Transactions With Related Parties

12 Months Ended

Dec. 31, 2024

Related Party Transactions [Abstract]

Transactions With Related Parties

TRANSACTIONS WITH RELATED PARTIES

Our Manager

We are managed by our Manager pursuant to the Management Agreement. The current term of the Management Agreement expires on December 19, 2025, and will be automatically renewed for a one-year term upon such date and each anniversary thereafter unless earlier terminated.

As of December 31, 2024, our consolidated balance sheet included $18.5 million of accrued management fees payable to our Manager. As of December 31, 2023, our consolidated balance sheet included $26.3 million of accrued management and incentive fees payable to our Manager. During the years ended December 31, 2024, 2023 and 2022, we paid aggregate management and incentive fees of $82.6 million, $126.6 million, and $104.8 million, respectively, to our Manager. In addition, during the years ended December 31, 2024, 2023 and 2022, we incurred expenses of $1.6 million, $3.4 million and $896,000, respectively, that were paid by our Manager and have been or will be reimbursed by us.

As of December 31, 2024, our Manager held 1,320,898 shares of unvested restricted class A common stock, which had an aggregate grant date fair value of $28.0 million. These shares vest in installments over three years from the date of issuance. During the years ended December 31, 2024, 2023 and 2022, we recorded non-cash expenses related to shares held by our Manager of $16.6 million, $14.6 million and $16.6 million, respectively. Refer to Note 18 for further details on our restricted class A common stock.

As of December 31, 2024, our Manager, its affiliates (including Blackstone), Blackstone employees, and our directors held an aggregate 13,136,754 shares, or 7.6%, of our class A common stock, of which 8,234,581 shares, or 4.8%, were held by Blackstone and its subsidiaries. Additionally, our directors held 412,096 of deferred stock units as of December 31, 2024. Certain of the parties listed above have in the past purchased or sold shares of our class A common stock in open market transactions, and such parties may in the future purchase or sell additional shares of our class A common stock. Any such

transactions would be made in the sole discretion of the relevant party based on market conditions and other considerations relevant to such parties.

Affiliate Service Providers

We have engaged certain portfolio companies owned by Blackstone-advised investment vehicles, to provide management, operational and corporate support services. The following table details the amounts incurred for affiliate service provides ($ in thousands):

		Year Ended December 31,
	Asset class	2024		2023		2022
Revantage Corporate Services, LLC and Revantage Global Services Europe S.à r.l.(1)	n/a	$	1,270	$	658	$	524
EQ Management, LLC(2)	Office	796		—		—
LivCor, LLC(2)	Multifamily	59		—		—
BRE Hotels & Resorts, LLC(2)	Hospitality	—		—		—
		$	2,125	$	658	$	524

(1)As applicable, provides corporate support services, operational services, and management services to certain of our investments directly.

(2)As applicable, provides management, operational, and corporate support services to certain of our REO assets directly.

Affiliates of our Manager    

We have engaged affiliates of our Manager to provide various services noted below. The following table details the amounts incurred for these affiliates of our manager ($ in thousands):

	Year Ended December 31,
	2024			2023		2022
BTIG, LLC(1)	$	124		$	1	$	191
Gryphon Mutual Property Americas IC(2)	320			—		—
Blackstone Internal audit services	95			95		95
CT Investment Management Co., LLC(3)	—			—		—
Lexington National Land Services(4)	67			—		—
Blackstone Securities Partners L.P.(5)	515			—		825
Total	$	1,121	—	$	96	$	1,111

(1)Affiliates of our Manager own an interest in the controlling entity of BTIG, LLC, or BTIG. BTIG was utilized as a broker to engage third-parties to facilitate our repurchase of our Senior Secured Notes and Convertible Notes. During the years ended December 31, 2024 and 2023, we repurchased $33.8 million and $500,000 of our Senior Secured Notes and Convertible Notes, respectively, utilizing BTIG as a broker. During the year ended 2022, we did not utilize BTIG as a broker. Additionally, we engaged BTIG as a sales agent to sell shares of our class A common stock under our ATM Agreements. During the year ended December 31, 2022, BTIG sold shares under our ATM agreements. During the years ended December 31, 2024 and 2023, we did not sell any shares under our ATM agreements. These engagements were on terms equivalent to those of third parties under similar arrangements.

