Seven Hills Realty Trust · NASDAQ:SEVN
Seven Hills Realty Trust — Q1 2025 Earnings Presentation
24 slides from Seven Hills Realty Trust's earnings presentation, Apr 28, 2025
Slide 1: Financial Results and Supplemental Information
Financial Results and Supplemental Information FIRST QUARTER 2025 April 28, 2025
Slide 2: Seven Hills Realty Trust Announces First Quarter 2025 Results
Seven Hills Realty Trust Announces First Quarter 2025 Results “We delivered solid first quarter Newton, MA (April 28, 2025). Seven Hills Realty Trust (Nasdaq: SEVN) today announced financial results for the quarter ended March 31, 2025. results, highlighted by sequential quarter growth in distributa
Slide 3: Company Snapshot
Company Snapshot (As of March 31, 2025, unless otherwise noted) Strong Loan Portfolio Conservative Leverage Integrated with RMR Real Estate Platform $691 million 1.6x 11% Floating rate Debt to equity ratio Ownership of SEVN first mortgage loan commitments $30 million $740 million ~$40 billion Averag
Slide 4: First Quarter 2025 Highlights
First Quarter 2025 Highlights (As of and for the three months ended March 31, 2025, unless otherwise noted) • Generated net income of $4.5 million, or $0.30 per diluted share, and Distributable Earnings of $5.0 million, or $0.34 per Financial diluted share. Results • Quarterly distribution of $0.35
Slide 5: First Quarter 2025 Financial Summary
First Quarter 2025 Financial Summary (amounts in thousands, except per share data) Income Statement Balance Sheet Three Months Ended March 31, 2025 March 31, 2025 Income from loan investments, net $ 6,885 Loans held for investment, net $ 652,589 Revenue from real estate owned 709 Real estate owned,
Slide 6: Distributable Earnings Bridge
Distributable Earnings Bridge (1) 0 .4 $0 8 .3 $0 ($0.02) 6 .3 $0 $0.04 $0.35 ($0.02) 4 $0.34 .3 $0.01 $0 $0.33 $0.33 $0.33 $0.33 2 .3 $0 0 .3 $0 8 .2 $0 6 .2 Q4 2024 Distributable Earnings Net interest income - loan Net interest income - loan Net interest income - decline in Other activity, net Q1
Slide 7: Income from Loan Investments, Net - Interest Rate Trends
Income from Loan Investments, Net - Interest Rate Trends Despite a well performing portfolio, recent declines in index rates, paired with continued compression of net interest margins on new loan originations coupled with less overall portfolio leverage, present continued headwinds to SEVN’s earning
Slide 8: Loan Origination Trends - Net Interest Margin
Loan Origination Trends - Net Interest Margin 2.00% 1.89% 1.80% 1.74% 1.60% 1.40% 1.35% Net Interest Margin (1) 1.20% 1.09% 1.00% 1.04% 0.80% 12/31/2021 12/31/2022 12/31/2023 12/31/2024 3/31/2025 Loans Originated 17 7 5 5 2 (1) Represents the difference between the interest rate margin for the new l
Slide 9: Loan Portfolio Summary
Loan Portfolio Summary First Quarter As of (dollars in thousands) Originations March 31, 2025 Number of loans 2 23 First Quarter 2025 Loan Portfolio Activity (dollars in millions) Average loan commitment $24,850 $30,040 $690.9 Total Loan Commitments $3.2 $29.5 Unfunded Commitments Total loan commitm
Slide 10: Loan Portfolio Originations and Diversity
Loan Portfolio Originations and Diversity Geographic Region (1) Loan Originations by Quarter (dollars in millions) Midwest 21% $87.0 South 36% $5.2 East 21% $54.3 West $- $49.7 Total Loan Commitments 22% $44.8 $3.2 Unfunded Commitments (1) $37.5 $3.2 $41.6 Property Type Retail $- $81.8 $5.6 Retail 9
Slide 11: Loan Portfolio Credit Quality
Loan Portfolio Credit Quality Loan to Value (1) % of Portfolio Weighted Average LTV: 67% 32% 21% 19% 17% 11% 30% - 60% 61% - 65% 66% - 70% 71% - 75% 76% - 80% Loan Count 5 3 4 8 3 Risk Rating Distribution (1) % of Portfolio Weighted Average Risk Rating: 2.9 51% 21% 22% 6% —% Lower Risk (1) Average R
Slide 12: Office Loans
Office Loans (1) • No office loans in urban or CBD markets in our portfolio. • As of March 31, 2025, all of our borrowers had paid their debt service obligations owed and due to us. • Reduced office loan exposure from 27% at December 31, 2024 to 25% at March 31, 2025. Total Loan Portfolio Office Ris
