10-Q

Table of Contents

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2022

OR

☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Commission file number 001-34436

__________________________________________________

Starwood Property Trust, Inc.

(Exact name of registrant as specified in its charter)

Maryland	27-0247747
(State or Other Jurisdiction of Incorporation or Organization)	(I.R.S. Employer Identification No.)
591 West Putnam Avenue
Greenwich, Connecticut	06830
(Address of Principal Executive Offices)	(Zip Code)

Registrant’s telephone number, including area code:

(203) 422-7700

___________________________________________________________________________

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common stock, $0.01 par value per share	STWD	New York Stock Exchange

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”, “accelerated filer”, “smaller reporting company”, and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

The number of shares of the issuer’s common stock, $0.01 par value, outstanding as of July 29, 2022 was 309,221,274.

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Special Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q contains certain forward-looking statements, including without limitation, statements concerning our operations, economic performance and financial condition. These forward-looking statements are made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are developed by combining currently available information with our beliefs and assumptions and are generally identified by the words “believe,” “expect,” “anticipate” and other similar expressions. Forward-looking statements do not guarantee future performance, which may be materially different from that expressed in, or implied by, any such statements. Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of their respective dates.

These forward-looking statements are based largely on our current beliefs, assumptions and expectations of our future performance taking into account all information currently available to us. These beliefs, assumptions and expectations can change as a result of many possible events or factors, not all of which are known to us or within our control, and which could materially affect actual results, performance or achievements. Factors that may cause actual results to vary from our forward-looking statements include, but are not limited to:

•factors described in our Annual Report on Form 10-K for the year ended December 31, 2021 and this Quarterly Report on Form 10-Q, including those set forth under the captions “Risk Factors”, “Business” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations”;

•the severity and duration of the pandemic of the novel strain of coronavirus (“COVID-19”), actions that may be taken by governmental authorities, businesses and others to contain the COVID-19 pandemic, including variants and resurgences, or to treat its impact and the adverse impacts that the COVID-19 pandemic has had, and will likely continue to have, on the global economy, on the borrowers underlying our real estate-related assets and infrastructure loans and tenants of our owned properties, including their ability to make payments on their loans or to pay rent, as the case may be, and on our operations and financial performance;

•defaults by borrowers in paying debt service on outstanding indebtedness;

•impairment in the value of real estate property securing our loans or in which we invest;

•availability of mortgage origination and acquisition opportunities acceptable to us;

•potential mismatches in the timing of asset repayments and the maturity of the associated financing agreements;

•our ability to achieve the benefits that we anticipate from the prior acquisition of the project finance origination, underwriting and capital markets business of GE Capital Global Holdings, LLC;

•national and local economic and business conditions, including continued disruption from the COVID-19 pandemic;

•the occurrence of certain geo-political events (such as wars, terrorist attacks and tensions between states) that affect the normal and peaceful course of international relations (such as the recent Russian invasion of Ukraine);

•general and local commercial and residential real estate property conditions;

•changes in federal government policies;

•changes in federal, state and local governmental laws and regulations;

•increased competition from entities engaged in mortgage lending and securities investing activities;

•changes in interest rates; and

•the availability of, and costs associated with, sources of liquidity.

In light of these risks and uncertainties, there can be no assurances that the results referred to in the forward-looking statements contained in this Quarterly Report on Form 10-Q will in fact occur. Except to the extent required by applicable law or regulation, we undertake no obligation to, and expressly disclaim any such obligation to, update or revise any forward-looking statements to reflect changed assumptions, the occurrence of anticipated or unanticipated events, changes to future results over time or otherwise.

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TABLE OF CONTENTS

		Page
Part I	Financial Information
Item 1.	Financial Statements	4
	Condensed Consolidated Balance Sheets	4
	Condensed Consolidated Statements of Operations	5
	Condensed Consolidated Statements of Comprehensive Income	6
	Condensed Consolidated Statements of Equity	7
	Condensed Consolidated Statements of Cash Flows	9
	Notes to Condensed Consolidated Financial Statements	11
	Note 1 Business and Organization	11
	Note 2 Summary of Significant Accounting Policies	12
	Note 3 Acquisitions and Divestitures	18
	Note 4 Loans	19
	Note 5 Investment Securities	24
	Note 6 Properties	27
	Note 7 Investments of Consolidated Affordable Housing Fund	29
	Note 8 Investments in Unconsolidated Entities	30
	Note 9 Goodwill and Intangibles	31
	Note 10 Secured Borrowings	33
	Note 11 Unsecured Senior Notes	37
	Note 12 Loan Securitization/Sale Activities	39
	Note 13 Derivatives and Hedging Activity	40
	Note 14 Offsetting Assets and Liabilities	42
	Note 15 Variable Interest Entities	42
	Note 16 Related-Party Transactions	44
	Note 17 Stockholders’ Equity and Non-Controlling Interests	46
	Note 18 Earnings per Share	48
	Note 19 Accumulated Other Comprehensive Income	49
	Note 20 Fair Value	50
	Note 21 Income Taxes	58
	Note 22 Commitments and Contingencies	59
	Note 23 Segment Data	60
	Note 24 Subsequent Events	66
Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	67
Item 3.	Quantitative and Qualitative Disclosures about Market Risk	102
Item 4.	Controls and Procedures	105
Part II	Other Information
Item 1.	Legal Proceedings	106
Item 1A.	Risk Factors	106
Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds	106
Item 3.	Defaults Upon Senior Securities	106
Item 4.	Mine Safety Disclosures	106
Item 5.	Other Information	106
Item 6.	Exhibits	107

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PART I - FINANCIAL INFORMATION

Item 1. Financial Statements

Starwood Property Trust, Inc. and Subsidiaries

Condensed Consolidated Balance Sheets

(Unaudited, amounts in thousands, except share data)

	As of June 30,		As of December 31,
	2022		2021
Assets:
Cash and cash equivalents	$	272,174	$	217,362
Restricted cash	64,632		104,552
Loans held-for-investment, net of credit loss allowances of $77,449 and $67,270 ($55,301 and $59,225 held at fair value)	17,895,789		15,536,849
Loans held-for-sale ($2,173,031 and $2,876,800 held at fair value)	2,236,647		2,876,800
Investment securities, net of credit loss allowances of $4,505 and $8,610 ($155,597 and $177,848 held at fair value)	913,360		860,984
Properties, net	1,225,979		1,166,387
Investments of consolidated affordable housing fund, at fair value	1,558,850		1,040,309
Investments in unconsolidated entities	85,510		90,097
Goodwill	259,846		259,846
Intangible assets ($17,499 and $16,780 held at fair value)	74,964		63,564
Derivative assets	128,727		48,216
Accrued interest receivable	131,660		116,262
Other assets	257,185		188,626
Variable interest entity (“VIE”) assets, at fair value	57,993,563		61,280,543
Total Assets	$	83,098,886	$	83,850,397
Liabilities and Equity
Liabilities:
Accounts payable, accrued expenses and other liabilities	$	273,414	$	189,696
Related-party payable	30,754		76,371
Dividends payable	149,991		147,624
Derivative liabilities	55,137		13,421
Secured financing agreements, net	13,147,447		12,576,850
Collateralized loan obligations and single asset securitization, net	3,764,151		2,616,116
Unsecured senior notes, net	2,324,772		1,828,590
VIE liabilities, at fair value	56,256,080		59,752,922
Total Liabilities	76,001,746		77,201,590
Commitments and contingencies (Note 22)
Temporary Equity: Redeemable non-controlling interests	322,753		214,915
Permanent Equity:
Starwood Property Trust, Inc. Stockholders’ Equity:
Preferred stock, $0.01 per share, 100,000,000 shares authorized, no shares issued and outstanding	—		—
Common stock, $0.01 per share, 500,000,000 shares authorized, 316,660,535 issued and 309,211,844 outstanding as of June 30, 2022 and 312,268,944 issued and 304,820,253 outstanding as of December 31, 2021	3,167		3,123
Additional paid-in capital	5,766,533		5,673,376
Treasury stock (7,448,691 shares)	(138,022)		(138,022)
Accumulated other comprehensive income	28,970		40,953
Retained earnings	733,348		493,106
Total Starwood Property Trust, Inc. Stockholders’ Equity	6,393,996		6,072,536
Non-controlling interests in consolidated subsidiaries	380,391		361,356
Total Permanent Equity	6,774,387		6,433,892
Total Liabilities and Equity	$	83,098,886	$	83,850,397

________________________________________________________

Note: In addition to the VIE assets and liabilities which are separately presented, our condensed consolidated balance sheets as of June 30, 2022 and December 31, 2021 include assets of $4.5 billion and $3.1 billion, respectively, and liabilities of $3.8 billion and $2.6 billion, respectively, related to consolidated collateralized loan obligations (“CLOs”) and a single asset securitization (“SASB”), which are considered to be VIEs. The CLOs’ and SASB’s assets can only be used to settle obligations of the CLOs and SASB, and the CLOs’ and SASB’s liabilities do not have recourse to Starwood Property Trust, Inc. Refer to Note 15 for additional discussion of VIEs.

See notes to condensed consolidated financial statements.

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Starwood Property Trust, Inc. and Subsidiaries

Condensed Consolidated Statements of Operations

(Unaudited, amounts in thousands, except per share data)

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2022		2021		2022		2021
Revenues:
Interest income from loans	$	261,150	$	189,272	$	494,769	$	379,847
Interest income from investment securities	15,306		10,648		29,289		22,258
Servicing fees	12,553		10,864		22,545		19,266
Rental income	31,524		77,119		63,104		153,457
Other revenues	5,053		2,964		9,871		3,269
Total revenues	325,586		290,867		619,578		578,097
Costs and expenses:
Management fees	31,624		29,250		86,919		67,986
Interest expense	152,618		109,653		279,069		213,027
General and administrative	45,005		45,265		89,326		83,901
Acquisition and investment pursuit costs	517		407		939		592
Costs of rental operations	10,598		30,731		19,888		59,476
Depreciation and amortization	12,240		22,477		23,887		44,951
Credit loss provision (reversal), net	8,438		(11,844)		4,780		(11,800)
Other expense	1,258		—		1,313		685
Total costs and expenses	262,298		225,939		506,121		458,818
Other income (loss):
Change in net assets related to consolidated VIEs	8,373		12,509		35,122		52,254
Change in fair value of servicing rights	(365)		1,299		719		503
Change in fair value of investment securities, net	(1,245)		1,508		(1,600)		1,202
Change in fair value of mortgage loans, net	(113,480)		45,867		(239,263)		36,389
Income from affordable housing fund investments	307,165		—		541,206		—
Earnings from unconsolidated entities	3,865		2,226		2,955		3,960
Gain on sale of investments and other assets, net	138		8,731		98,606		26,424
Gain (loss) on derivative financial instruments, net	128,583		(10,009)		255,851		23,980
Foreign currency (loss) gain, net	(78,602)		2,627		(105,883)		(9,054)
Loss on extinguishment of debt	—		(1,182)		(823)		(1,698)
Other loss, net	(33,809)		(5,473)		(34,572)		(5,452)
Total other income	220,623		58,103		552,318		128,508
Income before income taxes	283,911		123,031		665,775		247,787
Income tax (provision) benefit	(2,206)		3,353		244		1,123
Net income	281,705		126,384		666,019		248,910
Net income attributable to non-controlling interests	(69,418)		(10,074)		(129,133)		(21,222)
Net income attributable to Starwood Property Trust, Inc.	$	212,287	$	116,310	$	536,886	$	227,688
Earnings per share data attributable to Starwood Property Trust, Inc.:
Basic	$	0.68	$	0.40	$	1.72	$	0.79
Diluted	$	0.67	$	0.40	$	1.69	$	0.78

See notes to condensed consolidated financial statements.

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Starwood Property Trust, Inc. and Subsidiaries

Condensed Consolidated Statements of Comprehensive Income

(Unaudited, amounts in thousands)

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2022		2021		2022		2021
Net income	$	281,705	$	126,384	$	666,019	$	248,910
Other comprehensive income (loss) (net change by component):
Available-for-sale securities	(6,699)		(344)		(11,983)		(2,747)
Foreign currency translation	—		—		—		64
Other comprehensive loss	(6,699)		(344)		(11,983)		(2,683)
Comprehensive income	275,006		126,040		654,036		246,227
Less: Comprehensive income attributable to non-controlling interests	(69,418)		(10,074)		(129,133)		(21,222)
Comprehensive income attributable to Starwood Property Trust, Inc.	$	205,588	$	115,966	$	524,903	$	225,005

See notes to condensed consolidated financial statements.

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Starwood Property Trust, Inc. and Subsidiaries

Condensed Consolidated Statements of Equity

For the Three Months Ended June 30, 2022 and 2021

(Unaudited, amounts in thousands, except share data)

	Temporary Equity		Common stock			Additional Paid-in Capital		Treasury Stock			Retained Earnings (Accumulated Deficit)		Accumulated Other Comprehensive Income		Total Starwood Property Trust, Inc. Stockholders’ Equity		Non- Controlling Interests		Total Permanent Equity
			Shares	Par Value				Shares	Amount
Balance, March 31, 2022	$	261,685	314,360,996	$	3,144	$	5,709,027	7,448,691	$	(138,022)	$	669,877	$	35,669	$	6,279,695	$	368,273	$	6,647,968
Proceeds from ATM Agreement	—		1,415,564	14		33,307		—	—		—		—		33,321		—		33,321
Proceeds from DRIP Plan	—		12,208	—		284		—	—		—		—		284		—		284
Equity offering costs	—		—	—		(667)		—	—		—		—		(667)		—		(667)
Share-based compensation	—		224,639	3		9,904		—	—		—		—		9,907		—		9,907
Manager fees paid in stock	—		647,128	6		14,678		—	—		—		—		14,684		—		14,684
Net income	62,783		—	—		—		—	—		212,287		—		212,287		6,635		218,922
Dividends declared, $0.48 per share	—		—	—		—		—	—		(148,816)		—		(148,816)		—		(148,816)
Other comprehensive loss, net	—		—	—		—		—	—		—		(6,699)		(6,699)		—		(6,699)
Contributions from non-controlling interests	—		—	—		—		—	—		—		—		—		17,236		17,236
Distributions to non-controlling interests	(1,715)		—	—		—		—	—		—		—		—		(11,753)		(11,753)
Balance, June 30, 2022	$	322,753	316,660,535	$	3,167	$	5,766,533	7,448,691	$	(138,022)	$	733,348	$	28,970	$	6,393,996	$	380,391	$	6,774,387
Balance, March 31, 2021	$	—	294,300,251	$	2,943	$	5,225,037	7,448,691	$	(138,022)	$	(654,750)	$	41,654	$	4,476,862	$	377,923	$	4,854,785
Proceeds from DRIP Plan	—		8,936	—		226		—	—		—		—		226		—		226
Redemption of Class A Units	—		338,002	3		7,074		—	—		—		—		7,077		(7,077)		—
Share-based compensation	—		343,331	3		9,594		—	—		—		—		9,597		—		9,597
Manager fees paid in stock	—		267,378	3		6,559		—	—		—		—		6,562		—		6,562
Net income	—		—	—		—		—	—		116,310		—		116,310		10,074		126,384
Dividends declared, $0.48 per share	—		—	—		—		—	—		(138,935)		—		(138,935)		—		(138,935)
Other comprehensive loss, net	—		—	—		—		—	—		—		(344)		(344)		—		(344)
Contributions from non-controlling interests	—		—	—		—		—	—		—		—		—		2,569		2,569
Distributions to non-controlling interests	—		—	—		—		—	—		—		—		—		(9,144)		(9,144)
Balance, June 30, 2021	$	—	295,257,898	$	2,952	$	5,248,490	7,448,691	$	(138,022)	$	(677,375)	$	41,310	$	4,477,355	$	374,345	$	4,851,700

See notes to condensed consolidated financial statements.

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Starwood Property Trust, Inc. and Subsidiaries

Condensed Consolidated Statements of Equity (Continued)

For the Six Months Ended June 30, 2022 and 2021

(Unaudited, amounts in thousands, except share data)

	Temporary Equity		Common stock			Additional Paid-in Capital		Treasury Stock			Retained Earnings (Accumulated Deficit)		Accumulated Other Comprehensive Income		Total Starwood Property Trust, Inc. Stockholders’ Equity		Non- Controlling Interests		Total Permanent Equity
			Shares	Par Value				Shares	Amount
Balance, December 31, 2021	$	214,915	312,268,944	$	3,123	$	5,673,376	7,448,691	$	(138,022)	$	493,106	$	40,953	$	6,072,536	$	361,356	$	6,433,892
Proceeds from ATM Agreement	—		1,415,564	14		33,307		—	—		—		—		33,321		—		33,321
Proceeds from DRIP Plan	—		22,469	—		535		—	—		—		—		535		—		535
Equity offering costs	—		—	—		(756)		—	—		—		—		(756)		—		(756)
Share-based compensation	—		1,237,602	13		19,987		—	—		—		—		20,000		—		20,000
Manager fees paid in stock	—		1,715,956	17		40,084		—	—		—		—		40,101		—		40,101
Net income	110,503		—	—		—		—	—		536,886		—		536,886		18,630		555,516
Dividends declared, $0.96 per share	—		—	—		—		—	—		(296,644)		—		(296,644)		—		(296,644)
Other comprehensive loss, net	—		—	—		—		—	—		—		(11,983)		(11,983)		—		(11,983)
Contributions from non-controlling interests	—		—	—		—		—	—		—		—		—		21,926		21,926
Distributions to non-controlling interests	(2,665)		—	—		—		—	—		—		—		—		(21,521)		(21,521)
Balance, June 30, 2022	$	322,753	316,660,535	$	3,167	$	5,766,533	7,448,691	$	(138,022)	$	733,348	$	28,970	$	6,393,996	$	380,391	$	6,774,387
Balance, December 31, 2020	$	—	292,091,601	$	2,921	$	5,209,739	7,448,691	$	(138,022)	$	(629,733)	$	43,993	$	4,488,898	$	373,678	$	4,862,576
Cumulative effect of convertible notes accounting standard update adopted January 1, 2021	—		—	—		(3,755)		—	—		2,219		—		(1,536)		—		(1,536)
Proceeds from DRIP Plan	—		21,170	—		488		—	—		—		—		488		—		488
Redemption of Class A Units	—		388,002	4		8,112		—	—		—		—		8,116		(8,116)		—
Equity offering costs	—		—	—		(22)		—	—		—		—		(22)		—		(22)
Share-based compensation	—		2,157,745	21		19,886		—	—		—		—		19,907		—		19,907
Manager fees paid in stock	—		599,380	6		14,042		—	—		—		—		14,048		—		14,048
Net income	—		—	—		—		—	—		227,688		—		227,688		21,222		248,910
Dividends declared, $0.96 per share	—		—	—		—		—	—		(277,549)		—		(277,549)		—		(277,549)
Other comprehensive loss, net	—		—	—		—		—	—		—		(2,683)		(2,683)		—		(2,683)
Contributions from non-controlling interests	—		—	—		—		—	—		—		—		—		5,538		5,538
Distributions to non-controlling interests	—		—	—		—		—	—		—		—		—		(17,977)		(17,977)
Balance, June 30, 2021	$	—	295,257,898	$	2,952	$	5,248,490	7,448,691	$	(138,022)	$	(677,375)	$	41,310	$	4,477,355	$	374,345	$	4,851,700

See notes to condensed consolidated financial statements.

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Starwood Property Trust, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows

(Unaudited, amounts in thousands)

	For the Six Months Ended June 30
	2022		2021
Cash Flows from Operating Activities:
Net income	$	666,019	$	248,910
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization of deferred financing costs, premiums and discounts on secured borrowings	23,158		21,265
Amortization of discounts and deferred financing costs on unsecured senior notes	4,343		3,451
Accretion of net discount on investment securities	(7,010)		(6,773)
Accretion of net deferred loan fees and discounts	(30,869)		(29,739)
Share-based compensation	20,000		19,907
Manager fees paid in stock	40,101		14,048
Change in fair value of investment securities	1,600		(1,202)
Change in fair value of consolidated VIEs	36,885		19,024
Change in fair value of servicing rights	(719)		(503)
Change in fair value of loans	239,263		(36,389)
Change in fair value of affordable housing fund investments	(518,541)		—
Change in fair value of derivatives	(260,677)		(26,289)
Foreign currency loss, net	105,883		9,054
Gain on sale of investments and other assets	(98,606)		(26,424)
Impairment charges on properties and related intangibles	55		—
Credit loss provision (reversal), net	4,780		(11,800)
Depreciation and amortization	26,118		45,134
Earnings from unconsolidated entities	(2,955)		(3,960)
Distributions of earnings from unconsolidated entities	4,632		1,082
Loss on extinguishment of debt	624		1,698
Origination and purchase of loans held-for-sale, net of principal collections	(3,491,526)		(1,284,620)
Proceeds from sale of loans held-for-sale	3,960,798		1,477,579
Changes in operating assets and liabilities:
Related-party payable	(45,617)		(12,739)
Accrued and capitalized interest receivable, less purchased interest	(72,498)		(81,392)
Other assets	(60,627)		(32,132)
Accounts payable, accrued expenses and other liabilities	140,629		(19,203)
Net cash provided by operating activities	685,243		287,987
Cash Flows from Investing Activities:
Origination, purchase and funding of loans held-for-investment	(3,892,225)		(4,002,046)
Proceeds from principal collections on loans	1,204,499		2,244,935
Proceeds from loans sold	6,469		231,993
Purchase and funding of investment securities	(86,058)		—
Proceeds from principal collections on investment securities	15,180		68,867
Proceeds from sales of real estate	147,334		60,969
Purchases and additions to properties and other assets	(11,276)		(12,023)
Investments in unconsolidated entities	(461)		—
Distribution of capital from unconsolidated entities	3,375		21,263
Cash resulting from initial consolidation of entities	617		—
Payments for purchase or termination of derivatives	(16,308)		(8,111)
Proceeds from termination of derivatives	152,360		28,419
Net cash used in investing activities	(2,476,494)		$	(1,365,734)

See notes to condensed consolidated financial statements.

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Starwood Property Trust, Inc. and Subsidiaries

Condensed Consolidated Statements of Cash Flows (Continued)

(Unaudited, amounts in thousands)

	For the Six Months Ended June 30
	2022		2021
Cash Flows from Financing Activities:
Proceeds from borrowings	$	10,035,448	$	6,793,363
Principal repayments on and repurchases of borrowings	(7,683,627)		(5,538,664)
Payment of deferred financing costs	(33,885)		(27,172)
Proceeds from common stock issuances	33,856		488
Payment of equity offering costs	(756)		(22)
Payment of dividends	(294,277)		(276,051)
Contributions from non-controlling interests	21,926		5,538
Distributions to non-controlling interests	(24,186)		(17,977)
Issuance of debt of consolidated VIEs	—		42,288
Repayment of debt of consolidated VIEs	(290,034)		(306,496)
Distributions of cash from consolidated VIEs	42,753		42,546
Net cash provided by financing activities	1,807,218		717,841
Net increase (decrease) in cash, cash equivalents and restricted cash	15,967		(359,906)
Cash, cash equivalents and restricted cash, beginning of period	321,914		722,162
Effect of exchange rate changes on cash	(1,075)		(1,680)
Cash, cash equivalents and restricted cash, end of period	$	336,806	$	360,576
Supplemental disclosure of cash flow information:
Cash paid for interest	$	227,051	$	183,016
Income taxes (refunded) paid, net	(8,220)		6,871
Supplemental disclosure of non-cash investing and financing activities:
Dividends declared, but not yet paid	$	150,556	$	139,985
Consolidation of VIEs (VIE asset/liability additions)	4,361,325		2,778,279
Deconsolidation of VIEs (VIE asset/liability reductions)	730,012		—
Reclassification of loans held-for-investment to loans held-for-sale	63,962		190,799
Reclassification of loans held-for-sale to loans held-for-investment	—		124,933
Transfer of loans from VIE assets to residential loans upon redemption of consolidated RMBS trusts	—		172,474
Loan principal collections temporarily held at master servicer	14,053		56,064
Redemption of Class A Units for common stock	—		8,116
Net assets acquired through foreclosure, control or conversion to equity interest:
Assets acquired, less cash	145,330		36,308
Liabilities assumed	95,796		—

See notes to condensed consolidated financial statements.

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Starwood Property Trust, Inc. and Subsidiaries

Notes to Condensed Consolidated Financial Statements

As of June 30, 2022

(Unaudited)

1. Business and Organization

Starwood Property Trust, Inc. (“STWD” and, together with its subsidiaries, “we” or the “Company”) is a Maryland corporation that commenced operations in August 2009, upon the completion of our initial public offering. We are focused primarily on originating, acquiring, financing and managing mortgage loans and other real estate investments in the United States (“U.S.”), Europe and Australia. As market conditions change over time, we may adjust our strategy to take advantage of changes in interest rates and credit spreads as well as economic and credit conditions.

We have four reportable business segments as of June 30, 2022 and we refer to the investments within these segments as our target assets:

•Real estate commercial and residential lending (the “Commercial and Residential Lending Segment”)—engages primarily in originating, acquiring, financing and managing commercial first mortgages, non-agency residential mortgages (“residential loans”), subordinated mortgages, mezzanine loans, preferred equity, commercial mortgage-backed securities (“CMBS”), residential mortgage-backed securities (“RMBS”) and other real estate and real estate-related debt investments in the U.S., Europe and Australia (including distressed or non-performing loans). Our residential loans are secured by a first mortgage lien on residential property and primarily consist of non-agency residential loans that are not guaranteed by any U.S. Government agency or federally chartered corporation.

•Infrastructure lending (the “Infrastructure Lending Segment”)—engages primarily in originating, acquiring, financing and managing infrastructure debt investments.

•Real estate property (the “Property Segment”)—engages primarily in acquiring and managing equity interests in stabilized commercial real estate properties, including multifamily properties and commercial properties subject to net leases, that are held for investment.

•Real estate investing and servicing (the “Investing and Servicing Segment”)—includes (i) a servicing business in the U.S. that manages and works out problem assets, (ii) an investment business that selectively acquires and manages unrated, investment grade and non-investment grade rated CMBS, including subordinated interests of securitization and resecuritization transactions, (iii) a mortgage loan business which originates conduit loans for the primary purpose of selling these loans into securitization transactions and (iv) an investment business that selectively acquires commercial real estate assets, including properties acquired from CMBS trusts.

Our segments exclude the consolidation of securitization variable interest entities (“VIEs”).

We are organized and conduct our operations to qualify as a real estate investment trust (“REIT”) under the Internal Revenue Code of 1986, as amended (the “Code”). As such, we will generally not be subject to U.S. federal corporate income tax on that portion of our net income that is distributed to stockholders if we distribute at least 90% of our taxable income to our stockholders by prescribed dates and comply with various other requirements.

We are organized as a holding company and conduct our business primarily through our various wholly-owned subsidiaries. We are externally managed and advised by SPT Management, LLC (our “Manager”) pursuant to the terms of a management agreement. Our Manager is controlled by Barry Sternlicht, our Chairman and Chief Executive Officer. Our Manager is an affiliate of Starwood Capital Group Global L.P., a privately-held private equity firm founded by Mr. Sternlicht.

