Form 8-K BLACKSTONE MORTGAGE TRUS For: Jul 28
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (Date of earliest event reported): July 28, 2015
Blackstone Mortgage Trust, Inc.
(Exact name of registrant as specified in its charter)
| Maryland | 1-14788 | 94-6181186 | ||
| (State or Other Jurisdiction of Incorporation) |
(Commission File Number) |
(I.R.S. Employer Identification No.) |
345 Park Avenue, 42nd Floor
New York, New York 10154
(Address of Principal Executive Offices) (Zip Code)
Registrant’s telephone number, including area code: (212) 655-0220
Not Applicable
(Former Name or Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ¨ | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ¨ | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ¨ | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ¨ | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Item 2.02 Results of Operations and Financial Condition.
On July 28, 2015, Blackstone Mortgage Trust, Inc. (the “Company”) issued a press release and detailed presentation announcing its financial results for the second quarter ended June 30, 2015. The press release and full detailed presentation are furnished as Exhibit 99.1 and Exhibit 99.2, respectively, to this Current Report on Form 8-K report and are incorporated herein by reference.
In accordance with General Instruction B.2 of Form 8-K, the information contained under Item 2.02 in this Current Report on Form 8-K, including Exhibit 99.1 and Exhibit 99.2, is being furnished and shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liability of that section, and will not be incorporated by reference into any registration statement or other document filed under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in that filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
| Exhibit No. |
Description | |
| 99.1 | Press Release of Blackstone Mortgage Trust, Inc. dated July 28, 2015. | |
| 99.2 | Presentation of Blackstone Mortgage Trust, Inc. dated July 28, 2015. | |
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| BLACKSTONE MORTGAGE TRUST, INC. | ||||||
| Date: July 28, 2015 | By: | /s/ Paul D. Quinlan | ||||
| Name: | Paul D. Quinlan | |||||
| Title: | Chief Financial Officer | |||||
Exhibit 99.1
Blackstone Mortgage Trust Reports
Second Quarter 2015 Results
New York, July 28, 2015: Blackstone Mortgage Trust, Inc. (NYSE: BXMT) today reported its second quarter 2015 results. Net income for the second quarter was $29 million, or $0.36 per share.
Stephen D. Plavin, Chief Executive Officer, said, “This was a landmark quarter for BXMT. We closed $6.5 billion of loans, including the entire $4.9 billion GE portfolio, and added $1.73 to our book value primarily from the equity we issued to fund new investments. We enter the second half of the year with all of the drivers for significant growth in Core Earnings and dividends already in place.”
Blackstone Mortgage Trust issued a full detailed presentation of its second quarter 2015 results, which can be viewed at www.bxmt.com.
Quarterly Investor Call Details
Blackstone Mortgage Trust will host a conference call on Wednesday, July 29, 2015 at 10:00 a.m. ET to discuss second quarter 2015 results. The conference call can be accessed by dialing +1 (888) 268-4178 (U.S. domestic) or +1 (617) 597-5494 (international), with the passcode 245-054-61# or by webcast at www.bxmt.com (listen only). For those unable to listen to the live broadcast, a recorded replay will be available on the Company’s website or by telephone beginning approximately two hours after the event. The replay call number is +1 (888) 286-8010 (U.S. domestic) or +1 (617) 801-6888 (international), with the passcode 842-273-53#.
About Blackstone Mortgage Trust
Blackstone Mortgage Trust, Inc. (NYSE: BXMT) is a real estate finance company that originates and acquires senior loans collateralized by properties in North America and Europe. BXMT is a real estate investment trust headquartered in New York City and is externally managed by BXMT Advisors L.L.C., a subsidiary of Blackstone. Further information is available at www.bxmt.com.
About Blackstone
Blackstone (NYSE:BX) is one of the world’s leading investment firms. Blackstone seeks to create positive economic impact and long-term value for its investors, the companies it invests in, and the communities in which it works. Blackstone does this by using extraordinary people and flexible capital to help companies solve problems. Blackstone’s asset management businesses, with over $330 billion in assets under management, include investment vehicles focused on private equity, real estate, public debt and equity,
Blackstone Mortgage Trust, Inc.
345 Park Avenue
New York, New York 10154
T 212 655 0220
non-investment grade credit, real assets and secondary funds, all on a global basis. Blackstone also provides various financial advisory services, including financial and strategic advisory, restructuring and reorganization advisory and fund placement services. Further information is available at www.blackstone.com. Follow Blackstone on Twitter @Blackstone.
