448	​		(3)	​		1,445
Total revenues	​	****	379,804	​	****	43,166	​	****	127,707	​	****	88,585	​	****	—	​	****	639,262	​	****	(61,096)	​	****	578,166
Costs and expenses:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Management fees	​		690	​		—	​		—	​		459	​		62,661	​		63,810	​		33	​		63,843
Interest expense	​		95,821	​		22,795	​		33,063	​		13,371	​	​	56,630	​		221,680	​		(162)	​		221,518
General and administrative	​		16,747	​		8,760	​		2,359	​		35,677	​	​	7,669	​		71,212	​		167	​		71,379
Acquisition and investment pursuit costs	​		1,438	​		1,117	​		12	​		(68)	​	​	—	​		2,499	​		—	​		2,499
Costs of rental operations	​	​	1,766	​	​	—	​	​	47,555	​	​	8,525	​	​	—	​	​	57,846	​	​	—	​	​	57,846
Depreciation and amortization	​		845	​		159	​		38,441	​		7,956	​	​	—	​		47,401	​		—	​		47,401
Credit loss provision, net	​		51,511	​		7,360	​		—	​		—	​	​	—	​		58,871	​		—	​		58,871
Other expense	​		153	​		—	​		337	​		—	​	​	—	​		490	​		—	​		490
Total costs and expenses	​	****	168,971	​	****	40,191	​	****	121,767	​	****	65,920	​	​	126,960	​	****	523,809	​	****	38	​	****	523,847
Other income (loss):	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Change in net assets related to consolidated VIEs	​		—	​		—	​		—	​		—	​		—	​		—	​		5,768	​		5,768
Change in fair value of servicing rights	​		—	​		—	​		—	​		5,646	​	​	—	​		5,646	​		(8,608)	​		(2,962)
Change in fair value of investment securities, net	​		(22,425)	​		—	​		—	​		(39,275)	​	​	—	​		(61,700)	​		65,031	​		3,331
Change in fair value of mortgage loans, net	​		(2,507)	​		—	​		—	​		20,823	​	​	—	​		18,316	​		—	​		18,316
Earnings (loss) from unconsolidated entities	​		722	​		(1,118)	​		—	​		30,146	​	​	—	​		29,750	​		(877)	​		28,873
(Loss) gain on sale of investments and other assets, net	​		(961)	​		296	​		—	​		7,433	​	​	—	​		6,768	​		—	​		6,768
Gain (loss) on derivative financial instruments, net	​		19,069	​		(1,438)	​		(34,837)	​		(22,934)	​	​	33,752	​		(6,388)	​		—	​		(6,388)
Foreign currency loss, net	​		(27,059)	​		(163)	​		(67)	​		(24)	​	​	—	​		(27,313)	​		—	​		(27,313)
Loss on extinguishment of debt	​	​	(22)	​	​	(170)	​	​	(2,185)	​	​	—	​	​	—	​	​	(2,377)	​	​	—	​	​	(2,377)
Other income, net	​		—	​		—	​		241	​		89	​	​	—	​		330	​		—	​		330
Total other (loss) income	​	****	(33,183)	​	****	(2,593)	​	****	(36,848)	​	****	1,904	​	​	33,752	​	****	(36,968)	​	****	61,314	​	****	24,346
Income (loss) before income taxes	​	****	177,650	​	****	382	​	****	(30,908)	​	****	24,569	​	​	(93,208)	​	****	78,485	​	****	180	​	****	78,665
Income tax benefit	​		1,165	​		89	​		—	​		6,773	​	​	—	​		8,027	​		—	​		8,027
Net income (loss)	​	****	178,815	​	****	471	​	****	(30,908)	​	****	31,342	​	​	(93,208)	​	****	86,512	​	****	180	​	****	86,692
Net income attributable to non-controlling interests	​		(7)	​		—	​		(10,222)	​		(3,396)	​	​	—	​		(13,625)	​		(180)	​		(13,805)
Net income (loss) attributable to Starwood Property Trust, Inc.	​	$	178,808	​	$	471	​	$	(41,130)	​	$	27,946	​	$	(93,208)	​	$	72,887	​	$	—	​	$	72,887

​

5

​

​ Reconciliation of Net Income to Core Earnings

For the six months ended June 30, 2020

(Amounts in thousands except per share data)

