6. Equity Method Investments

As of December 31, 2025, the Company held 7.12% , 6.98% and 6.33% interests in AB Commercial Real Estate Debt Fund, SICAV-SIF (“AB CRED II”), AB Commercial Real Estate Debt Fund III, SICAV-SIF S.C.Sp. (“AB CRED III”) and Horton Plaza JV LLC ("Horton Plaza"), respectively, entities managed by affiliates of the Investment Manager, and unconsolidated joint ventures for which the Company is not the primary beneficiary, at their carrying values of $3.4 million, $23.0 million and $19.2 million, respectively. As of December 31, 2024, the carrying value was $3.7 million, $27.3 million and $0 million, respectively. The Company reported its share of the net asset value of AB CRED II, AB CRED III and Horton Plaza in its Consolidated Balance Sheets, presented as “Equity method investments”. The reporting period of the investments’ financial statements lags the Company’s financial reporting period, but such lag is never more than three months.

At acquisition of the equity investments in AB CRED II and AB CRED III, the Company allocated the basis difference to the mortgage loans held by the entities; the basis difference is amortized over the estimated life of the investments or recognized when a loan is repaid. Net amortization of the basis differences increased the carrying values of the Company’s equity investments during the years ended December 31, 2025 and December 31, 2024 in the amount of $0 million and $0.6 million. As of December 31, 2025 and December 31, 2024, no unamortized basis difference remains on the equity method investments.

During the years ended December 31, 2025, 2024 and 2023 the Company recorded impairment of the equity method investments of $0.5 million, $2.2 million, and $0, respectively.

Unconsolidated VIEs

In the third quarter of 2025, the Company received a 6.33% interest, in one VIE through foreclosure of a mixed use property underlying a delinquent commercial mortgage loan. The entity was determined to be a VIE but the Company was not determined to be the primary beneficiary; as a result, the investment in the entity is considered an equity method investment.

The Company does not consolidate variable interests held in an acquired joint venture investment accounted for as an equity method investment as the Company does not have the power to direct the activities that most significantly impact their economic performance and therefore, the Company only accounts for its specific interest in them.