Segment and Geographic Data

12 Months Ended

Dec. 31, 2020

Segment and Geographic Data

Segment and Geographic Data

23. Segment and Geographic Data

In its operation of the business, management, including our chief operating decision maker, who is our Chief Executive Officer, reviews certain financial information, including segmented internal profit and loss statements prepared on a basis prior to the impact of consolidating securitization VIEs under ASC 810. The segment information within this Note is reported on that basis.

The table below presents our results of operations for the year ended December 31, 2020 by business segment (amounts in thousands):

The table below presents our results of operations for the year ended December 31, 2020 by business segment (amounts in thousands):
	Commercial and
	Residential		Infrastructure				Investing
	Lending		Lending		Property		and Servicing						Securitization
	Segment		Segment		Segment		Segment		Corporate		Subtotal		VIEs		Total
Revenues:
Interest income from loans	$	665,503	$	77,851	$	—	$	8,589	$	—	$	751,943	$	—	$	751,943
Interest income from investment securities		78,490		2,637		—		93,823		—		174,950		(120,538)		54,412
Servicing fees		549		—		—		41,806		—		42,355		(12,721)		29,634
Rental income		4,706		—		255,452		37,670		—		297,828		—		297,828
Other revenues		412		499		293		1,139		—		2,343		(5)		2,338
Total revenues		749,660		80,987		255,745		183,027		—		1,269,419		(133,264)		1,136,155
Costs and expenses:
Management fees		796		—		—		901		125,372		127,069		58		127,127
Interest expense		176,230		40,913		65,390		24,303		113,313		420,149		(386)		419,763
General and administrative		41,972		15,673		4,542		80,039		15,312		157,538		336		157,874
Acquisition and investment pursuit costs		2,406		1,183		12		(29)		—		3,572		—		3,572
Costs of rental operations		3,186		—		97,136		17,354		—		117,676		—		117,676
Depreciation and amortization		1,708		342		76,246		16,109		—		94,405		—		94,405
Credit loss provision (reversal), net		47,256		(4,103)		—		—		—		43,153		—		43,153
Other expense		307		—		531		—		—		838		—		838
Total costs and expenses		273,861		54,008		243,857		138,677		253,997		964,400		8		964,408
Other income (loss):
Change in net assets related to consolidated VIEs		—		—		—		—		—		—		78,258		78,258
Change in fair value of servicing rights		—		—		—		11,415		—		11,415		(15,130)		(3,715)
Change in fair value of investment securities, net		(15,108)		—		—		(51,403)		—		(66,511)		71,904		5,393
Change in fair value of mortgage loans, net		76,897		—		—		56,227		—		133,124		—		133,124
Earnings (loss) from unconsolidated entities		8,779		(767)		—		30,845		—		38,857		(1,540)		37,317
(Loss) gain on sale of investments and other assets, net		(961)		306		—		7,965		—		7,310		—		7,310
(Loss) gain on derivative financial instruments, net		(58,664)		(1,499)		(34,392)		(21,269)		33,646		(82,178)		—		(82,178)
Foreign currency gain (loss), net		42,205		207		(14)		(3)		—		42,395		—		42,395
Loss on extinguishment of debt		(22)		(959)		(2,185)		—		(488)		(3,654)		—		(3,654)
Other (loss) income, net		—		—		(166)		447		—		281		—		281
Total other income (loss)		53,126		(2,712)		(36,757)		34,224		33,158		81,039		133,492		214,531
Income (loss) before income taxes		528,925		24,267		(24,869)		78,574		(220,839)		386,058		220		386,278
Income tax (provision) benefit		(21,091)		(117)		—		1,011		—		(20,197)		—		(20,197)
Net income (loss)		507,834		24,150		(24,869)		79,585		(220,839)		365,861		220		366,081
Net income attributable to non-controlling interests		(14)		—		(20,394)		(13,764)		—		(34,172)		(220)		(34,392)
Net income (loss) attributable to Starwood Property Trust, Inc.	$	507,820	$	24,150	$	(45,263)	$	65,821	$	(220,839)	$	331,689	$	—	$	331,689