Forward-Looking Statements and Other Matters
This release may contain 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, which reflect Blackstone Mortgage Trust’s current views with respect to, among other things, Blackstone Mortgage Trust’s operations and financial performance, including performance of its recently acquired loan portfolio from GE Capital. You can identify these forward-looking statements by the use of words such as “outlook,” “indicator,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. Blackstone Mortgage Trust believes these factors include but are not limited to those described under the section entitled “Risk Factors” in its Annual Report on Form 10-K for the fiscal year ended December 31, 2014 and under the section entitled “Risks Related to the Loan Portfolio Acquisition” in its Quarterly Report on From 10-Q for the fiscal quarter ended March 31, 2015, as such factors may be updated from time to time in its periodic filings with the Securities and Exchange Commission (“SEC”) which are accessible on the SEC’s website at www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this release and in the filings. Blackstone Mortgage Trust assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events or circumstances.
We refer to “Core Earnings”, which is a non-GAAP financial measure, in this release. A reconciliation to net income attributable to Blackstone Mortgage Trust, the most directly comparable GAAP measure, is included in our full detailed presentation of second quarter 2015 results and is available on our website at www.bxmt.com.
Investor and Media Relations Contact
Weston Tucker
Blackstone
+1 (888) 756-8443
2
 Blackstone Mortgage Trust, Inc. July 28, 2015 Second Quarter 2015 Results Exhibit 99.2 |
 Blackstone Mortgage Trust 1 Second Quarter 2015 Highlights Closed entire $4.9 billion GE loan pool and a record $1.7 billion of direct originations for a total of $6.5 billion. Loan fundings (a) of $6.1 billion, including $116 million of fundings under existing loans and received repayments of $391 million. Closed $4.2 billion GE portfolio acquisition facility and syndicated $754 million of non-consolidated senior interests, bringing total credit capacity to $10.0 billion with $517 million of available liquidity. Increased portfolio Gross ROI to 14.4% while maintaining consistent collateral LTV metrics. Book value per share increased by $1.73 to $26.60 primarily as a result of accretive share issuance. Core Earnings of $0.38 per share, as a result of $0.11 per share of transaction expenses and reflective of the temporary intra-quarter lag between new equity issuance and its deployment into the GE acquisition and other loan closings. GAAP net income of $0.36 per share. Information included in this presentation is as of or for the period ended June 30, 2015, unless otherwise indicated. See Appendix
for a definition of Core Earnings and a reconciliation to GAAP
net income, gross return on investment (“Gross ROI”), as well as certain per share calculations that are referenced throughout this presentation. (a) Includes $549 million funded under non-consolidated senior interests. |
 Blackstone Mortgage Trust 2 Second Quarter 2015 Balance Sheet, Net Income, and Core Earnings (a) (Dollars in Millions) $2,243 $163 $7,725 $10,131 CT Legacy net income Secured financings ($30.6) Equity and other (c) $1.9 ($3.4) ($9.5) ($9.0) Loan Origination portfolio $80.0 $29.3 $0.4 ($0.5) Interest income Interest expense Non-cash comp. $79.5 ($30.2) Core Earnings (b) Net Income $30.8 + + + Convertible notes, net Balance Sheet (a) See page 13 for First Quarter 2015 Balance Sheet, Net Income, and Core Earnings.
(b) See Appendix for a definition of Core Earnings and a reconciliation to GAAP net income.
(c) Includes stockholders’ equity of $2.5 billion, less the net of (i) cash and cash equivalents of $104 million, (ii) accrued interest
receivable, prepaid expenses, and other assets of $202 million,
(iii) accounts payable, accrued expenses, and other liabilities of $73 million, and (iv) CT Legacy portfolio net equity value of $8 million. Mgmt. fees/G&A ($1.9) $3.4 $- $- $- $- ($9.5) ($9.0) Transaction expenses |
 Blackstone Mortgage Trust 3 Second Quarter Financial Impact BXMT’s balance sheet doubled in 2Q substantially increasing scale and earnings power moving into 2H 2015. Loan fundings of $6.1 billion, taking total investments to $10.8 billion Investments (a) Loan fundings and total investments include non-consolidated senior interests of $549 million and $660 million, respectively.
