Ares Commercial Real Estate Corporation · NYSE:ACRE
Ares Commercial Real Estate — FY2021 Earnings Presentation
21 slides from Ares Commercial Real Estate's earnings presentation, Feb 15, 2022
Slide 1: Fourth Quarter and Full Year 2021 Earnings Presentation
0 42 65 155 112 42 4 94 109 127 127 127 0 42 65 2 87 133 71 126 163 120 163 198 Credit Private Equit y Real Estat e Strategi c Initiat ives BUSINE SS SECTOR PALETT E GENER AL PALET TE Fourth Quarter and Full Year 2021 Earnings Presentation Exhibit 99.2
Slide 2: Disclaimer
0 42 65 155 112 42 4 94 109 127 127 127 0 42 65 2 87 133 71 126 163 120 163 198 Credit Private Equit y Real Estat e Strategi c Initiat ives BUSINE SS SECTOR PALETT E GENER AL PALET TE 1 Disclaimer Statements included herein may constitute “forward-looking statements” within the meaning of the Privat
Slide 3: Originations activity supports portfolio growth and stable earnings
0 42 65 155 112 42 4 94 109 127 127 127 0 42 65 2 87 133 71 126 163 120 163 198 Credit Private Equit y Real Estat e Strategi c Initiat ives BUSINE SS SECTOR PALETT E GENER AL PALET TE 2 Originations activity supports portfolio growth and stable earnings Company Highlights As of December 31, 2021, un
Slide 4: Summary of Q4 and FY 2021 Results and Activity
0 42 65 155 112 42 4 94 109 127 127 127 0 42 65 2 87 133 71 126 163 120 163 198 Credit Private Equit y Real Estat e Strategi c Initiat ives BUSINE SS SECTOR PALETT E GENER AL PALET TE 3 Summary of Q4 and FY 2021 Results and Activity Earnings Results ∙ Q4 and FY 2021 GAAP net income of $0.36 and $1.4
Slide 5: Loan Portfolio Positioning and Performance
0 42 65 155 112 42 4 94 109 127 127 127 0 42 65 2 87 133 71 126 163 120 163 198 Credit Private Equit y Real Estat e Strategi c Initiat ives BUSINE SS SECTOR PALETT E GENER AL PALET TE 4 32% 22% 20% 18% 8% Southeast West Midwest Mid-Atlantic / Northeast Southwest 34% 13% 13% 12% 10% 7% 6% 5% Office M
Slide 6: Record Year of Production in 2021 / Accelerated Portfolio Growth
0 42 65 155 112 42 4 94 109 127 127 127 0 42 65 2 87 133 71 126 163 120 163 198 Credit Private Equit y Real Estat e Strategi c Initiat ives BUSINE SS SECTOR PALETT E GENER AL PALET TE 5 $875 $956 $609 $777 $524 $1,366 New commitments 2016 2017 2018 2019 2020 2021 Note: Differences may arise due to r
Slide 7: Q4 and FY 2021 Origination Activity
0 42 65 155 112 42 4 94 109 127 127 127 0 42 65 2 87 133 71 126 163 120 163 198 Credit Private Equit y Real Estat e Strategi c Initiat ives BUSINE SS SECTOR PALETT E GENER AL PALET TE 6 Note: Differences may arise due to rounding. 1. Based on commitment amount for new loan commitments closed. Q4 and
Slide 8: Conservative Balance Sheet and Liquidity Management
0 42 65 155 112 42 4 94 109 127 127 127 0 42 65 2 87 133 71 126 163 120 163 198 Credit Private Equit y Real Estat e Strategi c Initiat ives BUSINE SS SECTOR PALETT E GENER AL PALET TE 7 Conservative Balance Sheet and Liquidity Management Note: As of December 31, 2021, unless otherwise noted. Diversi
Slide 9: Well-Positioned for Potential Rise in Short-Term Interest Rates
0 42 65 155 112 42 4 94 109 127 127 127 0 42 65 2 87 133 71 126 163 120 163 198 Credit Private Equit y Real Estat e Strategi c Initiat ives BUSINE SS SECTOR PALETT E GENER AL PALET TE 8 Well-Positioned for Potential Rise in Short-Term Interest Rates Interest Rate Sensitivity to Benchmark Interest Ra
Slide 10: History of Growing and Consistent Dividends
0 42 65 155 112 42 4 94 109 127 127 127 0 42 65 2 87 133 71 126 163 120 163 198 Credit Private Equit y Real Estat e Strategi c Initiat ives BUSINE SS SECTOR PALETT E GENER AL PALET TE 9 Dividend Coverage (per share) 1.0x 1.2x 1.1x 1.0x 1.1x Supplemental dividend of $0.02 Distributable Earnings 2017
Slide 11: Appendix
0 42 65 155 112 42 4 94 109 127 127 127 0 42 65 2 87 133 71 126 163 120 163 198 Credit Private Equit y Real Estat e Strategi c Initiat ives BUSINE SS SECTOR PALETT E GENER AL PALET TE Appendix
Slide 12: Current Expected Credit Losses
0 42 65 155 112 42 4 94 109 127 127 127 0 42 65 2 87 133 71 126 163 120 163 198 Credit Private Equit y Real Estat e Strategi c Initiat ives BUSINE SS SECTOR PALETT E GENER AL PALET TE 11 Current Expected Credit Losses ∙ No specific loan impairments on loan portfolio ∙ Increase in CECL reserve of $0.
