v3.26.1
FAIR VALUE OF FINANCIAL INSTRUMENTS
 6 Months Ended
Jun. 30, 2026
Fair Value Disclosures [Abstract]  
FAIR VALUE OF FINANCIAL INSTRUMENTS 13. FAIR VALUE OF FINANCIAL INSTRUMENTS
 
Fair value is based upon internal models, using market quotations, broker quotations, counterparty quotations or pricing services quotations, which provide valuation estimates based upon reasonable market order indications and are subject to significant variability based on market conditions, such as interest rates, credit spreads and market liquidity. The fair value of the mortgage loan receivables held for sale is based upon a securitization model utilizing market data from recent securitization spreads and pricing.
 
Fair Value Summary Table
 
The carrying values and estimated fair values of the Company’s financial instruments, which are both reported at fair value on a recurring basis or amortized cost/par, at June 30, 2026 and December 31, 2025 are as follows ($ in thousands):
 
June 30, 2026
      Weighted Average
Assets:Principal Amount Amortized Cost Basis/Purchase PriceFair ValueFair Value MethodYield
%		Remaining
Maturity/Duration (years)
CMBS(1)$1,855,960  $1,855,743 $1,850,905 Internal model5.17 %2.99
CMBS interest-only(1)172,725 (2)606 626 Internal model8.56 %0.29
GNMA interest-only(3)27,498 (2)86 156 Internal model9.17 %3.50
Corporate bonds(1)9,250 9,234 9,191 Internal model8.58 %2.15
Equity securities(3) N/A 13,639 11,581 Observable market pricesN/AN/A
Mortgage loan receivables held for investment, net, at amortized cost(4)2,810,014  2,790,138 2,789,567 Discounted Cash Flow(5)7.26 %1.85
Mortgage loan receivables held for sale31,350  27,205 27,205 Internal model, third-party inputs(6)4.57 %6.55
Nonhedge derivatives(1)(7)101,900  116 116 Counterparty quotationsN/A0.23
Liabilities:       
Repurchase agreements - short-term825,936  825,937 825,937 Cost plus Accrued Interest(8)4.13 %0.04
Repurchase agreements - long-term107,228  107,228 107,228 Discounted Cash Flow(8)5.07 %4.45
Unsecured Revolving Credit Facility202,000 202,000 202,000 (9)4.87 %2.48
Term Loan Facility275,000 275,000 275,000 (9)5.00 %2.65
Mortgage loan financing386,017  387,485 382,848 Discounted Cash Flow5.88 %3.65
Senior unsecured notes2,222,993  2,207,255 2,229,452 Internal model5.29 %3.06
(1)Measured at fair value on a recurring basis with the net unrealized gains or losses recorded as a component of other comprehensive income (loss) in equity.
(2)Represents notional outstanding balance of underlying collateral.
(3)Measured at fair value on a recurring basis with the net unrealized gains or losses recorded in current period earnings.
(4)Balance does not include impact of allowance for current expected credit losses of $47.1 million at June 30, 2026.
(5)Fair value for floating rate mortgage loan receivables, held for investment is estimated to approximate the outstanding face amount given the short interest rate reset risk (30 days) and no significant change in credit spreads since origination. Fair value for fixed rate mortgage loan receivables, held for investment is measured using a discounted cash flow model.
(6)Fair value for mortgage loan receivables, held for sale is measured using a hypothetical securitization model utilizing market data from recent securitization spreads and pricing.
(7)The outstanding face amount of the nonhedge derivatives represents the notional amount of the underlying contracts.
(8)For repurchase agreements - short term, the value approximates the cost plus accrued interest.
(9)Fair value for the Unsecured Revolving Credit Facility and Term Loan Facility are estimated to approximate the outstanding face amount.
December 31, 2025
      Weighted Average
Assets:Principal Amount Amortized Cost Basis/Purchase PriceFair ValueFair Value MethodYield
%		Remaining
Maturity/Duration (years)
CMBS(1)$2,070,492  $2,069,307 $2,064,922 Internal model5.31 %2.97
CMBS interest-only(1)347,200 (2)1,283 1,275 Internal model8.63 %0.52
GNMA interest-only(3)29,203 (2)95 167 Internal model9.24 %3.27
Agency securities(1)2  2 2 Internal model3.04 %0.19
Corporate bonds(1)9,250 9,231 9,240 Internal model8.58 %2.60
Equity securities(3) N/A 12,910 12,699 Observable market pricesN/A N/A
Mortgage loan receivables held for investment, net, at amortized cost(4)2,234,346  2,217,375 2,214,987 Discounted Cash Flow(5)7.76 %1.57
Mortgage loan receivables held for sale31,350  27,986 27,986 Internal model, third-party inputs(6)4.57 %6.92
Nonhedge derivatives(1)(7)113,500  264 264 Counterparty quotationsN/A0.22
Liabilities:       
Repurchase agreements - short-term627,012  627,012 627,012 Cost plus Accrued Interest(8)4.29 %0.04
Unsecured Revolving Credit Facility280,000 280,000 280,000 (9)2.42 %2.97
Mortgage loan financing386,543  388,195 385,460 Discounted Cash Flow5.88 %4.01
Senior unsecured notes2,233,409  2,215,195 2,265,416 Internal model5.29 %3.54
(1)Measured at fair value on a recurring basis with the net unrealized gains or losses recorded as a component of other comprehensive income (loss) in equity.
(2)Represents notional outstanding balance of underlying collateral.
(3)Measured at fair value on a recurring basis with the net unrealized gains or losses recorded in current period earnings.
(4)Balance does not include impact of allowance for current expected credit losses of $47.1 million at December 31, 2025.
(5)Fair value for floating rate mortgage loan receivables, held for investment is estimated to approximate the outstanding face amount given the short interest rate reset risk (30 days) and no significant change in credit spreads since origination. Fair value for fixed rate mortgage loan receivables, held for investment is measured using a discounted cash flow model.
(6)Fair value for mortgage loan receivables, held for sale is measured using a hypothetical securitization model utilizing market data from recent securitization spreads and pricing.
(7)The outstanding face amount of the nonhedge derivatives represents the notional amount of the underlying contracts.
(8)For repurchase agreements - short term, the value approximates the cost plus accrued interest.
(9)Fair value for the Unsecured Revolving Credit Facility is estimated to approximate the outstanding face amount.
The following table summarizes the Company’s financial assets and liabilities, which are both reported at fair value on a recurring basis (as indicated) or amortized cost/par, at June 30, 2026 and December 31, 2025 ($ in thousands):
 