(b) Total leverage includes secured debt agreements, loan participations sold, and non-consolidated senior interests as well as
convertible notes outstanding. Closed
$4.9
billion
of
financings,
including
syndication
of
senior
loan
interests
Asset-Level
Leverage
Closed
$237
million
sequential
pay
advance
taking
corporate
debt
to
$410
million
including
convertible
notes
Corporate
Debt
Raised
$1.0
billion
of
new
equity
adding
a
net
$1.60
to
book
value
per
share
Equity
Invested
a
net
$835
million
and
retained
$517
million
of
capital
in
cash
and
available
borrowings
Liquidity
Gross ROI Increased
to 14.4%
Total Leverage
(b)
Increased to 3.4x |
 Blackstone Mortgage Trust 4 Loan Portfolio Overview Acquired the GE loan portfolio of 77 loans for a total purchase price of $4.7 billion and originated a record $1.7 billion of new loans. New loans significantly increase scale of lending platform and provide access to new borrower relationships. Fixed rate loans acquired from GE drove Gross ROI (a) to 14.4%, with consistent collateral LTV metrics. Loan Portfolio Statistics Loan Portfolio Gross ROI (a) (Principal Balance in Millions) L+12.7% L+12.7% 19.8% 14.4% (Dollars in Millions) Floating Fixed Total Number of loans 101 37 138 Principal balance $8,009 $2,161 $10,170 Net book value $7,969 $2,162 $10,131 Wtd. avg. origination LTV 63% 63% 63% Wtd. avg. cash coupon (c) L + 4.05% 5.33% 4.60% Wtd. avg. all-in yield (c) L + 4.43% 5.54% 4.94% Wtd. avg. Gross ROI (a)(c) L + 12.7% 19.8% 14.4% Wtd. avg. maximum maturity (d) 3.5 yrs. 2.9 yrs. 3.4 yrs. $5,532 $2,477 $2,161 $10,170 Direct Origination GE Floating GE Fixed Total (a) See Appendix for a definition of gross return on investment (“Gross ROI”), which among other things, assumes full leverage at
the asset level based on the maximum available leverage in
place or in negotiation for each investment, notwithstanding the amount actually borrowed. (b) Excludes non-consolidated senior interests of $660 million. (c) Coupon and all-in yield for the total portfolio assume applicable floating benchmark rate for weighted-average calculation.
Weighted average coupon and all-in yield exclude subordinate
loans, which are not comparable to other loans as they are reported net of related non-consolidated senior interests. Gross ROI calculation includes all loans and related financings.
(d)
Maximum maturity assumes all extension options are exercised, however
BXMT’s loans may be repaid prior to such dates. (b) (b) |
 Blackstone Mortgage Trust 5 Portfolio Diversification BXMT’s portfolio is diversified by collateral property type and geographic location, and is comprised of primarily senior mortgages and similar credit quality loans. $416,559,099 Collateral Diversification (Net Book Value, % of Total) Office Multifamily Hotel Condo 3% Other Retail Manufactured Housing Geographic Diversification (Net Book Value,% of Total) Senior Loans (Net Book Value, % of Total) 98% 40% 22% 14% 8% 5% 8% NY 19% CA 11% TX 9% CAN 8% FL 7% GA 4% IL 4% WA 3% VA 3% DC 2% NC 2% CO 2% AZ 2% HI 1% MA 1% MD 1% OR 1% IA 1% SC 1% TN, 1% OK 1% PA 1% DEU 2% UK 11% ES 1% NL 1% States that comprise less than 1% of total loan portfolio |
 Blackstone Mortgage Trust 6 Financing Capacity BXMT has developed $10.0 billion of market leading financing capacity with an emphasis on efficiency and stability. Total liquidity of $517 million (a) at quarter-end, providing for $1.9 billion (a) of potential loan originations and fundings. $10.0 Total Financing Capacity (Dollars in Billions) $4.1 • Six facilities with outstanding borrowings of $2.6 billion • All-in cost of L+2.05% Revolving Credit Facilities $2.0 • 11 transactions with 5 counterparties, $1.0 billion outstanding • Pricing directly related to underlying collateral assets Asset-Specific (b) Financings $3.9 • Asset-specific advances totaling $3.7 billion • All-in cost of L+1.94% GE Portfolio Financing (a) Total liquidity includes $104 million of cash and $412 million of available borrowings. Potential loan originations assumes 4.0x
asset-level leverage on total liquidity, net of $146 million
of minimum liquidity requirements under applicable debt covenants. (b) BXMT’s balance sheet includes asset-specific repurchase agreements of $413 million and $636 million of loan participations sold.
