Company Information

3

Forward-Looking Statements

5

Earnings Release Text

6

Financial Highlights

10

Balance Sheets

     Consolidated by quarter

11

     Consolidating, by segment

12

Statements of Operations, FFO & CORE FFO

     Consolidated

13

     Consolidated – Trailing 5 Quarters

15

     Consolidating, by segment

17

Fee and Other Income

19

EBITDA and Coverage Ratios

20

Portfolio Data:

    Lending

22

    Real Estate Summary

24

    Real Estate Properties, Changes in the portfolio

26

    Real Estate Properties at December 31, 2015

27

Debt Overview

29

Definitions

31

Corporate Headquarters

2929 Arch Street

17^th Floor, Cira Centre

Philadelphia, Pa 19104

215.243.9000

Trading Symbol

NYSE: “RAS”

Investor Relations Contact

Andres Viroslav

2929 Arch Street

17^th Floor, Cira Centre

Philadelphia, Pa 19104

215.243.9000

For the Three-Months Ended

December 31,

2015

September 30,

2015

June 30,

2015

March 31,

2015

December 31,

2014

Common:

Share Price, period end

$

2.70

$

4.96

$

6.11

$

6.86

$

7.67

Share Price, high

$

5.45

$

6.24

$

7.08

$

7.85

$

7.94

Share Price, low

$

2.25

$

4.77

$

6.04

$

6.62

$

6.86

Dividends declared

$

0.09

$

0.18

$

0.18

$

0.18

$

0.18

Dividend yield, period end

13.3

%

14.5

%

11.8

%

10.5

%

9.4

%

Common shares outstanding

91,586,767

90,898,034

82,895,723

82,885,444

82,506,606

Weighted Average common shares, basic

90,642,318

87,110,958

82,150,475

82,081,024

81,970,075

Weighted Average common shares, diluted

90,842,752

87,110,958

89,268,462

82,081,024

81,970,075

Preferred:

Series A

Shares outstanding

5,306,084

5,306,084

5,303,591

4,775,569

4,775,569

Share price, period end

$

18.15

$

18.19

22.34

23.35

23.32

Par, per share

$

25.00

$

25.00

$

25.00

$

25.00

$

25.00

Dividend

$

0.484375

$

0.484375

$

0.484375

$

0.484375

$

0.484375

Yield

10.7

%

10.7

%

8.7

%

8.3

%

8.3

%

Series B

Shares outstanding

2,340,969

2,340,969

2,325,626

2,288,465

2,288,465

Share price, period end

$

18.98

$

19.06

$

22.92

$

24.50

$

24.90

Par, per share

$

25.00

$

25.00

$

25.00

$

25.00

$

25.00

Dividend

$

0.5234375

$

0.5234375

$

0.5234375

$

0.5234375

$

0.5234375

Yield

11.0

%

11.0

%

9.1

%

8.5

%

8.4

%

Series C

Shares outstanding

1,640,425

1,640,425

1,640,100

1,640,100

1,640,100

Share price, period end

$

19.70

$

20.14

$

24.15

$

24.84

$

25.06

Par, per share

$

25.00

$

25.00

$

25.00

$

25.00

$

25.00

Dividend

$

0.5546875

$

0.5546875

$

0.5546875

$

0.5546875

$

0.5546875

Yield

11.3

%

11.0

%

9.2

%

8.9

%

8.9

%

Series D (not publicly traded)

Shares outstanding

4,000,000

4,000,000

4,000,000

4,000,000

4,000,000

Par, per share

$

25.00

$

25.00

$

25.00

$

25.00

$

25.00

Coupon

8.50

%

7.50

%

7.50

%

7.50

%

7.50

%

-

Cash Available for Distribution (“CAD”) per share of $0.28 for the quarter ended December 31, 2015 and $1.11 for the year ended December 31, 2015.  CAD per share, without real estate gains, of $0.19 for the quarter ended December 31, 2015 and $0.78 for the year ended December 31, 2015.

