Acres Commercial Realty Corp. · NYSE:ACR
Acres Commercial Realty — Q1 2021 Earnings Presentation
28 slides from Acres Commercial Realty's earnings presentation, May 5, 2021
Slide 1: First Quarter 2021 Earnings Presentation
ACRES Commercial Realty Corp. First Quarter 2021 Earnings Presentation May 5, 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: Recent Highlights
Recent Highlights1 CRE2 loan originations increased by 73% over the fourth quarter of 2020. Growth in CRE Loan GAAP Net Income2 Robust Liquidity Originations $143M $144M $1.03 of net liquidity, including of CRE loan originations were unrestricted cash, CRE term per share-diluted during first facil
Slide 5: Results for Quarter Ended March 31, 2021
Results for Quarter Ended March 31, 2021
Slide 6: Three Mos. Ended Mar. 31, 2021 Results and Recent Developments
Three Mos. Ended Mar. 31, 2021 Results and Recent Developments GAAP net income2: $1.03 GAAP net income4 includes a $0.55 reversal of CECL3 reserves primarily resulting from: CRE loan payoffs Financial Results Improved collateral operating performance Core Earnings3,4,5: $(0.01) Core Earn
Slide 7: First Quarter 2021 Book Value
First Quarter 2021 Book Value GAAP Book Value per Share Walk $0.59 $22.27 $1.06 $0.05 $20.57 GAAP GAAP Book Book Value Value -- Dec. Dec.‘20 '209 GAAP Net GAAP Net Income Income10 OCI OCI11 Stock Stock Repurchases Repurchases12 GAAP Book Value - Mar. ‘219 Jan. '21 ACRESREIT.COM 7
Slide 8: Summary of Future Tax Considerations
Summary of Future Tax Considerations ACR expects the following future tax carryforwards as of December 31, 2020: NOL13 carryforwards14 of $50.0M to $65.0M Net capital loss carryforwards15 of $115.0M to $130.0M At its TRS13 entities, ACR had the following at December 31, 2020: Pre-TCJA13 NOL ca
Slide 9: CRE Loan Activity and Portfolio
CRE Loan Activity and Portfolio
Slide 10: Deployment Progress
Deployment Progress CRE Loan Production, at Par Highlights19 $ in Millions 1st Quarter 4th Quarter ACR originated six CRE whole loans 2021 2020 in the first quarter of 2021, all of New CRE floating-rate loan which were originated with new $144.3 $83.4 commitments borrowers Sales, payoffs and paydow
Slide 11: CRE Loan Performance
CRE Loan Performance All but three loans (representing 3%20) of ACR’s 92 CRE loans are current on contractual payments through March 2021 ACR executed extensions, unrelated to the COVID-19 pandemic, on four CRE loans that became effective during the first quarter of 2021 CRE Loan Modifications a
Slide 12: CRE Loan Portfolio Overview
CRE Loan Portfolio Overview All floating-rate loans have LIBOR floors in excess of the current LIBOR rate on a weighted average basis $ in Millions Mar. 31, 2021 Dec. 31, 2020 Sep. 30, 2020 Jun. 30, 2020 (92 loans) (100 loans) (107 loans) (118 loans) CRE whole loans, floating-rate24 $1,456 $1,510
Slide 13: CRE Loan Portfolio LTV
CRE Loan Portfolio LTV29 80% $1,800 75% $1,600 73% 73% 74% $1,400 72% 70% Weighted Average LTV $1,200 Principal (in Millions) $1,000 65% $800 60% $600 $400 55% $200 50% $- June 30, 2020 September 30, 2020 December 31, 2020 March 31, 2021 Whole Loans, Floating-Rate Mezz. Loan Pref. Equity Invests. W.
Slide 14: CRE Loan Portfolio Diversification
CRE Loan Portfolio Diversification Balance by Region18,30 Property Type30 Office, 15.4% Pacific Hotel, Northeast Multifamily, 12.6% 10.4% East 56.5% 14.5% West North North Central Central Self- Mountain 0.4% 5.5% Mid Storage, 6.6% 18.4% Atlantic Retail, 15.8% Other31, 5.0% Southeast 3.9% 18.2% South
Slide 15: CRE Loan Portfolio Risk Ratings
CRE Loan Portfolio Risk Ratings32 79% of ACR’s loans have a risk rating of 2 or 3 that are performing in line or near underwritten expectations Percentage of Principal at March 31, 2021 Percentage of Principal at December 31, 2020 44% 40% 40% 35% 19% 18% 2% 2% Rating 1 Rating 2 Rating3333 Rating R
Slide 16: Capitalization and Liquidity
Capitalization and Liquidity
Slide 17: Summary Capitalization
Summary Capitalization $901.2 million of availability35 on its term warehouse and senior financing facilities and senior unsecured notes. $ in Millions Capitalization7 Maximum Wghtd. Avg. Leverage Amount Availability35 Capacity Coupon Ratio36 Term warehouse financing facilities $750.0 $128.3 $621.
Slide 18: Historical Leverage Ratios
Historical Leverage Ratios Historical Leverage Ratio36 5.0x 4.6x 3.9x 3.9x 1.4x 1.2x 1.1x 0.8x June 30, 2020 September 30, 2020 December 31, 2020 March 31, 2021 Recourse Debt37Leverage LeverageRatio Ratio Total Leverage Ratio ACRESREIT.COM 18
Slide 19: Liquidity at April 30, 2021
Liquidity at April 30, 2021 ($ in Millions) $75.0 $143.0 $(40.0) $64.6 $43.4 Unrestricted Cash CRE Term CRE Term and and Senior Senior Senior Unsecured Notes Working Capital Net Liquidity Secured Secured Facilities Facilities Availability Reserve Estimated Unfinanced Unfinanced Proceeds Proceeds44 A
Slide 20: Appendix
ACRES COMMERCIAL REALTY Appendix
Slide 21: Consolidated Balance Sheets
Consolidated Balance Sheets (In Thousands, except share and per share data) Mar. 31, 2021 Dec. 31, 2020 Assets (Unaudited) Cash and cash equivalents $70,985 $29,355 Restricted cash 42,825 38,386 Accrued interest receivable 7,368 7,372 CRE loans 1,482,371 1,541,992 Less: allowance for credit losses (
Slide 22: Consolidated Statements of Operations
Consolidated Statements of Operations (In Thousands, except share and per share data) For the Three Months Ended Mar. 31, 2021 Mar. 31, 2020 Revenues (Unaudited) (Unaudited) Interest income $24,749 $33,290 Interest expense 13,724 18,394 Net interest income 11,025 14,896 Real estate income 1,654 - Ot
Slide 23: Core Earnings
Core Earnings46 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 Mar
Slide 24: Footnotes
Footnotes 1. Unless otherwise noted, “recent highlights” include activity that occurred 1,280,150 shares for $14.9 million through March 31, 2021. during the second quarter of 2021 or balances at April 30, 2021. 13. “NOL” refers to net operating loss. “TRS” refers to taxable real estate 2. “CRE” ref
Slide 25: Footnotes (Continued)
Footnotes (Continued) 29. LTV is based on the outstanding principal divided by the as-is appraised the issuance of additional warrants to purchase 699,992 common shares property value available at March 31, 2021. ratably as commitments are funded. 30. At March 31, 2021; percentages are calculated ba
Slide 26: 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 27: 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 commercial real es
Slide 28: 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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