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2. Summary of Significant Accounting Policies

Balance Sheet Presentation of Securitization Variable Interest Entities

We operate investment businesses that acquire unrated, investment grade and non-investment grade rated CMBS and RMBS. These securities represent interests in securitization structures (commonly referred to as special purpose entities, or “SPEs”). These SPEs are structured as pass through entities that receive principal and interest on the underlying collateral and distribute those payments to the certificate holders. Under accounting principles generally accepted in the United States of America (“GAAP”), SPEs typically qualify as VIEs. These are entities that, by design, either (1) lack sufficient equity to permit the entity to finance its activities without additional subordinated financial support from other parties, or (2) have equity investors that do not have the ability to make significant decisions relating to the entity’s operations through voting rights, or do not have the obligation to absorb the expected losses, or do not have the right to receive the residual returns of the entity.

Because we often serve as the special servicer or servicing administrator of the trusts in which we invest, or we have the ability to remove and replace the special servicer without cause, consolidation of these structures is required pursuant to GAAP as outlined in detail below. This results in a consolidated balance sheet which presents the gross assets and liabilities of the VIEs. The assets and other instruments held by these VIEs are restricted and can only be used to fulfill the obligations of the entity. Additionally, the obligations of the VIEs do not have any recourse to the general credit of any other consolidated entities, nor to us as the consolidator of these VIEs.

The VIE liabilities initially represent investment securities on our balance sheet (pre-consolidation). Upon consolidation of these VIEs, our associated investment securities are eliminated, as is the interest income related to those securities. Similarly, the fees we earn in our roles as special servicer of the bonds issued by the consolidated VIEs or as collateral administrator of the consolidated VIEs are also eliminated. Finally, a portion of the identified servicing intangible associated with the eliminated fee streams is eliminated in consolidation.

Refer to the segment data in Note 23 for a presentation of our business segments without consolidation of these VIEs.

Basis of Accounting and Principles of Consolidation

The accompanying condensed consolidated financial statements include our accounts and those of our consolidated subsidiaries and VIEs. Intercompany amounts have been eliminated in consolidation. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows have been included.

These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021 (our “Form 10-K”), as filed with the Securities and Exchange Commission (“SEC”). The results of operations for the three and six months ended June 30, 2022 are not necessarily indicative of the operating results for the full year.

Refer to our Form 10-K for a description of our recurring accounting policies. We have included disclosure in this Note 2 regarding principles of consolidation and other accounting policies that (i) are required to be disclosed quarterly, (ii) we view as critical, (iii) became significant since December 31, 2021 due to a corporate action or increase in the significance of the underlying business activity or (iv) changed upon adoption of an Accounting Standards Update (“ASU”) issued by the Financial Accounting Standards Board (“FASB”).

Variable Interest Entities

In addition to the securitization VIEs, we have financed pools of our loans through collateralized loan obligations (“CLOs”) and a single asset securitization (“SASB”), which are considered VIEs. We also hold interests in certain other entities which are considered VIEs as the limited partners of those entities with equity at risk do not collectively possess (i) the right to remove the general partner or dissolve the partnership without cause or (ii) the right to participate in significant decisions made by the partnership.

We evaluate all of our interests in VIEs for consolidation. When our interests are determined to be variable interests, we assess whether we are deemed to be the primary beneficiary of the VIE. The primary beneficiary of a VIE is required to consolidate the VIE. Accounting Standards Codification (“ASC”) 810, Consolidation, defines the primary beneficiary as the party that has both (i) the power to direct the activities of the VIE that most significantly impact its economic performance, and (ii) the obligation to absorb losses and the right to receive benefits from the VIE which could be potentially significant. We

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consider our variable interests as well as any variable interests of our related parties in making this determination. Where both of these factors are present, we are deemed to be the primary beneficiary and we consolidate the VIE. Where either one of these factors is not present, we are not the primary beneficiary and do not consolidate the VIE.

To assess whether we have the power to direct the activities of a VIE that most significantly impact the VIE’s economic performance, we consider all facts and circumstances, including our role in establishing the VIE and our ongoing rights and responsibilities. This assessment includes: (i) identifying the activities that most significantly impact the VIE’s economic performance; and (ii) identifying which party, if any, has power over those activities. In general, the parties that make the most significant decisions affecting the VIE or have the right to unilaterally remove those decision makers are deemed to have the power to direct the activities of a VIE. The right to remove the decision maker in a VIE must be exercisable without cause for the decision maker to not be deemed the party that has the power to direct the activities of a VIE.

To assess whether we have the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE, we consider all of our economic interests, including debt and equity investments, servicing fees and other arrangements deemed to be variable interests in the VIE. This assessment requires that we apply judgment in determining whether these interests, in the aggregate, are considered potentially significant to the VIE. Factors considered in assessing significance include: the design of the VIE, including its capitalization structure; subordination of interests; payment priority; relative share of interests held across various classes within the VIE’s capital structure; and the reasons why the interests are held by us.

Our purchased investment securities include unrated and non-investment grade rated securities issued by securitization trusts. In certain cases, we may contract to provide special servicing activities for these trusts, or, as holder of the controlling class, we may have the right to name and remove the special servicer for these trusts. In our role as special servicer, we provide services on defaulted loans within the trusts, such as foreclosure or work-out procedures, as permitted by the underlying contractual agreements. In exchange for these services, we receive a fee. These rights give us the ability to direct activities that could significantly impact the trust’s economic performance. However, in those instances where an unrelated third party has the right to unilaterally remove us as special servicer without cause, we do not have the power to direct activities that most significantly impact the trust’s economic performance. We evaluated all of our positions in such investments for consolidation.

For securitization VIEs in which we are determined to be the primary beneficiary, all of the underlying assets, liabilities and equity of the structures are recorded on our books, and the initial investment, along with any associated unrealized holding gains and losses, are eliminated in consolidation. Similarly, the interest income earned from these structures, as well as the fees paid by these trusts to us in our capacity as special servicer, are eliminated in consolidation. Further, a portion of the identified servicing intangible asset associated with the servicing fee streams, and the corresponding amortization or change in fair value of the servicing intangible asset, are also eliminated in consolidation.

We perform ongoing reassessments of: (i) whether any entities previously evaluated under the majority voting interest framework have become VIEs, based on certain events, and therefore subject to the VIE consolidation framework, and (ii) whether changes in the facts and circumstances regarding our involvement with a VIE causes our consolidation conclusion regarding the VIE to change.

We elect the fair value option for initial and subsequent recognition of the assets and liabilities of our consolidated securitization VIEs. Interest income and interest expense associated with these VIEs are no longer relevant on a standalone basis because these amounts are already reflected in the fair value changes. We have elected to present these items in a single line on our condensed consolidated statements of operations. The residual difference shown on our condensed consolidated statements of operations in the line item “Change in net assets related to consolidated VIEs” represents our beneficial interest in the VIEs.

We separately present the assets and liabilities of our consolidated securitization VIEs as individual line items on our condensed consolidated balance sheets. The liabilities of our consolidated securitization VIEs consist solely of obligations to the bondholders of the related trusts, and are thus presented as a single line item entitled “VIE liabilities.” The assets of our consolidated securitization VIEs consist principally of loans, but at times, also include foreclosed loans which have been temporarily converted into real estate owned (“REO”). These assets in the aggregate are likewise presented as a single line item entitled “VIE assets.”

Loans comprise the vast majority of our securitization VIE assets and are carried at fair value due to the election of the fair value option. When an asset becomes REO, it is due to non-performance of the loan. Because the loan is already at fair value, the carrying value of an REO asset is also initially at fair value. Furthermore, when we consolidate a trust, any existing

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REO would be consolidated at fair value. Once an asset becomes REO, its disposition time is relatively short. As a result, the carrying value of an REO generally approximates fair value under GAAP.

In addition to sharing a similar measurement method as the loans in a trust, the securitization VIE assets as a whole can only be used to settle the obligations of the consolidated VIE. The assets of our securitization VIEs are not individually accessible by the bondholders, which creates inherent limitations from a valuation perspective. Also creating limitations from a valuation perspective is our role as special servicer, which provides us very limited visibility, if any, into the performing loans of a trust.

REO assets generally represent a very small percentage of the overall asset pool of a trust. In new issue trusts there are no REO assets. We estimate that REO assets constitute approximately 1% of our consolidated securitization VIE assets, with the remaining 99% representing loans. However, it is important to note that the fair value of our securitization VIE assets is determined by reference to our securitization VIE liabilities as permitted under ASU 2014-13, Consolidation (Topic 810): Measuring the Financial Assets and the Financial Liabilities of a Consolidated Collateralized Financing Entity. In other words, our VIE liabilities are more reliably measurable than the VIE assets, resulting in our current measurement methodology which utilizes this value to determine the fair value of our securitization VIE assets as a whole. As a result, these percentages are not necessarily indicative of the relative fair values of each of these asset categories if the assets were to be valued individually.

Due to our accounting policy election under ASU 2014-13, separately presenting two different asset categories would result in an arbitrary assignment of value to each, with one asset category representing a residual amount, as opposed to its fair value. However, as a pool, the fair value of the assets in total is equal to the fair value of the liabilities.

For these reasons, the assets of our securitization VIEs are presented in the aggregate.

Fair Value Option

The guidance in ASC 825, Financial Instruments, provides a fair value option election that allows entities to make an irrevocable election of fair value as the initial and subsequent measurement attribute for certain eligible financial assets and liabilities. Unrealized gains and losses on items for which the fair value option has been elected are reported in earnings. The decision to elect the fair value option is determined on an instrument by instrument basis and must be applied to an entire instrument and is irrevocable once elected. Assets and liabilities measured at fair value pursuant to this guidance are required to be reported separately in our consolidated balance sheets from those instruments using another accounting method.

We have elected the fair value option for certain eligible financial assets and liabilities of our consolidated securitization VIEs, residential loans held-for-investment, loans held-for-sale originated or acquired for future securitization and purchased CMBS issued by VIEs we could consolidate in the future. The fair value elections for VIE and securitization related items were made in order to mitigate accounting mismatches between the carrying value of the instruments and the related assets and liabilities that we consolidate at fair value. The fair value elections for residential loans held-for-investment were made in order to maintain consistency across all our residential loans. The fair value elections for mortgage loans held-for-sale were made due to the expected short-term holding period of these instruments.

Fair Value Measurements

We measure our mortgage-backed securities, investments of consolidated affordable housing fund, derivative assets and liabilities, domestic servicing rights intangible asset and any assets or liabilities where we have elected the fair value option at fair value. When actively quoted observable prices are not available, we either use implied pricing from similar assets and liabilities or valuation models based on net present values of estimated future cash flows, adjusted as appropriate for liquidity, credit, market and/or other risk factors.

As discussed above, we measure the assets and liabilities of consolidated securitization VIEs at fair value pursuant to our election of the fair value option. The securitization VIEs in which we invest are “static”; that is, no reinvestment is permitted, and there is no active management of the underlying assets. In determining the fair value of the assets and liabilities of the securitization VIEs, we maximize the use of observable inputs over unobservable inputs. Refer to Note 20 for further discussion regarding our fair value measurements.

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Loans Held-for-Investment

Loans that are held for investment (“HFI”) are carried at cost, net of unamortized acquisition premiums or discounts, loan fees and origination costs, as applicable, and net of credit loss allowances as discussed below, unless the loans are credit deteriorated or we have elected to apply the fair value option at purchase.

Loans Held-For-Sale

Our loans that we intend to sell or liquidate in the short-term are classified as held-for-sale and are carried at the lower of amortized cost or fair value, unless we have elected to apply the fair value option at origination or purchase.

Investment Securities

We designate our debt investment securities as held-to-maturity (“HTM”), available-for-sale (“AFS”), or trading depending on our investment strategy and ability to hold such securities to maturity. HTM debt securities where we have not elected to apply the fair value option are stated at cost plus any premiums or discounts, which are amortized or accreted through the condensed consolidated statements of operations using the effective interest method. Debt securities we (i) do not hold for the purpose of selling in the near-term, or (ii) may dispose of prior to maturity, are classified as AFS and are carried at fair value in the accompanying financial statements. Unrealized gains or losses on AFS debt securities where we have not elected the fair value option are reported as a component of accumulated other comprehensive income (“AOCI”) in stockholders’ equity. Our HTM and AFS debt securities are also subject to credit loss allowances as discussed below.

Our only equity investment security is carried at fair value, with unrealized holding gains and losses recorded in earnings.

Credit Losses

Loans and Debt Securities Measured at Amortized Cost

ASC 326, Financial Instruments – Credit Losses, became effective for the Company on January 1, 2020. ASC 326 mandates the use of a current expected credit loss model (“CECL”) for estimating future credit losses of certain financial instruments measured at amortized cost, instead of the “incurred loss” credit model previously required under GAAP. The CECL model requires the consideration of possible credit losses over the life of an instrument as opposed to only estimating credit losses upon the occurrence of a discrete loss event under the previous “incurred loss” methodology. The CECL model applies to our HFI loans and our HTM debt securities which are carried at amortized cost, including future funding commitments and accrued interest receivable related to those loans and securities. However, as permitted by ASC 326, we have elected not to measure an allowance for credit losses on accrued interest receivable (which is classified separately on our condensed consolidated balance sheets), but rather write off in a timely manner by reversing interest income and/or cease accruing interest that would likely be uncollectible.

As we do not have a history of realized credit losses on our HFI loans and HTM securities, we have subscribed to third party database services to provide us with historical industry losses for both commercial real estate and infrastructure loans. Using these losses as a benchmark, we determine expected credit losses for our loans and securities on a collective basis within our commercial real estate and infrastructure portfolios. See Note 4 for further discussion of our methodologies.

We also evaluate each loan and security measured at amortized cost for credit deterioration at least quarterly. Credit deterioration occurs when it is deemed probable that we will not be able to collect all amounts due according to the contractual terms of the loan or security. If a loan or security is considered to be credit deteriorated, we depart from the industry loss rate approach described above and determine the credit loss allowance as any excess of the amortized cost basis of the loan or security over (i) the present value of expected future cash flows discounted at the contractual effective interest rate or (ii) the fair value of the collateral, if repayment is expected solely from the collateral.

Available-for-Sale Debt Securities

Separate provisions of ASC 326 apply to our AFS debt securities, which are carried at fair value with unrealized gains and losses reported as a component of AOCI. We are required to establish an initial credit loss allowance for those securities that are purchased with credit deterioration (“PCD”) by grossing up the amortized cost basis of each security and providing an offsetting credit loss allowance for the difference between expected cash flows and contractual cash flows, both on a present value basis.

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Subsequently, cumulative adverse changes in expected cash flows on our AFS debt securities are recognized currently as an increase to the allowance for credit losses. However, the allowance is limited to the amount by which the AFS debt security’s amortized cost exceeds its fair value. Favorable changes in expected cash flows are first recognized as a decrease to the allowance for credit losses (recognized currently in earnings). Such changes would be recognized as a prospective yield adjustment only when the allowance for credit losses is reduced to zero. A change in expected cash flows that is attributable solely to a change in a variable interest reference rate does not result in a credit loss and is accounted for as a prospective yield adjustment.

Investments of Consolidated Affordable Housing Fund

On November 5, 2021, we established Woodstar Portfolio Holdings, LLC (the “Woodstar Fund”), an investment fund which holds our Woodstar multifamily affordable housing portfolios consisting of 59 properties with 15,057 units located in Central and South Florida. As managing member of the Woodstar Fund, we manage interests purchased by third party investors seeking capital appreciation and an ongoing return, for which we earn (i) a management fee based on each investor’s share of total Woodstar Fund equity; and (ii) an incentive distribution if the Woodstar Fund’s returns exceed an established threshold. In connection with the establishment of the Woodstar Fund, we entered into subscription and other related agreements with certain third party institutional investors to sell, through a feeder fund structure, an aggregate 20.6% interest in the Woodstar Fund for an initial aggregate subscription price of $216.0 million, which was adjusted to $214.2 million post-closing. The Woodstar Fund has an initial term of eight years.

Effective with the third party interest sale, the Woodstar Fund has the characteristics of an investment company under ASC 946, Financial Services – Investment Companies. Accordingly, the Woodstar Fund is required to carry the investments in its properties at fair value, with a cumulative effect adjustment between the fair value and previous carrying value of its investments recognized in stockholders’ equity as of November 5, 2021, the date of the Woodstar Fund’s change in status to an investment company. Because we are the primary beneficiary of the Woodstar Fund, which is a VIE (as discussed in Note 15), we consolidate the accounts of the Woodstar Fund into our consolidated financial statements, retaining the fair value basis of accounting for its investments. Realized and unrealized changes in the fair value of the Woodstar Fund’s property investments, and distributions thereon, are recognized in the “Income from affordable housing fund investments” caption within the other income (loss) section of our condensed consolidated statement of operations for the six months ended June 30, 2022. See Note 7 for further details regarding the Woodstar Fund’s investments and related income and Note 17 with respect to its contingently redeemable non-controlling interests which are classified as “Temporary Equity” in our condensed consolidated balance sheets.

Revenue Recognition

Interest Income

Interest income on performing loans and financial instruments is accrued based on the outstanding principal amount and contractual terms of the instrument. For loans where we do not elect the fair value option, origination fees and direct loan origination costs are also recognized in interest income over the loan term as a yield adjustment using the effective interest method. When we elect the fair value option, origination fees and direct loan costs are recorded directly in income and are not deferred. Discounts or premiums associated with the purchase of non-performing loans and investment securities are amortized or accreted into interest income as a yield adjustment on the effective interest method, based on expected cash flows through the expected maturity date of the investment. On at least a quarterly basis, we review and, if appropriate, make adjustments to our cash flow projections.

We cease accruing interest on non-performing loans at the earlier of (i) the loan becoming significantly past due or (ii) management concluding that a full recovery of all interest and principal is doubtful. Interest income on non-accrual loans in which management expects a full recovery of the loan’s outstanding principal balance is only recognized when received in cash. If a full recovery of principal is doubtful, the cost recovery method is applied whereby any cash received is applied to the outstanding principal balance of the loan. A non-accrual loan is returned to accrual status at such time as the loan becomes contractually current and management believes all future principal and interest will be received according to the contractual loan terms.

For loans acquired with deteriorated credit quality, interest income is only recognized to the extent that our estimate of undiscounted expected principal and interest exceeds our investment in the loan. Such excess, if any, is recognized as interest income on a level-yield basis over the life of the loan.

Upon the sale of loans or securities which are not accounted for pursuant to the fair value option, the excess (or deficiency) of net proceeds over the net carrying value of such loans or securities is recognized as a realized gain (loss).

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Servicing Fees

We typically seek to be the special servicer on CMBS transactions in which we invest. When we are appointed to serve in this capacity, we earn special servicing fees from the related activities performed, which consist primarily of overseeing the workout of under-performing and non-performing loans underlying the CMBS transactions. These fees are recognized in income in the period in which the services are performed and the revenue recognition criteria have been met.

Rental Income

Rental income is recognized when earned from tenants. For leases that provide rent concessions or fixed escalations over the lease term, rental income is recognized on a straight-line basis over the noncancelable term of the lease. In net lease arrangements, costs reimbursable from tenants are recognized in rental income in the period in which the related expenses are incurred as we are generally the primary obligor with respect to purchasing goods and services for property operations. In instances where the tenant is responsible for property maintenance and repairs and contracts and settles such costs directly with third party service providers, we do not reflect those expenses in our consolidated statement of operations as the tenant is the primary obligor.

Foreign Currency Translation

Our assets and liabilities denominated in foreign currencies are translated into U.S. dollars using foreign currency exchange rates at the end of the reporting period. Income and expenses are translated at the average exchange rates for each reporting period. The effects of translating the assets, liabilities and income of our foreign investments held by entities with a U.S. dollar functional currency are included in foreign currency gain (loss) in the consolidated statements of operations or other comprehensive income (“OCI”) for debt securities available-for-sale for which the fair value option has not been elected. The effects of translating the assets, liabilities and income of our foreign investments held by entities with functional currencies other than the U.S. dollar are included in OCI. Realized foreign currency gains and losses and changes in the value of foreign currency denominated monetary assets and liabilities are included in the determination of net income and are reported as foreign currency gain (loss) in our condensed consolidated statements of operations.

Earnings Per Share

We present both basic and diluted earnings per share (“EPS”) amounts in our financial statements. Basic EPS excludes dilution and is computed by dividing income available to common stockholders by the weighted-average number of shares of common stock outstanding for the period. Diluted EPS reflects the maximum potential dilution that could occur from (i) our share-based compensation, consisting of unvested restricted stock awards (“RSAs”) and restricted stock units (“RSUs”), (ii) shares contingently issuable to our Manager, (iii) the conversion options associated with our senior convertible notes (the “Convertible Notes”) (see Notes 11 and 18) and (iv) non-controlling interests that are redeemable with our common stock (see Note 17). Potential dilutive shares are excluded from the calculation if they have an anti-dilutive effect in the period.

Nearly all of the Company’s unvested RSUs and RSAs contain rights to receive non-forfeitable dividends and thus are participating securities. In addition, the non-controlling interests that are redeemable with our common stock are considered participating securities because they earn a preferred return indexed to the dividend rate on our common stock (see Note 17). Due to the existence of these participating securities, the two-class method of computing EPS is required, unless another method is determined to be more dilutive. Under the two-class method, undistributed earnings are reallocated between shares of common stock and participating securities. For the three and six months ended June 30, 2022 and 2021, the two-class method resulted in the most dilutive EPS calculation.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting periods. The most significant and subjective estimate that we make is the projection of cash flows we expect to receive on our investments, which has a significant impact on the amount of income that we record and/or disclose. The fair value of assets and liabilities that are estimated using a discounted cash flows method is significantly impacted by the rates at which we estimate market participants would discount the expected cash flows. In addition, the fair value of the Woodstar Fund’s investments are dependent upon the real estate and capital markets, which are cyclical in nature. Property and investment values are affected by, among other things, capitalization rates, the availability of capital, occupancy, rental rates and interest and inflation rates. Amounts ultimately realized from our investments may vary significantly from the fair values presented.

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We believe the estimates and assumptions underlying our consolidated financial statements are reasonable and supportable based on the information available as of June 30, 2022. However, uncertainty over the ultimate impact the COVID-19 pandemic, including variants and resurgences, will have on the global economy generally, and our business in particular, makes any estimates and assumptions as of June 30, 2022 inherently less certain than they would be absent the current and potential impacts of COVID-19 and geopolitical events. Actual results may ultimately differ from those estimates.

Recent Accounting Developments

On March 12, 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting, and on January 11, 2021, issued ASU 2021-01, Reference Rate Reform (Topic 848) – Scope, both of which provide optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions that reference LIBOR or other reference rates expected to be discontinued because of reference rate reform. These ASUs are effective through December 31, 2022. The Company has not adopted any of the optional expedients or exceptions through June 30, 2022, but will continue to evaluate the possible adoption of any such expedients or exceptions during the effective period as circumstances evolve.

On March 31, 2022, the FASB issued ASU 2022-2, Troubled Debt Restructurings and Vintage Disclosures (Topic 326). ASU 2022-2 eliminates the recognition and measurement guidance for troubled debt restructurings (“TDRs”) and, instead, requires that an entity evaluate (consistent with the accounting for other loan modifications) whether the modification represents a new loan or a continuation of an existing loan. The ASU also enhances existing disclosure requirements and introduces new requirements related to certain modifications of receivables made to borrowers experiencing financial difficulty. The ASU is effective for the Company beginning January 1, 2023 and is generally to be applied prospectively. Early adoption is permitted. We do not expect the application of this ASU to materially impact our consolidated financial statements as our operating practice is generally not to enter into TDRs for troubled loans.

3. Acquisitions and Divestitures

Investing and Servicing Segment Property Portfolio ("REIS Equity Portfolio")

During the six months ended June 30, 2022, we sold an operating property for $34.5 million. In connection with this sale, we recognized a total gain of $11.7 million within gain on sale of investments and other assets in our condensed consolidated statement of operations. During the three and six months ended June 30, 2021, we sold an operating property for $30.9 million. In connection with this sale, we recognized a gain of $9.7 million within gain on sale of investments and other assets in our condensed consolidated statements of operations.

Commercial and Residential Lending Segment

During the six months ended June 30, 2022, we sold a distribution facility located in Orlando, Florida that was previously acquired in April 2019 through foreclosure of a loan with a carrying value of $18.5 million. The property was sold for $114.8 million and we recognized a gain of $86.6 million within gain on sale of investments and other assets in our condensed consolidated statement of operations. During the six months ended June 30, 2021, we sold an operating property relating to a grocery distribution facility located in Montgomery, Alabama that was previously acquired in March 2019 through foreclosure of a loan with a carrying value of $9.0 million ($20.9 million unpaid principal balance net of an $8.3 million allowance and $3.6 million of unamortized discount) at the foreclosure date. The operating property was sold for $31.2 million and we recognized a gain of $17.7 million within gain on sale of investments and other assets in our condensed consolidated statement of operations.

During the three and six months ended June 30, 2022 and 2021, we had no significant acquisitions of properties or businesses.

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4. Loans

Our loans held-for-investment are accounted for at amortized cost and our loans held-for-sale are accounted for at the lower of cost or fair value, unless we have elected the fair value option for either. The following tables summarize our investments in mortgages and loans as of June 30, 2022 and December 31, 2021 (dollars in thousands):

June 30, 2022	Carrying Value		Face Amount		Weighted Average Coupon (1)		Weighted Average Life (“WAL”) (years)(2)
Loans held-for-investment:
Commercial loans:
First mortgages (3)	$	15,114,160	$	15,207,825	5.5	%	2.0
Subordinated mortgages (4)	69,413		70,729		11.2	%	2.3
Mezzanine loans (3)	433,730		431,475		10.3	%	1.2
Other	16,849		18,161		8.2	%	1.8
Total commercial loans	15,634,152		15,728,190
Infrastructure first priority loans	2,283,785		2,308,602		6.0	%	4.1
Residential loans, fair value option (5)	55,301		55,580		6.0	%	N/A	(6)
Total loans held-for-investment	17,973,238		18,092,372
Loans held-for-sale:
Residential, fair value option (5)	2,132,337		2,260,154		4.6	%	N/A	(6)
Commercial, $40,694 under fair value option (7)	104,310		108,356		4.2	%	7.6
Total loans held-for-sale	2,236,647		2,368,510
Total gross loans	20,209,885		$	20,460,882
Credit loss allowances:
Commercial loans held-for-investment	(56,671)
Infrastructure loans held-for-investment	(20,778)
Total allowances	(77,449)
Total net loans	$	20,132,436
December 31, 2021
Loans held-for-investment:
Commercial loans:
First mortgages (3)	$	12,991,099	$	13,067,524	4.5	%	1.9
Subordinated mortgages (4)	70,771		72,371		10.0	%	2.8
Mezzanine loans (3)	417,504		415,155		9.4	%	1.4
Other	17,424		19,029		8.2	%	2.1
Total commercial loans	13,496,798		13,574,079
Infrastructure first priority loans	2,048,096		2,071,912		4.4	%	4.3
Residential loans, fair value option	59,225		60,133		6.0	%	N/A	(6)
Total loans held-for-investment	15,604,119		15,706,124
Loans held-for-sale:
Residential, fair value option	2,590,005		2,525,910		4.2	%	N/A	(6)
Commercial, fair value option	286,795		289,761		4.0	%	9.0
Total loans held-for-sale	2,876,800		2,815,671
Total gross loans	18,480,919		$	18,521,795
Credit loss allowances:
Commercial loans held-for-investment	(46,600)
Infrastructure loans held-for-investment	(20,670)
Total allowances	(67,270)
Total net loans	$	18,413,649

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______________________________________________________________________________________________________________________

(1)Calculated using applicable index rates as of June 30, 2022 and December 31, 2021 for variable rate loans and excludes loans for which interest income is not recognized.