-

Earnings per share of $0.02 for the quarter ended December 31, 2015 and $0.08 for the year ended December 31, 2015.

-

Investments in mortgages and loans, at cost, increased 16.5% to $1.62 billion at December 31, 2015 from $1.39 billion at December 31, 2014.

-

RAIT originated $321.8 million of loans during the quarter ended December 31, 2015 and $996.9 million of loans for the year ended December 31, 2015.

-

RAIT paid a fourth quarter dividend of $0.09 per common share on January 29, 2016.

-

RAIT originated $321.8 million of loans during the quarter ended December 31, 2015 consisting of $71.9 million of fixed-rate conduit loans and $249.9 million of floating-rate bridge loans.  RAIT originated $996.9 million of loans during the year ended December 31, 2015 consisting of $384.1 million of fixed-rate conduit loans, $607.8 million of floating-rate bridge loans and a $5.0 million mezzanine loan.

-

RAIT sold $85.4 million of conduit loans during the quarter ended December 31, 2015 which generated fee income of $1.1 million. RAIT sold $425.0 million of conduit loans during the year ended December 31, 2015 which generated fee income of $7.2 million.

-

In December, RAIT closed its fifth non-recourse, floating-rate CMBS transaction totaling $347.4 million collateralized by floating rate commercial real estate first lien mortgage loans and pari passu participation interests in such mortgage loans.  The transaction involved the sale by a RAIT subsidiary of investment grade notes totaling approximately $263.6 million with a weighted average cost of LIBOR plus 2.62%.  RAIT affiliates retained certain investment grade notes and all of the below investment grade and un-rated subordinated interests totaling approximately $83.8 million.

-

CRE loan repayments were $121.6 million for the quarter ended December 31, 2015 and $291.2 million during the year ended December 31, 2015

-

As of December 31, 2015, RAIT’s investments in real estate were $2.5 billion which includes $1.4 billion of multi-family properties owned by Independence Realty Trust, Inc. (“IRT”) (NYSE MKT: IRT).  IRT is externally advised by RAIT and is a consolidated RAIT entity. IRT is a REIT focused on owning multifamily properties. At December 31, 2015, RAIT owned 15.5% of IRT’s outstanding common stock.

-

During the quarter ended December 31, 2015, RAIT sold three properties, consisting of two apartment communities and an office property, for $52.9 million and generated net proceeds of approximately $8.4 million after costs and full repayment of the underlying debt. IRT sold one apartment community for $33.6 million and generated net proceeds of approximately $14.2 million after costs and full repayment of the underlying debt.  During the year ended December 31, 2015, RAIT sold eight properties, six apartment communities and one office property, and one parcel of land for $141.4 million and generated net proceeds of approximately $27.5 million after costs and full repayment of the underlying debt.

-

During the three-months ended December 31, 2015, RAIT converted two loans secured by ten industrial properties and by one office property, respectively, into ownership of those properties. Those properties had an aggregate carrying value of $73.1 million.

-

RAIT reported a $0.9 million asset impairment for the quarter ended December 31, 2015 on an office property in Denver, Colorado and a parcel of land in Daytona Beach, FL.  Both of these properties are currently under contract to be sold.

-

On September 17, 2015, IRT completed the acquisition of Trade Street Residential, Inc. adding nineteen high-quality properties with 4,989 units to its portfolio.  RAIT expects the acquisition to benefit RAIT through RAIT’s ownership of IRT common stock and increased fees paid to RAIT by IRT.  

-

Total assets under management increased 33.3% to $6.0 billion at December 31, 2015 from $4.5 billion at December 31, 2014.

-

RAIT’s property management companies managed 19,639 apartment units and 22.8 million square feet of office and retail space at December 31, 2015.

-

RAIT generated $9.3 million in asset and property management fees and incentive fees through its external management of IRT during the year ended December 31, 2015.

