Blackstone Mortgage Trust, Inc. · NYSE:BXMT
Blackstone Mortgage Trust — Capital Trust — Investor Presentation (June 2005)
29 slides from Blackstone Mortgage Trust's investor presentation, Jun 27, 2005
Slide 1: Company Presentation June 2005
Company Presentation June 2005
Slide 2: Disclaimer
Disclaimer Except for historical information contained herein, the statements in this presentation regarding the Company's business, strategy, portfolio management and results of operations are forward-looking statements that are dependent upon certain risks and uncertainties, including those relate
Slide 3: Table of Contents
I. Overview II. Investment Strategy III. Financial Information TABLE OF CONTENTS
Slide 4: Capital Trust
o CAPITALTRUST
Slide 5: Capital Trust
Capital Trust Largest dedicated commercial real estate subordinate debt investor in the US Founded by Sam Zell and John Klopp in 1997 Originated $5.0 billion of investments since inception Unparalleled track record Less than 0.75% loss experience on the entire portfolio Fully integrated internal man
Slide 6: Unique Business Model
OVERVIEW I - 2 CT Investment Management Co., LLC (TRS) 100% CT Mezzanine Partners II LP Unique Business Model Balance Sheet Net Interest Margin Investment Management Fee Income CT Mezzanine Partners III, Inc. + Capital Trust, Inc. (NYSE: “CT”) (Management Contracts) Investment Manager CDO Collateral
Slide 7: Recent Highlights
OVERVIEW I - 3 Recent Highlights Collateralized Debt Obligations Capital Trust RE CDO 2004-1 (7/04): sold $253 million of investment grade securities backed by $324 million of BB/B subordinate real estate debt Capital Trust RE CDO 2005-1 (3/05): sold $299 million of investment grade securities backe
Slide 8: Trailing 12-Month Performance
NYSE: CT Trailing 12-Month Performance 2Q’ 04 Div. 3Q’ 04 Div. Trailing Twelve Month Return: 43% (1) Note: (1) Source: Bloomberg (assumes reinvestment of dividends). (2) Peer group includes iStar Financial Inc., Anthracite Capital Inc., Newcastle Investment Corp., Arbor Realty Trust, Gramercy Capita
Slide 9: Growth Strategy
OVERVIEW I - 5 Growth Strategy Continue to grow balance sheet assets Continue to grow investment management business through the sponsorship of additional funds Create the most efficient capital structure through the use of CDOs and other structured products Expand our franchise Incubate and/or acqu
Slide 10: Management and Board of Directors
Lending/Investing Asset Management Administration Finance Capital Markets CEO, John Klopp Board of Directors Sam Zell Thomas Dobrowski Martin Edelman Craig Hatkoff Edward Hyman John Klopp Henry Nassau Josh Polan Lynne Sagalyn OVERVIEW I - 6 36 Professionals CFO, Geoffrey Jervis COO, Stephen Plavin
Slide 11: Investment Strategy
Investment Strategy
Slide 12: A Large and Dynamic Market
II - 1 Note: (1) Source: Federal Reserve Data. INVESTMENT STRATEGY A Large and Dynamic Market CMBS has taken a larger share of a growing market Market Growth 2x CMBS Growth 8x ($52B) ($423B)
Slide 13: Growth of Securitization
II - 2 INVESTMENT STRATEGY Growth of Securitization Record issuance of $93 billion in 2004 Note: (1) 2005 YTD as of 6/15/05.