The table below presents our results of operations for the year ended December 31, 2019 by business segment (amounts in thousands):

	Commercial and
	Residential		Infrastructure				Investing
	Lending		Lending		Property		and Servicing						Securitization
	Segment		Segment		Segment		Segment		Corporate		Subtotal		VIEs		Total
Revenues:
Interest income from loans	$	610,316	$	99,580	$	—	$	14,117	$	—	$	724,013	$	—	$	724,013
Interest income from investment securities		81,255		6,318		—		117,663		—		205,236		(128,607)		76,629
Servicing fees		423		—		—		69,962		—		70,385		(16,089)		54,296
Rental income		—		—		287,094		50,872		—		337,966		—		337,966
Other revenues		1,038		751		409		1,317		26		3,541		(26)		3,515
Total revenues		693,032		106,649		287,503		253,931		26		1,341,141		(144,722)		1,196,419
Costs and expenses:
Management fees		1,495		—		—		72		117,404		118,971		161		119,132
Interest expense		222,118		62,836		76,838		33,621		113,964		509,377		(648)		508,729
General and administrative		29,481		18,260		6,232		87,115		13,681		154,769		343		155,112
Acquisition and investment pursuit costs		1,351		75		217		(587)		—		1,056		—		1,056
Costs of rental operations		2,691		—		95,370		24,921		—		122,982		—		122,982
Depreciation and amortization		1,091		83		92,561		19,587		—		113,322		—		113,322
Credit loss provision, net		2,616		4,510		—		—		—		7,126		—		7,126
Other expense		307		—		1,693		365		—		2,365		—		2,365
Total costs and expenses		261,150		85,764		272,911		165,094		245,049		1,029,968		(144)		1,029,824
Other income (loss):
Change in net assets related to consolidated VIEs		—		—		—		—		—		—		236,309		236,309
Change in fair value of servicing rights		—		—		—		(1,468)		—		(1,468)		(2,172)		(3,640)
Change in fair value of investment securities, net		(1,084)		—		—		89,206		—		88,122		(87,289)		833
Change in fair value of mortgage loans, net		10,462		—		—		61,139		—		71,601		—		71,601
Earnings (loss) from unconsolidated entities		10,649		—		(114,362)		4,166		—		(99,547)		(1,807)		(101,354)
Gain on sale of investments and other assets, net		4,619		3,041		119,746		60,622		—		188,028		—		188,028
(Loss) gain on derivative financial instruments, net		(20,325)		(3,349)		(1,284)		(7,414)		26,062		(6,310)		—		(6,310)
Foreign currency gain (loss), net		17,342		205		37		(2)		—		17,582		—		17,582
Loss on extinguishment of debt		(857)		(11,357)		(4,745)		(845)		(1,466)		(19,270)		—		(19,270)
Other (loss) income, net		—		(50)		(100)		16		(73)		(207)		—		(207)
Total other income (loss)		20,806		(11,510)		(708)		205,420		24,523		238,531		145,041		383,572
Income (loss) before income taxes		452,688		9,375		13,884		294,257		(220,500)		549,704		463		550,167
Income tax (provision) benefit		(4,818)		89		(393)		(8,110)		—		(13,232)		—		(13,232)
Net income (loss)		447,870		9,464		13,491		286,147		(220,500)		536,472		463		536,935
Net income attributable to non-controlling interests		(392)		—		(21,630)		(4,786)		—		(26,808)		(463)		(27,271)
Net income (loss) attributable to Starwood Property Trust, Inc.	$	447,478	$	9,464	$	(8,139)	$	281,361	$	(220,500)	$	509,664	$	—	$	509,664

The table below presents our results of operations for the year ended December 31, 2018 by business segment (amounts in thousands):