Slide 13: Additional Details on Sources of Funding
0 42 65 155 112 42 4 94 109 127 127 127 0 42 65 2 87 133 71 126 163 120 163 198 Credit Private Equit y Real Estat e Strategi c Initiat ives BUSINE SS SECTOR PALETT E GENER AL PALET TE 12 Additional Details on Sources of Funding ($ in millions) Financing Sources Total Commitments Outstanding Balance
Slide 14: Loans Held for Investment Portfolio Details
0 42 65 155 112 42 4 94 109 127 127 127 0 42 65 2 87 133 71 126 163 120 163 198 Credit Private Equit y Real Estat e Strategi c Initiat ives BUSINE SS SECTOR PALETT E GENER AL PALET TE 13 Loans Held for Investment Portfolio Details ($ in millions) # Loan Type Location Origination Date Current Loan Co
Slide 15: Loans Held for Investment Portfolio Details (Industrial)
0 42 65 155 112 42 4 94 109 127 127 127 0 42 65 2 87 133 71 126 163 120 163 198 Credit Private Equit y Real Estat e Strategi c Initiat ives BUSINE SS SECTOR PALETT E GENER AL PALET TE 14 ($ in millions) # Loan Type Location Origination Date Current Loan Commitment Outstanding Principal Carrying Valu
Slide 16: Loans Held for Investment Portfolio Details
0 42 65 155 112 42 4 94 109 127 127 127 0 42 65 2 87 133 71 126 163 120 163 198 Credit Private Equit y Real Estat e Strategi c Initiat ives BUSINE SS SECTOR PALETT E GENER AL PALET TE 15 Loans Held for Investment Portfolio Details Note: As of December 31, 2021. 1. I/O = interest only, P/I = principa
Slide 17: Loans Held for Investment Portfolio Details
0 42 65 155 112 42 4 94 109 127 127 127 0 42 65 2 87 133 71 126 163 120 163 198 Credit Private Equit y Real Estat e Strategi c Initiat ives BUSINE SS SECTOR PALETT E GENER AL PALET TE 16 Loans Held for Investment Portfolio Details Note: As of December 31, 2021. 1. I/O = interest only, P/I = principa
Slide 18: Consolidated Balance Sheets
0 42 65 155 112 42 4 94 109 127 127 127 0 42 65 2 87 133 71 126 163 120 163 198 Credit Private Equit y Real Estat e Strategi c Initiat ives BUSINE SS SECTOR PALETT E GENER AL PALET TE 17 As of ($ in thousands, except share and per share data) 12/31/2021 12/31/2020 ASSETS Cash and cash equivalents $
Slide 19: Consolidated Statements of Operations
0 42 65 155 112 42 4 94 109 127 127 127 0 42 65 2 87 133 71 126 163 120 163 198 Credit Private Equit y Real Estat e Strategi c Initiat ives BUSINE SS SECTOR PALETT E GENER AL PALET TE 18 Consolidated Statements of Operations For the Three Months Ended ($ in thousands, except share and per share data
Slide 20: Reconciliation of Net Income to Non-GAAP Distributable Earnings
0 42 65 155 112 42 4 94 109 127 127 127 0 42 65 2 87 133 71 126 163 120 163 198 Credit Private Equit y Real Estat e Strategi c Initiat ives BUSINE SS SECTOR PALETT E GENER AL PALET TE 19 Reconciliation of Net Income to Non-GAAP Distributable Earnings For the Three Months Ended ($ in thousands, excep
Slide 21: Glossary
0 42 65 155 112 42 4 94 109 127 127 127 0 42 65 2 87 133 71 126 163 120 163 198 Credit Private Equit y Real Estat e Strategi c Initiat ives BUSINE SS SECTOR PALETT E GENER AL PALET TE 20 Glossary Ares Warehouse The Ares Warehouse represents a real estate debt warehouse investment vehicle maintained
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