Attached files
| file | filename |
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| 8-K - 8-K - BLACKSTONE MORTGAGE TRUST, INC. | d499965d8k.htm |
| EX-10.1 - EX-10.1 - BLACKSTONE MORTGAGE TRUST, INC. | d499965dex101.htm |
| EX-99.1 - EX-99.1 - BLACKSTONE MORTGAGE TRUST, INC. | d499965dex991.htm |
 Capital Trust, Inc.
March 26, 2013
Fourth Quarter and Full Year 2012 Results
Exhibit 99.2 |
 Capital Trust
1
Fourth Quarter and Full Year 2012 Highlights
Successfully
completed
the
sale
of
our
investment
management
and
special
servicing
platform
to
The
Blackstone
Group
L.P.
(“Blackstone”)
and
paid
a
previously
announced
$2.00
per
share
special
cash dividend.
December 31, 2012 consolidated assets were $322.3 million and consolidated
liabilities were $168.9
million,
resulting
in
stockholders’
equity
of
$73.4
million,
or
$2.43
per
share.
•
Significant decrease in consolidated assets and liabilities during the fourth
quarter due to the deconsolidation of certain CDO entities managed by our
former investment management subsidiary, CT Investment
Management Co., LLC (“CTIMCO”). Fourth quarter consolidated net
income was $105.2 million, or $4.22 per share, and $181.0 million, or
$7.72 per share for the year ended December 31, 2012.
•
Fourth quarter and 2012 net income were driven by non-cash gains recognized
on the deconsolidation of subsidiaries and fair value adjustments on
Capital Trust’s investment in the CT Legacy REIT portfolio.
•
Revenues and expenses related to CTIMCO were reclassified to income from
discontinued operations due to the sale of CTIMCO to Blackstone in
December 2012. |
 Capital Trust
2
Sale of Investment Management Platform and Special Dividend
In conjunction with the sale, Blackstone purchased 5.0 million shares of our
class A common stock for $10.0
million,
or
$2.00
per
share
(1)
.
•
These
shares
represented
17.1%
of
our
total
class
A
common
stock
outstanding
as
of
March
25,
2013.
Blackstone now manages Capital Trust pursuant to the terms and conditions of its
management agreement. Blackstone designated two members to our board of
directors, Michael B. Nash, who serves as Executive Chairman,
and
John
G.
Schreiber,
who
replaced
two
former
members
of
our
board
of
directors,
Samuel
Zell
and
Edward S. Hyman.
________________________________________________
(1)
Blackstone did not receive the $2.00 per share special dividend, which was paid on December
20, 2012 to shareholders of record on November 12, 2012, prior to Blackstone’s
purchase of 5.0 million shares of our class A common stock.
On December 19, 2012, we completed the previously announced sale of our investment
management and special servicing business to Blackstone for a purchase price
of $21.4 million.
Capital
Trust
paid
a
previously
announced
$2.00
per
share
(1)
special
cash
dividend
in
connection
with
the
sale
of
its
investment
management
and
special
servicing
business. |
 Capital Trust
3
Overview of Significant Assets
Following the sale of our investment management and special servicing business,
the net book value of our significant
assets
totaled
$66.7
million
(1)
as
of
December
31,
2012,
and
consisted
primarily
of:
•
Cash and cash equivalents of $15.4 million;
•
Investment in CT Legacy REIT, with a net book value of $45.1 million;
•
Residual interests in CT CDO I, with a net book value of $6.2 million; and
•
Carried
interest
in
CT
Opportunity
Partners
I,
LP
(“CTOPI”)
(1)
.
________________________________________________
(1)
The $66.7 million net book value of our significant assets excludes our carried interest in
CTOPI. As of December 31, 2012, our gross carried interest allocation from CTOPI was
$14.7 million, which was reduced by $1.4 million of tax-advance distributions for a net asset of $13.3 million. Recognition of revenue related to
the CTOPI carried interest has been deferred, resulting in an unearned revenue liability of
$14.7 million as of December 31, 2012. |
 Capital Trust
4
CT Legacy REIT
Capital
Trust
owns
a
majority,
controlling-interest
in
CT
Legacy
REIT,
the
March
2011
restructuring
vehicle
that owns its remaining legacy asset portfolio. Capital Trust’s interests in
CT Legacy REIT are held subject to liabilities under its secured notes and
management incentive awards plan. The CT Legacy REIT investment portfolio
includes 27 loans and securities, all of which serve as collateral for its
JPMorgan repurchase
facility
with
an
outstanding
balance
of
$20.5
million,
which
is
not
recourse
to Capital Trust.