	Commercial and
	Residential		Infrastructure				Investing
	Lending		Lending		Property		and Servicing						Securitization
	Segment		Segment		Segment		Segment		Corporate		Subtotal		VIEs		Total
Revenues:
Interest income from loans	$	576,564	$	28,995	$	—	$	14,984	$	—	$	620,543	$	—	$	620,543
Interest income from investment securities		50,063		1,095		—		127,100		—		178,258		(121,419)		56,839
Servicing fees		421		—		—		103,866		—		104,287		(25,521)		78,766
Rental income		—		—		292,453		57,231		—		349,684		—		349,684
Other revenues		902		619		444		1,299		360		3,624		(176)		3,448
Total revenues		627,950		30,709		292,897		304,480		360		1,256,396		(147,116)		1,109,280
Costs and expenses:
Management fees		1,838		—		—		72		127,133		129,043		412		129,455
Interest expense		160,769		20,949		75,192		27,459		124,805		409,174		(986)		408,188
General and administrative		26,324		5,631		7,113		84,978		11,747		135,793		339		136,132
Acquisition and investment pursuit costs		2,490		6,806		(46)		(663)		—		8,587		—		8,587
Costs of rental operations		—		—		99,632		27,436		—		127,068		—		127,068
Depreciation and amortization		76		—		110,684		21,889		—		132,649		—		132,649
Credit loss provision, net		34,821		—		—		—		—		34,821		—		34,821
Other expense		307		—		(27)		452		—		732		—		732
Total costs and expenses		226,625		33,386		292,548		161,623		263,685		977,867		(235)		977,632
Other income (loss):
Change in net assets related to consolidated VIEs		—		—		—		—		—		—		165,892		165,892
Change in fair value of servicing rights		—		—		—		(14,373)		—		(14,373)		4,171		(10,202)
Change in fair value of investment securities, net		(2,765)		—		—		33,229		—		30,464		(20,119)		10,345
Change in fair value of mortgage loans, net		(6,851)		—		—		47,373		—		40,522		—		40,522
Earnings from unconsolidated entities		5,063		—		3,658		3,809		—		12,530		(1,990)		10,540
Gain on sale of investments and other assets, net		4,019		—		28,468		26,557		—		59,044		—		59,044
Gain (loss) on derivative financial instruments, net		17,654		1,821		22,756		(298)		(7,330)		34,603		—		34,603
Foreign currency loss, net		(7,816)		(1,425)		(2)		(2)		—		(9,245)		—		(9,245)
Loss on extinguishment of debt		(730)		—		(2,661)		(318)		(2,099)		(5,808)		—		(5,808)
Other income (loss), net		43		—		508		(1,363)		—		(812)		—		(812)
Total other income (loss)		8,617		396		52,727		94,614		(9,429)		146,925		147,954		294,879
Income (loss) before income taxes		409,942		(2,281)		53,076		237,471		(272,754)		425,454		1,073		426,527
Income tax provision		(2,801)		(292)		(7,549)		(4,688)		—		(15,330)		—		(15,330)
Net income (loss)		407,141		(2,573)		45,527		232,783		(272,754)		410,124		1,073		411,197
Net income attributable to non-controlling interests		(1,451)		—		(17,623)		(5,220)		—		(24,294)		(1,073)		(25,367)
Net income (loss) attributable to Starwood Property Trust, Inc.	$	405,690	$	(2,573)	$	27,904	$	227,563	$	(272,754)	$	385,830	$	—	$	385,830

The table below presents our consolidated balance sheet as of December 31, 2020 by business segment (amounts in thousands):