-

RAIT generated $12.8 million of property management and leasing fees primarily through its retail property manager subsidiary and through services provided by its multi-family property manager subsidiary to unaffiliated properties during the year ended December 31, 2015.

-

On December 7, 2015, RAIT’s Board of Trustees (the “Board”) declared a fourth quarter 2015 cash dividend on RAIT’s common shares of $0.09 per common share. The dividend was paid on January 29, 2016 to holders of record on January 8, 2016.

-

On November 4, 2015, the Board declared a fourth quarter 2015 cash dividend of $0.484375 per share on RAIT’s 7.75% Series A Cumulative Redeemable Preferred Shares, $0.5234375 per share on RAIT’s 8.375% Series B Cumulative Redeemable Preferred Shares and $0.5546875 per share on RAIT’s 8.875% Series C Cumulative Redeemable Preferred Shares. The dividends were paid on December 31, 2015 to holders of record on December 1, 2015.

2016 Annualized Projected CAD⁽¹⁾

Net income (loss) allocable to common shares

$22,792

-

$31,892

Adjustments:

Gains on property sales

(5,766)

-

(5,766)

Depreciation, amortization expense and other items

60,324

-

60,324

CAD

$77,350

-

$86,450

CAD per share 

$0.85

-

$0.95

CAD per share, without real estate gains

$0.50

-

$0.60

(1)

Constitutes forward-looking information.  Actual full 2016 CAD could vary significantly from the projections presented.  CAD may fluctuate based upon a variety of factors, including those described in “Forward Looking Statements” below.  Our estimate is based on the following key operating assumptions during 2016:

-

Gross loan originations of $200 million to $500 million.

-

No CMBS gain on sale profits.

-

RAIT property sale gains of $32 million.

-

Loan repayments totaling $200 million.

-

No capital issuances in 2016.

($'s in 000's)

For the Three-Months Ended

December 31,

2015

September 30, 2015

June 30,

2015

March 31,

2015

December 31,

2014

OPERATING DATA:

Lending:

Investments in loans

$

1,623,583

$

1,588,097

$

1,506,542

$

1,504,456

$

1,392,436

Gross loan production

$

321,837

$

237,674

$

218,613

$

218,770

$

255,335

CMBS gain on sales (included in fee income)

$

1,135

$

434

$

3,681

$

1,996

$

2,986

CMBS loans sold

$

85,430

$

116,251

$

130,401

$

92,897

$

170,679

Average CMBS Gain on Sale (points)

1.3

0.4

2.8

2.1

1.7

Real estate portfolio:

Gross real estate investments (a)

$

2,517,645

$

2,448,331

$

1,783,888

$

1,833,978

$

1,840,451

Property income (a)

$

69,464

$

55,459

$

55,534

$

53,274

$

46,096

Operating expenses (a)

$

31,476

$

25,832

$

26,416

$

25,277

$

22,948

Net operating income (a)

$

37,988

$

29,627

$

29,118

$

27,997

$

23,148

NOI margin (a)

54.7

%

53.4

%

52.4

%

52.6

%

50.2

%

EARNINGS & DIVIDENDS:

Earnings per Share -- diluted

$

0.02

$

(0.07

)

$

0.22

$

(0.09

)

$

(3.11

)

FFO per share

$

(0.08

)

$

(0.05

)

$

0.15

$

0.05

$

(2.97

)

CAD per share

$

0.28

$

0.27

$

0.37

$

0.19

$

0.26

CAD per share, without real estate gains

$

0.19

$

0.20

$

0.21

$

0.18

$

0.26

Dividends per share

$

0.09

$

0.18

$

0.18

$

0.18

$

0.18

CAD payout ratio

31.8

%

66.0

%

48.8

%

96.7

%

70.4

%

CAPITALIZATION AND COVERAGE RATIOS:

Debt:

Recourse

$

494,697

$

586,952

$

497,430

$

579,258

$

509,701

Non-recourse

2,864,753

2,613,029

2,164,098

2,107,499

2,105,965

Total debt

3,359,450

3,199,981

2,661,528

2,686,757

2,615,666

Preferred shares (par)