(2)Represents the WAL of each respective group of loans, excluding loans for which interest income is not recognized, as of the respective balance sheet date. The WAL of each individual loan is calculated using amounts and timing of future principal payments, as projected at origination or acquisition.

(3)First mortgages include first mortgage loans and any contiguous mezzanine loan components because as a whole, the expected credit quality of these loans is more similar to that of a first mortgage loan.  The application of this methodology resulted in mezzanine loans with carrying values of $1.2 billion and $1.4 billion being classified as first mortgages as of June 30, 2022 and December 31, 2021, respectively.

(4)Subordinated mortgages include B-Notes and junior participation in first mortgages where we do not own the senior A-Note or senior participation. If we own both the A-Note and B-Note, we categorize the loan as a first mortgage loan.

(5)During the six months ended June 30, 2022, $0.3 million of residential loans held-for-investment were reclassified into loans held-for-sale.

(6)Residential loans have a weighted average remaining contractual life of 29.3 years and 29.4 years as of June 30, 2022 and December 31, 2021, respectively.

(7)During the six months ended June 30, 2022, $63.6 million of commercial loans held-for-investment were reclassified into loans held-for-sale.

As of June 30, 2022, our variable rate loans held-for-investment, excluding loans for which interest income is not recognized, were as follows (dollars in thousands):

June 30, 2022	Carrying Value		Weighted-average Spread Above Index
Commercial loans	$	14,941,518	4.0	%
Infrastructure loans	2,283,785		3.9	%
Total variable rate loans held-for-investment	$	17,225,303	4.0	%

Credit Loss Allowances

As discussed in Note 2, we do not have a history of realized credit losses on our HFI loans and HTM securities, so we have subscribed to third party database services to provide us with industry losses for both commercial real estate and infrastructure loans. Using these losses as a benchmark, we determine expected credit losses for our loans and securities on a collective basis within our commercial real estate and infrastructure portfolios.

For our commercial loans, we utilize a loan loss model that is widely used among banks and commercial mortgage REITs and is marketed by a leading CMBS data analytics provider. It employs logistic regression to forecast expected losses at the loan level based on a commercial real estate loan securitization database that contains activity dating back to 1998. We provide specific loan-level inputs which include loan-to-stabilized-value (“LTV”) and debt service coverage ratio (DSCR) metrics, as well as principal balances, property type, location, coupon, origination year, term, subordination, expected repayment dates and future fundings. We also select from a group of independent five-year macroeconomic forecasts included in the model that are updated regularly based on current economic trends. We categorize the results by LTV range, which we consider the most significant indicator of credit quality for our commercial loans, as set forth in the credit quality indicator table below. A lower LTV ratio typically indicates a lower credit loss risk.

The macroeconomic forecasts do not differentiate among property types or asset classes. Instead, these forecasts reference general macroeconomic growth factors which apply broadly across all assets. However, the COVID-19 pandemic has had a more negative impact on certain property types, principally retail and hospitality, which were initially impacted by lockdowns and partial reopenings and reduced consumer travel. The office sector has also been adversely affected due to the increase in remote working arrangements. The broad macroeconomic forecasts do not account for such differentiation. Accordingly, we have selected a more adverse macroeconomic recovery forecast related to these property types in determining our credit loss allowance.

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For our infrastructure loans, we utilize a database of historical infrastructure loan performance that is shared among a consortium of banks and other lenders and compiled by a major bond credit rating agency. The database is representative of industry-wide project finance activity dating back to 1983. We derive historical loss rates from the database filtered by industry, sub-industry, term and construction status for each of our infrastructure loans. Those historical loss rates reflect global economic cycles over a long period of time as well as average recovery rates. We categorize the results between the power and oil and gas industries, which we consider the most significant indicator of credit quality for our infrastructure loans, as set forth in the credit quality indicator table below.

As discussed in Note 2, we use a discounted cash flow or collateral value approach, rather than the industry loan loss approach described above, to determine credit loss allowances for any credit deteriorated loans.

We regularly evaluate the extent and impact of any credit deterioration associated with the performance and/or value of the underlying collateral, as well as the financial and operating capability of the borrower. Specifically, the collateral’s operating results and any cash reserves are analyzed and used to assess (i) whether cash flow from operations is sufficient to cover the debt service requirements currently and into the future, (ii) the ability of the borrower to refinance the loan and/or (iii) the collateral’s liquidation value. We also evaluate the financial wherewithal of any loan guarantors as well as the borrower’s competency in managing and operating the collateral. In addition, we consider the overall economic environment, real estate or industry sector, and geographic sub-market in which the borrower operates. Such analyses are completed and reviewed by asset management and finance personnel who utilize various data sources, including (i) periodic financial data such as property operating statements, occupancy, tenant profile, rental rates, operating expenses, the borrower’s exit plan, and capitalization and discount rates, (ii) site inspections and (iii) current credit spreads and discussions with market participants.

The significant credit quality indicators for our loans measured at amortized cost, which excludes loans held-for-sale, were as follows as of June 30, 2022 (dollars in thousands):

	Term Loans Amortized Cost Basis by Origination Year												Revolving Loans Amortized Cost Total		Total Amortized Cost Basis		Credit Loss Allowance
As of June 30, 2022	2022		2021		2020		2019		2018		Prior
Commercial loans:
Credit quality indicator:
LTV < 60%	$	446,275	$	2,613,440	$	501,609	$	947,347	$	384,309	$	703,459	$	—	$	5,596,439	$	4,287
LTV 60% - 70%	2,318,864		4,151,281		246,709		1,104,966		457,469		68,379		—		8,347,668		15,849
LTV > 70%	99,746		321,271		247,756		422,725		312,890		263,883		—		1,668,271		31,610
Credit deteriorated	—		—		—		—		—		4,925		—		4,925		4,925
Defeased and other	—		—		—		—		—		16,849		—		16,849		—
Total commercial	$	2,864,885	$	7,085,992	$	996,074	$	2,475,038	$	1,154,668	$	1,057,495	$	—	$	15,634,152	$	56,671
Infrastructure loans:
Credit quality indicator:
Power	$	93,913	$	229,627	$	108,491	$	268,362	$	393,708	$	338,268	$	7,378	$	1,439,747	$	5,366
Oil and gas	—		346,373		40,670		287,062		84,692		50,004		1,949		810,750		5,291
Credit deteriorated	—		—		—		—		—		33,288		—		33,288		10,121
Total infrastructure	$	93,913	$	576,000	$	149,161	$	555,424	$	478,400	$	421,560	$	9,327	$	2,283,785	$	20,778
Residential loans held-for-investment, fair value option															55,301		—
Loans held-for-sale															2,236,647		—
Total gross loans															$	20,209,885	$	77,449

Non-Credit Deteriorated Loans

As of June 30, 2022, we had the following loans with a combined amortized cost basis of $501.0 million that were 90 days or greater past due at June 30, 2022: (i) a $201.2 million senior loan on a retail and entertainment project in New Jersey, of which $7.3 million was converted into equity interests (see Note 8); (ii) a $222.5 million senior loan on an office building in California; (iii) a $37.8 million leasehold mortgage loan on a luxury resort in California destroyed by wildfire; (iv) $30.3 million of residential loans; and (v) a $9.2 million loan on a hospitality asset in New York that our Investing and Servicing Segment acquired as nonperforming in October 2021. Loans on nonaccrual as of June 30, 2022 include (i) - (iv) above. None of these loans are considered credit deteriorated as we presently expect to recover all amounts due.

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Credit Deteriorated Loans

As of June 30, 2022, we had the following loans with a combined amortized cost basis of $38.2 million which were deemed credit deteriorated and are on nonaccrual status: (i) a $33.3 million senior loan participation secured by a natural gas-fired power plant in Massachusetts, for which we recorded a credit loss allowance of $10.1 million in 2021 based on our share of the estimated fair value of the asset and for which interest collections were current as of June 30, 2022; and (ii) a $4.9 million subordinated loan secured by a department store in Chicago which is fully reserved.

Foreclosures and Equity Control

In May 2022, we obtained control over the pledged equity interests of a mezzanine borrower entity related to an office building located in Texas, which resulted in our consolidating the mezzanine borrower entity including the underlying property collateral and related debt. The net carrying value of our loans related to this property totaled $50.2 million and consisted of first mortgage and mezzanine loans which are now eliminated in consolidation. In connection with the consolidation of the mezzanine borrower entity, we recorded properties of $110.8 million, lease intangible assets of $15.4 million, net working capital of $11.8 million and third-party first mortgage debt of $87.8 million in accordance with the asset acquisition provisions of ASC 805, Business Combinations.

The following tables present the activity in our credit loss allowance for funded loans and unfunded commitments (amounts in thousands):

	Funded Commitments Credit Loss Allowance
	Loans Held-for-Investment				Total Funded Loans
Six Months Ended June 30, 2022	Commercial		Infrastructure
Credit loss allowance at December 31, 2021	$	46,600	$	20,670	$	67,270
Credit loss provision, net	10,071		108		10,179
Credit loss allowance at June 30, 2022	$	56,671	$	20,778	$	77,449

	Unfunded Commitments Credit Loss Allowance (1)
	Loans Held-for-Investment				HTM Preferred
Six Months Ended June 30, 2022	Commercial		Infrastructure		Interests (2)		CMBS (2)		Total
Credit loss allowance at December 31, 2021	$	6,692	$	145	$	—	$	—	$	6,837
Credit loss (reversal) provision, net	(1,469)		(120)		248		47		(1,294)
Credit loss allowance at June 30, 2022	$	5,223	$	25	$	248	$	47	$	5,543
Memo: Unfunded commitments as of June 30, 2022 (3)	$	2,550,117	$	4,667	$	12,500	$	35,976	$	2,603,260

______________________________________________________________________________________________________________________

(1)Included in accounts payable, accrued expenses and other liabilities in our consolidated balance sheets.

(2)See Note 5 for further details.

(3)Represents amounts expected to be funded (see Note 22).

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Loan Portfolio Activity

The activity in our loan portfolio was as follows (amounts in thousands):

	Held-for-Investment Loans
Six Months Ended June 30, 2022	Commercial		Infrastructure		Residential		Held-for-Sale Loans		Total Loans
Balance at December 31, 2021	$	13,450,198	$	2,027,426	$	59,225	$	2,876,800	$	18,413,649
Acquisitions/originations/additional funding	3,510,157		382,068		—		3,607,070		7,499,295
Capitalized interest (1)	54,414		242		—		147		54,803
Basis of loans sold (2)	(6,330)		—		—		(3,960,798)		(3,967,128)
Loan maturities/principal repayments	(1,034,439)		(148,225)		(4,207)		(110,642)		(1,297,513)
Discount accretion/premium amortization	26,525		4,344		—		—		30,869
Changes in fair value	—		—		629		(239,892)		(239,263)
Foreign currency translation gain/(loss), net	(299,206)		(2,740)		—		—		(301,946)
Credit loss provision, net	(10,071)		(108)		—		—		(10,179)
Transfer to/from other asset classifications or between segments	(113,767)		—		(346)		63,962		(50,151)		(3)
Balance at June 30, 2022	$	15,577,481	$	2,263,007	$	55,301	$	2,236,647	$	20,132,436

	Held-for-Investment Loans
Six Months Ended June 30, 2021	Commercial		Infrastructure		Residential		Held-for-Sale Loans		Total Loans
Balance at December 31, 2020	$	9,583,949	$	1,412,440	$	90,684	$	1,052,835	$	12,139,908
Acquisitions/originations/additional funding	3,713,142		288,904		—		1,367,574		5,369,620
Capitalized interest (1)	63,538		—		—		—		63,538
Basis of loans sold (2)	(207,975)		—		—		(1,502,588)		(1,710,563)
Loan maturities/principal repayments	(2,025,641)		(100,624)		(18,868)		(206,119)		(2,351,252)
Discount accretion/premium amortization	27,067		2,168		—		504		29,739
Changes in fair value	—		—		1,384		35,005		36,389
Foreign currency translation gain/(loss), net	1,987		(345)		—		—		1,642
Credit loss reversal (provision), net	11,381		(1,519)		—		—		9,862
Loan foreclosure and conversion to equity interest	(36,308)		—		—		—		(36,308)		(4)
Transfer to/from other asset classifications or between segments	(204,583)		93,085		69,506		214,466		172,474		(5)
Balance at June 30, 2021	$	10,926,557	$	1,694,109	$	142,706	$	961,677	$	13,725,049

______________________________________________________________________________________________________________________

(1)Represents accrued interest income on loans whose terms do not require current payment of interest.

(2)See Note 12 for additional disclosure on these transactions.

(3)Represents the net carrying value of first mortgage and contiguous mezzanine loans related to an office building in Texas that is eliminated as a result of consolidating the net assets of the mezzanine borrower entity upon obtaining control over its pledged equity interests in May 2022 (see discussion above).

(4)Includes (i) a $29.0 million credit deteriorated loan related to a residential conversion project which was foreclosed in April 2021 and (ii) $7.3 million of a commercial loan that was converted to equity interests in March 2021 (see Note 8) pursuant to a consensual transfer under pre-existing equity pledges of additional collateral.

(5)Net transfers represent residential loans transferred from VIE assets upon redemption of a consolidated RMBS trust.

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5. Investment Securities

Investment securities were comprised of the following as of June 30, 2022 and December 31, 2021 (amounts in thousands):

	Carrying Value as of
	June 30, 2022		December 31, 2021
RMBS, available-for-sale	$	124,439	$	143,980
RMBS, fair value option (1)	416,057		250,424
CMBS, fair value option (1), (2)	1,307,440		1,263,606
HTM debt securities, amortized cost net of credit loss allowance of $4,505 and $8,610	757,763		683,136
Equity security, fair value	10,193		11,624
Subtotal—Investment securities	2,615,892		2,352,770
VIE eliminations (1)	(1,702,532)		(1,491,786)
Total investment securities	$	913,360	$	860,984

______________________________________________________________________________________________________________________

(1)Certain fair value option CMBS and RMBS are eliminated in consolidation against VIE liabilities pursuant to ASC 810.

(2)Includes $205.3 million and $182.6 million of non-controlling interests in the consolidated entities which hold certain of these CMBS as of June 30, 2022 and December 31, 2021, respectively.

Purchases, sales, principal collections and redemptions for all investment securities were as follows (amounts in thousands):

	RMBS, available-for-sale		RMBS, fair value option		CMBS, fair value option		HTM Securities		Securitization VIEs (1)		Total
Three Months Ended June 30, 2022
Purchases/fundings	$	—	$	141,795	$	63,681	$	67,919	$	(205,476)	$	67,919
Sales	—		—		—		—		—		—
Principal collections	5,893		20,325		641		1,276		(20,739)		7,396
Three Months Ended June 30, 2021
Purchases	$	—	$	52,351	$	54,082	$	—	$	(106,433)	$	—
Sales	—		30,684		—				(30,684)		—
Principal collections	7,863		14,687		2,013		879		(16,089)		9,353
Redemptions	—		11,976		—		—		(11,976)		—

	RMBS, available-for-sale		RMBS, fair value option		CMBS, fair value option		HTM Securities		Securitization VIEs (1)		Total
Six Months Ended June 30, 2022
Purchases/fundings	$	—	$	226,152	$	63,681	$	86,058	$	(289,833)	$	86,058
Sales	—		—		—		—		—		—
Principal collections	12,788		41,929		1,276		1,940		(42,753)		15,180
Six Months Ended June 30, 2021
Purchases	$	—	$	79,684	$	54,082	$	—	$	(133,766)	$	—
Sales	—		30,684		11,604				(42,288)		—
Principal collections	15,114		28,031		3,723		52,569		(30,570)		68,867
Redemptions	—		11,976		—		—		(11,976)		—

______________________________________________________________________________________________________________________

(1)Represents RMBS and CMBS, fair value option amounts eliminated due to our consolidation of securitization VIEs. These amounts are reflected as issuance or repayment of debt of, or distributions from, consolidated VIEs in our consolidated statements of cash flows.

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RMBS, Available-for-Sale

The Company classified all of its RMBS not eliminated in consolidation as available-for-sale as of June 30, 2022 and December 31, 2021. These RMBS are reported at fair value in the balance sheet with changes in fair value recorded in accumulated other comprehensive income (“AOCI”).

The tables below summarize various attributes of our investments in available-for-sale RMBS as of June 30, 2022 and December 31, 2021 (amounts in thousands):

							Unrealized Gains or (Losses) Recognized in AOCI
	Amortized Cost		Credit Loss Allowance		Net Basis		Gross Unrealized Gains		Gross Unrealized Losses		Net Fair Value Adjustment		Fair Value
June 30, 2022
RMBS	$	95,469	$	—	$	95,469	$	29,278	$	(308)	$	28,970	$	124,439
December 31, 2021
RMBS	$	103,027	$	—	$	103,027	$	41,052	$	(99)	$	40,953	$	143,980

	Weighted Average Coupon (1)		WAL  (Years) (2)
June 30, 2022
RMBS	2.6	%	6.1

______________________________________________________________________________________________________________________

(1)Calculated using the June 30, 2022 one-month LIBOR rate of 1.787% for floating rate securities.

(2)Represents the remaining WAL of each respective group of securities as of the balance sheet date. The WAL of each individual security is calculated using projected amounts and projected timing of future principal payments.

As of June 30, 2022, approximately $109.7 million, or 88%, of RMBS were variable rate. We purchased all of the RMBS at a discount, a portion of which is accreted into income over the expected remaining life of the security. The majority of the income from this strategy is earned from the accretion of this accretable discount.

We have engaged a third party manager who specializes in RMBS to execute the trading of RMBS, the cost of which was $0.2 million and $0.3 million for the three months ended June 30, 2022 and 2021, and $0.5 million and $0.6 million for the six months ended June 30, 2022 and 2021, respectively, recorded as management fees in the accompanying condensed consolidated statements of operations.

The following table presents the gross unrealized losses and estimated fair value of any available-for-sale securities that were in an unrealized loss position as of June 30, 2022 and December 31, 2021, and for which an allowance for credit losses has not been recorded (amounts in thousands):

	Estimated Fair Value				Unrealized Losses
	Securities with a loss less than 12 months		Securities with a loss greater than 12 months		Securities with a loss less than 12 months		Securities with a loss greater than 12 months
As of June 30, 2022
RMBS	$	4,691	$	—	$	(308)	$	—
As of December 31, 2021
RMBS	$	2,478	$	—	$	(99)	$	—

As of June 30, 2022 and December 31, 2021, there were seven securities and one security, respectively, with unrealized losses reflected in the table above. After evaluating the securities and recording adjustments for credit losses, we concluded that the remaining unrealized losses reflected above were noncredit-related and would be recovered from the securities’ estimated future cash flows. We considered a number of factors in reaching this conclusion, including that we did not intend to sell the securities, it was not considered more likely than not that we would be forced to sell the securities prior to recovering our amortized cost, and there were no material credit events that would have caused us to otherwise conclude that we would not recover our cost. Credit losses are calculated by comparing (i) the estimated future cash flows of each security discounted at the yield determined as of the initial acquisition date or, if since revised, as of the last date previously revised, to (ii) our net amortized cost basis. Significant judgment is used in projecting cash flows for our non-agency RMBS. As a result, actual income and/or credit losses could be materially different from what is currently projected and/or reported.

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CMBS and RMBS, Fair Value Option

As discussed in the “Fair Value Option” section of Note 2 herein, we elect the fair value option for certain CMBS and RMBS in an effort to eliminate accounting mismatches resulting from the current or potential consolidation of securitization VIEs. As of June 30, 2022, the fair value and unpaid principal balance of CMBS where we have elected the fair value option, excluding the notional value of interest-only securities and before consolidation of securitization VIEs, were $1.3 billion and $2.9 billion, respectively. As of June 30, 2022, the fair value and unpaid principal balance of RMBS where we have elected the fair value option, excluding the notional value of interest-only securities and before consolidation of securitization VIEs, were $416.1 million and $326.3 million, respectively. The $1.7 billion total fair value balance of CMBS and RMBS represents our economic interests in these assets. However, as a result of our consolidation of securitization VIEs, the vast majority of this fair value (all except $21.0 million at June 30, 2022) is eliminated against VIE liabilities before arriving at our GAAP balance for fair value option investment securities.

As of June 30, 2022, $97.1 million of our CMBS were variable rate and none of our RMBS were variable rate.

HTM Debt Securities, Amortized Cost

The table below summarizes our investments in HTM debt securities as of June 30, 2022 and December 31, 2021 (amounts in thousands):

	Amortized Cost Basis		Credit Loss Allowance		Net Carrying Amount		Gross Unrealized Holding Gains		Gross Unrealized Holding Losses		Fair Value
June 30, 2022
CMBS	$	571,959	$	(1,169)	$	570,790	$	198	$	(31,239)	$	539,749
Preferred interests	119,899		(262)		119,637		125		(5,851)		113,911
Infrastructure bonds	70,410		(3,074)		67,336		604		(959)		66,981
Total	$	762,268	$	(4,505)	$	757,763	$	927	$	(38,049)	$	720,641
December 31, 2021
CMBS	$	538,506	$	(3,140)	$	535,366	$	195	$	(25,029)	$	510,532
Preferred interests	118,409		(2,562)		115,847		450		(2,449)		113,848
Infrastructure bonds	34,831		(2,908)		31,923		561		—		32,484
Total	$	691,746	$	(8,610)	$	683,136	$	1,206	$	(27,478)	$	656,864

The following table presents the activity in our credit loss allowance for HTM debt securities (amounts in thousands):

	CMBS		Preferred Interests		Infrastructure Bonds		Total HTM Credit Loss Allowance
Six Months Ended June 30, 2022
Credit loss allowance at December 31, 2021	$	3,140	$	2,562	$	2,908	$	8,610
Credit loss (reversal) provision, net	(1,971)		(2,300)		166		(4,105)
Credit loss allowance at June 30, 2022	$	1,169	$	262	$	3,074	$	4,505

The table below summarizes the maturities of our HTM debt securities by type as of June 30, 2022 (amounts in thousands):

	CMBS		Preferred Interests		Infrastructure Bonds		Total
Less than one year	$	314,026	$	91,368	$	—	$	405,394
One to three years	24,382		28,269		—		52,651
Three to five years	232,382		—		37,906		270,288
Thereafter	—		—		29,430		29,430
Total	$	570,790	$	119,637	$	67,336	$	757,763

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Equity Security, Fair Value

During 2012, we acquired 9,140,000 ordinary shares from a related-party in Starwood European Real Estate Finance Limited (“SEREF”), a debt fund that is externally managed by an affiliate of our Manager and is listed on the London Stock Exchange. The fair value of the investment remeasured in USD was $10.2 million and $11.6 million as of June 30, 2022 and December 31, 2021, respectively. As of June 30, 2022, our shares represent an approximate 2% interest in SEREF.

6. Properties

Our properties are held within the following portfolios:

Medical Office Portfolio

The Medical Office Portfolio is comprised of 34 medical office buildings acquired during the year ended December 31, 2016. These properties, which collectively comprise 1.9 million square feet, are geographically dispersed throughout the U.S. and primarily affiliated with major hospitals or located on or adjacent to major hospital campuses. The Medical Office Portfolio includes total gross properties and lease intangibles of $763.4 million and debt of $595.4 million as of June 30, 2022.

Master Lease Portfolio

The Master Lease Portfolio is comprised of 16 retail properties geographically dispersed throughout the U.S., with more than 50% of the portfolio, by carrying value, located in Florida, Texas and Minnesota. These properties, which we acquired in September 2017, collectively comprise 1.9 million square feet and were leased back to the seller under corporate guaranteed master net lease agreements with initial terms of 24.6 years and periodic rent escalations. The Master Lease Portfolio includes total gross properties of $343.8 million and debt of $193.2 million as of June 30, 2022.

Investing and Servicing Segment Property Portfolio

The REIS Equity Portfolio is comprised of 12 commercial real estate properties and one equity interest in an unconsolidated commercial real estate property which were acquired from CMBS trusts during the previous six years. The REIS Equity Portfolio includes total gross properties and lease intangibles of $200.9 million and debt of $144.2 million as of June 30, 2022.

Woodstar Portfolios

Refer to Note 7 for a discussion of our Woodstar I and Woodstar II Portfolios which are not included in the table below.

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The table below summarizes our properties held as of June 30, 2022 and December 31, 2021 (dollars in thousands):

	Depreciable Life	June 30, 2022		December 31, 2021
Property Segment
Land and land improvements	0 - 15 years	$	175,836	$	175,810
Buildings and building improvements	0 - 45 years	851,919		851,274
Furniture & fixtures	3 - 5 years	288		260
Investing and Servicing Segment
Land and land improvements	0 - 15 years	36,910		41,771
Buildings and building improvements	3 - 40 years	133,748		149,399
Furniture & fixtures	2 - 5 years	3,181		3,143
Commercial and Residential Lending Segment (1)
Land and land improvements	N/A	33,681		9,691
Buildings and building improvements	0 - 24 years	77,941		12,408
Construction in progress	N/A	104,184		104,088
Properties, cost		1,417,688		1,347,844
Less: accumulated depreciation		(191,709)		(181,457)
Properties, net		$	1,225,979	$	1,166,387

______________________________________________________________________________________________________________________

(1)Represents properties acquired through loan foreclosure or exercise of control over a mezzanine loan borrower’s pledged equity interests.

During the six months ended June 30, 2022, we sold an operating property within the REIS Equity Portfolio for $34.5 million and recognized a total gain of $11.7 million within gain on sale of investments and other assets in our consolidated statement of operations. During the three and six months ended June 30, 2021, we sold an operating property within the REIS Equity Portfolio for $30.9 million and recognized a gain of $9.7 million within gain on sale of investments and other assets in our condensed consolidated statements of operations.

During the six months ended June 30, 2022, we sold an operating property within the Commercial and Residential Lending Segment for $114.8 million and recognized a gain of $86.6 million within gain on sale of investments and other assets in our condensed consolidated statement of operations. During the six months ended June 30, 2021, we sold an operating property within the Commercial and Residential Lending Segment for $31.2 million and recognized a gain of $17.7 million within gain on sale of investments and other assets in our condensed consolidated statement of operations. Refer to Note 3 for further discussion.

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7. Investments of Consolidated Affordable Housing Fund

As discussed in Note 2, we established the Woodstar Fund effective November 5, 2021, an investment fund which holds our Woodstar multifamily affordable housing portfolios. The Woodstar portfolios consist of the following:

Woodstar I Portfolio

The Woodstar I Portfolio is comprised of 32 affordable housing communities with 8,948 units concentrated primarily in the Tampa, Orlando and West Palm Beach metropolitan areas. During the year ended December 31, 2015, we acquired 18 of the 32 affordable housing communities of the Woodstar I Portfolio, with the final 14 communities acquired during the year ended December 31, 2016. The Woodstar I Portfolio includes properties at fair value of $1.5 billion and debt at fair value of $719.2 million as of June 30, 2022.

Woodstar II Portfolio

The Woodstar II Portfolio is comprised of 27 affordable housing communities with 6,109 units concentrated primarily in Central and South Florida. We acquired eight of the 27 affordable housing communities in December 2017, with the final 19 communities acquired during the year ended December 31, 2018. The Woodstar II Portfolio includes properties at fair value of $1.2 billion and debt at fair value of $492.5 million as of June 30, 2022.

