Acres Commercial Realty Corp. · NYSE:ACR
Acres Commercial Realty — Q2 2021 Earnings Presentation
27 slides from Acres Commercial Realty's earnings presentation, Aug 4, 2021
Slide 1: Second Quarter 2021 Earnings Presentation
ACRES Commercial Realty Corp. Second Quarter 2021 Earnings Presentation August 4, 2021
Slide 2: Forward Looking Statements
Forward Looking Statements This presentation contains forward-looking statements within the meaning of federal securities laws. These forward-looking statements are not historical facts but rather are based on our current beliefs, assumptions and expectations. These beliefs, assumptions and expectat
Slide 3: Forward Looking Statements (continued)
Forward Looking Statements (continued) We undertake no obligation, and specifically disclaim any obligation, to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law. In light of these risks and uncerta
Slide 4: Second Quarter 2021 Highlights
Second Quarter 2021 Highlights1 CRE2 loan originations increased by 226% over the first quarter of 2021. Growth in CRE Loan Robust Liquidity at GAAP Net Income2 Originations July 31, 2021 $243M $470M $1.04 of net liquidity, including unrestricted cash, CRE term of CRE loan originations were facili
Slide 5: Results for Quarter and Six Months Ended June 30, 2021
Results for Quarter and Six Months Ended June 30, 2021
Slide 6: Results and Recent Developments
Three And Six Months Ended June 30, 2021 Results and Recent Developments GAAP net income2,4: $1.04 and $2.06, respectively GAAP net income4 includes a $1.06 and $1.60, respectively, reversal of CECL5 reserves primarily resulting from: Financial Results Improved macroeconomic factors CRE loan
Slide 7: Second Quarter 2021 Book Value
Second Quarter 2021 Book Value GAAP Book Value per Share Walk $0.18 $0.01 $23.56 $0.05 $1.05 $22.27 GAAP GAAPBook BookValue Value- -Mar. Mar.‘21 '2110 GAAP Net Income11 OCI OCI12 Stock Repurchases13 Equity Compensation Compensation GAAPBook GAAP BookValue Value--Jun. Jun.‘21 '2110 ACRESREIT.COM 7
Slide 8: CRE Loan Activity and Portfolio
CRE Loan Activity and Portfolio
Slide 9: Deployment Progress
Deployment Progress CRE Loan Production, at Par $ in Millions 2nd Quarter 2021 1st Quarter 2021 4th Quarter 2020 New CRE floating-rate loan commitments $470.2 $144.3 $83.4 Sales, payoffs and paydowns14 (353.2) (197.2) (162.0) Future fundings 6.5 6.6 6.3 New unfunded loan commitments (39.0) (18.6) (0
Slide 10: Production, Payoff and Paydown Detail
Production, Payoff and Paydown Detail New Loan Production W. Avg. Coupon Rate Commitments Multifamily (14 Loans) 1M L + 3.47% $401.3 Hotel (2 Loans) 1M L + 6.30% $35.6 Office (1 Loan) 1M L + 5.00% $25.0 Self-Storage (1 Loan) 1M L + 5.25% $8.3 W. Avg./Total 1M L + 3.81% $470.2 W. Avg. Months on W. Av
Slide 11: CRE Loan Portfolio Overview
CRE Loan Portfolio Overview $ in Millions Jun. 30, 2021 Mar. 31, 2021 Dec. 31, 2020 Sep. 30, 2020 (88 loans) (92 loans) (100 loans) (107 loans) CRE whole loans, floating-rate20,21 $1,559 $1,456 $1,510 $1,620 CRE mezzanine loan 5 5 5 5 CRE preferred equity investments22 - 22 27 27 Total loans held fo
Slide 12: CRE Loan Portfolio LTV
CRE Loan Portfolio LTV25 80% $1,800 75% $1,600 73% 74% $1,400 72% 70% 71% Weighted Average LTV $1,200 Principal (in Millions) $1,000 65% $800 60% $600 $400 55% $200 50% $- September 30, 2020 December 31, 2020 March 31, 2021 June 30, 2021 Whole Loans, Floating-Rate Mezz. Loan Pref. Equity Invests. W.
Slide 13: CRE Loan Portfolio Diversification
CRE Loan Portfolio Diversification Balance by Region26,27 Property Type27 Office, 15.5% Pacific Multifamily, 13.0% Northeast Hotel, East 60.8% 12.5% 11.6% West North North Central Central Self- Mountain 1.6% 7.4% Mid Storage, 18.4% Atlantic 6.5% 13.2% Retail, Southeast Manufactured Housing, 4.7% 18.