Capacity of $2.0 billion also includes $868 million of
non-consolidated senior interests, which result from non-recourse sales of senior loan interests in loans BXMT originates. These non-consolidated senior interests provide structural leverage for BXMT’s net investments which are reflected in the form of mezzanine or other subordinate
loans on BXMT’s balance sheet and results of operations. |
 Blackstone Mortgage Trust 7 Interest Rates Earnings generated by loan portfolio is positively correlated to changes in USD and GBP LIBOR, the benchmark index for 75% of BXMT’s loan portfolio and the related secured financings. Concentration of fixed rate assets in EUR and CAD results in an inverse correlation to EURIBOR and CDOR, such that an increase in both benchmark rates by 50bps would decrease annual Core Earnings by $0.02 per share. (a) As of June 30, 2015, $1.2 billion of floating rate loans earned interest based on floors that are above the applicable index, with an
average floor of 0.59%. Portfolio Income
Sensitivity to USD LIBOR (Dollars of Net Interest Income per
share) Portfolio Fixed vs. Floating
(% of Outstanding Principal Balance)
$0.00 $0.05 $0.10 $0.15 $0.20 $0.25 0.19% 0.69% 1.19% 1.69% 2.19% 2.69% USD LIBOR Floating Fixed 79% 21% (a) |
 Appendix * * * * * * * * * |
 Blackstone Mortgage Trust 9 Loan Portfolio Details The following table provides details of BXMT’s loan portfolio:
(Dollars in Millions)
Loan Type Origination Date (a) Total Loan Principal Balance Book Value Cash Coupon All-In Yield Maximum Maturity (b) Geographic Location Property Type Origination LTV (a) Loan 1 Senior loan 6/4/2015 411 $ 404 $ 408 $ 5.48% (c) 5.66% (c) 7/18/2018 Canada Hotel 54% Loan 2 Senior loan 6/11/2015 341 341 342 4.88% (c) 4.93% (c) 4/30/2019 Diversified-US MHC 78% Loan 3 Senior loan 5/22/2014 315 315 311 L+4.00% L+4.34% 5/22/2019 U.K. Hotel 57% Loan 4 Senior loan 6/23/2015 307 307 308 5.26% (c) 5.41% (c) 1/31/2017 Diversified-US MHC 60% Loan 5 Senior loan 5/1/2015 320 295 292 L+3.45% L+3.83% 5/1/2020 NY Office 68% Loan 6 Senior loan 1/7/2015 315 261 259 L+3.50% L+3.95% 1/9/2020 NY Office 53% Loan 7 Senior loan 6/23/2015 213 213 213 5.38% 5.56% 1/18/2017 Germany Retail 53% Loan 8 Senior loan 6/11/2015 207 207 207 4.76% (c) 4.90% (c) 1/31/2017 Diversified-US MHC 65% Loan 9 Senior loan 3/4/2015 200 200 200 L+4.25% L+4.25% 3/9/2017 WA Office 64% Loan 10 Senior loan 12/9/2014 211 164 163 L+3.80% L+4.31% 12/9/2019 Diversified-US Office 65% Loan 11 Senior loan 7/31/2014 190 158 158 L+3.50% L+4.01% 8/9/2019 IL Office 70% Loan 12 Senior loan 1/7/2014 156 156 155 L+4.75% L+5.14% 1/7/2019 Diversified-US Other 58% Loan 13 Senior loan 11/20/2014 151 151 150 L+3.40% L+3.62% 11/20/2019 U.K. Hotel 62% Loan 14 Senior loan 2/25/2014 166 150 149 L+4.40% L+4.82% 3/9/2019 Diversified-US Hotel 49% Loan 15 Loan 16-138 Various (d) Various 7,277 6,667 6,636 4.49% 4.87% Various Various Various 63% Total/Wtd. avg. (e) 10,961 $ 10,170 $ 10,131 $ 4.60% 4.94% 3.4 years 63% (a) Date loan was originated or acquired by BXMT, and the LTV as of such date. (b) Maximum maturity date assumes all extension options are exercised, however loans may be repaid prior to such dates. (c) Loan consists of one or more floating and fixed rate tranches. Coupon and all-in yield assume applicable floating benchmark rate for
weighted-average calculation. (d) Includes (i) 120 senior loans with an aggregate principal balance of $6.5 billion and (ii) three mezzanine loans with an aggregate
principal balance of $156 million resulting from BXMT’s sale
of the related non-consolidated senior interests. (e) Weighted average coupon and all-in yield exclude subordinate loans, which are not comparable to other loans as they are reported net
of syndicated amounts. Senior loan 11/21/2013 181 181 180 L+4.50% L+4.86% 11/9/2018 NY Condo 68% |
 Blackstone Mortgage Trust 10 Consolidated Balance Sheet (Dollars in Thousands, Except per Share Data) June 30, 2015 December 31, 2014 Assets Cash and cash equivalents 104,252 $