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	****	Commercial and		****	​		****	​		****	​		****	​		****	​
​	​	Residential		​	Infrastructure		​	​		​	Investing		​	​		​	​
​	​	Lending		​	Lending		​	Property		​	and Servicing		​	​		​	​
​	​	Segment		​	Segment		​	Segment		​	Segment		​	Corporate		​	Total
Net income (loss) attributable to Starwood Property Trust, Inc.	​	$	178,808	​	$	471	​	$	(41,130)	​	$	27,946	​	$	(93,208)	​	$	72,887
Add / (Deduct):	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Non-controlling interests attributable to Woodstar II Class A Units	​	​	—	​	​	—	​	​	10,222	​	​	—	​	​	—	​		10,222
Non-cash equity compensation expense	​		2,548	​	​	947	​	​	131	​	​	2,510	​	​	10,016	​	​	16,152
Management incentive fee	​		—	​	​	—	​	​	—	​	​	—	​	​	15,799	​	​	15,799
Acquisition and investment pursuit costs	​	​	564	​	​	—	​	​	(177)	​	​	(72)	​	​	—	​	​	315
Depreciation and amortization	​		725	​	​	130	​	​	38,617	​	​	7,144	​	​	—	​	​	46,616
Credit loss provision, net	​		51,511	​	​	7,360	​	​	—	​	​	—	​	​	—	​	​	58,871
Interest income adjustment for securities	​		1,273	​	​	—	​	​	—	​	​	7,942	​	​	—	​	​	9,215
Extinguishment of debt, net	​	​	—	​	​	—	​	​	—	​	​	—	​	​	(493)	​	​	(493)
Income tax benefit associated with fair value adjustment	​	​	(3,907)	​	​	—	​	​	—	​	​	(1,834)	​	​	—	​	​	(5,741)
Other non-cash items	​	​	7	​	​	—	​	​	(976)	​	​	478	​	​	312	​	​	(179)
Reversal of GAAP unrealized (gains) / losses on:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Loans	​		2,507	​	​	—	​	​	—	​	​	(20,823)	​	​	—	​	​	(18,316)
Securities	​		22,425	​	​	—	​	​	—	​	​	39,275	​	​	—	​	​	61,700
Derivatives	​		(19,520)	​	​	1,433	​	​	33,970	​	​	22,537	​	​	(27,889)	​	​	10,531
Foreign currency	​		27,059	​	​	163	​	​	67	​	​	24	​	​	—	​	​	27,313
(Earnings) loss from unconsolidated entities	​		(722)	​	​	1,118	​	​	—	​	​	(30,146)	​	​	—	​	​	(29,750)
Recognition of Core realized gains / (losses) on:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Loans	​		(3,499)	​	​	(62)	​	​	—	​	​	16,558	​	​	—	​	​	12,997
Securities	​		—	​	​	—	​	​	—	​	​	(4,393)	​	​	—	​	​	(4,393)
Derivatives	​		7,772	​	​	118	​	​	(404)	​	​	(6,097)	​	​	—	​	​	1,389
Foreign currency	​		(6,240)	​	​	(142)	​	​	(69)	​	​	(24)	​	​	—	​	​	(6,475)
(Loss) earnings from unconsolidated entities	​		(580)	​	​	(733)	​	​	—	​	​	16,730	​	​	—	​	​	15,417
Sales of properties	​		—	​	​	—	​	​	—	​	​	(5,789)	​	​	—	​	​	(5,789)
Core Earnings (Loss)	​	$	260,731	​	$	10,803	​	$	40,251	​	$	71,966	​	$	(95,463)	​	$	288,288
Core Earnings (Loss) per Weighted Average Diluted Share	​	$	0.88	​	$	0.04	​	$	0.14	​	$	0.24	​	$	(0.32)	​	$	0.98

​

​

6

​

​ Starwood Property Trust, Inc. and Subsidiaries

Condensed Consolidated Balance Sheet by Segment

As of June 30, 2020

(Amounts in thousands)