(2)In the first quarter of 2024, in order to provide insurance for our REO assets, we became a member of Gryphon Mutual Property Americas IC, or Gryphon, a captive insurance company owned by us and other Blackstone-advised investment vehicles. A Blackstone affiliate provides oversight and advisory services to Gryphon and receives fees based on a percentage of premiums paid for such policies. The fees and expenses of Gryphon, including insurance premiums and fees paid to its manager, are paid annually and borne by us and the other Blackstone-advised investment vehicles that are members of Gryphon pro rata based on insurance premiums paid for each party’s respective properties. During the year ended December 31, 2024, we paid $660,000 to Gryphon for insurance costs, inclusive of premiums, capital surplus contributions, taxes, and our pro rata share of other expenses. Of this amount, $13,000 was attributable to the fee paid to a Blackstone affiliate to provide oversight and management services to Gryphon. The amounts included in the table above reflect the amortization of the insurance expense over the period of the respective policies.

(3)CT Investment Management Co., LLC is the special servicer of the CLOs. As of December 31, 2024, two of our assets were in special servicing under the CLOs. CTIMCO has waived any fees that would be payable to a special servicer pursuant to the applicable servicing agreements, and no such fees have been paid or will become payable to CTIMCO.

(4)Lexington National Land Services, or LNLS, a title agent company owned by Blackstone, acts as an agent for one or more underwriters in issuing title policies and/or providing support services in connection with investments by us, Blackstone and their affiliates and related parties, and third-parties. LNLS focuses on transactions in rate-regulated states where the cost of title insurance is non-negotiable. LNLS will not perform services in non-regulated states for us, unless (i) in the context of a portfolio transaction that includes properties in rate-regulated states, (ii) as part of a syndicate of title insurance companies where the rate is negotiated by other insurers or their agents, (iii) when a third-party is paying all or a material portion of the premium or (iv) when providing only support services to the underwriter. LNLS earns fees, which would have otherwise been paid to third parties, by providing title agency services and facilitating placement of title insurance with underwriters. Blackstone receives distributions from LNLS in connection with investments by us based on its equity interest in LNLS. In each case, there will be no related expense offset to us. The costs included above were capitalized into REO assets on our consolidated balance sheet.

(5)In the fourth quarter of 2024, Blackstone Securities Partners L.P., or BSP, an affiliate of our Manager, was engaged as a member of the syndicate for our B-5 Term Loan and our 2024 Senior Secured Notes. These engagements were on terms equivalent to those of unaffiliated parties.

Affiliate Transactions

In the fourth quarter of 2024, pursuant to our Agency Multifamily Lending Partnership, we referred three loans to MTRCC for origination, where the borrower was a Blackstone-advised investment vehicle. The loan terms and pricing were on market terms negotiated by MTRCC. Pursuant to our Agency Multifamily Lending Partnership, we received $217,000 of origination and servicing fees for referring these loans.

In the fourth quarter of 2024, as part of broad syndications led by a third party, Blackstone-advised investment vehicles acquired (i) an aggregate $62.5 million participation in our $650.0 million B-5 Term Loan, and (ii) an aggregate $80.0 million of our $450.0 million senior secured notes due 2029. In the second and fourth quarter of 2022, a Blackstone-advised investment vehicle acquired an aggregate $33.0 million participation, or 4%, of the aggregate B-4 Term Loan as a part of a broad syndication lead-arranged by a third-party. All of these transactions were on terms equivalent to those of unaffiliated parties. BSP was engaged as a member of the syndicate for both transactions. See “—Affiliates of our Manager” for more information.

In the fourth quarter of 2024, in connection with the modification of one of our senior loans, a Blackstone-advised investment vehicle purchased a pari passu participation in the loan from a third party at a discount to par.