	Commercial and
	Residential		Infrastructure				Investing
	Lending		Lending		Property		and Servicing						Securitization
	Segment		Segment		Segment		Segment		Corporate		Subtotal		VIEs		Total
Assets:
Cash and cash equivalents	$	160,007	$	4,440	$	32,080	$	19,546	$	346,372	$	562,445	$	772	$	563,217
Restricted cash		93,445		45,113		7,192		13,195		—		158,945		—		158,945
Loans held-for-investment, net		9,673,625		1,412,440		—		1,008		—		11,087,073		—		11,087,073
Loans held-for-sale		841,963		120,540		—		90,332		—		1,052,835		—		1,052,835
Investment securities		1,014,402		35,681		—		1,112,145		—		2,162,228		(1,425,570)		736,658
Properties, net		103,896		—		1,969,414		197,843		—		2,271,153		—		2,271,153
Intangible assets		—		—		40,370		71,123		—		111,493		(41,376)		70,117
Investment in unconsolidated entities		54,407		25,095		—		44,664		—		124,166		(16,112)		108,054
Goodwill		—		119,409		—		140,437		—		259,846		—		259,846
Derivative assets		6,595		—		41		147		33,772		40,555		—		40,555
Accrued interest receivable		87,922		2,091		—		123		5,978		96,114		(134)		95,980
Other assets		61,638		4,531		69,859		44,579		10,148		190,755		(7)		190,748
VIE assets, at fair value		—		—		—		—		—		—		64,238,328		64,238,328
Total Assets	$	12,097,900	$	1,769,340	$	2,118,956	$	1,735,142	$	396,270	$	18,117,608	$	62,755,901	$	80,873,509
Liabilities and Equity
Liabilities:
Accounts payable, accrued expenses and other liabilities	$	41,104	$	12,144	$	43,630	$	45,309	$	64,583	$	206,770	$	75	$	206,845
Related-party payable		—		—		—		5		39,165		39,170		—		39,170
Dividends payable		—		—		—		—		137,959		137,959		—		137,959
Derivative liabilities		39,082		1,718		—		524		—		41,324		—		41,324
Secured financing agreements, net		5,893,999		1,240,763		1,794,609		606,100		632,719		10,168,190		(22,000)		10,146,190
Collateralized loan obligations, net		930,554		—		—		—		—		930,554		—		930,554
Unsecured senior notes, net		—		—		—		—		1,732,520		1,732,520		—		1,732,520
VIE liabilities, at fair value		—		—		—		—		—		—		62,776,371		62,776,371
Total Liabilities		6,904,739		1,254,625		1,838,239		651,938		2,606,946		13,256,487		62,754,446		76,010,933
Equity:
Starwood Property Trust, Inc. Stockholders’ Equity:
Common stock		—		—		—		—		2,921		2,921		—		2,921
Additional paid-in capital		1,192,584		496,387		98,882		(322,992)		3,744,878		5,209,739		—		5,209,739
Treasury stock		—		—		—		—		(138,022)		(138,022)		—		(138,022)
Accumulated other comprehensive income (loss)		44,057		—		—		(64)		—		43,993		—		43,993
Retained earnings (accumulated deficit)		3,956,405		18,328		(44,832)		1,260,819		(5,820,453)		(629,733)		—		(629,733)
Total Starwood Property Trust, Inc. Stockholders’ Equity		5,193,046		514,715		54,050		937,763		(2,210,676)		4,488,898		—		4,488,898
Non-controlling interests in consolidated subsidiaries		115		—		226,667		145,441		—		372,223		1,455		373,678
Total Equity		5,193,161		514,715		280,717		1,083,204		(2,210,676)		4,861,121		1,455		4,862,576
Total Liabilities and Equity	$	12,097,900	$	1,769,340	$	2,118,956	$	1,735,142	$	396,270	$	18,117,608	$	62,755,901	$	80,873,509

The table below presents our consolidated balance sheet as of December 31, 2019 by business segment (amounts in thousands):