​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
​	​	Commercial and		​	​		​	​		​	​		​	​		​	​		​	​		​	​
​	​	Residential		​	Infrastructure		​	​		​	Investing		​	​		​	​		​	​		​	​
​	​	Lending		​	Lending		​	Property		​	and Servicing		​	​		​	​		​	Securitization		​	​
​	​	Segment		​	Segment		​	Segment		​	Segment		​	Corporate		​	Subtotal		​	VIEs		​	Total
Assets:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Cash and cash equivalents	​	$	13,959	​	$	299	​	$	30,237	​	$	35,855	​	$	266,333	​	$	346,683	​	$	1,051	​	$	347,734
Restricted cash	​		114,656	​		34,160	​		7,537	​		20,044	​		—	​		176,397	​		—	​		176,397
Loans held-for-investment, net	​		8,960,410	​		1,459,239	​		—	​		1,153	​		—	​		10,420,802	​		—	​		10,420,802
Loans held-for-sale	​		432,786	​		44,876	​		—	​		194,097	​		—	​		671,759	​		—	​		671,759
Investment securities	​		1,120,624	​		40,312	​		—	​		1,094,613	​		—	​		2,255,549	​		(1,503,524)	​		752,025
Properties, net	​	​	27,283	​	​	—	​	​	1,998,759	​	​	198,281	​	​	—	​	​	2,224,323	​	​	—	​	​	2,224,323
Intangible assets	​		—	​		—	​		43,580	​		67,567	​		—	​		111,147	​		(34,854)	​		76,293
Investment in unconsolidated entities	​		49,853	​		24,744	​		—	​		47,114	​		—	​		121,711	​		(16,798)	​		104,913
Goodwill	​		—	​		119,409	​		—	​		140,437	​		—	​		259,846	​		—	​		259,846
Derivative assets	​		47,875	​		—	​		348	​		586	​		42,096	​		90,905	​		—	​		90,905
Accrued interest receivable	​		55,877	​		3,163	​		—	​		520	​		13,589	​		73,149	​		(1,401)	​		71,748
Other assets	​		29,864	​		5,616	​		81,859	​		57,321	​		9,512	​		184,172	​		(25)	​		184,147
VIE assets, at fair value	​		—	​		—	​		—	​		—	​		—	​		—	​		64,175,387	​		64,175,387
Total Assets	​	$	10,853,187	​	$	1,731,818	​	$	2,162,320	​	$	1,857,588	​	$	331,530	​	$	16,936,443	​	$	62,619,836	​	$	79,556,279
Liabilities and Equity	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Liabilities:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Accounts payable, accrued expenses and other liabilities	​	$	27,941	​	$	10,285	​	$	45,277	​	$	36,400	​	$	91,765	​	$	211,668	​	$	54	​	$	211,722
Related-party payable	​		—	​		—	​		—	​		5	​		20,936	​		20,941	​		—	​		20,941
Dividends payable	​		—	​		—	​		—	​		—	​		138,778	​		138,778	​		—	​		138,778
Derivative liabilities	​		2,260	​		1,620	​		—	​		—	​		—	​		3,880	​		—	​		3,880
Secured financing agreements, net	​		4,749,321	​		1,221,001	​		1,792,818	​		683,466	​		389,714	​		8,836,320	​		—	​		8,836,320
Collateralized loan obligations, net	​	​	929,307	​	​	—	​	​	—	​		—	​		—	​		929,307	​	​	—	​	​	929,307
Unsecured senior notes, net	​		—	​		—	​		—	​		—	​		1,932,560	​		1,932,560	​		—	​		1,932,560
VIE liabilities, at fair value	​		—	​		—	​		—	​		—	​		—	​		—	​		62,617,975	​		62,617,975
Total Liabilities	​	****	5,708,829	​	****	1,232,906	​	****	1,838,095	​	****	719,871	​	****	2,573,753	​	****	12,073,454	​	****	62,618,029	​	****	74,691,483
Equity:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Starwood Property Trust, Inc. Stockholders’ Equity:	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​	​
Common stock	​		—	​		—	​		—	​		—	​		2,916	​		2,916	​		—	​		2,916
Additional paid-in capital	​		1,473,921	​		504,262	​		137,777	​		(228,654)	​		3,306,266	​		5,193,572	​		—	​		5,193,572
Treasury stock	​		—	​		—	​		—	​		—	​		(133,024)	​		(133,024)	​		—	​		(133,024)
Accumulated other comprehensive income (loss)	​		42,930	​		—	​		—	​		(64)	​		—	​		42,866	​		—	​		42,866
Retained earnings (accumulated deficit)	​		3,627,392	​		(5,350)	​		(40,699)	​		1,222,945	​		(5,418,381)	​		(614,093)	​		—	​		(614,093)
Total Starwood Property Trust, Inc. Stockholders’ Equity	​		5,144,243	​		498,912	​		97,078	​		994,227	​		(2,242,223)	​		4,492,237	​		—	​		4,492,237
Non-controlling interests in consolidated subsidiaries	​		115	​		—	​		227,147	​		143,490	​		—	​		370,752	​		1,807	​		372,559
Total Equity	​	****	5,144,358	​	****	498,912	​	****	324,225	​	****	1,137,717	​	****	(2,242,223)	​	****	4,862,989	​	****	1,807	​	****	4,864,796
Total Liabilities and Equity	​	$	10,853,187	​	$	1,731,818	​	$	2,162,320	​	$	1,857,588	​	$	331,530	​	$	16,936,443	​	$	62,619,836	​	$	79,556,279

​

7

​