Starwood (STWD) Q1 2026 Earnings Transcript

Motley Fool Transcribing, The Motley Fool

Fri, May 8, 2026 astatine 10:40 AM CDT 37 min read

Image source: The Motley Fool.

Date

Friday, May 8, 2026 astatine 10:00 a.m. ET

Call participants

• Chief Financial Officer — Rina Paniry

• President — Jeffrey F. DiModica

• Chairman & Chief Executive Officer — Barry Stuart Sternlicht

• Director of Investor Relations — Zachary H. Tanenbaum

Full Conference Call Transcript

Rina Paniry: Thank you, Zach, and bully morning, everyone. Today, we reported distributable net of $147 million, oregon $0.39 per share, for the archetypal quarter. Our results were impacted by continued higher-than-normal currency balances, the solution of nonperforming assets, and the ongoing optimization of our caller nett lease cylinder, adjusted for which DE would person been $0.47. I volition supply much item for these items wrong my concern conception discussion. As we proceed connected our stated task to turn our concern base, resoluteness our nonperforming assets, and optimize our caller nett lease platform, our underlying net powerfulness continues to build.

In the quarter, we deployed $2.5 cardinal of superior crossed our businesses, including $1.5 cardinal successful commercialized lending, $597 cardinal successful infrastructure lending, and $128 cardinal successful nett lease, bringing full undepreciated assets to a grounds $31.7 cardinal astatine 4th end. We deployed different $1.5 cardinal aft the quarter, 70% of which was successful commercialized lending. Our institution is diverse, with commercialized lending comprising conscionable 52% of our concern basal and owned spot expanding to 25% this quarter. We are truly not a emblematic owe REIT. I volition present instrumentality you done our idiosyncratic conception results, opening with commercialized and residential lending, which contributed DE of $172 cardinal to the quarter, oregon $0.45 per share.

In commercialized lending, we funded $894 cardinal of our $1.5 cardinal successful indebtedness originations on with different $278 cardinal of preexisting indebtedness commitments. After factoring successful repayments of $835 million, our funded indebtedness portfolio grew to $16.7 billion. This does not see $1 cardinal of caller originations aft 4th end, which brings our indebtedness portfolio to its highest level since inception, oregon $2.3 cardinal of unfunded commitments connected antecedently closed loans that volition make aboriginal net erstwhile funded. I mentioned earlier that our run-rate net were impacted by our solution of nonperforming assets. During the quarter, we sold a multifamily plus successful Conyers, Georgia that was foreclosed successful February.

We repositioned the plus during our one-year clasp period, cutting delinquency successful fractional from 16% to 8% and expanding occupancy from 86% to 91%. After a wide selling run and implicit 20 qualified bids, we sold the plus for a $5 cardinal DE nonaccomplishment and a tiny GAAP gain, reflecting the adequacy of the GAAP reserves we antecedently recorded connected this asset. We foreclosed connected 3 five-rated nonaccrual loans successful the quarter, the archetypal of which was a $248 cardinal mixed-use spot successful Dallas, consisting arsenic of multifamily and hospitality. The 2nd was a $71 cardinal multifamily successful Phoenix and the 3rd was a $28 cardinal multifamily successful Dallas.