Slide 14: Evolving Capital Structure
Equity 1 st Mortgage A Note Equity Equity IG CMBS Equity II - 3 Traditional Early Stage Mezzanine Current Multiple Tranches of B Notes, Mezzanine Loans and CMBS INVESTMENT STRATEGY Evolving Capital Structure
Slide 15: Securitized Capital Structures
AAA A AA BBB Equity Equity Equity Equity AAA A AA BBB Equity Equity Equity Equity II - 4 Floating Rate $13 Billion 2004 INVESTMENT STRATEGY Securitized Capital Structures Fixed Rate $80 Billion 2004 B Note/ Mezz B Note/ Mezz B Note/ Mezz B Note/ Mezz B BB NR
Slide 16: Relative Value
Equity AAA to A CMBS BBB AAA to A CMBS BBB Equity II - 5 Floating Rate 5 – 15%+ Senior B Note Junior B Note Junior Mezzanine Senior Mezzanine L + 150 to 225 bps L + 225 to 375 bps L + 375 to 500 bps L + 500 to 1000+ bps INVESTMENT STRATEGY Relative Value B BB NR Fixed Rate Gross Unleveraged Returns
Slide 17: CDO Model: Capital Trust RE CDO 2004-1
IG CDO Notes CDO Equity Sold to 3 rd Parties Retained by Capital Trust II - 6 Below IG CDO Notes INVESTMENT STRATEGY Collateralized Debt Obligation Model: Capital Trust RE CDO 2004-1 Mezzanine Loans B Notes Subordinate CMBS Capital Trust RE CDO 2004-1 $324 million of collateral / 48 assets 88% B Not
Slide 18: CDO Model: Capital Trust RE CDO 2005-1
IG CDO Notes CDO Equity Sold to 3 rd Parties Retained by Capital Trust II - 7 Below IG CDO Notes INVESTMENT STRATEGY Collateralized Debt Obligation Model: Capital Trust RE CDO 2005-1 Mezzanine Loans B Notes Subordinate CMBS Capital Trust RE CDO 2005-1 $338 million of collateral / 28 assets 65% B Not
Slide 19: Competitive Advantages
II - 8 INVESTMENT STRATEGY Competitive Advantages Investment Origination Broad Network/Established Relationships Structural Creativity and Flexibility Quick Turnaround/Certainty of Closing Transaction Execution Credit Underwriting Expertise Financial Structuring Experience Proven Process Capital Acc
Slide 20: Senior Debt Provided by Major Lenders
Senior Debt Provided by Bank of America 717 Fifth Avenue New York, NY $165 Million Senior Debt Provided by Wells Fargo DRA/DDR Portfolio Nationwide $175 Million Senior Debt Provided by Merrill Lynch GGP Portfolio Nationwide $1 Billion Senior Debt Provided by IXIS Real Estate Capital Cerberus Hotel P
Slide 21: Investment Process
Origination Asset Mgmt. Approval Underwriting II - 10 Originators Due Diligence Senior Lenders Borrowers Brokers Deal Team Business Credit Team Finance/Capital Markets Team Legal Structure Investment Committee Board of Directors Credit Providers Partners Asset Mgmt. Team Credit Team Finance/Capital
Slide 22: Risk Management Principles
II - 11 INVESTMENT STRATEGY Risk Management Principles Create diversified portfolios Asset category, property type and geographic market Prudently employ leverage Enhance returns Increase the size and diversity of the portfolios Manage a matched book Control asset/liability mix (index & duration) Us
Slide 23: Financial Information
Financial Information
Slide 24: Capital Trust, Inc. Structure and Balance Sheet
Capital Trust, Inc. 3/31/05 Assets $1,001 Liabilities $683 Equity $318 CT Investment Management Co., LLC (TRS) (100% owned) (Management Contracts) CT Mezzanine Partners II LP 3/31/05 Assets $84 Liabilities $43 Equity $41 (4.7% owned) (5.9% owned) III - 1 Net Interest Margin Base and Incentive Manage
Slide 25: Assets
III - 2 FINANCIAL INFORMATION Assets ($000s) Assets Cash Loans Fixed Rate Variable Rate CMBS Fund Investments Interest Rate Hedge (Swap) Other Total Assets Liabilities Secured Debt CDO Debt Other Total Liabilities Common Equity 3/31/05 $31,078 101,718 578,310 244,214 20,983 3,232 21,214 $1,000,749 $
Slide 26: Liabilities and Equity
Assets Cash Loans Fixed Rate Variable Rate CMBS Fund Investments Interest Rate Hedge (Swap) Other Total Assets Liabilities Secured Debt CDO Debt Other Total Liabilities Common Equity 3/31/05 $31,078 101,718 578,310 244,214 20,983 3,232 21,214 $1,000,749 $113,884 551,691 16,982 $682,557 $318,192 Liab
Slide 27: Investment Management
CT Investment Management Co., LLC (TRS) CT Mezzanine Partners II LP 3/31/05 Assets $84 Liabilities $43 Equity $41 III - 4 FINANCIAL INFORMATION Investment Management $1.2 billion of investments Investment period expired 1.3% mgmt. fee per annum 20% of profits after 10% pref. return and 100% return o
Slide 28: Income Statement
3/31/05 $15,696 (5,752) - 9,944 7,904 (1,422) 6,507 5,755 - - 6,034 1,267 $9,150 $0.60 $0.55 Income Statement ($000s) FINANCIAL INFORMATION III - 5 3 Months Ended 12/31/04 $46,561 (13,724) (6,417) 26,420 7,853 2,407 10,648 15,229 1,100 5,886 (6,672) 15,543 (451) $21,976 $2.14 $1.85 12 Months Ended P
Slide 29: Conclusion
FINANCIAL INFORMATION III - 6 Conclusion Dominant franchise in an attractive/growing market niche Organic growth through: Balance sheet investments – net interest margin Assets under management – base and incentive management fees Stable capital structure through the use of CDOs and other structured