June 30, 2026
 
Financial Instruments Reported at Fair Value on Consolidated Statements of Financial ConditionPrincipal
Amount		 Fair Value
 Level 1Level 2Level 3Total
Assets:      
CMBS(1)$1,847,125  $— $1,842,180 $— $1,842,180 
CMBS interest-only(1)164,844 (2)— 573 — 573 
GNMA interest-only(3)27,498 (2)— 156 — 156 
Corporate bonds(1)9,250 — 9,191 — 9,191 
Equity securities N/A 11,581 — — 11,581 
Nonhedge derivatives(4)101,900 116 — — 116 
$11,697 $1,852,100 $— $1,863,797 
Financial Instruments Not Reported at Fair Value on Consolidated Statements of Financial ConditionPrincipal
Amount		 Fair Value
 Level 1Level 2Level 3Total
Assets:
Mortgage loan receivables held for investment, net, at amortized cost(5)$2,810,014  $— $— $2,789,567 $2,789,567 
Mortgage loan receivable held for sale(6)31,350  — — 27,205 27,205 
CMBS(7)8,836 — 8,725 — 8,725 
CMBS interest-only(7)7,881 — 53 — 53 
$— $8,778 $2,816,772 $2,825,550 
Liabilities:     
Repurchase agreements - short-term$825,936  $— $825,937 $— $825,937 
Repurchase agreements - long-term107,228  — 107,228 — 107,228 
Unsecured Revolving Credit Facility202,000 — — 202,000 202,000 
Term Loan Facility275,000 — — 275,000 275,000 
Mortgage loan financing386,017  — — 382,848 382,848 
Senior unsecured notes2,222,993  — 2,229,452 — 2,229,452 
$— $3,162,617 $859,848 $4,022,465 
(1)Measured at fair value on a recurring basis with the net unrealized gains or losses recorded as a component of other comprehensive income (loss) in equity.
(2)Represents notional outstanding balance of underlying collateral. 
(3)Measured at fair value on a recurring basis with the net unrealized gains or losses recorded in current period earnings. 
(4)Measured at fair value on a recurring basis with the net unrealized gains or losses recorded in current period earnings. The outstanding face amount of the nonhedge derivatives represents the notional amount of the underlying contracts.
(5)Balance does not include impact of allowance for current expected credit losses of $47.1 million at June 30, 2026.
(6)A lower of cost or market adjustment was recorded as of June 30, 2026.
(7)Restricted securities which are designated as risk retention securities under the Dodd-Frank Act and are therefore subject to transfer restrictions over the term of the securitization trust, are classified as held-to-maturity and reported at amortized cost.
December 31, 2025
 