Slide 14: CRE Loan Portfolio Risk Ratings
CRE Loan Portfolio Risk Ratings29 89% of ACR’s loans have a risk rating of 2 or 3 that are performing in line or near underwritten expectations All but two of ACR’s 88 loans are current on contractual payments through June 2021 Percentage of Principal at June 30, 2021 Percentage of Principal at
Slide 15: Capitalization and Liquidity
Capitalization and Liquidity
Slide 16: Summary Capitalization
Summary Capitalization $1.0 billion of availability32 on its term warehouse and senior financing facilities and senior unsecured notes at June 30, 2021. $ in Millions Capitalization7 Maximum Wghtd. Avg. Leverage Amount Availability32 Capacity Coupon Ratio33 Term warehouse financing facilities $750
Slide 17: Historical Leverage Ratios
Historical Leverage Ratios Historical Leverage Ratio33 4.6x 3.9x 3.9x 3.0x 1.2x 1.1x 0.8x 0.7x September 30, 2020 December 31, 2020 March 31, 2021 June 30, 2021 Recourse Debt34Leverage LeverageRatio Ratio Total Leverage Ratio ACRESREIT.COM 17
Slide 18: Liquidity at July 31, 2021
Liquidity at July 31, 2021 ($ in Millions) $75.0 $243.1 $(40.0) $118.1 $90.0 Unrestricted Cash CRE Term and Senior CRE Term Senior Unsecured Working Capital Net Liquidity Secured Facilities and Senior Notes Availability Reserve Estimated SecuredUnfinanced Facilities Proceeds Unfinanced 43 Proceeds A
Slide 19: Appendix
ACRES COMMERCIAL REALTY Appendix
Slide 20: Consolidated Balance Sheets
Consolidated Balance Sheets (In Thousands, except share and per share data) Jun. 30, 2021 Dec. 31, 2020 Assets (Unaudited) Cash and cash equivalents $90,805 $29,355 Restricted cash 15,003 38,386 Accrued interest receivable 7,254 7,372 CRE loans 1,564,025 1,541,992 Less: allowance for credit losses (
Slide 21: Consolidated Statements of Operations
Consolidated Statements of Operations (Unaudited, in thousands, except share and per share data) For the Three Months Ended For the Six Months Ended Jun. 30, 2021 Jun. 30, 2020 Jun. 30, 2021 Jun. 30, 2020 Revenues Interest income $25,793 $27,243 $50,542 $60,533 Interest expense 18,702 12,547 32,426
Slide 22: Core Earnings
Core Earnings45 The following table provides a reconciliation from GAAP net income (loss) allocable to common shares to Core Earnings allocable to common shares, a non-GAAP measure, for the periods presented: (Unaudited, In Thousands, except share and per share data) For the Three Months Ended For
Slide 23: Footnotes
Footnotes 1. “Second quarter 2021 highlights” includes activity that occurred during the third repurchase program to repurchase up to $20.0 million of the currently outstanding quarter of 2021 or balances at July 31, 2021, where specifically referenced. common stock through June 2021 or until the $2
Slide 24: Footnotes (Continued)
Footnotes (Continued) 30. Includes one mezzanine loan, 0.3% of total principal, risk rated a 3 at June 30, 2021 43. CRE term and senior secured facilities estimated unfinanced proceeds includes the and March 31, 2021. projected amount of proceeds available to the Company if the unfinanced loans were
Slide 25: Other Disclosures
Other Disclosures Commercial Real Estate Loans Risk Ratings CRE loans are collateralized by a diversified mix of real estate properties and are assessed for credit quality based on the collective evaluation of several factors, including but not limited to: collateral performance relative to underwri
Slide 26: Other Disclosures (continued)
Other Disclosures (continued) Core Earnings Core Earnings is a non-GAAP financial measure that we use to evaluate our operating performance. Core Earnings exclude the effects of certain transactions and GAAP adjustments that we believe are not necessarily indicative of our current CRE loan portfolio
Slide 27: Company Information
Company Information ACRES Commercial Realty Corp. is a real estate investment trust that is primarily focused on originating, holding and managing commercial real estate mortgage loans and other commercial real estate-related debt investments. Additional information is available at the Company’s web
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