332,187

332,187

331,733

317,603

317,603

Common shares (market capitalization)

247,284

450,854

506,493

568,594

632,826

Noncontrolling interests, at carrying value

340,213

346,063

204,034

208,894

214,297

Total market capitalization

$

4,279,134

$

4,329,085

$

3,703,788

$

3,781,848

$

3,780,392

Total Liabilities/Total Gross Assets

77.9

%

77.2

%

77.5

%

78.0

%

77.3

%

Total Liabilities + Preferred/Total Gross Assets

85.0

%

84.6

%

86.4

%

86.5

%

85.9

%

Interest Coverage

1.94

x

1.81

x

2.12

x

1.93

x

2.20

x

Interest + Preferred Coverage

1.55

x

1.42

x

1.63

x

1.50

x

1.70

x

OTHER KEY BENCHMARKS:

Total Assets Under Management (AUM)

$

6,026,341

$

5,820,702

$

4,764,259

$

4,607,413

$

4,485,525

Total Gross Assets

$

4,645,622

$

4,475,217

$

3,754,148

$

3,741,103

$

3,681,955

(a)

Includes Independence Realty Trust.

($'s in 000's)

As of

December 31,

2015

September 30,

2015

June 30,

2015

March 31,

2015

December 31,

2014

Assets

Investments in loans:

Investment in loans

$

1,623,583

$

1,588,097

$

1,506,542

$

1,504,456

$

1,392,436

Allowance for loan losses

(17,097

)

(14,646

)

(12,796

)

(10,797

)

(9,218

)

Investments in loans, net

1,606,486

1,573,451

1,493,746

1,493,659

1,383,218

Investments in real estate:

Investments in real estate at cost

2,517,645

2,448,331

1,783,888

1,833,978

1,840,451

Accumulated depreciation

(198,326

)

(188,581

)

(178,572

)

(175,319

)

(168,480

)

Investments in real estate, net

2,319,319

2,259,750

1,605,316

1,658,659

1,671,971

Investments in securities, at fair value

—

—

—

—

31,412

Cash and cash equivalents

125,886

92,652

104,772

92,657

121,726

Restricted cash

213,012

159,200

179,878

126,850

124,220

Accrued interest receivable

47,343

56,249

56,844

53,586

51,640

Other assets

71,207

76,222

77,708

84,629

72,023

Deferred costs, net

31,368

29,806

25,117

25,034

27,802

Intangible assets, net

32,675

39,306

32,195

30,710

29,463

Total assets

$

4,447,296

$

4,286,636

$

3,575,576

$

3,565,784

$

3,513,475

Liabilities and Equity

Indebtedness:

Indebtedness:

Recourse

$

494,697

$

586,952

$

497,430

$

579,258

$

509,701

Nonrecourse

2,864,753

2,613,029

2,164,098

2,107,499

2,105,965

Indebtedness, total

3,359,450

3,199,981

2,661,528

2,686,757

2,615,666

Accrued interest payable

9,834

13,748

11,042

12,889

10,269

Accounts payable and accrued expenses

39,672

42,219

52,728

48,489

54,962

Derivative liabilities

4,727

8,960

12,154

17,767

20,695

Borrowers escrows, dividends payable and other liabilities

203,477

188,797

172,621

152,757

144,733

Total liabilities

3,617,160

3,453,705

2,910,073

2,918,659

2,846,325

Series D preferred stock

85,395

83,787

82,513

80,871

79,308

Equity

Equity:

Preferred shares:

Shareholders' Equity:

7.75% Series A Preferred shares

53

53

53

48

48

8.375% Series B Preferred shares

23

23

23

23

23

8.875% Series C Preferred shares

17

17

17

17

17

Common shares, $0.01 par value per share

2,748

2,727

2,487

2,484

2,473

Additional paid in capital

2,087,137

2,082,695

2,039,594

2,026,347

2,025,683

Accumulated other comprehensive income (loss)