•
See page 8 for a detailed presentation of the CT Legacy REIT loans receivable
portfolio. ________________________________________________
(1)
CT Legacy Asset owns CT Legacy REIT’s investment portfolio. Amount represents the fair
value of estimated cash distributions from CT Legacy Asset, of $179.8 million, based on
certain assumptions, including a discount rate of 15%. See Note 12 to our financial statements contained in the Form 10-K, filed on March 26, 2013, for additional
details.
(2)
Includes the full potential prepayment premium on secured notes. This liability is carried at
its amortized basis of $8.5 million on our balance sheet as of December 31, 2012. See
Note 3 to our financial statements contained in the Form 10-K, filed on March 26, 2013, for additional details.
(3)
Assumes full payment of the management incentive awards plan based on a hypothetical GAAP
liquidation value of CT Legacy REIT as of December 31, 2012. As of December 31, 2012,
our balance sheet includes $5.3 million in accounts payable and accrued expenses for the management incentive awards plan. See Note 3 to our
financial statements contained in the Form 10-K, filed on March 26, 2013, for additional
details. (Dollars
in Thousands) Dec. 31, 2012
Gross investment in CT Legacy REIT
Restricted cash
14,246
$
Investment in CT Legacy Asset, at fair value
(1)
132,000
Accounts payable, accrued expenses, and other liabilities
(250)
Noncontrolling interests
(80,009)
Total gross investment in CT Legacy REIT
65,987
$
Secured notes, including prepayment premium
(2)
(11,059)
Management incentive awards plan, fully vested
(3)
(9,855)
Net investment in CT Legacy REIT
45,073
$
|
 Capital Trust
5
CT CDO I
Capital Trust owns the residual debt and equity positions of CT CDO I, a
collateralized debt obligation which it issued in 2004, and which is
consolidated onto its balance sheet. The
CT
CDO
I
investment
portfolio
includes
seven
loans,
all
of
which
serve
as
collateral
for
its
non-recourse
senior securitized debt obligations with an outstanding balance of $139.2
million. •
See page 9 for a detailed presentation of the CT CDO I loans receivable
portfolio. (Dollars in Thousands)
Dec. 31, 2012
Assets and liabilities of CT CDO I
Loans receivable, net
141,500
$
Accrued interest receivable, prepaid expenses, and other assets
4,021
Total assets
145,521
Accounts payable, accrued expenses, and other liabilities
88
Securitized debt obligations
139,184
Total liabilities
139,272
Net investment in CT CDO I
6,249
$
|
 Capital Trust
6
CTOPI
Upon Capital Trust’s sale of its investment management and special servicing
platform, including its related fund co-investments, it retained its
carried interest in CTOPI, a private equity real estate fund formed in 2007
and sponsored by Capital Trust. •
CTOPI has invested $491.5 million in 39 transactions, of which $286.2 million has
been realized and $205.3 million remains outstanding as of December 31,
2012. The carried interest in CTOPI entitles us to earn incentive
compensation in an amount equal to 17.7% of the fund’s profits, after
a 9% preferred return and 100% return of capital to the CTOPI limited partners.
As of December 31, 2012, Capital Trust was allocated $14.7 million of
CTOPI’s net assets based on a hypothetical liquidation of the fund,
reduced by tax-advance distributions received for a net asset of
$13.3 million. Other than tax-advance distributions, we have not received any
cash payments from CTOPI. •
The gross carried interest allocation of $14.7 million as of December 31, 2012 is
based on the fair value of CTOPI’s net assets.
•
Recognition
of
the
revenue
related
to
the
CTOPI
carried
interest
has
been
deferred,
resulting
in
an unearned
revenue
liability
of
$14.7
million
included
in
accounts
payable
and
accrued
expenses.