Income from the Woodstar Fund’s investments reflects the following components for the three and six months ended June 30, 2022 (in thousands):

	For the Three Months Ended June 30, 2022		For the Six Months Ended June 30, 2022
Distributions from affordable housing fund investments	$	12,475	$	22,665
Unrealized change in fair value of investments	294,690		518,541
Income from affordable housing fund investments	$	307,165	$	541,206

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8. Investments in Unconsolidated Entities

The table below summarizes our investments in unconsolidated entities as of June 30, 2022 and December 31, 2021 (dollars in thousands):

	Participation / Ownership % (1)	Carrying value as of
		June 30, 2022		December 31, 2021
Equity method investments:
Equity interest in a natural gas power plant	10%	$	26,994	$	26,255
Investor entity which owns equity in an online real estate company	50%	5,288		5,206
Equity interest in and advances to a residential mortgage originator (2)	N/A	15,920		20,327
Various	25% - 50%	14,317		12,528
		62,519		64,316
Other equity investments:
Equity interest in a servicing and advisory business	2%	12,955		12,955
Investment funds which own equity in a loan servicer and other real estate assets (3)	4% - 6%	940		4,194
Investor entities which own equity interests in two entertainment and retail centers (4)	15%	7,320		7,320
Various	1% - 3%	1,776		1,312
		22,991		25,781
		$	85,510	$	90,097

______________________________________________________________________________________________________________________

(1)None of these investments are publicly traded and therefore quoted market prices are not available.

(2)Included a $4.5 million subordinated loan as of both June 30, 2022 and December 31, 2021.

(3)During the three and six months ended June 30, 2022, we received distributions of $7.3 million, of which $3.3 million were considered returns of capital which reduced the carrying value of two of our investments.

(4)In March 2021, we obtained equity interests in two investor entities that own interests in two entertainment and retail centers in satisfaction of $7.3 million principal amount of a commercial loan. The interests were obtained in order to facilitate repayment of a portion of that loan for which these interests represented underlying collateral. The interests are entitled to preferred treatment in the distribution waterfall and are intended to repay us the $7.3 million principal amount of the loan plus interest. See further discussion in Note 4.

As of June 30, 2022, the carrying value of our equity investment in a residential mortgage originator exceeded the underlying equity in net assets of such investee by $1.6 million. This difference is the result of the Company recording its investment in the investee at its acquisition date fair value, which included certain non-amortizing intangible assets not recognized by the investee. Should the Company determine these intangible assets held by the investee are impaired, the Company will recognize such impairment loss through earnings from unconsolidated entities in our consolidated statement of operations, otherwise, such difference between the carrying value of our equity investment in the residential mortgage originator and the underlying equity in the net assets of the residential mortgage originator will continue to exist.

Other than our equity interest in the residential mortgage originator, there were no differences between the carrying value of our equity method investments and the underlying equity in the net assets of the investees as of June 30, 2022.

During the three and six months ended June 30, 2022, we did not become aware of (i) any observable price changes in our other equity investments accounted for under the fair value practicability election or (ii) any indicators of impairment.

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9. Goodwill and Intangibles

Goodwill

Goodwill is tested for impairment annually in the fourth quarter, or more frequently if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount.

Infrastructure Lending Segment

The Infrastructure Lending Segment’s goodwill of $119.4 million at both June 30, 2022 and December 31, 2021 represents the excess of consideration transferred over the fair value of net assets acquired on September 19, 2018 and October 15, 2018. The goodwill recognized is attributable to value embedded in the acquired Infrastructure Lending Segment’s lending platform.

LNR Property LLC (“LNR”)

The Investing and Servicing Segment’s goodwill of $140.4 million at both June 30, 2022 and December 31, 2021 represents the excess of consideration transferred over the fair value of net assets of LNR acquired on April 19, 2013. The goodwill recognized is attributable to value embedded in LNR’s existing platform, which includes a network of commercial real estate asset managers, work-out specialists, underwriters and administrative support professionals as well as proprietary historical performance data on commercial real estate assets.

Intangible Assets

Servicing Rights Intangibles

In connection with the LNR acquisition, we identified domestic servicing rights that existed at the purchase date, based upon the expected future cash flows of the associated servicing contracts. As of June 30, 2022 and December 31, 2021, the balance of the domestic servicing intangible was net of $41.7 million and $42.1 million, respectively, which was eliminated in consolidation pursuant to ASC 810 against VIE assets in connection with our consolidation of securitization VIEs. Before VIE consolidation, as of June 30, 2022 and December 31, 2021, the domestic servicing intangible had a balance of $59.2 million and $58.9 million, respectively, which represents our economic interest in this asset.

Lease Intangibles

In connection with our acquisitions of commercial real estate, we recognized in-place lease intangible assets and favorable lease intangible assets associated with certain non-cancelable operating leases of the acquired properties.

The following table summarizes our intangible assets, which are comprised of servicing rights intangibles and lease intangibles, as of June 30, 2022 and December 31, 2021 (amounts in thousands):

	As of June 30, 2022						As of December 31, 2021
	Gross Carrying Value		Accumulated Amortization		Net Carrying Value		Gross Carrying Value		Accumulated Amortization		Net Carrying Value
Domestic servicing rights, at fair value	$	17,499	$	—	$	17,499	$	16,780	$	—	$	16,780
In-place lease intangible assets	100,797		(60,874)		39,923		94,712		(62,721)		31,991
Favorable lease intangible assets	26,762		(9,220)		17,542		23,746		(8,953)		14,793
Total net intangible assets	$	145,058	$	(70,094)	$	74,964	$	135,238	$	(71,674)	$	63,564

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The following table summarizes the activity within intangible assets for the six months ended June 30, 2022 (amounts in thousands):

	Domestic Servicing Rights		In-place Lease Intangible Assets		Favorable Lease Intangible Assets		Total
Balance as of January 1, 2022	$	16,780	$	31,991	$	14,793	$	63,564
Acquisition (1)	—		11,910		3,520		15,430
Amortization	—		(3,434)		(729)		(4,163)
Impairment (2)	—		(43)		(4)		(47)
Sales	—		(501)		(38)		(539)
Changes in fair value due to changes in inputs and assumptions	719		—		—		719
Balance as of June 30, 2022	$	17,499	$	39,923	$	17,542	$	74,964

_________________________________________________

(1)    Represents lease intangibles related to an office building in Texas that are consolidated upon exercising control over a mezzanine loan borrower’s pledged equity interests in May 2022 (see Note 4).

(2)     Impairment of intangible lease assets is recognized within other expense in our condensed consolidated statement of operations.

The following table sets forth the estimated aggregate amortization of our in-place lease intangible assets and favorable lease intangible assets for the next five years and thereafter (amounts in thousands):

2022 (remainder of)	$	4,760
2023	8,639
2024	6,941
2025	5,827
2026	4,301
Thereafter	26,997
Total	$	57,465

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10. Secured Borrowings

Secured Financing Agreements

The following table is a summary of our secured financing agreements in place as of June 30, 2022 and December 31, 2021 (dollars in thousands):

													Outstanding Balance at
	Current Maturity		Extended Maturity (a)		Weighted Average Pricing		Pledged Asset Carrying Value			Maximum Facility Size			June 30, 2022			December 31, 2021
Repurchase Agreements:
Commercial Loans	Aug 2022 to Jun 2027	(b)	Jun 2025 to Dec 2030	(b)	Index + 2.03%	(c)	$	10,771,843		$	12,407,967	(d)	$	7,828,681		$	6,556,438
Residential Loans	May 2023 to Dec 2023		May 2023 to Dec 2024		Index + 2.11%		1,697,635			2,502,636			1,405,200			1,744,225
Infrastructure Loans	Sep 2024		Sep 2026		Index + 2.01%		350,599			650,000			293,673			379,095
Conduit Loans	Feb 2023 to Jun 2024		Feb 2024 to Jun 2025		Index + 2.28%		40,694			650,000			30,923			174,130
CMBS/RMBS	Mar 2023 to Apr 2032	(e)	Jun 2023 to Oct 2032	(e)	(f)		1,458,270			876,651			757,173		(g)	688,146
Total Repurchase Agreements							14,319,041			17,087,254			10,315,650			9,542,034
Other Secured Financing:
Borrowing Base Facility	Nov 2024		Oct 2026		SOFR + 2.11%		8,786			750,000		(h)	6,613			213,478
Commercial Financing Facilities	Dec 2023 to Jan 2025		Jan 2027 to Dec 2030		Index + 1.73%		299,352			445,005		(i)	234,948			167,476
Residential Financing Facility	Mar 2024		Mar 2027		SOFR + 2.45%		489,474			500,000			142,418			102,018
Infrastructure Financing Facilities	Oct 2022 to Jul 2025		Oct 2024 to Jul 2032		Index + 2.04%		915,824			1,750,000			737,326			855,646
Property Mortgages - Fixed rate	Nov 2024 to Sep 2029	(j)	N/A		4.48%		384,284			275,993			275,993			272,522
Property Mortgages - Variable rate	Nov 2022 to Dec 2025		N/A		(k)		775,534			742,650			730,336			712,493
Term Loan and Revolver	(l)		N/A		(l)		N/A		(l)	934,759			784,759			788,753
Total Other Secured Financing							2,873,254			5,398,407			2,912,393			3,112,386
							$	17,192,295		$	22,485,661		13,228,043			12,654,420
Unamortized net discount													(13,813)			(13,350)
Unamortized deferred financing costs													(66,783)			(64,220)
													$	13,147,447		$	12,576,850

______________________________________________________________________________________________________________________

(a)Subject to certain conditions as defined in the respective facility agreement.

(b)For certain facilities, borrowings collateralized by loans existing at maturity may remain outstanding until such loan collateral matures, subject to certain specified conditions.

(c)Certain facilities with an outstanding balance of $2.9 billion as of June 30, 2022 are indexed to GBP LIBOR, EURIBOR, BBSY, SARON and SONIA. The remainder are indexed to USD LIBOR or SOFR.

(d)Certain facilities with an aggregate initial maximum facility size of $11.5 billion may be increased to $12.4 billion, subject to certain conditions. The $12.4 billion amount includes such upsizes.

(e)Certain facilities with an outstanding balance of $332.6 million as of June 30, 2022 carry a rolling 11-month or 12-month term which may reset monthly or quarterly with the lender’s consent. These facilities carry no maximum facility size.

(f)A facility with an outstanding balance of $265.7 million as of June 30, 2022 has a weighted average fixed annual interest rate of 3.27%. All other facilities are variable rate with a weighted average rate of Index + 1.94%.

(g)Includes: (i) $265.7 million outstanding on a repurchase facility that is not subject to margin calls; and (ii) $43.3 million outstanding on one of our repurchase facilities that represents the 49% pro rata share owed by a non-controlling partner in a consolidated joint venture (see Note 15).

(h)The maximum facility size as of June 30, 2022 of $650.0 million is scheduled to decline to $450.0 million as of December 31, 2022 and may be increased to $750.0 million, subject to certain conditions.

(i)Certain facilities with an aggregate initial maximum facility size of $345.0 million may be increased to $445.0 million, subject to certain conditions. The $445.0 million amount includes such upsizes.

(j)The weighted average maturity is 5.0 years as of June 30, 2022.

(k)Includes a $600.0 million first mortgage and mezzanine loan secured by our Medical Office Portfolio. This debt has a weighted average interest rate of LIBOR + 2.07% that we swapped to a fixed rate of 3.34%. The remainder have a weighted average rate of Index + 2.28%.

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(l)Consists of: (i) a $784.8 million term loan facility that matures in July 2026, of which $389.0 million has an annual interest rate of LIBOR + 2.50% and $395.8 million has an annual interest rate of LIBOR + 3.25%, subject to a 0.75% LIBOR floor, and (ii) a $150.0 million revolving credit facility that matures in April 2026 with an annual interest rate of SOFR + 2.50%. These facilities are secured by the equity interests in certain of our subsidiaries which totaled $5.0 billion as of June 30, 2022.

The above table no longer reflects property mortgages of the Woodstar Portfolios which, as discussed in Notes 2 and 7, are now reflected within “Investments of consolidated affordable housing fund” on our condensed consolidated balance sheets.

In the normal course of business, the Company is in discussions with its lenders to extend, amend or replace any financing facilities which contain near term expirations.

In March 2022, we amended a Residential Loans credit facility to increase the available borrowings to $500.0 million from $250.0 million and extend the initial maturity for 18 months to March 2024 with a three-year extension option. The margin call provisions under this facility do not permit valuation adjustments based on capital market events and are limited to collateral-specific credit marks.

In June 2022, we entered into a credit facility to finance loans within the Infrastructure Lending Segment. The maximum facility size is $500.0 million and carries a three-year revolving period with two one-year extension options. The margin call provisions under this facility do not permit valuation adjustments based on capital market events and are limited to collateral-specific credit marks.

During the six months ended June 30, 2022, we entered into commercial credit facilities of $1.4 billion. In addition, we amended several commercial credit facilities resulting in an aggregate upsize of $924.7 million.

Our secured financing agreements contain certain financial tests and covenants. As of June 30, 2022, we were in compliance with all such covenants.

We seek to mitigate risks associated with our repurchase agreements by managing risk related to the credit quality of our assets, interest rates, liquidity, prepayment speeds and market value. The margin call provisions under the majority of our repurchase facilities, consisting of 70% of these agreements, do not permit valuation adjustments based on capital market events and are limited to collateral-specific credit marks generally determined on a commercially reasonable basis. To monitor credit risk associated with the performance and value of our loans and investments, our asset management team regularly reviews our investment portfolios and is in regular contact with our borrowers, monitoring performance of the collateral and enforcing our rights as necessary. For the 30% of repurchase agreements which do permit valuation adjustments based on capital market events, approximately 12% of these pertain to our loans held-for-sale, for which we manage credit risk through the purchase of credit instruments. We further seek to manage risks associated with our repurchase agreements by matching the maturities and interest rate characteristics of our loans with the related repurchase agreement.

For the three and six months ended June 30, 2022, approximately $9.2 million and $18.8 million, respectively, of amortization of deferred financing costs from secured financing agreements was included in interest expense on our condensed consolidated statements of operations. For the three and six months ended June 30, 2021, approximately $8.9 million and $18.4 million, respectively, of amortization of deferred financing costs from secured financing agreements was included in interest expense on our condensed consolidated statements of operations.

As of June 30, 2022, Morgan Stanley Bank, N.A. held collateral sold under certain of our repurchase agreements with carrying values that exceeded the respective repurchase obligations by $719.9 million. The weighted average extended maturity of those repurchase agreements is 3.9 years.

Collateralized Loan Obligations and Single Asset Securitization

Commercial and Residential Lending Segment

In February 2022, we refinanced a pool of our commercial loans held-for-investment through a CLO, STWD 2022-FL3. On the closing date, the CLO issued $1.0 billion of notes and preferred shares, of which $842.5 million of notes were purchased by third party investors. We retained $82.5 million of notes along with preferred shares with a liquidation preference of $75.0 million. The CLO contains a reinvestment feature that, subject to certain eligibility criteria, allows us to contribute new

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loans or participation interests in loans to the CLO for a period of two years. The reinvestment feature was not utilized during the six months ended June 30, 2022.

In July 2021, we contributed into a single asset securitization, STWD 2021-HTS, a previously originated $230.0 million first mortgage and mezzanine loan on a portfolio of 41 extended stay hotels with $210.1 million of third party financing.

In May 2021, we refinanced a pool of our commercial loans held-for-investment through a CLO, STWD 2021-FL2. On the closing date, the CLO issued $1.3 billion of notes and preferred shares, of which $1.1 billion of notes was purchased by third party investors. We retained $70.1 million of notes, along with preferred shares with a liquidation preference of $127.5 million. The CLO contains a reinvestment feature that, subject to certain eligibility criteria, allows us to contribute new loans or participation interests in loans to the CLO in exchange for cash. During the six months ended June 30, 2022, we utilized the reinvestment feature, contributing $123.7 million of additional interests into the CLO.

In August 2019, we refinanced a pool of our commercial loans held-for-investment through a CLO, STWD 2019-FL1. On the closing date, the CLO issued $1.1 billion of notes and preferred shares, of which $936.4 million of notes was purchased by third party investors. We retained $86.6 million of notes, along with preferred shares with a liquidation preference of $77.0 million. The CLO contains a reinvestment feature that, subject to certain eligibility criteria, allows us to contribute new loans or participation interests in loans to the CLO in exchange for cash. During the six months ended June 30, 2022, the reinvestment period expired, and we repaid CLO debt in the amount of $106.2 million.

Infrastructure Lending Segment

In January 2022, we refinanced a pool of our infrastructure loans held-for-investment through a CLO, STWD 2021-SIF2. On the closing date, the CLO issued $500.0 million of notes and preferred shares, of which $410.0 million of notes were purchased by third party investors. We retained preferred shares with a liquidation preference of $90.0 million. The CLO contains a reinvestment feature that, subject to certain eligibility criteria, allows us to contribute new loans or participation interests in loans to the CLO for a period of three years. During the six months ended June 30, 2022, we utilized the reinvestment feature, contributing $86.2 million of additional interests into the CLO.

In April 2021, we refinanced a pool of our infrastructure loans held-for-investment through a CLO, STWD 2021-SIF1. On the closing date, the CLO issued $500.0 million of notes and preferred shares, of which $410.0 million of notes were purchased by third party investors. We retained preferred shares with a liquidation preference of $90.0 million. The CLO contains a reinvestment feature that, subject to certain eligibility criteria, allows us to contribute new loans or participation interests in loans to the CLO in exchange for cash. During the six months ended June 30, 2022, we utilized the reinvestment feature, contributing $57.7 million of additional interests into the CLO.

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The following table is a summary of our CLOs and our SASB as of June 30, 2022 and December 31, 2021 (amounts in thousands):

June 30, 2022	Count	Face Amount		Carrying Value		Weighted Average Spread		Maturity
STWD 2022-FL3
Collateral assets	24	$	1,000,000	$	1,010,536	Index + 3.58%	(a)	January 2026	(b)
Financing	1	842,500		843,681		SOFR + 1.91%	(c)	November 2038	(d)
STWD 2021-HTS
Collateral assets	1	230,000		230,713		LIBOR + 3.85%	(a)	April 2026	(b)
Financing	1	210,091		208,509		LIBOR + 2.69%	(c)	April 2034	(d)
STWD 2021-FL2
Collateral assets	24	1,275,275		1,281,127		Index + 4.09%	(a)	April 2025	(b)
Financing	1	1,077,375		1,071,047		LIBOR + 1.78%	(c)	April 2038	(d)
STWD 2019-FL1
Collateral assets	18	993,774		996,268		LIBOR + 3.82%	(a)	January 2025	(b)
Financing	1	830,149		828,071		SOFR + 1.65%	(c)	July 2038	(d)
STWD 2021-SIF2
Collateral assets	32	494,789		510,807		LIBOR + 3.71%	(a)	January 2027	(b)
Financing	1	410,000		406,807		SOFR + 2.11%	(c)	January 2033	(d)
STWD 2021-SIF1
Collateral assets	31	496,249		507,465		Index + 3.87%	(a)	July 2026	(b)
Financing	1	410,000		406,036		LIBOR + 2.15%	(c)	April 2032	(d)
Total
Collateral assets		$	4,490,087	$	4,536,916
Financing		$	3,780,115	$	3,764,151

December 31, 2021	Count	Face Amount		Carrying Value		Weighted Average Spread		Maturity
STWD 2021-HTS
Collateral assets	1	$	230,000	$	230,587	LIBOR + 4.12%	(a)	April 2026	(b)
Financing	1	210,091		208,057		LIBOR + 2.48%	(c)	April 2034	(d)
STWD 2021-FL2
Collateral assets	25	1,272,133		1,279,678		LIBOR + 4.22%	(a)	February 2025	(b)
Financing	1	1,077,375		1,069,691		LIBOR + 1.78%	(c)	April 2038	(d)
STWD 2019-FL1
Collateral assets	24	1,092,887		1,103,513		LIBOR + 4.19%	(a)	November 2024	(b)
Financing	1	936,375		933,049		SOFR + 1.63%	(c)	July 2038	(d)
STWD 2021-SIF1
Collateral assets	31	491,299		506,666		LIBOR + 3.91%	(a)	March 2026	(b)
Financing	1	410,000		405,319		LIBOR + 2.15%	(c)	April 2032	(d)
Total
Collateral assets		$	3,086,319	$	3,120,444
Financing		$	2,633,841	$	2,616,116

______________________________________________________________________________________________________________________________

(a)Represents the weighted-average coupon earned on variable rate loans during the respective year-to-date period. Of the loans financed by the STWD 2021-FL2 CLO as of June 30, 2022, 7% earned fixed-rate weighted average interest of 7.44%. Of the investments financed by the STWD 2021-SIF2 CLO as of June 30, 2022, 5% earned fixed-rate weighted average interest of 7.75%. Of the investments financed by the STWD 2021-SIF1 CLO as of June 30, 2022, 3% earned fixed-rate weighted average interest of 5.95%.

(b)Represents the weighted-average maturity, assuming the extended contractual maturity of the collateral assets.

(c)Represents the weighted-average cost of financing incurred during the respective year-to-date period, inclusive of deferred issuance costs.

(d)Repayments of the CLOs and SASB are tied to timing of the related collateral asset repayments. The term of the CLOs and SASB financing obligations represents the legal final maturity date.

We incurred $37.9 million of issuance costs in connection with the CLOs and SASB, which are amortized on an effective yield basis over the estimated life of the CLOs and SASB. For the three and six months ended June 30, 2022, approximately $2.7 million and $5.1 million, respectively, of amortization of deferred financing costs was included in interest expense on our condensed consolidated statements of operations. For the three and six months ended June 30, 2021,

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approximately $1.4 million and $2.0 million, respectively, of amortization of deferred financing costs was included in interest expense on our condensed consolidated statements of operations. As of June 30, 2022 and December 31, 2021, our unamortized issuance costs were $23.7 million and $17.7 million, respectively.

The CLOs and SASB are considered VIEs, for which we are deemed the primary beneficiary. We therefore consolidate the CLOs and SASB. Refer to Note 15 for further discussion.

Maturities

Our credit facilities generally require principal to be paid down prior to the facilities’ respective maturities if and when we receive principal payments on, or sell, the investment collateral that we have pledged. The following table sets forth our principal repayments schedule for secured financings based on the earlier of (i) the extended contractual maturity of each credit facility or (ii) the extended contractual maturity of each of the investments that have been pledged as collateral under the respective credit facility (amounts in thousands):

	Repurchase Agreements		Other Secured Financing		CLOs and SASB (a)		Total
2022 (remainder of)	$	258,961	$	24,259	$	143,428	$	426,648
2023	2,120,093		736,558		652,016		3,508,667
2024	1,097,580		235,871		434,434		1,767,885
2025	2,742,149		246,581		678,448		3,667,178
2026	1,797,262		974,237		1,732,148		4,503,647
Thereafter	2,299,605		694,887		139,641		3,134,133
Total	$	10,315,650	$	2,912,393	$	3,780,115	$	17,008,158

______________________________________________________________________________________________________________________

(a)For the CLOs, the above does not assume utilization of their reinvestment features. The SASB does not have a reinvestment feature.

11. Unsecured Senior Notes

The following table is a summary of our unsecured senior notes outstanding as of June 30, 2022 and December 31, 2021 (dollars in thousands):

	Coupon Rate			Effective Rate (1)		Maturity Date	Remaining Period of Amortization	Carrying Value at
								June 30, 2022		December 31, 2021
2023 Senior Notes	5.50	%		5.71	%	11/1/2023	1.3 years	300,000		300,000
2023 Convertible Notes	4.38	%		4.57	%	4/1/2023	0.8 years	250,000		250,000
2024 Senior Notes	3.75	%		3.94	%	12/31/2024	2.5 years	400,000		400,000
2025 Senior Notes	4.75	%	(2)	5.04	%	3/15/2025	2.7 years	500,000		500,000
2026 Senior Notes	3.63	%		3.77	%	7/15/2026	4.0 years	400,000		400,000
2027 Senior Notes	4.38	%	(3)	4.49	%	1/15/2027	4.6 years	500,000		—
Total principal amount								2,350,000		1,850,000
Unamortized discount—Convertible Notes								(351)		(578)
Unamortized discount—Senior Notes								(10,847)		(10,067)
Unamortized deferred financing costs								(14,030)		(10,765)
Total carrying amount								$	2,324,772	$	1,828,590

______________________________________________________________________________________________________________________

(1)Effective rate includes the effects of underwriter purchase discount.

(2)The coupon on the 2025 Senior Notes is 4.75%.  At closing, we swapped $470.0 million of the notes to a floating rate of LIBOR + 2.53%.

(3)The coupon on the 2027 Senior Notes is 4.375%.  At closing, we swapped the notes to a floating rate of SOFR + 2.95%.

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Our unsecured senior notes contain certain financial tests and covenants. As of June 30, 2022, we were in compliance with all such covenants.

Senior Notes

On January 25, 2022, we issued $500.0 million of 4.375% Senior Notes due 2027 (the “2027 Senior Notes”). The 2027 Senior Notes mature on January 15, 2027. Prior to July 15, 2026, we may redeem some or all of the 2027 Senior Notes at a price equal to 100% of the principal amount thereof, plus the applicable “make-whole” premium as of the applicable date of redemption. On and after July 15, 2026, we may redeem some or all of the 2027 Senior Notes at a price equal to 100% of the principal amount thereof. In addition, prior to July 15, 2025, we may redeem up to 40% of the 2027 Senior Notes at the applicable redemption price using the proceeds of certain equity offerings.

Convertible Senior Notes

On March 29, 2017, we issued $250.0 million of 4.375% Convertible Senior Notes due 2023 (the “2023 Convertible Notes”) which remain outstanding at June 30, 2022 and mature on April 1, 2023.

We recognized interest expense of $2.9 million and $5.8 million, respectively, during the three and six months ended June 30, 2022 and 2021 from our Convertible Notes.

The following table details the conversion attributes of our Convertible Notes outstanding as of June 30, 2022 (amounts in thousands, except rates):

	June 30, 2022
	Conversion	Conversion
	Rate (1)	Price (2)
2023 Convertible Notes	38.5959	$	25.91

______________________________________________________________________________________________________________________

(1)The conversion rate represents the number of shares of common stock issuable per $1,000 principal amount of 2023 Convertible Notes converted, as adjusted in accordance with the indenture governing the 2023 Convertible Notes (including the applicable supplemental indenture).

(2)As of June 30, 2022, the market price of the Company’s common stock was $20.89.

The if-converted value of the 2023 Convertible Notes was less than their principal amount by $48.4 million at June 30, 2022 as the closing market price of the Company’s common stock of $20.89 was less than the implicit conversion price of $25.91 per share. The if-converted value of the principal amount of the 2023 Convertible Notes was $201.6 million as of June 30, 2022. As of June 30, 2022, the net carrying amount and fair value of the 2023 Convertible Notes was $249.5 million and $246.3 million, respectively.

Upon conversion of the 2023 Convertible Notes, settlement may be made in common stock, cash or a combination of both, at the option of the Company.