51,810 $
Restricted cash
7,025 11,591
Loans receivable,
net 10,131,323
4,428,500
Equity investments in unconsolidated
subsidiaries 7,406
10,604 Accrued interest receivable, prepaid expenses, and other
assets 216,055
86,016
Total
assets 10,466,061
$
4,588,521
$
Liabilities and equity
Accounts payable, accrued expenses, and other liabilities
83,182 $
61,013 $
Secured debt agreements
7,088,738 2,365,336 Loan participations sold
635,581 499,433 Convertible notes, net
163,073 161,853 Total liabilities
7,970,574 3,087,635 Equity Class A common stock, $0.01 par value 932 583
Additional paid-in capital 3,063,429 2,027,404 Accumulated other comprehensive loss
(19,332) (15,024) Accumulated deficit
(561,905) (547,592) Total Blackstone Mortgage Trust, Inc. stockholders' equity
2,483,124 1,465,371 Non-controlling interests
12,363 35,515
Total
equity 2,495,487
1,500,886
Total liabilities and equity
10,466,061 $ 4,588,521 $ |
 Blackstone Mortgage Trust 11 Consolidated Statement of Operations (Dollars in Thousands, Except per Share Data) Three Months Ended June 30, Six Months Ended June 30, 2015 2014 2015 2014 Income from loans and other investments Interest and related income 80,481 $ 42,466 $ 143,889 $ 76,122 $ Less: Interest and related expenses 30,634 15,720 54,796 27,794 Income from loans and other investments, net 49,847 26,746 89,093 48,328 Other expenses Management and incentive fees 8,051 4,410 14,721 7,807 General and administrative expenses 15,698 15,356 23,359 18,554 Total other expenses 23,749 19,766 38,080 26,361 Unrealized gain on investments at fair value 4,714 7,163 22,190 5,824 Income from equity investments in unconsolidated subsidiaries 1,710 24,294 5,659 24,294 Income before income taxes 32,522 38,437 78,862 52,085 Income tax provision (benefit) 105 (2) 350 530 Net income 32,417 $ 38,439 $ 78,512 $ 51,555 $ Net income attributable to non-controlling interests (3,133) (4,973) (13,833) (5,024) Net income attributable to Blackstone Mortgage Trust, Inc. 29,284 $ 33,466 $ 64,679 $ 46,531 $ Per share information (basic and diluted) Weighted-average shares of common stock outstanding 80,940,535 47,977,813 69,820,061 43,000,242 Net income per share of common stock 0.36 $
0.70 $
0.93 $
1.08 $ |
 Blackstone Mortgage Trust 12 Per Share Calculations (Amounts in Thousands, Except per Share Data) Core Earnings Reconciliation Book Value per Share Earnings per Share (a) Adjustment in respect of the deferral in Core Earnings of the accretion of a total $9.1 million of purchase discount attributable to a
certain pool of GE portfolio loans pending the repayment of those
loans. June 30, 2015
March 15, 2015
Stockholders' equity
2,483,124 $
1,456,935 $
Shares Class A common stock 93,230 58,451
Deferred
stock units 130
124 Total outstanding
93,360 58,575
Book value
per share 26.60
$
24.87 $
Three Months Ended
June 30, 2015 March 15, 2015 Net income 29,284 $
35,393 $
Weighted-average shares
outstanding, basic and diluted
80,941 58,576
Earnings per
share, basic and diluted 0.36
$
0.60 $
Three Months Ended
June 30, 2015 March 31, 2015 Net income 29,284 $
35,393 $
CT Legacy Portfolio net income
(1,857) (8,400) Incentive management fees - 1,212 Non-cash compensation expense 3,396 3,297 GE purchase discount accretion adjustment (459) - Other items 416 342 Core Earnings 30,780 $
31,844 $
Weighted-average shares outstanding, basic and diluted
80,941 58,576 Core Earnings per share, basic and diluted 0.38 $
0.54
$
(a) |
 Blackstone Mortgage Trust 13 First Quarter 2015 Balance Sheet, Net Income, and Core Earnings (Dollars in Millions) $1,454 $162 $3,358 $31 $4,943 CT Legacy portfolio $8.4 Secured financings ($24.2) Equity and other (b) ($3.3) ($6.7) ($1.7) Loan Origination portfolio $62.8 $35.4 ($8.4) $0.4 $- Interest income Interest expense Non-cash comp. G&A/other expenses Net results $62.8 $- ($23.8) Core Earnings (a) Net Income $31.8 + + + + Convertible notes, net Balance Sheet (a) See page 14 for a definition of Core Earnings and page 12 for a reconciliation to GAAP net income.