In the fourth quarter of 2024, the senior lenders negotiated a discounted payoff of a senior loan in which we held an interest. As part of the discounted payoff, a Blackstone-advised investment vehicle’s mezzanine loan, which had been part of the total financing, received a small repayment.

In the third quarter of 2024, we acquired $94.4 million of a total $560.0 million senior loan to an unaffiliated third party. One Blackstone-advised investment vehicle holds a portion of the senior loan and another holds a mezzanine loan. We will forgo all non-economic rights under our loan, including voting rights, so long as any Blackstone-advised investment vehicle controls the mezzanine loan. The intercreditor agreement between the senior loan lender and the mezzanine lender was negotiated on market terms by a third party without our involvement, and our 17% interest in the senior loan was made on such market terms.

In 2019 and 2021, we acquired an aggregate participation of €350.0 million of a senior loan to a borrower that is partially owned by a Blackstone-advised investment vehicle. We forgo all non-economic rights under the loan, including voting rights, so long as the Blackstone-advised investment vehicle controls the borrower. The loan was negotiated by third parties on market terms without our involvement, and our interest in the senior loan was subject to such market terms. In the third quarter of 2024, the borrower under a senior loan to the same borrower in which we held a minority position completed a refinancing transaction involving new lenders and the existing lenders. We elected to sell €232.0 million of our then remaining €347.0 million loan position to the new lenders at par and extend the remainder on modified terms. The terms of the modification (which included, among other changes, an extension of the maturity date, and increase in the interest rate, and additional guarantees) were negotiated by our third-party co-lender.

In the fourth quarter of 2018, we originated £148.7 million of a total £303.5 million senior loan to a borrower that is wholly owned by a Blackstone-advised investment vehicle. The loan terms were negotiated by our third-party co-lender, and we will forgo all non-economic rights under the loan, including voting rights, so long as a Blackstone-advised investment vehicle controls the borrower. In the third quarter of 2024, we agreed to a refinancing transaction pursuant to which £46.4 million of our £148.7 million participation in an existing £303.5 million loan to a borrower that is wholly owned by a Blackstone-advised investment vehicle was repaid, and we received a £100.0 million participation in a new loan made to the same borrower that continues to be controlled by a Blackstone-advised investment vehicle, and the terms of the loan were modified to include, among other changes, an expanded collateral pool, an extension of the maturity date and an increase in the interest rate. The transaction, including the terms of the modification, was negotiated by our third-party co-lender.

In the second quarter of 2024, a Blackstone-advised investment vehicle acquired a portfolio of assets from an unaffiliated third-party borrower. The proceeds of this transaction repaid a £46.5 million performing junior loan owned by us, and a £186.0 million performing senior loan owned by an unaffiliated third-party, both of which were included in our consolidated balance sheets, with the senior loan also recorded as a loan participation sold liability. The transaction was initiated by the third-party borrower with the sale pricing on market terms and the repayment completed in accordance with the loan agreements between the lenders and the unaffiliated third-party borrower.

In the first quarter of 2024, a Blackstone-advised investment vehicle originated a loan to one of our unaffiliated third-party borrowers, the proceeds of which repaid a $98.6 million performing senior loan owned by us. The transaction was initiated by the third-party borrower with the loan terms and pricing on market terms.

In the first quarter of 2019, we originated £240.1 million of a total £490.0 million senior loan to a borrower that is wholly owned by a Blackstone-advised investment vehicle. The loan terms were negotiated by our third-party co-lender, and we forgo all non-economic rights under the loan, including voting rights, so long as a Blackstone-advised investment vehicle controls the borrower. In the second quarter of 2023, the loan was modified to include, among other changes, an extension of the loan's maturity date, an additional borrower equity contribution and partial repayment, and an increase in the loan’s contractual interest rate (a portion of which is paid-in-kind). The terms of the modification were negotiated by our third-party co-lender, and we agreed to the modification on such terms.