Conditions for Conversion

Prior to October 1, 2022, the 2023 Convertible Notes will be convertible only upon satisfaction of one or more of the following conditions: (1) the closing market price of the Company’s common stock is at least 110% of the conversion price of the 2023 Convertible Notes for at least 20 out of 30 trading days prior to the end of the preceding fiscal quarter, (2) the trading price of the 2023 Convertible Notes is less than 98% of the product of (i) the conversion rate and (ii) the closing price of the Company’s common stock during any five consecutive trading day period, (3) the Company issues certain equity instruments at less than the 10-day average closing market price of its common stock or the per-share value of certain distributions exceeds the market price of the Company’s common stock by more than 10% or (4) certain other specified corporate events (significant consolidation, sale, merger, share exchange, fundamental change, etc.) occur.

On or after October 1, 2022, holders of the 2023 Convertible Notes may convert each of their notes at the applicable conversion rate at any time prior to the close of business on the second scheduled trading day immediately preceding the maturity date.

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12. Loan Securitization/Sale Activities

As described below, we regularly sell loans and notes under various strategies. We evaluate such sales as to whether they meet the criteria for treatment as a sale—legal isolation, ability of transferee to pledge or exchange the transferred assets without constraint and transfer of control.

Loan Securitizations

Within the Investing and Servicing Segment, we originate commercial mortgage loans with the intent to sell these mortgage loans to VIEs for the purposes of securitization. These VIEs then issue CMBS that are collateralized in part by these assets, as well as other assets transferred to the VIE by third parties. Within the Commercial and Residential Lending Segment, we acquire residential loans with the intent to sell these mortgage loans to VIEs for the purpose of securitization. These VIEs then issue RMBS that are collateralized by these assets.

In certain instances, we retain an interest in the CMBS or RMBS VIE and serve as special servicer or servicing administrator for the VIE. In these circumstances, we generally consolidate the VIE into which the loans were sold. The securitizations are subject to optional redemption after a certain period of time or when the pool balance falls below a specified threshold.

The following summarizes the face amount and proceeds of commercial and residential loans securitized for the three and six months ended June 30, 2022 and 2021 (amounts in thousands):

	Commercial Loans				Residential Loans
	Face Amount		Proceeds		Face Amount		Proceeds
For the Three Months Ended June 30,
2022	$	658,447	$	649,730	$	827,871	$	813,175
2021	304,604		321,377		564,429		583,877
For the Six Months Ended June 30,
2022	$	1,005,889	$	991,797	$	1,905,829	$	1,913,459
2021	389,641		411,087		947,978		973,675

The securitization of these commercial and residential loans does not result in a discrete gain or loss since they are carried under the fair value option.

Our securitizations have each been structured as bankruptcy-remote entities whose assets are not intended to be available to the creditors of any other party.

Commercial and Residential Loan Sales

Within the Commercial and Residential Lending Segment, we originate or acquire commercial mortgage loans, subsequently selling all or a portion thereof. Typically, our motivation for entering into these transactions is to effectively create leverage on the subordinated position that we will retain and hold for investment. We also may sell certain of our previously-acquired residential loans to third parties outside a securitization. The following table summarizes our loans sold by the Commercial and Residential Lending Segment, net of expenses (amounts in thousands):

	Loan Transfers Accounted for as Sales
	Commercial Loans				Residential Loans
	Face amount (1)		Proceeds (1)		Face Amount (2)		Proceeds (2)
For the Three Months Ended June 30,
2022	$	6,980	$	6,469	$	220,101	$	219,426
2021	232,670		229,490		383		398
For the Six Months Ended June 30,
2022	$	6,980	$	6,469	$	1,055,861	$	1,055,542
2021	232,670		229,490		89,801		92,817

______________________________________________________________________________________________________________________

(1)During both the three and six months ended June 30, 2022, we sold $7.0 million of senior interests in a first mortgage loan for proceeds of $6.5 million. During both the three and six months ended June 30, 2021, we sold $210.1 million of senior interests in first mortgage loans and $22.6 million of whole loan interests for proceeds of $208.0 million and $21.5 million, respectively.

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(2)In February 2022, we sold $745.0 million of agency-eligible residential loans at face amount which was subject to a post-closing contingent sales price adjustment based on the gain or loss to the purchaser/securitization underwriter, less underwriting costs, if those loans were sold into a future securitization. Given spread widening which occurred in the residential markets during the three months ended June 30, 2022, we estimated the amount of this contingency to be $32.7 million at June 30, 2022 based on the probability and timing of executing a disposition strategy on these loans and the amount at which such a disposition could be executed. In June 2022, in lieu of the buyer executing a securitization or sale of the loans, we entered into a forward settlement agreement to acquire $729.1 million of these loans at par. The loan purchase is subject to a financing contingency, whereby the seller is to provide us financing under a mutually agreed repurchase agreement within 120 days. If such mutually agreed financing is not completed, we are not obligated to complete the forward settlement, and the previous post-closing contingency referenced above would be reinstated.

During both the three and six months ended June 30, 2022, losses recognized by the Commercial and Residential Lending Segment on sales of commercial loans were $0.1 million. During both the three and six months ended June 30, 2021, losses recognized by the Commercial and Residential Lending Segment on sales of commercial loans were $1.0 million.

Infrastructure Loan Sales

There were no sales of loans by the Infrastructure Lending Segment during the three and six months ended June 30, 2022. During both the three and six months ended June 30, 2021, the Infrastructure Lending Segment sold loans held-for-sale with an aggregate face amount of $2.5 million for proceeds of $2.5 million, recognizing immaterial gains.

13. Derivatives and Hedging Activity

Risk Management Objective of Using Derivatives

We are exposed to certain risks arising from both our business operations and economic conditions. Refer to Note 14 to the consolidated financial statements included in our Form 10-K for further discussion of our risk management objectives and policies.

Designated Hedges

The Company does not generally elect to apply the hedge accounting designation to its hedging instruments. As of June 30, 2022 and December 31, 2021, the Company did not have any designated hedges.

Non-designated Hedges and Derivatives

We have entered into the following types of non-designated hedges and derivatives:

•Foreign exchange (“Fx”) forwards whereby we agree to buy or sell a specified amount of foreign currency for a specified amount of USD at a future date, economically fixing the USD amounts of foreign denominated cash flows we expect to receive or pay related to certain foreign denominated loan investments;

•Interest rate contracts which hedge a portion of our exposure to changes in interest rates;

•Credit instruments which hedge a portion of our exposure to the credit risk of our commercial loans held-for-sale; and

•Interest rate swap guarantees whereby we guarantee the interest rate swap obligations of certain Infrastructure Lending borrowers. Our interest rate swap guarantees were assumed in connection with the acquisition of the Infrastructure Lending Segment.

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The following table summarizes our non-designated derivatives as of June 30, 2022 (notional amounts in thousands):

Type of Derivative	Number of Contracts	Aggregate Notional Amount	Notional Currency	Maturity
Fx contracts – Buy Euros ("EUR")	20	43,684	EUR	July 2022 - June 2023
Fx contracts – Buy Pounds Sterling ("GBP")	8	9,772	GBP	July 2022 - October 2024
Fx contracts – Buy Australian dollar ("AUD")	5	8,915	AUD	July 2022 - August 2023
Fx contracts – Buy Swiss Franc ("CHF")	1	29,400	CHF	July 2022
Fx contracts – Sell EUR	225	616,996	EUR	July 2022 - April 2026
Fx contracts – Sell GBP	196	575,781	GBP	July 2022 - April 2027
Fx contracts – Sell AUD	93	640,709	AUD	July 2022 - January 2026
Fx contracts – Sell CHF	1	38,449	CHF	July 2022
Interest rate swaps – Paying fixed rates	32	3,061,834	USD	April 2024 - June 2032
Interest rate swaps – Receiving fixed rates	2	970,000	USD	March 2025 - January 2027
Interest rate caps	5	633,900	USD	November 2022 - April 2025
Interest rate caps	1	61,000	GBP	April 2024
Credit instruments	3	49,000	USD	September 2058 - August 2061
Interest rate swap guarantees	4	271,363	USD	August 2022 - June 2025
Total	596

The table below presents the fair value of our derivative financial instruments as well as their classification on the condensed consolidated balance sheets as of June 30, 2022 and December 31, 2021 (amounts in thousands):

	Fair Value of Derivatives in an Asset Position (1) as of				Fair Value of Derivatives in a Liability Position (2) as of
	June 30, 2022		December 31, 2021		June 30, 2022		December 31, 2021
Interest rate contracts	$	7,487	$	17,728	$	49,642	$	16
Interest rate swap guarantees	—		—		—		260
Foreign exchange contracts	120,637		30,478		5,495		12,870
Credit instruments	603		10		—		275
Total derivatives	$	128,727	$	48,216	$	55,137	$	13,421

___________________________________________________

(1)Classified as derivative assets in our condensed consolidated balance sheets.

(2)Classified as derivative liabilities in our condensed consolidated balance sheets.

The table below presents the effect of our derivative financial instruments on the condensed consolidated statements of operations for the three and six months ended June 30, 2022 and 2021 (amounts in thousands):

Derivatives Not Designated as Hedging Instruments	Location of Gain (Loss) Recognized in Income	Amount of Gain (Loss) Recognized in Income for the Three Months Ended June 30,				Amount of Gain (Loss) Recognized in Income for the Six Months Ended June 30,
		2022		2021		2022		2021
Interest rate contracts	Gain (loss) on derivative financial instruments	$	37,257	$	(7,344)	$	140,190	$	12,814
Interest rate swap guarantees	Gain (loss) on derivative financial instruments	100		145		259		496
Foreign exchange contracts	Gain (loss) on derivative financial instruments	90,543		(2,540)		114,685		11,061
Credit instruments	Gain (loss) on derivative financial instruments	683		(270)		717		(391)
		$	128,583	$	(10,009)	$	255,851	$	23,980

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14. Offsetting Assets and Liabilities

The following tables present the potential effects of netting arrangements on our financial position for financial assets and liabilities within the scope of ASC 210-20, Balance Sheet—Offsetting, which for us are derivative assets and liabilities as well as repurchase agreement liabilities (amounts in thousands):

			(ii)   Gross Amounts Offset in the Statement of Financial Position		(iii) = (i) - (ii) Net Amounts Presented in the Statement of Financial Position		(iv) Gross Amounts Not Offset in the Statement of Financial Position
	(i) Gross Amounts Recognized						Financial Instruments		Cash Collateral Received / Pledged		(v) = (iii) - (iv) Net Amount
As of June 30, 2022
Derivative assets	$	128,727	$	—	$	128,727	$	52,137	$	—	$	76,590
Derivative liabilities	$	55,137	$	—	$	55,137	$	52,137	$	3,000	$	—
Repurchase agreements	10,315,650		—		10,315,650		10,315,650		—		—
	$	10,370,787	$	—	$	10,370,787	$	10,367,787	$	3,000	$	—
As of December 31, 2021
Derivative assets	$	48,216	$	—	$	48,216	$	12,870	$	21,290	$	14,056
Derivative liabilities	$	13,421	$	—	$	13,421	$	12,870	$	291	$	260
Repurchase agreements	9,542,034		—		9,542,034		9,542,034		—		—
	$	9,555,455	$	—	$	9,555,455	$	9,554,904	$	291	$	260

15. Variable Interest Entities

Investment Securities

As discussed in Note 2, we evaluate all of our investments and other interests in entities for consolidation, including our investments in CMBS, RMBS and our retained interests in securitization transactions we initiated, all of which are generally considered to be variable interests in VIEs.

Securitization VIEs consolidated in accordance with ASC 810 are structured as pass through entities that receive principal and interest on the underlying collateral and distribute those payments to the certificate holders. The assets and other instruments held by these securitization entities are restricted and can only be used to fulfill the obligations of the entity. Additionally, the obligations of the securitization entities do not have any recourse to the general credit of any other consolidated entities, nor to us as the primary beneficiary. The VIE liabilities initially represent investment securities on our balance sheet (pre-consolidation). Upon consolidation of these VIEs, our associated investment securities are eliminated, as is the interest income related to those securities. Similarly, the fees we earn in our roles as special servicer of the bonds issued by the consolidated VIEs or as collateral administrator of the consolidated VIEs are also eliminated. Finally, a portion of the identified servicing intangible associated with the eliminated fee streams is eliminated in consolidation.

VIEs in which we are the Primary Beneficiary

The inclusion of the assets and liabilities of securitization VIEs in which we are deemed the primary beneficiary has no economic effect on us. Our exposure to the obligations of securitization VIEs is generally limited to our investment in these entities. We are not obligated to provide, nor have we provided, any financial support for any of these consolidated structures.

As discussed in Note 10, we have refinanced various pools of our commercial and infrastructure loans held-for-investment through five CLOs and one SASB, which are considered to be VIEs. We are the primary beneficiary of, and therefore consolidate, the CLOs and SASB in our financial statements as we have both (i) the power to direct the activities in our role as collateral manager, collateral advisor, or controlling class representative that most significantly impact the CLOs’ and SASB's economic performance, and (ii) the obligation to absorb losses and the right to receive benefits from the CLOs and SASB that could be potentially significant through the subordinate interests we own.

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The following table details the assets and liabilities of our consolidated CLOs and SASB as of June 30, 2022 and December 31, 2021 (amounts in thousands):

	June 30, 2022		December 31, 2021
Assets:
Cash and cash equivalents	$	28,169	$	15,297
Loans held-for-investment	4,458,435		3,073,572
Investment securities	37,427		11,426
Accrued interest receivable	12,424		8,936
Other assets	461		11,213
Total Assets	$	4,536,916	$	3,120,444
Liabilities
Accounts payable, accrued expenses and other liabilities	$	10,813	$	3,335
Collateralized loan obligations and single asset securitization, net	3,764,151		2,616,116
Total Liabilities	$	3,774,964	$	2,619,451

Assets held by the CLOs and SASB are restricted and can be used only to settle obligations of the CLOs and SASB, including the subordinate interests owned by us. The liabilities of the CLOs and SASB are non-recourse to us and can only be satisfied from the assets of the CLOs and SASB.

We also hold controlling interests in other non-securitization entities that are considered VIEs. The Woodstar Fund, Woodstar Feeder Fund, L.P. and one of the Woodstar Fund’s indirect investees, SPT Dolphin Intermediate LLC (“SPT Dolphin”), the entity which holds the Woodstar II Portfolio, are each VIEs because the third party interest holders do not carry kick-out rights or substantive participating rights. We were deemed to be the primary beneficiary of those VIEs because we possess both the power to direct the activities of the VIEs that most significantly impact their economic performance and a significant economic interest in each entity. The Woodstar Fund had total assets of $1.6 billion, including its indirect investment in SPT Dolphin, and no significant liabilities as of June 30, 2022. As of June 30, 2022, Woodstar Feeder Fund, L.P. and its consolidated subsidiary which is also considered a VIE, Woodstar Feeder REIT, LLC, had a $0.4 billion investment in the Woodstar Fund, had no significant liabilities and had temporary equity of $0.3 billion consisting of the contingently redeemable non-controlling interests of the third party investors (see Note 17).

We also hold a 51% controlling interest in a joint venture (the “CMBS JV”) within our Investing and Servicing Segment, which is considered a VIE because the third party interest holder does not carry kick-out rights or substantive participating rights. We are deemed the primary beneficiary of the CMBS JV. This VIE had total assets of $367.2 million and liabilities of $89.1 million as of June 30, 2022. Refer to Note 17 for further discussion.

In addition to the above non-securitization entities, we have smaller VIEs with total assets of $75.6 million and liabilities of $32.3 million as of June 30, 2022.

VIEs in which we are not the Primary Beneficiary

In certain instances, we hold a variable interest in a VIE in the form of CMBS, but either (i) we are not appointed, or do not serve as, special servicer or servicing administrator or (ii) an unrelated third party has the rights to unilaterally remove us as special servicer without cause. In these instances, we do not have the power to direct activities that most significantly impact the VIE’s economic performance. In other cases, the variable interest we hold does not obligate us to absorb losses or provide us with the right to receive benefits from the VIE which could potentially be significant. For these structures, we are not deemed to be the primary beneficiary of the VIE, and we do not consolidate these VIEs.

As noted above, we are not obligated to provide, nor have we provided, any financial support for any of our securitization VIEs, whether or not we are deemed to be the primary beneficiary. As such, the risk associated with our involvement in these VIEs is limited to the carrying value of our investment in the entity. As of June 30, 2022, our maximum risk of loss related to securitization VIEs in which we were not the primary beneficiary was $21.0 million on a fair value basis.

As of June 30, 2022, the securitization VIEs which we do not consolidate had debt obligations to beneficial interest holders with unpaid principal balances, excluding the notional value of interest-only securities, of $4.8 billion. The corresponding assets are comprised primarily of commercial mortgage loans with unpaid principal balances corresponding to the amounts of the outstanding debt obligations.

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We also hold passive non-controlling interests in certain unconsolidated entities that are considered VIEs. We are not the primary beneficiaries of these VIEs as we do not possess the power to direct the activities of the VIEs that most significantly impact their economic performance and therefore report our interests, which totaled $16.9 million as of June 30, 2022, within investments in unconsolidated entities on our consolidated balance sheet. Our maximum risk of loss is limited to our carrying value of the investments.

16. Related-Party Transactions

Management Agreement

We are party to a management agreement (the “Management Agreement”) with our Manager. Under the Management Agreement, our Manager, subject to the oversight of our board of directors, is required to manage our day to day activities, for which our Manager receives a base management fee and is eligible for an incentive fee and stock awards. Our Manager’s personnel perform certain due diligence, legal, management and other services that outside professionals or consultants would otherwise perform. As such, in accordance with the terms of our Management Agreement, our Manager is paid or reimbursed for the documented costs of performing such tasks, provided that such costs and reimbursements are in amounts no greater than those which would be payable to outside professionals or consultants engaged to perform such services pursuant to agreements negotiated on an arm’s-length basis. Refer to Note 17 to the consolidated financial statements included in our Form 10-K for further discussion of this agreement.

Base Management Fee. For the three months ended June 30, 2022 and 2021, approximately $21.6 million and $19.2 million, respectively, was incurred for base management fees. For the six months ended June 30, 2022 and 2021, approximately $43.1 million and $38.3 million, respectively, was incurred for base management fees. As of June 30, 2022 and December 31, 2021, there were $21.6 million and $20.3 million, respectively, of unpaid base management fees included in related-party payable in our condensed consolidated balance sheets.

Incentive Fee. For the three months ended June 30, 2022 and 2021, approximately $5.2 million and $5.0 million, respectively, was incurred for incentive fees. For the six months ended June 30, 2022 and 2021, approximately $34.2 million and $18.2 million, respectively, was incurred for incentive fees. As of June 30, 2022 and December 31, 2021, there were $5.2 million and $51.2 million of unpaid incentive fees included in related-party payable in our condensed consolidated balance sheets.

Expense Reimbursement. For the three months ended June 30, 2022 and 2021, approximately $1.9 million and $1.6 million, respectively, was incurred for executive compensation and other reimbursable expenses and recognized within general and administrative expenses in our condensed consolidated statements of operations. For the six months ended June 30, 2022 and 2021, approximately $3.6 million and $3.1 million, respectively, was incurred for executive compensation and other reimbursable expenses. As of June 30, 2022 and December 31, 2021, there were $4.0 million and $4.9 million, respectively, of unpaid reimbursable executive compensation and other expenses included in related-party payable in our condensed consolidated balance sheets.

Equity Awards. In certain instances, we issue RSAs to certain employees of affiliates of our Manager who perform services for us. There were no RSAs granted during the three months ended June 30, 2022 and 2021. Expenses related to the vesting of awards to employees of affiliates of our Manager were $2.3 million and $2.2 million during the three months ended June 30, 2022 and 2021, respectively, and are reflected in general and administrative expenses in our condensed consolidated statements of operations. During the six months ended June 30, 2022 and 2021, we granted 200,972 and 981,951 RSAs, respectively, at grant date fair values of $4.8 million and $19.6 million, respectively. Expenses related to the vesting of awards to employees of affiliates of our Manager were $5.0 million and $4.5 million during the six months ended June 30, 2022 and 2021, respectively. These shares generally vest over a three-year period.

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Manager Equity Plan

In April 2022, the Company’s shareholders approved the Starwood Property Trust, Inc. 2022 Manager Equity Plan (the “2022 Manager Equity Plan”) which replaces the Starwood Property Trust, Inc. 2017 Manager Equity Plan (the “2017 Manager Equity Plan”). In November 2020, we granted 1,800,000 RSUs to our Manager under the 2017 Manager Equity Plan. In September 2019, we granted 1,200,000 RSUs to our Manager under the 2017 Manager Equity Plan. In April 2018, we granted 775,000 RSUs to our Manager under the 2017 Manager Equity Plan. In connection with these grants and prior similar grants, we recognized share-based compensation expense of $4.5 million within management fees in our condensed consolidated statements of operations for both the three months ended June 30, 2022 and 2021. For the six months ended June 30, 2022 and 2021, we recognized $9.0 million and $10.4 million, respectively, related to these awards. Refer to Note 17 for further discussion.

Investments in Loans and Securities

In March 2022, we originated a new loan on the development and recapitalization of luxury rental cabins with a total commitment of $200.0 million, of which $92.7 million was outstanding as of June 30, 2022. The loan bears interest at SOFR + 6.50% plus fees and contains a term of 24 months with three one-year extension options. The proceeds were partially used to repay an existing $99.0 million first mortgage loan that we originated in February 2020. Certain members of our executive team and board of directors own equity interests in the borrower.

During the three and six months ended June 30, 2022, the Company acquired $332.9 million and $956.8 million, respectively, of loans from a residential mortgage originator in which it holds an equity interest. Additionally, as of June 30, 2022, the Company had outstanding residential mortgage loan purchase commitments of $130.1 million to this residential mortgage originator. Refer to Note 8 for further discussion. During the six months ended June 30, 2022, the Company received proceeds of $4.4 million from the sale of loans to the residential mortgage originator. No proceeds were received from the sale of loans to the residential mortgage originator during the three months ended June 30, 2022.

Lease Arrangements

In March 2020, we entered into an office lease agreement with an entity which is controlled by our Chairman and CEO through majority equity ownership of the entity. The leased premises serve as our new Miami Beach office following the expiration of our former lease in Miami Beach. The lease is for approximately 65,000 square feet of office space, has an initial term of 15 years and requires monthly lease payments starting in the tenth month after lease commencement, which is pending final completion of the premises. The lease payments are based on an annual base rate of $52.00 per square foot that increases by 3% each anniversary following commencement, plus our pro rata share of building operating expenses. Prior to the execution of this lease, we engaged an independent third party leasing firm and external counsel to advise the independent directors of our board of directors on market terms for the lease.  The terms of the lease were approved by our independent directors. In April 2020 we provided a $1.9 million cash security deposit to the landlord. During the six months ended June 30, 2022, we made payments to the landlord of $1.8 million for reimbursements relating to tenant improvements under the terms of the lease. No payments were made to the landlord for reimbursements relating to tenant improvements during the three months ended June 30, 2022.

Other Related-Party Arrangements

Highmark Residential (“Highmark”), an affiliate of our Manager, provides property management services for properties within our Woodstar I and Woodstar II Portfolios. Fees paid to Highmark are calculated as a percentage of gross receipts and are at market terms. During the three months ended June 30, 2022 and 2021, property management fees to Highmark of $1.3 million and $0.7 million, respectively, were recognized within our Woodstar Portfolios. During the six months ended June 30, 2022 and 2021, property management fees to Highmark were $2.7 million and $1.5 million, respectively.

Refer to Note 17 to the consolidated financial statements included in our Form 10-K for further discussion of related-party agreements.

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17. Stockholders’ Equity and Non-Controlling Interests

During the six months ended June 30, 2022, our board of directors declared the following dividends:

Declaration Date	Record Date	Ex-Dividend Date	Payment Date	Amount		Frequency
6/15/22	6/30/22	6/29/22	7/15/22	$	0.48	Quarterly
3/14/22	3/31/22	3/30/22	4/15/22	0.48		Quarterly

In May 2022, we entered into a Starwood Property Trust, Inc. Common Stock Sales Agreement (the “ATM Agreement”) with a syndicate of financial institutions to sell shares of the Company’s common stock of up to $500.0 million from time to time, through an “at the market” equity offering program. Sales of shares under the ATM Agreement are made by means of ordinary brokers’ transactions on the New York Stock Exchange or otherwise at market prices prevailing at the time of sale or at negotiated prices. The ATM Agreement replaces a similar agreement previously entered into in May 2014 with Merrill Lynch, Pierce, Fenner and Smith Incorporated. During the three and six months ended June 30, 2022, we issued 1,415,564 shares of common stock under our ATM Agreement for gross proceeds of $33.3 million at an average share price of $23.54 and paid related commission costs of $0.7 million. During the three and six months ended June 30, 2021, there were no shares issued under our previous ATM agreement.

During the six months ended June 30, 2022 and 2021, shares issued under the Starwood Property Trust, Inc. Dividend Reinvestment and Direct Stock Purchase Plan (the “DRIP Plan”) were not material.

In April 2022, the Company’s shareholders approved the Starwood Property Trust, Inc. Employee Stock Purchase Plan (the “ESPP”) which allows eligible employees to purchase common stock of the Company at a discounted purchase price. The discounted purchase price of a share of the Company's common stock is 85% of the fair market value at the lower of the beginning or the end of the quarterly offering period. Participants may purchase shares not exceeding an aggregate fair market value of $25,000 in any calendar year. The maximum aggregate number of shares subject to issuance in accordance with the ESPP is 2,000,000 shares. No shares have been issued under the ESPP through June 30, 2022.

Equity Incentive Plans

In April 2022, the Company’s shareholders approved the 2022 Manager Equity Plan and the Starwood Property Trust, Inc. 2022 Equity Plan (the “2022 Equity Plan”), which allow for the issuance of up to 18,700,000 stock options, stock appreciation rights, RSAs, RSUs or other equity-based awards or any combination thereof to the Manager, directors, employees, consultants or any other party providing services to the Company. The 2022 Manager Equity Plan succeeds and replaces the 2017 Manager Equity Plan and the 2022 Equity Plan succeeds and replaces the Starwood Property Trust, Inc. 2017 Equity Plan (the “2017 Equity Plan”).

The table below summarizes our share awards granted or vested under the 2017 Manager Equity Plan (none under the 2022 Manager Equity Plan) during the six months ended June 30, 2022 and 2021 (dollar amounts in thousands):

Grant Date	Type	Amount Granted	Grant Date Fair Value		Vesting Period
November 2020	RSU	1,800,000	$	30,078	3 years
September 2019	RSU	1,200,000	29,484		(1)
April 2018	RSU	775,000	16,329		3 years

______________________________________________________________________________________________________________________

(1)Of the amount granted, 218,898 vested immediately on the grant date and the remaining amount vests over a three-year period.

Schedule of Non-Vested Shares and Share Equivalents (1)

	2022 Equity Plan	2022 Manager Equity Plan	Total	Weighted Average Grant Date Fair Value (per share)
Balance as of January 1, 2022	2,406,730	1,295,277	3,702,007	$	18.90
Granted	784,893	—	784,893	23.81
Vested	(600,902)	(463,518)	(1,064,420)	18.11
Forfeited	(10,809)	—	(10,809)	23.17
Balance as of June 30, 2022	2,579,912	831,759	3,411,671	20.26

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(1)    Equity-based award activity for awards granted under the 2017 Equity Plan is reflected within the 2022 Equity Plan column, and for awards granted under the 2017 Manager Equity Plan, within the 2022 Manager Equity Plan column.

As of June 30, 2022, there were 18.7 million shares of common stock available for future grants under the 2022 Manager Equity Plan and the 2022 Equity Plan.