Slide 13: Secured Financing Facilities
Secured Financing Facilities (As of March 31, 2025) Total/Weighted UBS Citibank BMO Wells Fargo Average (dollars in thousands) Maximum facility size $ 250,000 $ 215,000 $ 150,000 $ 125,000 $ 740,000 Principal balance $ 181,989 $ 93,314 $ 103,855 $ 62,868 $ 442,026 Unused capacity $ 68,011 $ 121,686
Slide 14: Appendix
SEVEN HILLS REALTY TRUST Appendix a eo Ph ... ) — “4
Slide 15: Company Profile, Governance and Research Coverage
Company Profile, Governance and Research Coverage Management Equity Research Coverage Our manager, Tremont, is registered with the Securities and Exchange Commission, or SEC, as an JMP Securities Janney Montgomery Scott investment adviser and is owned by RMR. As of March 31, 2025, RMR had approximat
Slide 16: Loan Investment Details
Loan Investment Details (dollars in thousands) First mortgage loans as of March 31, 2025: Committed Maximum Origination Principal Principal Coupon All in Maturity Maturity Risk # Location Property Type Date Amount Balance Rate Yield Date Date LTV Rating 1 Olmsted Falls, OH Multifamily 01/28/2021 $ 5
Slide 17: Loan Investment Details (Continued)
Loan Investment Details (Continued) (dollars in thousands) First mortgage loans as of March 31, 2025: Committed Maximum Origination Principal Principal Coupon All in Maturity Maturity Risk # Location Property Type Date Amount Balance Rate Yield Date Date LTV Rating 14 Fayetteville, GA Industrial 10/
Slide 18: Interest Rate Sensitivity
Interest Rate Sensitivity (As of March 31, 2025) Annualized Impact to Net Interest Income per Share $0.20 $0.15 $0.15 $0.12 $0.10 $0.08 $0.05 $0.05 $— $0.00 $(0.02) $-0.05 $(0.04) $(0.06) $(0.07) $-0.10 $-0.15 $-0.20 -100 bps -75 bps -50 bps -25 bps 0 bps +25 bps +50 bps +75 bps +100 bps Interest Ra
Slide 19: Financial Summary
Condensed Consolidated Balance Sheets (dollars in thousands, except per share data) March 31, December 31, 2025 2024 ASSETS Cash and cash equivalents $ 41,637 $ 70,750 Loans held for investment 660,237 609,916 Allowance for credit losses (7,648) (8,074) Loans held for investment, net 652,589 601,842
Slide 20: Condensed Consolidated Statements of Operations
Condensed Consolidated Statements of Operations (amounts in thousands, except per share data) Three Months Ended March 31, 2025 2024 INCOME FROM INVESTMENTS: Interest and related income $ 14,322 $ 16,311 Purchase discount accretion — 1,145 Less: interest and related expenses (7,437) (8,673) Income f
Slide 21: Non-GAAP Financial Measures
Non-GAAP Financial Measures (amounts in thousands, except per share data) Three Months Ended March 31, December 31, September 30, June 30, March 31, 2025 2024 2024 2024 2024 Net income $ 4,532 $ 4,879 $ 3,479 $ 4,229 $ 5,233 Non-cash equity compensation expense 356 159 367 497 336 Non-cash accretion
Slide 22: Non-GAAP Financial Measures (Continued)
Non-GAAP Financial Measures (Continued) We present Distributable Earnings, Distributable Earnings per common share, Adjusted Book Value and Adjusted Book Value per common share, which are considered “non-GAAP financial measures” within the meaning of the applicable SEC rules. These non-GAAP financia
Slide 23: Other Measures and Definitions
Other Measures and Definitions All In Yield: All In Yield represents the yield on a loan, including amortization of deferred fees over the initial term of the loan and excluding any purchase discount accretion. BMO Facility: Amounts advanced under the facility loan agreement and security agreement w
Slide 24: Warning Concerning Forward-Looking Statements
Warning Concerning Forward-Looking Statements This presentation contains statements that constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 and other securities laws. These statements include words such as “believe”, "could", “expect”, “a
Seven Hills Realty Trust — Q1 2025 Earnings Presentation on 6ix