(b) Includes stockholders’ equity of $1.5 billion, less the net of (i) cash and cash equivalents of $18 million, (ii) accrued interest
receivable, prepaid expenses, and other assets of $34 million,
and (iii) accounts payable, accrued expenses, and other liabilities of $49 million. Mgmt./Incen. fees $3.3 $1.2 ($0.1) $- ($5.5) ($1.8) |
 Blackstone Mortgage Trust 14 Definitions Core Earnings: Blackstone Mortgage Trust, Inc. (“BXMT”) discloses Core Earnings, a financial measure that is calculated and presented on the basis of methodologies other than in accordance with generally accepted accounting principles in the United States of America (“GAAP”) in this presentation. Core Earnings is an adjusted measure that helps BXMT evaluate its performance excluding the effects of certain transactions and GAAP adjustments that it believes are not necessarily indicative of its current loan origination portfolio and operations. BXMT also uses Core Earnings to calculate the incentive and base management fees due to its manager under its management agreement and, as such, BXMT believes that the disclosure of Core Earnings is useful to investors. Core Earnings is defined as GAAP net income (loss), including realized losses not otherwise included in GAAP net income (loss), and excluding (i) net income (loss) attributable to the CT Legacy Portfolio, (ii) non-cash equity compensation expense, (iii) incentive management fees, (iv) depreciation and amortization, and (v) unrealized gains (losses) or similar non-cash items. Core Earnings may also be adjusted from time to time to exclude one-time events pursuant to changes in GAAP and certain other non-cash charges as determined by BXMT’s manager, subject to approval by a majority of its independent directors. Core Earnings does not represent net income or cash generated from operating activities and should not be considered as an alternative to GAAP net income, or an indication of BXMT’s GAAP cash flows from operations, a measure of BXMT’s liquidity, or an indication of funds available for its cash needs. In addition, BXMT’s methodology for calculating Core Earnings may differ from the methodologies employed by other companies to calculate the same or similar supplemental performance measures, and accordingly, its reported Core Earnings may not be comparable to the Core Earnings reported by other companies. Weighted average gross return on investment (“Gross ROI”): Investment return based on each asset’s all-in yield, assuming current rates with no dispositions, early repayments, or defaults, and all-in cost of secured debt, assuming full leverage at the asset level based on the maximum available leverage in place or in negotiation for each investment, notwithstanding the amount actually borrowed. Gross ROI excludes costs related to convertible notes, the sequential pay advance under the GE portfolio acquisition facility, management fees, and other corporate-level expenses. Gross ROI is presented solely for informational purposes and is not representative of net income recognized in prior or future periods. |
 Blackstone Mortgage Trust 15 Forward-Looking Statements This presentation may contain 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, which reflect Blackstone Mortgage Trust’s (“BXMT”) current views with respect to, among other things, BXMT’s operations and financial performance, including performance of its recently acquired loan portfolio from GE Capital. You can identify these forward-looking statements by the use of words such as “outlook,” “indicator,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of these words or other comparable words. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause actual outcomes or results to differ materially from those indicated in these statements. BXMT believes these factors include but are not limited to those described under the section entitled “Risk Factors” in its Annual Report on Form 10-K for the fiscal year ended December 31, 2014 and under the section entitled “Risks Related to the Loan Portfolio Acquisition” in its Quarterly Report on Form 10-Q for the fiscal quarter ended March 31, 2015, as such factors may be updated from time to time in its periodic filings with the Securities and Exchange Commission (“SEC”) which are accessible on the SEC’s website at www.sec.gov. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this presentation and in the filings. BXMT assumes no obligation to update or supplement forward-looking statements that become untrue because of subsequent events or circumstances. |