Non-Controlling Interests in Consolidated Subsidiaries

As discussed in Note 2, on November 5, 2021 we sold a 20.6% non-controlling interest in the Woodstar Fund to third party investors for net cash proceeds of $214.2 million. Under the Woodstar Fund operating agreement, such interests are contingently redeemable by us, at the option of the interest holder, for cash at liquidation fair value if any assets remain upon termination of the Woodstar Fund. The Woodstar Fund operating agreement specifies an eight-year term with two one-year extension options, the first at our option and the second subject to consent of an advisory committee representing the non-controlling interest holders. Accordingly, these contingently redeemable non-controlling interests have been classified as “Temporary Equity” in our condensed consolidated balance sheets and represent the fair value of the Woodstar Fund’s net assets allocable to those interests. During the three and six months ended June 30, 2022, net income attributable to these non-controlling interests was $62.8 million and $110.5 million, respectively.

In connection with our Woodstar II Portfolio acquisitions, we issued 10.2 million Class A Units in our subsidiary, SPT Dolphin, and rights to receive an additional 1.9 million Class A Units if certain contingent events occur. As of June 30, 2022, all of the 1.9 million contingent Class A Units were issued. The Class A Units are redeemable for consideration equal to the current share price of the Company’s common stock on a one-for-one basis, with the consideration paid in either cash or the Company’s common stock, at the determination of the Company. There were 9.8 million Class A Units outstanding as of June 30, 2022. The outstanding Class A Units are reflected as non-controlling interests in consolidated subsidiaries on our consolidated balance sheets, the balance of which was $208.5 million as of June 30, 2022 and December 31, 2021.

To the extent SPT Dolphin has sufficient cash available, the Class A Units earn a preferred return indexed to the dividend rate of the Company’s common stock. Any distributions made pursuant to this waterfall are recognized within net income attributable to non-controlling interests in our condensed consolidated statements of operations. During the three and six months ended June 30, 2022, we recognized net income attributable to non-controlling interests of $4.7 million and $9.4 million, respectively, associated with these Class A Units. During the three and six months ended June 30, 2021, we recognized net income attributable to non-controlling interests of $4.9 million and $10.0 million, respectively, associated with these Class A Units.

As discussed in Note 15, we hold a 51% controlling interest in the CMBS JV within our Investing and Servicing Segment. Because the CMBS JV is deemed a VIE for which we are the primary beneficiary, the 49% interest of our joint venture partner is reflected as a non-controlling interest in consolidated subsidiaries on our condensed consolidated balance sheets, and any net income attributable to this 49% joint venture interest is reflected within net income attributable to non-controlling interests in our condensed consolidated statement of operations. The non-controlling interests in the CMBS JV were $153.0 million and $131.9 million as of June 30, 2022 and December 31, 2021, respectively. During the three and six months ended June 30, 2022, net income attributable to these non-controlling interests was $1.3 million and $4.9 million, respectively. During the three and six months ended June 30, 2021, net income attributable to these non-controlling interests was $4.7 million and $10.1 million, respectively.

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18. Earnings per Share

The following table provides a reconciliation of net income and the number of shares of common stock used in the computation of basic EPS and diluted EPS (amounts in thousands, except per share amounts):

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2022		2021		2022		2021
Basic Earnings
Income attributable to STWD common stockholders	$	212,287	$	116,310	$	536,886	$	227,688
Less: Income attributable to participating shares not already deducted as non-controlling interests	(3,990)		(1,791)		(12,811)		(3,716)
Basic earnings	$	208,297	$	114,519	$	524,075	$	223,972
Diluted Earnings
Income attributable to STWD common stockholders	$	212,287	$	116,310	$	536,886	$	227,688
Less: Income attributable to participating shares not already deducted as non-controlling interests	(3,990)		(1,791)		(12,811)		(3,716)
Add: Interest expense on Convertible Notes	2,915		2,900		5,818		5,816
Add: Undistributed earnings to participating shares	2,584		—		9,879		—
Less: Undistributed earnings reallocated to participating shares	(2,506)		—		(9,579)		—
Diluted earnings	$	211,290	$	117,419	$	530,193	$	229,788
Number of Shares:
Basic — Average shares outstanding	305,035		284,710		303,995		284,018
Effect of dilutive securities — Convertible Notes	9,649		9,649		9,649		9,649
Effect of dilutive securities — Contingently issuable shares	120		95		120		95
Effect of dilutive securities — Unvested non-participating shares	158		117		144		46
Diluted — Average shares outstanding	314,962		294,571		313,908		293,808
Earnings Per Share Attributable to STWD Common Stockholders:
Basic	$	0.68	$	0.40	$	1.72	$	0.79
Diluted	$	0.67	$	0.40	$	1.69	$	0.78

As of June 30, 2022 and 2021, participating shares of 12.7 million and 14.0 million, respectively, were excluded from the computation of diluted shares as their effect was already considered under the more dilutive two-class method used above. Such participating shares at June 30, 2022 and 2021 included 9.8 million and 10.2 million potential shares, respectively, of our common stock issuable upon redemption of the Class A Units in SPT Dolphin, as discussed in Note 17.

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19. Accumulated Other Comprehensive Income

The changes in AOCI by component are as follows (amounts in thousands):

	Cumulative Unrealized Gain (Loss) on Available-for- Sale Securities		Foreign Currency Translation		Total
Three Months Ended June 30, 2022
Balance at April 1, 2022	$	35,669	$	—	$	35,669
OCI before reclassifications	(6,699)		—		(6,699)
Amounts reclassified from AOCI	—		—		—
Net period OCI	(6,699)		—		(6,699)
Balance at June 30, 2022	$	28,970	$	—	$	28,970
Three Months Ended June 30, 2021
Balance at April 1, 2021	$	41,654	$	—	$	41,654
OCI before reclassifications	(344)		—		(344)
Amounts reclassified from AOCI	—		—		—
Net period OCI	(344)		—		(344)
Balance at June 30, 2021	$	41,310	$	—	$	41,310
Six Months Ended June 30, 2022
Balance at January 1, 2022	$	40,953	$	—	$	40,953
OCI before reclassifications	(11,983)		—		(11,983)
Amounts reclassified from AOCI	—		—		—
Net period OCI	(11,983)		—		(11,983)
Balance at June 30, 2022	$	28,970	$	—	$	28,970
Six Months Ended June 30, 2021
Balance at January 1, 2021	$	44,057	$	(64)	$	43,993
OCI before reclassifications	(2,747)		—		(2,747)
Amounts reclassified from AOCI	—		64		64
Net period OCI	(2,747)		64		(2,683)
Balance at June 30, 2021	$	41,310	$	—	$	41,310

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20. Fair Value

GAAP establishes a hierarchy of valuation techniques based on the observability of inputs utilized in measuring financial assets and liabilities at fair value. GAAP establishes market-based or observable inputs as the preferred source of values, followed by valuation models using management assumptions in the absence of market inputs. The three levels of the hierarchy are described below:

Level I—Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date.

Level II—Inputs (other than quoted prices included in Level I) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life.

Level III—Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model.

Valuation Process

We have valuation control processes in place to validate the fair value of the Company’s financial assets and liabilities measured at fair value including those derived from pricing models. These control processes are designed to assure that the values used for financial reporting are based on observable inputs wherever possible. In the event that observable inputs are not available, the control processes are designed to assure that the valuation approach utilized is appropriate and consistently applied and the assumptions are reasonable.

Pricing Verification—We use recently executed transactions, other observable market data such as exchange data, broker/dealer quotes, third party pricing vendors and aggregation services for validating the fair values generated using valuation models. Pricing data provided by approved external sources is evaluated using a number of approaches; for example, by corroborating the external sources’ prices to executed trades, analyzing the methodology and assumptions used by the external source to generate a price and/or by evaluating how active the third party pricing source (or originating sources used by the third party pricing source) is in the market.

Unobservable Inputs—Where inputs are not observable, we review the appropriateness of the proposed valuation methodology to ensure it is consistent with how a market participant would arrive at the unobservable input. The valuation methodologies utilized in the absence of observable inputs may include extrapolation techniques and the use of comparable observable inputs.

Any changes to the valuation methodology will be reviewed by our management to ensure the changes are appropriate. The methods used may produce a fair value calculation that is not indicative of net realizable value or reflective of future fair values. Furthermore, while we anticipate that our valuation methods are appropriate and consistent with other market participants, the use of different methodologies, or assumptions, to determine the fair value could result in a different estimate of fair value at the reporting date.

Fair Value on a Recurring Basis

We determine the fair value of our financial assets and liabilities measured at fair value on a recurring basis as follows:

Loans held-for-sale, commercial

We measure the fair value of our commercial mortgage loans held-for-sale using a discounted cash flow analysis unless observable market data (i.e., securitized pricing) is available. A discounted cash flow analysis requires management to make estimates regarding future interest rates and credit spreads. The most significant of these inputs relates to credit spreads and is unobservable. Thus, we have determined that the fair values of mortgage loans valued using a discounted cash flow analysis should be classified in Level III of the fair value hierarchy, while mortgage loans valued using securitized pricing should be classified in Level II of the fair value hierarchy. Mortgage loans classified in Level III are transferred to Level II if securitized pricing becomes available.

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Loans held-for-sale and loans held-for-investment, residential

We measure the fair value of our residential loans held-for-sale and held-for-investment based on the net present value of expected future cash flows using a combination of observable and unobservable inputs. Observable market participant assumptions include pricing related to trades of residential loans with similar characteristics. Unobservable inputs include the expectation of future cash flows, which involves judgments about the underlying collateral, the creditworthiness of the borrower, estimated prepayment speeds, estimated future credit losses, forward interest rates, investor yield requirements and certain other factors. At each measurement date, we consider both the observable and unobservable valuation inputs in the determination of fair value. However, given the significance of the unobservable inputs, these loans have been classified within Level III.

RMBS

RMBS are valued utilizing observable and unobservable market inputs. The observable market inputs include recent transactions, broker quotes and vendor prices (“market data”). However, given the implied price dispersion amongst the market data, the fair value determination for RMBS has also utilized significant unobservable inputs in discounted cash flow models including prepayments, default and severity estimates based on the recent performance of the collateral, the underlying collateral characteristics, industry trends, as well as expectations of macroeconomic events (e.g., housing price curves, interest rate curves, etc.). At each measurement date, we consider both the observable and unobservable valuation inputs in the determination of fair value. However, given the significance of the unobservable inputs these securities have been classified within Level III.

CMBS

CMBS are valued utilizing both observable and unobservable market inputs. These factors include projected future cash flows, ratings, subordination levels, vintage, remaining lives, credit issues, recent trades of similar securities and the spreads used in the prior valuation. We obtain current market spread information where available and use this information in evaluating and validating the market price of all CMBS. Depending upon the significance of the fair value inputs used in determining these fair values, these securities are classified in either Level II or Level III of the fair value hierarchy. CMBS may shift between Level II and Level III of the fair value hierarchy if the significant fair value inputs used to price the CMBS become or cease to be observable.

Equity security

The equity security is publicly registered and traded in the U.S. and its market price is listed on the London Stock Exchange. The security has been classified within Level I.

Woodstar Fund Investments

The fair value of investments held by the Woodstar Fund is determined based on observable and unobservable market inputs. The initial fair value of the Woodstar Fund's investments at its November 5, 2021 establishment date was determined by reference to the purchase price paid by third party investors, which was consistent with both a recent external appraisal as well as our extensive marketing efforts to sell interests in the Woodstar Fund, plus working capital.

For the properties, the third party appraisal applied the income capitalization approach with corroborative support from the sales comparison approach. The cost approach was not employed, as it is typically not emphasized by potential investors in the multifamily affordable housing sector. The income capitalization approach estimates an income stream for a property over a 10-year period and discounts this income plus a reversion (presumed sale) into a present value at a risk adjusted discount rate. Terminal capitalization rates and discount rates utilized in this approach are derived from market transactions as well as other financial and industry data.

For secured financing, the third party appraisal discounted the contractual cash flows at the interest rate at which such arrangements would bear if executed in the current market. The fair value of investment level working capital is assumed to approximate carrying value due to its primarily short-term monetary nature. The fair value of interest rate derivatives is determined using the methodology described in the Derivatives discussion below.

Internal valuations at interim quarter ends are prepared by management. The valuation of properties is based on a direct income capitalization approach, whereby a direct capitalization market rate is applied to annualized in-place net operating income at the portfolio level. The direct capitalization rate is initially calibrated to the implied rate from the latest appraisal and

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adjusted for subsequent changes in current market capitalization rates for sales of comparable multifamily properties. The valuations of secured financing agreements, working capital and interest rate derivatives are consistent with the methodologies described in the paragraph above.

Given the significance of the unobservable inputs used in the respective valuations, the Woodstar Fund’s investments have been classified within Level III of the fair value hierarchy.

Domestic servicing rights

The fair value of this intangible is determined using discounted cash flow modeling techniques which require management to make estimates regarding future net servicing cash flows, including forecasted loan defeasance, control migration, delinquency and anticipated maturity defaults which are calculated assuming a debt yield at which default occurs. Since the most significant of these inputs are unobservable, we have determined that the fair values of this intangible in its entirety should be classified in Level III of the fair value hierarchy.

Derivatives

The valuation of derivative contracts are determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market based inputs, including interest rate curves, spot and market forward points and implied volatilities. The fair values of interest rate swaps are determined using the market standard methodology of netting the discounted future fixed cash payments and the discounted expected variable cash receipts. The variable cash receipts are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves.

We incorporate credit valuation adjustments to appropriately reflect both our own non-performance risk and the respective counterparty’s non-performance risk in the fair value measurements. In adjusting the fair value of our derivative contracts for the effect of non-performance risk, we have considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts, and guarantees.

The valuation of over the counter derivatives are determined using discounted cash flows based on Overnight Index Swap (“OIS”) rates. Fully collateralized trades are discounted using OIS with no additional economic adjustments to arrive at fair value. Uncollateralized or partially collateralized trades are also discounted at OIS, but include appropriate economic adjustments for funding costs (i.e., a LIBOR OIS basis adjustment to approximate uncollateralized cost of funds) and credit risk. For credit instruments, fair value is determined based on changes in the relevant indices from the date of initiation of the instrument to the reporting date, as these changes determine the amount of any future cash settlement between us and the counterparty. These indices are considered Level II inputs as they are directly observable.

Although we have determined that the majority of the inputs used to value our derivatives fall within Level II of the fair value hierarchy, the credit valuation adjustments associated with our derivatives utilize Level III inputs, such as estimates of current credit spreads to evaluate the likelihood of default by us and our counterparties. However, as of June 30, 2022 and December 31, 2021, we have assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative positions and have determined that the credit valuation adjustments are not significant to the overall valuation of our derivatives. As a result, we have determined that our derivative valuations in their entirety are classified in Level II of the fair value hierarchy.

Liabilities of consolidated VIEs

Our consolidated VIE liabilities generally represent bonds that are not owned by us. The majority of these are either traded in the marketplace or can be analogized to similar securities that are traded in the marketplace. For these liabilities, pricing is considered to be Level II, where the valuation is based upon quoted prices for similar instruments traded in active markets. We generally utilize third party pricing service providers for valuing these liabilities. In order to determine whether to utilize the valuations provided by third parties, we conduct an ongoing evaluation of their valuation methodologies and processes, as well as a review of the individual valuations themselves. In evaluating third party pricing for reasonableness, we consider a variety of factors, including market transaction information for the particular bond, market transaction information for bonds within the same trust, market transaction information for similar bonds, the bond’s ratings and the bond’s subordination levels.

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For the minority portion of our consolidated VIE liabilities which consist of unrated or non-investment grade bonds that are not owned by us, pricing may be either Level II or Level III. If independent third party pricing similar to that noted above is available, we consider the valuation to be Level II. If such third party pricing is not available, the valuation is generated from model-based techniques that use significant unobservable assumptions, and we consider the valuation to be Level III. For VIE liabilities classified as Level III, valuation is determined based on discounted expected future cash flows which take into consideration expected duration and yields based on market transaction information, ratings, subordination levels, vintage and current market spread. VIE liabilities may shift between Level II and Level III of the fair value hierarchy if the significant fair value inputs used to price the VIE liabilities become or cease to be observable.

Assets of consolidated VIEs

The securitization VIEs in which we invest are “static”; that is, no reinvestment is permitted, and there is no active management of the underlying assets. In determining the fair value of the assets of the VIE, we maximize the use of observable inputs over unobservable inputs. The individual assets of a VIE are inherently incapable of precise measurement given their illiquid nature and the limitations on available information related to these assets. Because our methodology for valuing these assets does not value the individual assets of a VIE, but rather uses the value of the VIE liabilities as an indicator of the fair value of VIE assets as a whole, we have determined that our valuations of VIE assets in their entirety should be classified in Level III of the fair value hierarchy.

Fair Value Only Disclosed

We determine the fair value of our financial instruments and assets where fair value is disclosed as follows:

Loans held-for-investment and loans held-for-sale

We estimate the fair values of our loans not carried at fair value on a recurring basis by discounting their expected cash flows at a rate we estimate would be demanded by the market participants that are most likely to buy our loans. The expected cash flows used are generally the same as those used to calculate our level yield income in the financial statements. Since these inputs are unobservable, we have determined that the fair value of these loans in their entirety would be classified in Level III of the fair value hierarchy.

HTM debt securities

We estimate the fair value of our mandatorily redeemable preferred equity interests in commercial real estate companies and infrastructure bonds using the same methodology described for our loans held-for-investment. We estimate the fair value of our HTM CMBS using the same methodology described for our CMBS carried at fair value on a recurring basis.

Secured financing agreements, CLOs and SASB

The fair value of the secured financing agreements, CLOs and SASB are determined by discounting the contractual cash flows at the interest rate we estimate such arrangements would bear if executed in the current market. We have determined that our valuation of these instruments should be classified in Level III of the fair value hierarchy.

Unsecured senior notes

The fair value of our unsecured senior notes is determined based on the last available bid price for the respective notes in the current market. As these prices represent observable market data, we have determined that the fair value of these instruments would be classified in Level II of the fair value hierarchy.

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Fair Value Disclosures

The following tables present our financial assets and liabilities carried at fair value on a recurring basis in the consolidated balance sheets by their level in the fair value hierarchy as of June 30, 2022 and December 31, 2021 (amounts in thousands):

	June 30, 2022
	Total		Level I		Level II		Level III
Financial Assets:
Loans under fair value option	$	2,228,332	$	—	$	30,831	$	2,197,501
RMBS	124,439		—		—		124,439
CMBS	20,965		—		—		20,965
Equity security	10,193		10,193		—		—
Woodstar Fund investments	1,558,850		—		—		1,558,850
Domestic servicing rights	17,499		—		—		17,499
Derivative assets	128,727		—		128,727		—
VIE assets	57,993,563		—		—		57,993,563
Total	$	62,082,568	$	10,193	$	159,558	$	61,912,817
Financial Liabilities:
Derivative liabilities	$	55,137	$	—	$	55,137	$	—
VIE liabilities	56,256,080		—		50,275,446		5,980,634
Total	$	56,311,217	$	—	$	50,330,583	$	5,980,634

	December 31, 2021
	Total		Level I		Level II		Level III
Financial Assets:
Loans under fair value option	$	2,936,025	$	—	$	—	$	2,936,025
RMBS	143,980		—		—		143,980
CMBS	22,244		—		—		22,244
Equity security	11,624		11,624		—		—
Woodstar Fund investments	1,040,309		—		—		1,040,309
Domestic servicing rights	16,780		—		—		16,780
Derivative assets	48,216		—		48,216		—
VIE assets	61,280,543		—		—		61,280,543
Total	$	65,499,721	$	11,624	$	48,216	$	65,439,881
Financial Liabilities:
Derivative liabilities	$	13,421	$	—	$	13,421	$	—
VIE liabilities	59,752,922		—		54,972,701		4,780,221
Total	$	59,766,343	$	—	$	54,986,122	$	4,780,221

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The changes in financial assets and liabilities classified as Level III are as follows for the three and six months ended June 30, 2022 and 2021 (amounts in thousands):

Three Months Ended June 30, 2022	Loans at Fair Value		RMBS		CMBS		Woodstar Fund Investments		Domestic Servicing Rights		VIE Assets		VIE Liabilities		Total
April 1, 2022 balance	$	2,367,022	$	134,406	$	21,858	$	1,264,160	$	17,864	$	57,763,543	$	(5,479,288)	$	56,089,565
Total realized and unrealized gains (losses):
Included in earnings:
Change in fair value / gain on sale	(113,480)		—		(665)		294,690		(365)		(3,021,691)		447,311		(2,394,200)
Net accretion	—		2,625		—		—		—		—		—		2,625
Included in OCI	—		(6,699)		—		—		—		—		—		(6,699)
Purchases / Originations	1,340,371		—		—		—		—		—		—		1,340,371
Sales	(1,309,220)		—		—		—		—		—		—		(1,309,220)
Cash repayments / receipts	(56,415)		(5,893)		(228)		—		—		—		(415)		(62,951)
Transfers into Level III	54		—		—		—		—		—		(426,237)		(426,183)
Transfers out of Level III	(30,831)		—		—		—		—		—		262,839		232,008
Consolidation of VIEs	—		—		—		—		—		3,251,711		(784,844)		2,466,867
June 30, 2022 balance	$	2,197,501	$	124,439	$	20,965	$	1,558,850	$	17,499	$	57,993,563	$	(5,980,634)	$	55,932,183
Amount of unrealized gains (losses) attributable to     assets still held at June 30, 2022:
Included in earnings	$	(108,411)	$	2,340	$	(665)	$	294,690	$	(365)	$	(3,021,691)	$	447,311	$	(2,386,791)
Included in OCI	$	—	$	(6,375)	$	—	$	—	$	—	$	—	$	—	$	(6,375)

Three Months Ended June 30, 2021	Loans at Fair Value		RMBS		CMBS		Woodstar Fund Investments		Domestic Servicing Rights		VIE Assets		VIE Liabilities		Total
April 1, 2021 balance	$	763,773	$	160,301	$	19,256	$	—	$	12,406	$	62,367,110	$	(2,227,428)	$	61,095,418
Total realized and unrealized gains (losses):
Included in earnings:
Change in fair value / gain on sale	45,867		—		320		—		1,299		(1,085,746)		1,294		(1,036,966)
Net accretion	—		2,610		—		—		—		—		—		2,610
Included in OCI	—		(344)		—		—		—		—		—		(344)
Purchases / Originations	992,304		—		—		—		—		—		—		992,304
Sales	(905,653)		—		—		—		—		—		—		(905,653)
Cash repayments / receipts	(50,257)		(7,863)		(611)		—		—		—		(1,401)		(60,132)
Transfers into Level III	—		—		—		—		—		—		(2,431,880)		(2,431,880)
Transfers out of Level III	(250,687)		—		—		—		—		—		365,456		114,769
Transfers within Level III	172,474		—		—						(172,474)		—		—
Consolidation of VIEs	—		—		—		—		—		2,384,906		(542,233)		1,842,673
June 30, 2021 balance	$	767,821	$	154,704	$	18,965	$	—	$	13,705	$	63,493,796	$	(4,836,192)	$	59,612,799
Amount of unrealized gains (losses) attributable to     assets still held at June 30, 2021:
Included in earnings	$	3,274	$	2,610	$	320	$	—	$	1,299	$	(1,258,220)	$	1,294	$	(1,249,423)
Included in OCI	$	—	$	(344)	$	—	$	—	$	—	$	—	$	—	$	(344)

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Six Months Ended June 30, 2022	Loans at Fair Value		RMBS		CMBS		Woodstar Fund Investments		Domestic Servicing Rights		VIE Assets		VIE Liabilities		Total
January 1, 2022 balance	$	2,936,025	$	143,980	$	22,244	$	1,040,309	$	16,780	$	61,280,543	$	(4,780,221)	$	60,659,660
Total realized and unrealized gains (losses):
Included in earnings:
Change in fair value / gain on sale	(239,263)		—		(1,357)		518,541		719		(6,918,293)		922,222		(5,717,431)
Net accretion	—		5,230		—		—		—		—		—		5,230
Included in OCI	—		(11,983)		—		—		—		—		—		(11,983)
Purchases / Originations	3,607,070		—		—		—		—		—		—		3,607,070
Sales	(3,587,687)		—		—		—		—		—		—		(3,587,687)
Cash repayments / receipts	(114,849)		(12,788)		(452)		—		—		—		(825)		(128,914)
Transfers into Level III	147		—		—		—		—		—		(630,117)		(629,970)
Transfers out of Level III	(403,942)		—		—		—		—		—		317,449		(86,493)
Consolidation of VIEs	—		—		—		—		—		4,361,325		(1,810,101)		2,551,224
Deconsolidation of VIEs	—		—		530		—		—		(730,012)		959		(728,523)
June 30, 2022 balance	$	2,197,501	$	124,439	$	20,965	$	1,558,850	$	17,499	$	57,993,563	$	(5,980,634)	$	55,932,183
Amount of unrealized gains (losses) attributable to     assets still held at June 30, 2022:
Included in earnings	$	(168,610)	$	4,896	$	(827)	$	518,541	$	719	$	(6,918,293)	$	922,222	$	(5,641,352)
Included in OCI	$	—	$	(11,577)	$	—	$	—	$	—	$	—	$	—	$	(11,577)

Six Months Ended June 30, 2021	Loans at Fair Value		RMBS		CMBS		Woodstar Fund Investments		Domestic Servicing Rights		VIE Assets		VIE Liabilities		Total
January 1, 2021 balance	$	1,022,979	$	167,349	$	19,457	$	—	$	13,202	$	64,238,328	$	(2,019,876)	$	63,441,439
Total realized and unrealized gains (losses):
Included in earnings:
Change in fair value / gain on sale	36,389		—		692		—		503		(3,350,337)		66,975		(3,245,778)
Net accretion	—		5,216		—		—		—		—		—		5,216
Included in OCI	—		(2,747)		—		—		—		—		—		(2,747)
Purchases / Originations	1,367,574		—		—		—		—		—		—		1,367,574
Sales	(1,477,580)		—		—		—		—		—		—		(1,477,580)
Issuances	—		—		—		—		—		—		(11,604)		(11,604)
Cash repayments / receipts	(103,328)		(15,114)		(1,184)		—		—		—		(2,538)		(122,164)
Transfers into Level III	—		—		—		—		—		—		(2,841,147)		(2,841,147)
Transfers out of Level III	(250,687)		—		—		—		—		—		514,231		263,544
Transfers within Level III	172,474		—		—		—		—		(172,474)		—		—
Consolidation of VIEs	—		—		—		—		—		2,778,279		(542,233)		2,236,046
June 30, 2021 balance	$	767,821	$	154,704	$	18,965	$	—	$	13,705	$	63,493,796	$	(4,836,192)	$	59,612,799
Amount of unrealized gains (losses) attributable to     assets still held at June 30, 2021:
Included in earnings	$	2,902	$	5,216	$	692	$	—	$	503	$	(3,522,811)	$	66,975	$	(3,446,523)
Included in OCI	$	—	$	(2,747)	$	—	$	—	$	—	$	—	$	—	$	(2,747)

Amounts were transferred from Level II to Level III due to a decrease in the observable relevant market activity and amounts were transferred from Level III to Level II due to an increase in the observable relevant market activity.