	Commercial and
	Residential		Infrastructure				Investing
	Lending		Lending		Property		and Servicing						Securitization
	Segment		Segment		Segment		Segment		Corporate		Subtotal		VIEs		Total
Assets:
Cash and cash equivalents	$	26,278	$	2,209	$	30,123	$	61,693	$	356,864	$	477,167	$	1,221	$	478,388
Restricted cash		36,135		41,967		7,171		10,370		—		95,643		—		95,643
Loans held-for-investment, net		9,187,332		1,397,448		—		1,294		—		10,586,074		—		10,586,074
Loans held-for-sale		605,384		119,528		—		159,238		—		884,150		—		884,150
Investment securities		992,974		45,153		—		1,177,148		—		2,215,275		(1,405,037)		810,238
Properties, net		26,834		—		2,029,024		210,582		—		2,266,440		—		2,266,440
Intangible assets		—		—		47,303		64,644		—		111,947		(26,247)		85,700
Investment in unconsolidated entities		46,921		25,862		—		32,183		—		104,966		(20,637)		84,329
Goodwill		—		119,409		—		140,437		—		259,846		—		259,846
Derivative assets		14,718		7		3		7		14,208		28,943		—		28,943
Accrued interest receivable		45,996		3,134		133		2,388		13,242		64,893		(806)		64,087
Other assets		59,170		6,101		82,910		54,238		8,911		211,330		(7)		211,323
VIE assets, at fair value		—		—		—		—		—		—		62,187,175		62,187,175
Total Assets	$	11,041,742	$	1,760,818	$	2,196,667	$	1,914,222	$	393,225	$	17,306,674	$	60,735,662	$	78,042,336
Liabilities and Equity
Liabilities:
Accounts payable, accrued expenses and other liabilities	$	30,594	$	6,443	$	48,370	$	73,021	$	53,494	$	211,922	$	84	$	212,006
Related-party payable		—		—		—		5		40,920		40,925		—		40,925
Dividends payable		—		—		—		—		137,427		137,427		—		137,427
Derivative liabilities		7,698		750		—		292		—		8,740		—		8,740
Secured financing agreements, net		5,038,876		1,217,066		1,698,334		574,507		391,215		8,919,998		(13,950)		8,906,048
Collateralized loan obligations, net		928,060		—		—		—		—		928,060		—		928,060
Unsecured senior notes, net		—		—		—		—		1,928,622		1,928,622		—		1,928,622
VIE liabilities, at fair value		—		—		—		—		—		—		60,743,494		60,743,494
Total Liabilities		6,005,228		1,224,259		1,746,704		647,825		2,551,678		12,175,694		60,729,628		72,905,322
Equity:
Starwood Property Trust, Inc. Stockholders’ Equity:
Common stock		—		—		—		—		2,874		2,874		—		2,874
Additional paid-in capital		1,522,360		529,668		208,650		(123,210)		2,995,064		5,132,532		—		5,132,532
Treasury stock		—		—		—		—		(104,194)		(104,194)		—		(104,194)
Accumulated other comprehensive income (loss)		50,996		—		—		(64)		—		50,932		—		50,932
Retained earnings (accumulated deficit)		3,463,158		6,891		5,431		1,194,998		(5,052,197)		(381,719)		—		(381,719)
Total Starwood Property Trust, Inc. Stockholders’ Equity		5,036,514		536,559		214,081		1,071,724		(2,158,453)		4,700,425		—		4,700,425
Non-controlling interests in consolidated subsidiaries		—		—		235,882		194,673		—		430,555		6,034		436,589
Total Equity		5,036,514		536,559		449,963		1,266,397		(2,158,453)		5,130,980		6,034		5,137,014
Total Liabilities and Equity	$	11,041,742	$	1,760,818	$	2,196,667	$	1,914,222	$	393,225	$	17,306,674	$	60,735,662	$	78,042,336

Revenues generated from foreign sources were $115.2 million, $115.6 million and $90.5 million for the years ended December 31, 2020, 2019 and 2018, respectively. The majority of our revenues generated from foreign sources are derived from the United Kingdom. Refer to Schedules III and IV for a detailed listing of the properties and loans held by the Company, including their respective geographic locations.