•
Collections from the CTOPI carried interest will be offset by incentive awards to
our former employees, which provide for payment of 45% of the amount of
carried interest distributions we receive. Payments under these awards are
not reflected in the $13.3 million CTOPI asset balance as of December 31, 2012. |
 Capital Trust
7
Book Value per Share
Stockholders’
equity
totaled
$73.4
million,
or
$2.43
per
share
as
of
December
31,
2012.
In conjunction with the sale of our investment management and special servicing
platform, Blackstone purchased 5.0 million shares of our class A common
stock for $10.0 million, or $2.00 per share. Our
previously
outstanding
warrants
were
exercised
on
a
cashless
basis
in
November
2012,
resulting
in
the issuance of 1.7 million shares of our class A common stock.
________________________________________________
(Dollars in Thousands, Except per Share Data)
Dec. 31, 2012
Stockholders' equity
73,444
$
Shares
Class A common stock
29,266,514
Restricted class A common stock
-
Stock units
(1)
897,555
Total
30,164,069
Book value per share
(2)
2.43
$
(1)
Stock units are granted to certain members of our board of directors in lieu of cash
compensation for services and in lieu of dividends earned on previously granted stock
units. See Note 11 to our financial statements contained in the Form 10-K, filed on March 26, 2013, for additional details.
(2)
Capital Trust’s book value as of December 31, 2012 includes two of its significant
assets, CT Legacy REIT and the CTOPI carried interest, recorded on a fair value basis.
The fair value of each of these assets represents a discount to the cash flows management has estimated these investments will generate. |
 Capital Trust
8
CT Legacy REIT’s Loans Receivable
The
following
table
provides
details
of
CT
Legacy
REIT’s
loan
portfolio
(1)
as
of
December
31,
2012:
________________________________________________
In addition, CT Legacy REIT owns investments in securities with an aggregate face value of
$135.4 million and a net book value of $12.0 million as of December 31, 2012. Represents the net book
value of the loans receivable on the balance sheet of CT Legacy Asset, LLC, an entity that is not consolidated into our financial
statements. See Note 3 to our financial statements contained in the Form 10-K, filed on
March 26, 2013, for additional details.
All floating rate loans are indexed to one-month LIBOR. Maturity date assumes
all extension options are executed.
Includes four loans receivable investments, each of which are 100% impaired as of December 31,
2012. (Dollars in
Millions) Principal
Balance
Book
Value
(2)
Rate
(3)
Maturity
(4)
Loan Type
Geographic
Location
Property
Type
Loan A
27.0
$
27.0
$
L + 2.75%
12/31/14
Sub. mortgage
Northwest
Other
Loan B
25.2
25.2
L + 7.94%
4/9/13
Sub. mortgage
International
Hotel
Loan C
20.0
20.2
8.00%
9/1/14
Mezzanine
Northeast
Office
Loan D
17.9
17.9
L + 4.00%
3/15/12
Sr. mortgage
Northeast
Office
Loan E
15.0
15.0
L + 3.00%
12/9/14
Sr. mortgage
West
Hotel
Loan F
12.9
12.9
L + 1.96%
1/3/17
Sub. mortgage
Northeast
Multifamily
Loan G
14.4
12.4
L + 2.75%
12/31/14
Sub. mortgage
Northwest
Other
Loan H
14.3
12.0
L + 8.50%
6/9/13
Mezzanine
Southeast
Hotel
Loan I
8.0
8.0
12.00%
10/9/13
Mezzanine
Northeast
Office
Loan J
4.5
4.5
8.77%
2/1/16
Mezzanine
Northeast
Office
Loan K
1.2
0.6
L + 6.05%
7/10/10
Sub. mortgage
Southwest
Multifamily
Other
(5)
98.2
-
Various
Various
Various
Various
Various
Total
258.6
$
155.7
$
(1)
(2)
(3)
(4)
(5) |
 Capital Trust
9
CT CDO I’s Loans Receivable
The following table provides details of CT CDO I’s consolidated loan
portfolio as of December 31, 2012:
________________________________________________
(1)
All floating rate loans are indexed to one-month LIBOR.
(2)
Maturity date assumes all extension options are executed.