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The following table presents the fair values of our financial instruments not carried at fair value on the consolidated balance sheets (amounts in thousands):

	June 30, 2022				December 31, 2021
	Carrying Value		Fair Value		Carrying Value		Fair Value
Financial assets not carried at fair value:
Loans	$	17,904,104	$	17,684,507	$	15,477,624	$	15,526,235
HTM debt securities	757,763		720,641		683,136		656,864
Financial liabilities not carried at fair value:
Secured financing agreements, CLOs and SASB	$	16,911,598	$	16,751,875	$	15,192,966	$	15,266,440
Unsecured senior notes	2,324,772		2,149,983		1,828,590		1,893,065

The following is quantitative information about significant unobservable inputs in our Level III measurements for those assets and liabilities measured at fair value on a recurring basis (dollars in thousands):

	Carrying Value at June 30, 2022		Valuation Technique	Unobservable Input	Range (Weighted Average) as of (1)
					June 30, 2022	December 31, 2021
Loans under fair value option	$	2,197,501	Discounted cash flow, market pricing	Coupon (d)	2.8% - 9.2% (4.6%)	2.6% - 9.2% (4.2%)
				Remaining contractual term (d)	5.8 - 40.0 years (29.2 years)	6.3 - 39.9 years (27.4 years)
				FICO score (a)	584 - 900 (745)	582 - 829 (748)
				LTV (b)	5% - 94% (68%)	1% - 94% (66%)
				Purchase price (d)	80.0% - 108.6% (101.8%)	80.0% - 108.6% (102.3%)
RMBS	124,439		Discounted cash flow	Constant prepayment rate (a)	3.4% - 14.6% (6.6%)	4.8% - 19.2% (9.9%)
				Constant default rate (b)	0.9% - 4.7% (2.0%)	0.8% - 6.0% (2.1%)
				Loss severity (b)	0% - 76% (16%) (f)	0% - 86% (26%) (f)
				Delinquency rate (c)	6% - 30% (15%)	10.4% - 35% (19%)
				Servicer advances (a)	25% - 79% (53%)	19% - 83% (52%)
				Annual coupon deterioration (b)	0% - 2.5% (0.1%)	0% - 1.7% (0.1%)
				Putback amount per projected total collateral loss (e)	0% - 8% (0.5%)	0% - 8% (0.5%)
CMBS	20,965		Discounted cash flow	Yield (b)	0% - 67.3% (8.9%)	0% - 613.6% (9.3%)
				Duration (c)	0 - 8.2 years (3.1 years)	0 - 7.2 years (5.2 years)
Woodstar Fund investments	1,558,850		Discounted cash flow	Discount rate - properties (b)	N/A	5.8% - 6.3% (6.0%)
				Discount rate - debt (a)	4.7% - 5.0% (4.8%)	2.6% - 3.3% (2.9%)
				Terminal capitalization rate (b)	N/A	4.8% - 5.3% (4.9%)
				Direct capitalization rate (b)	4.2% (4.2%)	4.1% - 4.2% (4.2%) (Implied)
Domestic servicing rights	17,499		Discounted cash flow	Debt yield (a)	7.50% (7.50%)	7.30% (7.30%)
				Discount rate (b)	15% (15%)	15% (15%)
VIE assets	57,993,563		Discounted cash flow	Yield (b)	0% - 253.1% (13.2%)	0% - 615.3% (13.0%)
				Duration (c)	0 - 11.3 years (3.2 years)	0 - 11.0 years (3.2 years)
VIE liabilities	5,980,634		Discounted cash flow	Yield (b)	0% - 253.1% (8.4%)	0% - 615.3% (6.4%)
				Duration (c)	0 - 11.3 years (2.2 years)	0 - 11.0 years (2.3 years)

______________________________________________________________________________________________________________________

(1)Unobservable inputs were weighted by the relative carrying value of the instruments as of June 30, 2022 and December 31, 2021.

Information about Uncertainty of Fair Value Measurements

(a)Significant increase (decrease) in the unobservable input in isolation would result in a significantly higher (lower) fair value measurement.

(b)Significant increase (decrease) in the unobservable input in isolation would result in a significantly lower (higher) fair value measurement.

(c)Significant increase (decrease) in the unobservable input in isolation would result in either a significantly lower or higher (higher or lower) fair value measurement depending on the structural features of the security in question.

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(d)This unobservable input is not subject to variability as of the respective reporting dates.

(e)Any delay in the putback recovery date leads to a decrease in fair value for the majority of securities in our RMBS portfolio.

(f)6% and 18% of the portfolio falls within a range of 45% - 80% as of June 30, 2022 and December 31, 2021, respectively.

21. Income Taxes

Certain of our domestic subsidiaries have elected to be treated as taxable REIT subsidiaries (“TRSs”). TRSs permit us to participate in certain activities from which REITs are generally precluded, as long as these activities meet specific criteria, are conducted within the parameters of certain limitations established by the Code and are conducted in entities which elect to be treated as taxable subsidiaries under the Code. To the extent these criteria are met, we will continue to maintain our qualification as a REIT.

Our TRSs engage in various real estate-related operations, including special servicing of commercial real estate, originating and securitizing mortgage loans, and investing in entities which engage in real estate-related operations. As of June 30, 2022 and December 31, 2021, approximately $2.5 billion and $3.2 billion, respectively, of assets were owned by TRS entities. Our TRSs are not consolidated for U.S. federal income tax purposes, but are instead taxed as corporations. For financial reporting purposes, a provision for current and deferred taxes is established for the portion of earnings recognized by us with respect to our interest in TRSs.

The following table is a reconciliation of our U.S. federal income tax provision determined using our statutory federal tax rate to our reported income tax provision (benefit) for the three and six months ended June 30, 2022 and 2021 (dollars in thousands):

	For the Three Months Ended June 30,								For the Six Months Ended June 30,
	2022				2021				2022				2021
Federal statutory tax rate	$	59,622	21.0	%	$	25,836	21.0	%	$	139,813	21.0	%	$	52,035	21.0	%
REIT and other non-taxable income	(58,233)		(20.6)	%	(24,018)		(19.5)	%	(137,431)		(20.6)	%	(48,519)		(19.6)	%
State income taxes	456		0.2	%	597		0.5	%	782		0.1	%	1,155		0.5	%
Federal benefit of state tax deduction	(95)		—	%	(126)		(0.1)	%	(164)		—	%	(243)		(0.1)	%
Intra-entity transfers	—		—	%	(6,037)		(4.9)	%	(3,868)		(0.6)	%	(6,052)		(2.4)	%
Other	456		0.2	%	395		0.3	%	624		0.1	%	501		0.1	%
Effective tax rate	$	2,206	0.8	%	$	(3,353)	(2.7)	%	$	(244)	—	%	$	(1,123)	(0.5)	%

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22. Commitments and Contingencies

As of June 30, 2022, our Commercial and Residential Lending Segment had future commercial loan funding commitments totaling $2.9 billion, of which we expect to fund $2.6 billion. These future funding commitments primarily relate to construction projects, capital improvements, tenant improvements and leasing commissions. Additionally, as of June 30, 2022, our Commercial and Residential Lending Segment had outstanding residential loan purchase commitments of $130.1 million.

As discussed in Note 12, in February 2022, our Commercial and Residential Lending Segment sold $745.0 million of agency-eligible residential loans at face amount which was subject to a post-closing contingent sales price adjustment based on the gain or loss to the purchaser/securitization underwriter, less underwriting costs, if those loans were sold into a future securitization. Given spread widening which occurred in the residential markets during the three months ended June 30, 2022, we estimated the amount of this contingency to be $32.7 million at June 30, 2022 based on the probability and timing of executing a disposition strategy on these loans and the amount at which such a disposition could be executed. In June 2022, in lieu of the buyer executing a securitization or sale of the loans, we entered into a forward settlement agreement to acquire $729.1 million of these loans at par. The loan purchase is subject to a financing contingency, whereby the seller is to provide us financing under a mutually agreed repurchase agreement within 120 days. If such mutually agreed financing is not completed, we are not obligated to complete the forward settlement, and the previous post-closing contingency referenced above would be reinstated.

As of June 30, 2022, our Infrastructure Lending Segment had future infrastructure loan funding commitments totaling $141.7 million, including $137.0 million under revolvers and letters of credit (“LCs”), and $4.7 million under delayed draw term loans. As of June 30, 2022, $10.8 million of revolvers and LCs were outstanding. Additionally, as of June 30, 2022, our Infrastructure Lending Segment had outstanding loan purchase commitments of $112.2 million.

In connection with the Infrastructure Lending Segment acquisition, we assumed guarantees of certain borrowers’ performance under existing interest rate swaps. As of June 30, 2022, we had four outstanding guarantees on interest rate swaps maturing between August 2022 and June 2025. Refer to Note 13 for further discussion.

Generally, funding commitments are subject to certain conditions that must be met, such as customary construction draw certifications, minimum debt service coverage ratios or executions of new leases before advances are made to the borrower.

Management is not aware of any other contractual obligations, legal proceedings, or any other contingent obligations incurred in the normal course of business that would have a material adverse effect on our consolidated financial statements.

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23. Segment 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 three months ended June 30, 2022 by business segment (amounts in thousands):

	Commercial and Residential Lending Segment		Infrastructure Lending Segment		Property Segment		Investing and Servicing Segment		Corporate		Subtotal		Securitization VIEs		Total
Revenues:
Interest income from loans	$	227,555	$	30,096	$	—	$	3,499	$	—	$	261,150	$	—	$	261,150
Interest income from investment securities	22,591		1,173		—		20,990		—		44,754		(29,448)		15,306
Servicing fees	142		—		—		15,616		—		15,758		(3,205)		12,553
Rental income	1,044		—		22,628		7,852		—		31,524		—		31,524
Other revenues	61		90		48		4,854		3		5,056		(3)		5,053
Total revenues	251,393		31,359		22,676		52,811		3		358,242		(32,656)		325,586
Costs and expenses:
Management fees	254		—		—		—		31,370		31,624		—		31,624
Interest expense	88,226		15,001		7,074		6,391		36,142		152,834		(216)		152,618
General and administrative	11,845		3,631		975		23,114		5,342		44,907		98		45,005
Acquisition and investment pursuit costs	738		—		2		(223)		—		517		—		517
Costs of rental operations	1,826		—		5,216		3,556		—		10,598		—		10,598
Depreciation and amortization	1,183		104		8,179		2,774		—		12,240		—		12,240
Credit loss provision, net	7,925		513		—		—		—		8,438		—		8,438
Other expense	1,251		—		—		7		—		1,258		—		1,258
Total costs and expenses	113,248		19,249		21,446		35,619		72,854		262,416		(118)		262,298
Other income (loss):
Change in net assets related to consolidated VIEs	—		—		—		—		—		—		8,373		8,373
Change in fair value of servicing rights	—		—		—		543		—		543		(908)		(365)
Change in fair value of investment securities, net	(19,312)		—		—		(8,150)		—		(27,462)		26,217		(1,245)
Change in fair value of mortgage loans, net	(121,356)		—		—		7,876		—		(113,480)		—		(113,480)
Income from affordable housing fund investments	—		—		307,165		—		—		307,165		—		307,165
Earnings (loss) from unconsolidated entities	2,786		394		—		1,748		—		4,928		(1,063)		3,865
Gain on sale of investments and other assets, net	138		—		—		—		—		138		—		138
Gain (loss) on derivative financial instruments, net	127,140		265		5,354		9,007		(13,183)		128,583		—		128,583
Foreign currency (loss) gain, net	(78,331)		(289)		18		—		—		(78,602)		—		(78,602)
Other loss, net	(33,809)		—		—		—		—		(33,809)		—		(33,809)
Total other income (loss)	(122,744)		370		312,537		11,024		(13,183)		188,004		32,619		220,623
Income (loss) before income taxes	15,401		12,480		313,767		28,216		(86,034)		283,830		81		283,911
Income tax (provision) benefit	(557)		1		—		(1,650)		—		(2,206)		—		(2,206)
Net income (loss)	14,844		12,481		313,767		26,566		(86,034)		281,624		81		281,705
Net income attributable to non-controlling interests	(4)		—		(67,482)		(1,851)		—		(69,337)		(81)		(69,418)
Net income (loss) attributable to Starwood Property Trust, Inc.	$	14,840	$	12,481	$	246,285	$	24,715	$	(86,034)	$	212,287	$	—	$	212,287

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The table below presents our results of operations for the three months ended June 30, 2021 by business segment (amounts in thousands):

	Commercial and Residential Lending Segment		Infrastructure Lending Segment		Property Segment		Investing and Servicing Segment		Corporate		Subtotal		Securitization VIEs		Total
Revenues:
Interest income from loans	$	165,697	$	21,171	$	—	$	2,404	$	—	$	189,272	$	—	$	189,272
Interest income from investment securities	17,190		555		—		25,668		—		43,413		(32,765)		10,648
Servicing fees	110		—		—		16,365		—		16,475		(5,611)		10,864
Rental income	1,419		—		65,410		10,290		—		77,119		—		77,119
Other revenues	74		69		44		2,777		—		2,964		—		2,964
Total revenues	184,490		21,795		65,454		57,504		—		329,243		(38,376)		290,867
Costs and expenses:
Management fees	300		—		—		224		28,716		29,240		10		29,250
Interest expense	48,356		9,694		16,863		5,789		29,171		109,873		(220)		109,653
General and administrative	10,411		3,532		1,028		25,720		4,489		45,180		85		45,265
Acquisition and investment pursuit costs	179		249		—		(21)		—		407		—		407
Costs of rental operations	433		—		25,922		4,376		—		30,731		—		30,731
Depreciation and amortization	311		100		17,901		4,165		—		22,477		—		22,477
Credit loss (reversal) provision, net	(12,447)		603		—		—		—		(11,844)		—		(11,844)
Other expense	—		—		—		—		—		—		—		—
Total costs and expenses	47,543		14,178		61,714		40,253		62,376		226,064		(125)		225,939
Other income (loss):
Change in net assets related to consolidated VIEs	—		—		—		—		—		—		12,509		12,509
Change in fair value of servicing rights	—		—		—		460		—		460		839		1,299
Change in fair value of investment securities, net	(9,402)		—		—		(12,585)		—		(21,987)		23,495		1,508
Change in fair value of mortgage loans, net	12,329		—		—		33,538		—		45,867		—		45,867
Earnings (loss) from unconsolidated entities	1,996		(70)		—		(507)		—		1,419		807		2,226
(Loss) gain on sale of investments and other assets, net	(1,019)		27		—		9,723		—		8,731		—		8,731
(Loss) gain on derivative financial instruments, net	(4,945)		112		(372)		(5,731)		927		(10,009)		—		(10,009)
Foreign currency gain (loss), net	2,715		(62)		(25)		(1)		—		2,627		—		2,627
Loss on extinguishment of debt	(221)		(939)		—		(22)		—		(1,182)		—		(1,182)
Other (loss) income, net	(5,504)		2		—		29		—		(5,473)		—		(5,473)
Total other income (loss)	(4,051)		(930)		(397)		24,904		927		20,453		37,650		58,103
Income (loss) before income taxes	132,896		6,687		3,343		42,155		(61,449)		123,632		(601)		123,031
Income tax benefit (provision)	8,043		(58)		—		(4,632)		—		3,353		—		3,353
Net income (loss)	140,939		6,629		3,343		37,523		(61,449)		126,985		(601)		126,384
Net (income) loss attributable to non-controlling interests	(4)		—		(4,914)		(5,757)		—		(10,675)		601		(10,074)
Net income (loss) attributable to Starwood Property Trust, Inc.	$	140,935	$	6,629	$	(1,571)	$	31,766	$	(61,449)	$	116,310	$	—	$	116,310

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The table below presents our results of operations for the six months ended June 30, 2022 by business segment (amounts in thousands):

	Commercial and Residential Lending Segment		Infrastructure Lending Segment		Property Segment		Investing and Servicing Segment		Corporate		Subtotal		Securitization VIEs		Total
Revenues:
Interest income from loans	$	430,025	$	57,079	$	—	$	7,665	$	—	$	494,769	$	—	$	494,769
Interest income from investment securities	43,427		1,920		—		48,379		—		93,726		(64,437)		29,289
Servicing fees	278		—		—		29,687		—		29,965		(7,420)		22,545
Rental income	2,730		—		44,993		15,381		—		63,104		—		63,104
Other revenues	113		158		98		9,508		3		9,880		(9)		9,871
Total revenues	476,573		59,157		45,091		110,620		3		691,444		(71,866)		619,578
Costs and expenses:
Management fees	531		—		—		—		86,388		86,919		—		86,919
Interest expense	156,828		26,931		13,155		12,601		69,984		279,499		(430)		279,069
General and administrative	23,447		7,142		2,031		46,557		9,970		89,147		179		89,326
Acquisition and investment pursuit costs	1,237		1		7		(306)		—		939		—		939
Costs of rental operations	2,345		—		10,217		7,326		—		19,888		—		19,888
Depreciation and amortization	1,477		209		16,398		5,803		—		23,887		—		23,887
Credit loss provision, net	4,626		154		—		—		—		4,780		—		4,780
Other expense	1,251		—		55		7		—		1,313		—		1,313
Total costs and expenses	191,742		34,437		41,863		71,988		166,342		506,372		(251)		506,121
Other income (loss):
Change in net assets related to consolidated VIEs	—		—		—		—		—		—		35,122		35,122
Change in fair value of servicing rights	—		—		—		326		—		326		393		719
Change in fair value of investment securities, net	(21,417)		—		—		(17,441)		—		(38,858)		37,258		(1,600)
Change in fair value of mortgage loans, net	(237,584)		—		—		(1,679)		—		(239,263)		—		(239,263)
Income from affordable housing fund investments	—		—		541,206		—		—		541,206		—		541,206
Earnings (loss) from unconsolidated entities	1,446		739		—		1,899		—		4,084		(1,129)		2,955
Gain on sale of investments and other assets, net	86,748		—		—		11,858		—		98,606		—		98,606
Gain (loss) on derivative financial instruments, net	245,535		897		22,900		36,870		(50,351)		255,851		—		255,851
Foreign currency (loss) gain, net	(105,585)		(317)		19		—		—		(105,883)		—		(105,883)
Loss on extinguishment of debt	(206)		(469)		—		(148)		—		(823)		—		(823)
Other (loss) income, net	(34,597)		—		—		—		—		(34,597)		25		(34,572)
Total other income (loss)	(65,660)		850		564,125		31,685		(50,351)		480,649		71,669		552,318
Income (loss) before income taxes	219,171		25,570		567,353		70,317		(216,690)		665,721		54		665,775
Income tax benefit (provision)	4,583		5		—		(4,344)		—		244		—		244
Net income (loss)	223,754		25,575		567,353		65,973		(216,690)		665,965		54		666,019
Net income attributable to non-controlling interests	(7)		—		(119,893)		(9,179)		—		(129,079)		(54)		(129,133)
Net income (loss) attributable to Starwood Property Trust, Inc.	$	223,747	$	25,575	$	447,460	$	56,794	$	(216,690)	$	536,886	$	—	$	536,886

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The table below presents our results of operations for the six months ended June 30, 2021 by business segment (amounts in thousands):

	Commercial and Residential Lending Segment		Infrastructure Lending Segment		Property Segment		Investing and Servicing Segment		Corporate		Subtotal		Securitization VIEs		Total
Revenues:
Interest income from loans	$	336,290	$	39,979	$	—	$	3,578	$	—	$	379,847	$	—	$	379,847
Interest income from investment securities	35,575		1,119		—		46,608		—		83,302		(61,044)		22,258
Servicing fees	234		—		—		28,821		—		29,055		(9,789)		19,266
Rental income	2,758		—		130,514		20,185		—		153,457		—		153,457
Other revenues	164		162		84		2,859		—		3,269		—		3,269
Total revenues	375,021		41,260		130,598		102,051		—		648,930		(70,833)		578,097
Costs and expenses:
Management fees	615		—		—		446		66,904		67,965		21		67,986
Interest expense	92,651		18,535		32,695		11,238		58,319		213,438		(411)		213,027
General and administrative	21,744		6,974		2,051		44,160		8,800		83,729		172		83,901
Acquisition and investment pursuit costs	364		249		—		(21)		—		592		—		592
Costs of rental operations	910		—		49,882		8,684		—		59,476		—		59,476
Depreciation and amortization	618		200		36,001		8,132		—		44,951		—		44,951
Credit loss (reversal) provision, net	(12,976)		1,176		—		—		—		(11,800)		—		(11,800)
Other expense	31		—		583		71		—		685		—		685
Total costs and expenses	103,957		27,134		121,212		72,710		134,023		459,036		(218)		458,818
Other income (loss):
Change in net assets related to consolidated VIEs	—		—		—		—		—		—		52,254		52,254
Change in fair value of servicing rights	—		—		—		1,205		—		1,205		(702)		503
Change in fair value of investment securities, net	(11,452)		—		—		(5,415)		—		(16,867)		18,069		1,202
Change in fair value of mortgage loans, net	1,615		—		—		34,774		—		36,389		—		36,389
Earnings (loss) from unconsolidated entities	3,749		(324)		—		82		—		3,507		453		3,960
Gain on sale of investments and other assets, net	16,674		27		—		9,723		—		26,424		—		26,424
Gain (loss) on derivative financial instruments, net	21,196		796		4,352		3,552		(5,916)		23,980		—		23,980
Foreign currency loss, net	(8,879)		(111)		—		(64)		—		(9,054)		—		(9,054)
Loss on extinguishment of debt	(289)		(1,246)		(141)		(22)		—		(1,698)		—		(1,698)
Other (loss) income, net	(5,504)		23		—		29		—		(5,452)		—		(5,452)
Total other income (loss)	17,110		(835)		4,211		43,864		(5,916)		58,434		70,074		128,508
Income (loss) before income taxes	288,174		13,291		13,597		73,205		(139,939)		248,328		(541)		247,787
Income tax benefit (provision)	6,538		(150)		—		(5,265)		—		1,123		—		1,123
Net income (loss)	294,712		13,141		13,597		67,940		(139,939)		249,451		(541)		248,910
Net (income) loss attributable to non-controlling interests	(7)		—		(9,991)		(11,765)		—		(21,763)		541		(21,222)
Net income (loss) attributable to Starwood Property Trust, Inc.	$	294,705	$	13,141	$	3,606	$	56,175	$	(139,939)	$	227,688	$	—	$	227,688

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The table below presents our consolidated balance sheet as of June 30, 2022 by business segment (amounts in thousands):

	Commercial and Residential Lending Segment		Infrastructure Lending Segment		Property Segment		Investing and Servicing Segment		Corporate		Subtotal		Securitization VIEs		Total
Assets:
Cash and cash equivalents	$	67,812	$	26,325	$	27,926	$	27,863	$	120,192	$	270,118	$	2,056	$	272,174
Restricted cash	2,889		38,835		958		10,011		11,939		64,632		—		64,632
Loans held-for-investment, net	15,623,041		2,263,006		—		9,742		—		17,895,789		—		17,895,789
Loans held-for-sale	2,195,953		—		—		40,694		—		2,236,647		—		2,236,647
Investment securities	1,338,195		67,336		—		1,210,361		—		2,615,892		(1,702,532)		913,360
Properties, net	215,099		—		874,119		136,761		—		1,225,979		—		1,225,979
Investments of consolidated affordable housing fund	—		—		1,558,850		—		—		1,558,850		—		1,558,850
Investments in unconsolidated entities	38,612		27,454		—		35,246		—		101,312		(15,802)		85,510
Goodwill	—		119,409		—		140,437		—		259,846		—		259,846
Intangible assets	14,948		—		32,050		69,691		—		116,689		(41,725)		74,964
Derivative assets	126,546		232		371		1,578		—		128,727		—		128,727
Accrued interest receivable	117,918		4,941		14		1,118		7,827		131,818		(158)		131,660
Other assets	126,936		6,952		66,483		34,667		22,453		257,491		(306)		257,185
VIE assets, at fair value	—		—		—		—		—		—		57,993,563		57,993,563
Total Assets	$	19,867,949	$	2,554,490	$	2,560,771	$	1,718,169	$	162,411	$	26,863,790	$	56,235,096	$	83,098,886
Liabilities and Equity
Liabilities:
Accounts payable, accrued expenses and other liabilities	$	152,679	$	24,052	$	10,161	$	48,634	$	37,823	$	273,349	$	65	$	273,414
Related-party payable	—		—		—		—		30,754		30,754		—		30,754
Dividends payable	—		—		—		—		149,991		149,991		—		149,991
Derivative liabilities	11,899		197		—		—		43,041		55,137		—		55,137
Secured financing agreements, net	9,999,749		1,025,145		788,557		584,395		770,965		13,168,811		(21,364)		13,147,447
Collateralized loan obligations and single asset securitization, net	2,951,308		812,843		—		—		—		3,764,151		—		3,764,151
Unsecured senior notes, net	—		—		—		—		2,324,772		2,324,772		—		2,324,772
VIE liabilities, at fair value	—		—		—		—		—		—		56,256,080		56,256,080
Total Liabilities	13,115,635		1,862,237		798,718		633,029		3,357,346		19,766,965		56,234,781		76,001,746
Temporary Equity: Redeemable non-controlling interests	—		—		322,753		—		—		322,753		—		322,753
Permanent Equity:
Starwood Property Trust, Inc. Stockholders’ Equity:
Common stock	—		—		—		—		3,167		3,167		—		3,167
Additional paid-in capital	1,926,108		624,101		(378,128)		(556,122)		4,150,574		5,766,533		—		5,766,533
Treasury stock	—		—		—		—		(138,022)		(138,022)		—		(138,022)
Accumulated other comprehensive income	28,970		—		—		—		—		28,970		—		28,970
Retained earnings (accumulated deficit)	4,797,121		68,152		1,608,794		1,469,935		(7,210,654)		733,348		—		733,348
Total Starwood Property Trust, Inc. Stockholders’ Equity	6,752,199		692,253		1,230,666		913,813		(3,194,935)		6,393,996		—		6,393,996
Non-controlling interests in consolidated subsidiaries	115		—		208,634		171,327		—		380,076		315		380,391
Total Permanent Equity	6,752,314		692,253		1,439,300		1,085,140		(3,194,935)		6,774,072		315		6,774,387
Total Liabilities and Equity	$	19,867,949	$	2,554,490	$	2,560,771	$	1,718,169	$	162,411	$	26,863,790	$	56,235,096	$	83,098,886

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The table below presents our consolidated balance sheet as of December 31, 2021 by business segment (amounts in thousands):

	Commercial and Residential Lending Segment		Infrastructure Lending Segment		Property Segment		Investing and Servicing Segment		Corporate		Subtotal		Securitization VIEs		Total
Assets:
Cash and cash equivalents	$	65,064	$	17,011	$	14,136	$	26,700	$	93,861	$	216,772	$	590	$	217,362
Restricted cash	39,853		43,408		954		20,337		—		104,552		—		104,552
Loans held-for-investment, net	13,499,520		2,027,426		—		9,903		—		15,536,849		—		15,536,849
Loans held-for-sale	2,590,005		—		—		286,795		—		2,876,800		—		2,876,800
Investment securities	1,155,452		31,923		—		1,165,395		—		2,352,770		(1,491,786)		860,984
Properties, net	124,503		—		887,553		154,331		—		1,166,387		—		1,166,387
Investments of consolidated affordable housing fund	—		—		1,040,309		—		—		1,040,309		—		1,040,309
Investments in unconsolidated entities	44,938		26,255		—		34,160		—		105,353		(15,256)		90,097
Goodwill	—		119,409		—		140,437		—		259,846		—		259,846
Intangible assets	—		—		34,619		71,064		—		105,683		(42,119)		63,564
Derivative assets	34,265		128		8		391		13,424		48,216		—		48,216
Accrued interest receivable	106,251		3,207		—		947		5,988		116,393		(131)		116,262
Other assets	68,908		14,265		43,420		40,395		21,800		188,788		(162)		188,626
VIE assets, at fair value	—		—		—		—		—		—		61,280,543		61,280,543
Total Assets	$	17,728,759	$	2,283,032	$	2,020,999	$	1,950,855	$	135,073	$	24,118,718	$	59,731,679	$	83,850,397
Liabilities and Equity
Liabilities:
Accounts payable, accrued expenses and other liabilities	$	57,267	$	8,917	$	14,757	$	58,920	$	49,779	$	189,640	$	56	$	189,696
Related-party payable	—		—		—		—		76,371		76,371		—		76,371
Dividends payable	—		—		—		—		147,624		147,624		—		147,624
Derivative liabilities	12,870		260		—		291		—		13,421		—		13,421
Secured financing agreements, net	9,097,985		1,225,548		787,396		714,237		773,244		12,598,410		(21,560)		12,576,850
Collateralized loan obligations and single asset securitization, net	2,210,798		405,318		—		—		—		2,616,116		—		2,616,116
Unsecured senior notes, net	—		—		—		—		1,828,590		1,828,590		—		1,828,590
VIE liabilities, at fair value	—		—		—		—		—		—		59,752,922		59,752,922
Total Liabilities	11,378,920		1,640,043		802,153		773,448		2,875,608		17,470,172		59,731,418		77,201,590
Temporary Equity: Redeemable non-controlling interests	—		—		214,915		—		—		214,915		—		214,915
Permanent Equity:
Starwood Property Trust, Inc. Stockholders’ Equity:
Common stock	—		—		—		—		3,123		3,123		—		3,123
Additional paid-in capital	1,735,397		600,412		(365,922)		(388,196)		4,091,685		5,673,376		—		5,673,376
Treasury stock	—		—		—		—		(138,022)		(138,022)		—		(138,022)
Accumulated other comprehensive income	40,953		—		—		—		—		40,953		—		40,953
Retained earnings (accumulated deficit)	4,573,374		42,577		1,161,334		1,413,142		(6,697,321)		493,106		—		493,106
Total Starwood Property Trust, Inc. Stockholders’ Equity	6,349,724		642,989		795,412		1,024,946		(2,740,535)		6,072,536		—		6,072,536
Non-controlling interests in consolidated subsidiaries	115		—		208,519		152,461		—		361,095		261		361,356
Total Permanent Equity	6,349,839		642,989		1,003,931		1,177,407		(2,740,535)		6,433,631		261		6,433,892
Total Liabilities and Equity	$	17,728,759	$	2,283,032	$	2,020,999	$	1,950,855	$	135,073	$	24,118,718	$	59,731,679	$	83,850,397

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24. Subsequent Events

Our significant events subsequent to June 30, 2022 were as follows:

Commercial Loan Sale

In July 2022, the Company sold a $63.6 million first mortgage loan secured by a hotel in San Francisco at its carrying value.