Financial Instruments Reported at Fair Value on Consolidated Statements of Financial ConditionPrincipal
Amount		 Fair Value
 Level 1Level 2Level 3Total
Assets:      
CMBS(1)$2,061,579  $— $2,056,177 $— $2,056,177 
CMBS interest-only(1)339,241 (2)— 1,171 — 1,171 
GNMA interest-only(3)29,203 (2)— 167 — 167 
Agency securities(1)2  — 2 — 2 
Corporate bonds(1)9,250 — 9,240 — 9,240 
Equity securities N/A 12,699 — — 12,699 
Nonhedge derivatives(4)113,500 264 — — 264 
$12,963 $2,066,757 $— $2,079,720 
Financial Instruments Not Reported at Fair Value on Consolidated Statements of Financial ConditionPrincipal
Amount		 Fair Value
 Level 1Level 2Level 3Total
Assets:
Mortgage loan receivables held for investment, net, at amortized cost(5)$2,234,346  $— $— $2,214,987 $2,214,987 
Mortgage loan receivable held for sale(6)31,350  — — 27,986 27,986 
CMBS(7)8,913 — 8,745 — 8,745 
CMBS interest-only(7)7,958 — 104 — 104 
$— $8,849 $2,242,973 $2,251,822 
Liabilities:     
Repurchase agreements - short-term$627,012  $— $627,012 $— $627,012 
Unsecured Revolving Credit Facility280,000 — — 280,000 280,000 
Mortgage loan financing386,543  — — 385,460 385,460 
Senior unsecured notes2,233,409  — 2,265,416 — 2,265,416 
$— $2,892,428 $665,460 $3,557,888 
(1)Measured at fair value on a recurring basis with the net unrealized gains or losses recorded as a component of other comprehensive income (loss) in equity.
(2)Represents notional outstanding balance of underlying collateral. 
(3)Measured at fair value on a recurring basis with the net unrealized gains or losses recorded in current period earnings. 
(4)Measured at fair value on a recurring basis with the net unrealized gains or losses recorded in current period earnings. The outstanding face amount of the nonhedge derivatives represents the notional amount of the underlying contracts.
(5)Balance does not include impact of allowance for current expected credit losses of $47.1 million at December 31, 2025.
(6)A lower of cost or market adjustment was recorded as of December 31, 2025.
(7)Restricted securities which are designated as risk retention securities under the Dodd-Frank Act and are therefore subject to transfer restrictions over the term of the securitization trust, are classified as held-to-maturity and reported at amortized cost.

The Company did not have any Level 3 financial instruments as of June 30, 2026 and December 31, 2025.

Nonrecurring Fair Values

The Company measures fair value of certain assets on a nonrecurring basis when events or changes in circumstances indicate that the carrying value of the assets may be impaired. Adjustments to fair value generally result from the application of lower of amortized cost or fair value accounting for assets held for sale or write-down of assets value due to impairment. Refer to Note 3, Mortgage Loan Receivables and Note 5, Real Estate and Related Lease Intangibles, Net, for disclosure of Level 3 inputs for certain assets measured on a nonrecurring basis.