(4,699

)

(8,022

)

(11,605

)

(15,778

)

(20,788

)

Retained earnings (deficit)

(1,680,751

)

(1,674,412

)

(1,651,613

)

(1,655,781

)

(1,633,911

)

Total shareholders' equity

404,528

403,081

378,956

357,360

373,545

Noncontrolling Interests

340,213

346,063

204,034

208,894

214,297

Total equity

744,741

749,144

582,990

566,254

587,842

Total liabilities and equity

$

4,447,296

$

4,286,636

$

3,575,576

$

3,565,784

$

3,513,475

($'s in 000's)

As of December 31, 2015

RAIT

IRT

Corporate / Eliminations

Consolidated

Assets

Investments in loans:

Investment in loans

$

1,661,658

$

-

$

(38,075

)

$

1,623,583

Allowance for loan losses

(17,097

)

-

-

(17,097

)

Investments in loans, net

1,644,561

-

(38,075

)

1,606,486

Investments in real estate:

Investments in real estate at cost

1,145,630

1,372,015

-

2,517,645

Accumulated depreciation

(158,688

)

(39,638

)

-

(198,326

)

Investments in real estate, net

986,942

1,332,377

-

2,319,319

Investment in IRT

53,947

-

(53,947

)

-

Cash and cash equivalents

87,585

38,301

-

125,886

Restricted cash

207,599

5,413

-

213,012

Accrued interest receivable

47,343

-

-

47,343

Other assets

68,281

3,362

(436

)

71,207

Deferred costs, net

22,142

9,226

-

31,368

Intangible assets, net

28,940

3,735

-

32,675

Total assets

$

3,147,340

$

1,392,414

$

(92,458

)

$

4,447,296

Liabilities and Equity

Indebtedness:

Recourse

$

494,697

$

391,500

$

(391,500

)

$

494,697

Nonrecourse

1,926,991

584,337

353,425

2,864,753

Indebtedness, total

2,421,688

975,837

(38,075

)

3,359,450

Accrued interest payable

8,595

1,239

-

9,834

Accounts payable and accrued expenses

20,368

19,304

-

39,672

Derivative liabilities

4,727

-

-

4,727

Borrowers escrows, dividends payable and other liabilities

197,909

6,004

(436

)

203,477

Total liabilities

2,653,287

1,002,384

(38,511

)

3,617,160

Series D preferred stock

85,395

-

-

85,395

Equity:

Shareholders' Equity:

7.75% Series A Preferred shares

53

-

-

53

8.375% Series B Preferred shares

23

-

-

23

8.875% Series C Preferred shares

17

-

-

17

Common shares, $0.01 par value per share

2,748

471

(471

)

2,748

Additional paid in capital

2,087,137

378,187

(378,187

)

2,087,137

Accumulated other comprehensive income (loss)

(4,691

)

(8

)

-

(4,699

)

Retained earnings (deficit)

(1,680,751

)

(14,500

)

14,500

(1,680,751

)

Total shareholders' equity

404,536

364,150

(364,158

)

404,528

Noncontrolling Interests

4,122

25,880

310,211

340,213

Total equity

408,658

390,030

(53,947

)

744,741

Total liabilities and equity

$

3,147,340

$

1,392,414

$

(92,458

)

$

4,447,296

($'s in 000's, except per share amounts)

Three-Months Ended

December 31

Year Ended                       December 31

2015

2014

2015

2014

Revenue:

Net interest margin

Investment interest income

$

26,609

$

30,537

$

98,432

$

133,419

Investment interest expense

(6,733

)

(7,968

)

(29,250

)

(30,310

)

Net interest margin

19,876

22,569

69,182

103,109

Property income

69,464

46,096

233,731

162,281

Fee and other income

5,004

5,167

21,069

24,280

Total revenue

94,344

73,832

323,982