(3)
Includes two loans receivable investments, each of which are 100% impaired as of December 31,
2012. (Dollars in Millions)
Principal
Balance
Book
Value
Rate
(1)
Maturity
(2)
Loan Type
Geographic
Location
Property
Type
Loan A
62.5
$
62.5
$
L + 0.86%
5/3/13
Sr. mortgage
West
Office
Loan B
30.0
30.0
L + 7.25%
7/9/14
Sub. mortgage
West
Hotel
Loan C
27.0
27.0
L + 9.53%
10/9/13
Sub. mortgage
Northeast
Office
Loan D
20.0
20.0
L + 5.06%
10/9/13
Sub. mortgage
Diversified
Office
Loan E
6.6
2.0
L + 5.01%
2/9/13
Sub. mortgage
Southwest
Office
Other
(3)
18.1
-
Various
Various
Various
Various
Various
Total
164.2
$
141.5
$ |
 Capital Trust
10
Consolidated Balance Sheet
(Dollars in Thousands)
Dec. 31, 2012
Assets
Cash and cash equivalents
15,423
$
Restricted cash
14,246
Investment in CT Legacy Asset, at fair value
132,000
Loans receivable, net
141,500
Equity investments in unconsolidated subsidiaries
13,306
Accrued interest receivable, prepaid expenses, and other assets
5,868
Total assets
322,343
$
Liabilities & Equity
Accounts
payable,
accrued
expenses,
and
other
liabilities
21,209
Secured notes
8,497
Securitized debt obligations
139,184
Total liabilities
168,890
Commitments and contingencies
-
Equity
Class A common stock, $0.01 par value
293
Additional paid-in capital
609,002
Accumulated deficit
(535,851)
Total Capital Trust, Inc. stockholders' equity
73,444
Noncontrolling interests
80,009
Total equity
153,453
Total liabilities and equity
322,343
$ |
 Capital Trust
11
Consolidated Statement of Operations
(Dollars in Thousands, Except Share and per Share Data)
2012
Income from loans and other investments:
Interest and related income
34,939
$
Less: Interest and related expenses
38,138
Loss from loans and other investments, net
(3,199)
Other expenses:
General and administrative
10,369
Total other expenses
10,369
Total other-than-temporary impairments of securities
-
Portion of other-than-temporary impairments of securities recognized in other
comprehensive income (160)
Net impairments recognized in earnings
(160)
Recovery of provision for loan losses
36,147
Fair value adjustment on investment in CT Legacy Asset
51,904
Gain on deconsolidation of subsidiaries
200,283
Gain on sale of investments
6,000
Income from equity investments in unconsolidated subsidiaries
1,781
Income before income taxes
282,387
Income tax provision
174
Income from continuing operations
282,213
$
Loss from discontinued operations, net of tax
(2,138)
Loss on sale of discontinued operations
(271)
Net income
279,804
$
Net income attributable to noncontrolling interests
(98,780)
Net income attributable to Capital Trust, Inc.
181,024
$
Per share information (Basic)
Income from continuing operations per share of common stock
7.82
$
Loss from discontinued operations per share of common stock
(0.10)
$
Net income per share of common stock
7.72
$
Weighted average shares of common stock outstanding
23,459,432
Per share information (Diluted)
Income from continuing operations per share of common stock
7.41
$
Loss from discontinued operations per share of common stock
(0.10)
$
Net income per share of common stock
7.31
$
Weighted average shares of common stock outstanding
24,752,944 |
 Capital Trust
12
Forward-Looking Statements
This presentation contains certain forward-looking statements within the meaning of Section
27A of the Securities Act of 1933 as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended, including statements relating
to
future
financial
results
and
business
prospects.
The
forward-looking
statements
contained
in
this
presentation are subject to certain risks and uncertainties including, but not limited to, the
performance of Capital Trust’s investments, the timing of collections, its
capability to repay indebtedness as it comes due, its ability to originate investments,
the availability of capital and Capital Trust’s tax status, as well as other risks indicated from
time to time in Capital Trust’s Form 10-K and Form 10-Q filings with the SEC.
Capital Trust assumes no obligation to update or supplement forward-looking
statements that become untrue because of subsequent events or circumstances.
|