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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

This “Management’s Discussion and Analysis of Financial Condition and Results of Operations” should be read in conjunction with the information included elsewhere in this Quarterly Report on Form 10-Q and in the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021 (our “Form 10-K”). This discussion contains forward-looking statements that involve risks and uncertainties. Actual results could differ significantly from the results discussed in the forward-looking statements. See “Special Note Regarding Forward-Looking Statements” at the beginning of this Quarterly Report on Form 10-Q.

Overview

Starwood Property Trust, Inc. (“STWD” and, together with its subsidiaries, “we” or the “Company”) is a Maryland corporation that commenced operations in August 2009, upon the completion of our initial public offering. We are focused primarily on originating, acquiring, financing and managing mortgage loans and other real estate investments in the United States (“U.S.”), Europe and Australia. As market conditions change over time, we may adjust our strategy to take advantage of changes in interest rates and credit spreads as well as economic and credit conditions.

We have four reportable business segments as of June 30, 2022 and we refer to the investments within these segments as our target assets:

•Real estate commercial and residential lending (the “Commercial and Residential Lending Segment”)—engages primarily in originating, acquiring, financing and managing commercial first mortgages, non-agency residential mortgages (“residential loans”), subordinated mortgages, mezzanine loans, preferred equity, commercial mortgage-backed securities (“CMBS”), residential mortgage-backed securities (“RMBS”) and other real estate and real estate-related debt investments in the U.S., Europe and Australia (including distressed or non-performing loans). Our residential loans are secured by a first mortgage lien on residential property and primarily consist of non-agency residential loans that are not guaranteed by any U.S. Government agency or federally chartered corporation.

•Infrastructure lending (the “Infrastructure Lending Segment”)—engages primarily in originating, acquiring, financing and managing infrastructure debt investments.

•Real estate property (the “Property Segment”)—engages primarily in acquiring and managing equity interests in stabilized commercial real estate properties, including multifamily properties and commercial properties subject to net leases, that are held for investment.

•Real estate investing and servicing (the “Investing and Servicing Segment”)—includes (i) a servicing business in the U.S. that manages and works out problem assets, (ii) an investment business that selectively acquires and manages unrated, investment grade and non-investment grade rated CMBS, including subordinated interests of securitization and resecuritization transactions, (iii) a mortgage loan business which originates conduit loans for the primary purpose of selling these loans into securitization transactions and (iv) an investment business that selectively acquires commercial real estate assets, including properties acquired from CMBS trusts.

Our segments exclude the consolidation of securitization variable interest entities (“VIEs”).

Refer to Note 1 of our condensed consolidated financial statements included herein (the “Condensed Consolidated Financial Statements”) for further discussion of our business and organization.

COVID-19 Pandemic

The full extent of the impact and effects of the COVID-19 pandemic will depend on future developments, including, among other factors, the duration, spread and resurgences of the virus, including variants thereof, along with related travel advisories and restrictions, the recovery time of the disrupted supply chains and industries, the impact of labor market interruptions, the impact of government interventions, the pace, scope and efficacy of vaccination and booster programs, and general uncertainty as to the impact of COVID-19, including variants and resurgences, on the global economy.

Further discussion of the potential impacts on our business, financial condition, results of operations, liquidity, the market price of our common stock and our ability to make distributions to our stockholders from the COVID-19 pandemic is provided in the section entitled “Risk Factors” in Part I, Item 1A of our Form 10-K.

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Developments During the Second Quarter of 2022

Commercial and Residential Lending Segment

•Originated $2.2 billion of commercial investments during the quarter, including the following:

◦A$1.3 billion ($960.5 million) first mortgage loan for the acquisition of three of the largest hotel and gaming resorts located across Australia, which the Company fully funded.

◦$174.1 million first mortgage loan for the acquisition and renovation of two garden-style multifamily properties located in Florida, of which the Company funded $166.1 million.

◦$147.9 million first mortgage and mezzanine loan for the acquisition of a Class A mid-rise multifamily property totaling 353 units, ground-floor retail space, and structured parking located in Florida, of which the Company funded $135.2 million.

◦£109.7 million ($134.5 million) first mortgage loan to refinance existing debt secured by 31 existing care homes, acquire and refurbish one new asset and provide capital expenditures on multiple properties located across the United Kingdom, of which the Company funded $108.6 million.

◦€82.0 million ($85.7 million) investment security secured by a first mortgage loan for the renovation and rebranding of a five star hotel located in Rome, Italy, of which the Company funded $49.8 million.

◦$82.4 million first mortgage loan for the acquisition and renovation of a garden-style multifamily property comprised of 388 units located in Georgia, of which the Company funded $77.2 million.

•Entered into commercial credit facilities of $920.1 million. Amended several commercial credit facilities resulting in an aggregate upsize of $300.0 million.

•Funded $238.9 million of previously originated commercial loan commitments.

•Received gross proceeds of $318.7 million ($123.8 million, net of debt repayments) from maturities and principal repayments on our commercial loans.

•Received gross proceeds of $6.5 million from sales of senior interests in first mortgage loans.

•Acquired $1.0 billion of residential loans.

•Received proceeds of $1.0 billion, including retained RMBS of $141.8 million, from the securitization and sales of $1.0 billion of residential loans.

Infrastructure Lending Segment

•Acquired $195.8 million of infrastructure loans and bonds and funded $14.4 million of pre-existing infrastructure loan commitments.

•Received proceeds of $57.5 million from principal repayments on our infrastructure loans and bonds.

•Entered into a credit facility with a maximum facility size of $500.0 million and a three-year revolving period with two one-year extension options. The margin call provisions under this facility do not permit valuation adjustments based on capital market events and are limited to collateral-specific credit marks.

Investing and Servicing Segment

•Originated commercial conduit loans of $297.4 million.

•Received proceeds of $649.7 million from sales of previously originated commercial conduit loans and priced $33.0 million of previously originated commercial conduit loans in a securitization that settled subsequent to June 30, 2022.

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•Acquired CMBS for a purchase price of $63.7 million, of which $17.1 million related to non-controlling interests.

•Obtained nine new special servicing assignments for CMBS trusts with a total unpaid principal balance of $9.0 billion, bringing our total named special servicing portfolio to $105.1 billion.

Corporate

•Entered into a Starwood Property Trust, Inc. Common Stock Sales Agreement (the “ATM Agreement”) with a syndicate of financial institutions to sell shares of the Company’s common stock of up to $500.0 million from time to time, through an “at the market” equity offering program. During the quarter, we issued 1,415,564 shares under the ATM Agreement for gross proceeds of $33.3 million at an average share price of $23.54.

Developments During the First Quarter of 2022

Commercial and Residential Lending Segment

•Originated or acquired $1.9 billion of commercial loans during the quarter, including the following:

◦$263.6 million of first mortgage loans for the acquisition of a 1,828 unit portfolio of eight multifamily properties located in Texas, of which the Company funded $236.1 million.

◦$250.0 million participation in a first mortgage loan for the construction of 235 luxury residences, a 136-key hotel and 78,000 square feet of commercial space located in New York, of which the Company funded $142.4 million.

◦$200.0 million first mortgage loan to refinance existing debt on a 22 property luxury cabin portfolio and finance the acquisition of 18 future properties located across the U.S., of which the Company funded $84.5 million.

◦€162.7 million ($186.2 million) first mortgage loan for the acquisition of a 382,000 square foot office and retail property located in Berlin, Germany, which the Company has not yet funded.

◦$165.0 million first mortgage and mezzanine loan for the construction of a 65-story 100% pre-sold residential project located in South Florida, of which the Company funded $17.8 million.

◦$111.9 million first mortgage and mezzanine loan for the acquisition of a 348 unit, mid-rise multifamily property located in Arizona, of which the Company funded $102.9 million.

•In February 2022, we refinanced a pool of our commercial loans held-for-investment through a collateralized loan obligation ("CLO"), STWD 2022-FL3. The CLO has a contractual maturity of November 2038 and a weighted average cost of financing of SOFR + 1.91%, inclusive of the amortization of deferred issuance costs. On the closing date, the CLO issued $1.0 billion of notes and preferred shares, of which $842.5 million of notes were purchased by third party investors. We retained $82.5 million of notes, along with preferred shares with a liquidation preference of $75.0 million. The CLO contains a reinvestment feature that, subject to certain eligibility criteria, allows us to contribute new loans or participation interests in loans to the CLO in exchange for cash for a period of two years.

•Sold commercial real estate in Florida that was previously acquired through foreclosure in April 2019 for gross proceeds of $114.8 million and recognized a gain of $86.6 million.

•Entered into or amended commercial credit facilities to increase the available borrowings by $1.1 billion.

•Funded $240.9 million of previously originated commercial loan commitments.

•Received gross proceeds of $715.6 million ($382.2 million, net of debt repayments) from maturities and principal repayments on our commercial loans.

•Acquired $1.8 billion of residential loans.

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•Received proceeds of $1.9 billion, including retained RMBS of $84.4 million, from the securitization and sales of $1.9 billion of residential loans.

•Amended a residential loan repurchase facility to increase the available borrowings by $250 million. The margin call provisions under this facility do not permit valuation adjustments based on capital market events and are limited to collateral-specific credit marks.

Infrastructure Lending Segment

•In January 2022, we refinanced a pool of our infrastructure loans held-for-investment through a CLO, STWD 2021-SIF2. The CLO has a contractual maturity of January 2033 and a weighted average cost of financing of SOFR + 2.11%, inclusive of the amortization of deferred issuance costs. On the closing date, the CLO issued $500.0 million of notes and preferred shares, of which $410.0 million of notes was purchased by third party investors. We retained preferred shares with a liquidation preference of $90.0 million. The CLO contains a reinvestment feature that, subject to certain eligibility criteria, allows us to contribute new loans or participation interests in loans to the CLO in exchange for cash for a period of three years.

•Acquired $231.4 million of infrastructure loans and bonds and funded $8.7 million of pre-existing infrastructure loan commitments.

•Received proceeds of $92.6 million from principal repayments on our infrastructure loans and bonds.

Investing and Servicing Segment

•Originated commercial conduit loans of $450.4 million.

•Received proceeds of $342.1 million from sales of previously originated commercial conduit loans and priced $320.1 million of previously originated commercial conduit loans in two securitizations that settled subsequent to March 31, 2022.

•Obtained six new special servicing assignments for CMBS trusts with a total unpaid principal balance of $5.8 billion, bringing our total named special servicing portfolio to $98.0 billion.

•Sold commercial real estate for gross proceeds of $34.5 million and recognized a total gain of $11.7 million.

Corporate

•Issued $500.0 million of 4.375% Senior Notes due 2027 (the “2027 Senior Notes”) and swapped the notes to a floating rate of SOFR + 2.95%.

Subsequent Events

Refer to Note 24 to the Consolidated Financial Statements for disclosure regarding significant transactions that occurred subsequent to June 30, 2022.

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Results of Operations

The discussion below is based on accounting principles generally accepted in the United States of America (“GAAP”) and therefore reflects the elimination of certain key financial statement line items related to the consolidation of securitization variable interest entities (“VIEs”), particularly within revenues and other income, as discussed in Note 2 to the Condensed Consolidated Financial Statements. For a discussion of our results of operations excluding the impact of Accounting Standards Codification (“ASC”) Topic 810 as it relates to the consolidation of securitization VIEs, refer to the section captioned “Non-GAAP Financial Measures”

The following table compares our summarized results of operations for the three months ended June 30, 2022 and March 31, 2022 and for the six months ended June 30, 2022 and 2021 by business segment (amounts in thousands):

	For the Three Months Ended						For the Six Months Ended				$ Change
Revenues:	June 30, 2022		March 31, 2022		$ Change		June 30, 2022		June 30, 2021
Commercial and Residential Lending Segment	$	251,393	$	225,180	$	26,213	$	476,573	$	375,021	$	101,552
Infrastructure Lending Segment	31,359		27,798		3,561		59,157		41,260		17,897
Property Segment	22,676		22,415		261		45,091		130,598		(85,507)
Investing and Servicing Segment	52,811		57,809		(4,998)		110,620		102,051		8,569
Corporate	3		—		3		3		—		3
Securitization VIE eliminations	(32,656)		(39,210)		6,554		(71,866)		(70,833)		(1,033)
	325,586		293,992		31,594		619,578		578,097		41,481
Costs and expenses:
Commercial and Residential Lending Segment	113,248		78,494		34,754		191,742		103,957		87,785
Infrastructure Lending Segment	19,249		15,188		4,061		34,437		27,134		7,303
Property Segment	21,446		20,417		1,029		41,863		121,212		(79,349)
Investing and Servicing Segment	35,619		36,369		(750)		71,988		72,710		(722)
Corporate	72,854		93,488		(20,634)		166,342		134,023		32,319
Securitization VIE eliminations	(118)		(133)		15		(251)		(218)		(33)
	262,298		243,823		18,475		506,121		458,818		47,303
Other income (loss):
Commercial and Residential Lending Segment	(122,744)		57,084		(179,828)		(65,660)		17,110		(82,770)
Infrastructure Lending Segment	370		480		(110)		850		(835)		1,685
Property Segment	312,537		251,588		60,949		564,125		4,211		559,914
Investing and Servicing Segment	11,024		20,661		(9,637)		31,685		43,864		(12,179)
Corporate	(13,183)		(37,168)		23,985		(50,351)		(5,916)		(44,435)
Securitization VIE eliminations	32,619		39,050		(6,431)		71,669		70,074		1,595
	220,623		331,695		(111,072)		552,318		128,508		423,810
Income (loss) before income taxes:
Commercial and Residential Lending Segment	15,401		203,770		(188,369)		219,171		288,174		(69,003)
Infrastructure Lending Segment	12,480		13,090		(610)		25,570		13,291		12,279
Property Segment	313,767		253,586		60,181		567,353		13,597		553,756
Investing and Servicing Segment	28,216		42,101		(13,885)		70,317		73,205		(2,888)
Corporate	(86,034)		(130,656)		44,622		(216,690)		(139,939)		(76,751)
Securitization VIE eliminations	81		(27)		108		54		(541)		595
	283,911		381,864		(97,953)		665,775		247,787		417,988
Income tax (provision) benefit	(2,206)		2,450		(4,656)		244		1,123		(879)
Net income attributable to non-controlling interests	(69,418)		(59,715)		(9,703)		(129,133)		(21,222)		(107,911)
Net income attributable to Starwood Property Trust, Inc.	$	212,287	$	324,599	$	(112,312)	$	536,886	$	227,688	$	309,198

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Three Months Ended June 30, 2022 Compared to the Three Months Ended March 31, 2022

Commercial and Residential Lending Segment

Revenues

For the three months June 30, 2022, revenues of our Commercial and Residential Lending Segment increased $26.2 million to $251.4 million, compared to $225.2 million for the three months ended March 31, 2022. This increase was primarily due to an increase in interest income from loans of $25.1 million and investment securities of $1.8 million. The increase in interest income from loans reflects (i) a $23.4 million increase from commercial loans, reflecting higher average index rates, balances and prepayment related income and (ii) a $1.7 million increase from residential loans principally due to higher average coupon rates. The increase in interest income from investment securities was primarily due to higher average index rates on commercial investments and higher RMBS investment balances.

Costs and Expenses

For the three months ended June 30, 2022, costs and expenses of our Commercial and Residential Lending Segment increased $34.7 million to $113.2 million, compared to $78.5 million for the three months ended March 31, 2022. This increase was primarily due to a $19.6 million increase in interest expense associated with the various secured financing facilities used to fund a portion of this segment’s investment portfolio and an $11.2 million increase in credit loss provision. The increase in interest expense was primarily due to higher average borrowings outstanding and higher average index rates. The credit loss provision increased from a reversal of $3.3 million in the first quarter of 2022 to a provision of $7.9 million in the second quarter of 2022. The credit loss provision in the second quarter of 2022 was primarily due to rising index rates and its potential effect on borrower cash flows in our estimate of current expected credit losses (“CECL”).

Net Interest Income (amounts in thousands)

	For the Three Months Ended
	June 30, 2022		March 31, 2022		Change
Interest income from loans	$	227,555	$	202,470	$	25,085
Interest income from investment securities	22,591		20,836		1,755
Interest expense	(88,226)		(68,602)		(19,624)
Net interest income	$	161,920	$	154,704	$	7,216

For the three months ended June 30, 2022, net interest income of our Commercial and Residential Lending Segment increased $7.2 million to $161.9 million, compared to $154.7 million for the three months ended March 31, 2022. This increase reflects the increase in interest income, partially offset by the increase in interest expense on our secured financing facilities, both as discussed in the sections above.

During the three months ended June 30, 2022 and March 31, 2022, the weighted average unlevered yields on the Commercial and Residential Lending Segment’s loans and investment securities, excluding retained RMBS and loans for which interest income is not recognized, were as follows:

	For the Three Months Ended
	June 30, 2022		March 31, 2022
Commercial	5.4	%	5.2	%
Residential	4.8	%	4.3	%
Overall	5.4	%	5.1	%

The weighted average unlevered yield on our commercial loans increased primarily due to higher average index rates and prepayment related income. The weighted average unlevered yield on our residential loans increased primarily due to higher average coupon rates.

During the three months ended June 30, 2022 and March 31, 2022, the Commercial and Residential Lending Segment’s weighted average secured borrowing rates, inclusive of interest rate hedging costs and the amortization of deferred financing fees, were 2.9% and 2.4%, respectively. The increase in borrowing rates primarily reflects higher index rates.

Other Income (Loss)

For the three months ended June 30, 2022, other income of our Commercial and Residential Lending Segment decreased $179.8 million to a loss of $122.7 million compared to income of $57.1 million for the three months ended March 31,

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2022. This decrease was primarily due to (i) the nonrecurrence of an $86.6 million gain on sale of a distribution facility in the first quarter of 2022, (ii) a $51.1 million increase in foreign currency loss, (iii) a $32.7 million estimated loss contingency related to residential loans sold in February 2022 (refer to Note 22 to the Condensed Consolidated Financial Statements) and (iv) a $17.2 million greater decrease in fair value of investment securities, principally related to RMBS, partially offset by (v) an $8.7 million increase in net gains on derivatives. The increase in net gains on derivatives in the second quarter of 2022 reflects a $66.4 million increased gain on foreign currency hedges, partially offset by a $57.7 million decreased gain on interest rate swaps principally related to residential loans. The foreign currency hedges are used to fix the U.S. dollar amounts of cash flows (both interest and principal payments) we expect to receive from our foreign currency denominated loans and investments. The increased gain on foreign currency hedges and the increase in foreign currency loss reflect the strengthening of the U.S. dollar against the pound sterling (“GBP”), Euro (“EUR”) and Australian dollar (“AUD”) in the second quarter of 2022 compared to a lesser strengthening of the U.S. dollar against the GBP and EUR, partially offset by a weakening against the AUD, in the first quarter of 2022. The interest rate swaps are used primarily to hedge our interest rate risk on residential loans held-for-sale and to fix our interest rate payments on certain variable rate borrowings which fund fixed rate investments.

Infrastructure Lending Segment

Revenues

For the three months ended June 30, 2022, revenues of our Infrastructure Lending Segment increased $3.6 million to $31.4 million, compared to $27.8 million for the three months ended March 31, 2022. This was primarily due to an increase in interest income from loans of $3.1 million reflecting higher average index rates and balances.

Costs and Expenses

For the three months ended June 30, 2022, costs and expenses of our Infrastructure Lending Segment increased $4.0 million to $19.2 million, compared to $15.2 million for the three months ended March 31, 2022. The increase was primarily due to a $3.1 million increase in interest expense associated with the various secured financing facilities used to fund this segment’s investment portfolio and a $0.9 million increase in credit loss provision. The increase in interest expense was primarily due to higher average index rates.

Net Interest Income (amounts in thousands)

	For the Three Months Ended
	June 30, 2022		March 31, 2022		Change
Interest income from loans	$	30,096	$	26,983	$	3,113
Interest income from investment securities	1,173		747		426
Interest expense	(15,001)		(11,930)		(3,071)
Net interest income	$	16,268	$	15,800	$	468

For the three months ended June 30, 2022, net interest income of our Infrastructure Lending Segment increased $0.5 million to $16.3 million, compared to $15.8 million for the three months ended March 31, 2022. The increase reflects the increase in interest income, partially offset by the increase in interest expense on the secured financing facilities, both as discussed in the sections above.

During the three months ended June 30, 2022 and March 31, 2022, the weighted average unlevered yields on the Infrastructure Lending Segment’s loans and investment securities held-for-investment were 5.5% and 5.0%, respectively.

During the three months ended June 30, 2022 and March 31, 2022, the Infrastructure Lending Segment’s weighted average secured borrowing rates, inclusive of the amortization of deferred financing fees, were 3.4% and 2.8%, respectively.

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Other Income

For the three months ended June 30, 2022, other income of our Infrastructure Lending Segment decreased $0.1 million to $0.4 million, compared to $0.5 million for the three months ended March 31, 2022.

Property Segment

Change in Results by Portfolio (amounts in thousands)

	$ Change from prior period
	Revenues		Costs and  expenses		Gain (loss) on derivative financial instruments		Other income (loss)		Income (loss) before  income taxes
Master Lease Portfolio	$	—	$	26	$	—	$	—	$	(26)
Medical Office Portfolio	261		1,094		(12,191)		—		(13,024)
Woodstar Fund	—		(22)		—		73,123		73,145
Other/Corporate	—		(69)		—		17		86
Total	$	261	$	1,029	$	(12,191)	$	73,140	$	60,181

See Notes 6 and 7 to the Condensed Consolidated Financial Statements for a description of the above-referenced Property Segment portfolios and fund.

Revenues

For the three months ended June 30, 2022, revenues of our Property Segment increased $0.3 million to $22.7 million, compared to $22.4 million for the three months ended March 31, 2022.

Costs and Expenses

For the three months ended June 30, 2022, costs and expenses of our Property Segment increased $1.0 million to $21.4 million, compared to $20.4 million for the three months ended March 31, 2022. The increase is primarily due to an increase in interest expense reflecting higher index rates on variable rate borrowings.

Other Income

For the three months ended June 30, 2022, other income of our Property Segment increased $60.9 million to $312.5 million compared to $251.6 million for the three months ended March 31, 2022. The increase is primarily due to (i) a $73.1 million increase in income attributable to investments of the Woodstar Fund, reflecting greater unrealized increases in fair value during the second quarter of 2022, partially offset by (ii) a $12.2 million decreased gain on derivatives which primarily hedge our interest rate risk on borrowings secured by our Medical Office Portfolio.

Investing and Servicing Segment

Revenues

For the three months ended June 30, 2022, revenues of our Investing and Servicing Segment decreased $5.0 million to $52.8 million, compared to $57.8 million for the three months ended March 31, 2022. The decrease primarily reflects a $6.4 million decrease in interest income from CMBS due to lower recoveries, partially offset by a $1.5 million increase in servicing fees.

Costs and Expenses

For the three months ended June 30, 2022, costs and expenses of our Investing and Servicing Segment decreased $0.8 million to $35.6 million, compared to $36.4 million for the three months ended March 31, 2022.

Other Income

For the three months ended June 30, 2022, other income of our Investing and Servicing Segment decreased $9.7 million to $11.0 million, compared to $20.7 million for the three months ended March 31, 2022. The decrease in other income was primarily due to (i) an $18.9 million decrease in net gains on derivatives which primarily hedge our interest rate risk on

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conduit loans and CMBS investments and (ii) the nonrecurrence of an $11.7 million gain on sale of an operating property in the first quarter of 2022, partially offset by (iii) a $17.4 million favorable change in fair value of conduit loans.

Corporate and Other Items

Corporate Costs and Expenses

For the three months ended June 30, 2022, corporate expenses decreased $20.6 million to $72.9 million, compared to $93.5 million for the three months ended March 31, 2022. This decrease was primarily due to (i) a decrease of $23.6 million in management fees principally due to lower incentive fees attributable to nonrecurring transactions, partially offset by (ii) a $2.3 million increase in interest expense attributable to the 2027 Senior Notes we issued in late January 2022 and higher index rates on our term loan.

Corporate Other Loss

For the three months ended June 30, 2022, corporate other loss decreased $24.0 million to $13.2 million, compared to $37.2 million for the three months ended March 31, 2022. This decrease was due to a lower loss on our fixed-to-floating interest rate swaps which hedge a portion of our unsecured senior notes.

Securitization VIE Eliminations

Securitization VIE eliminations primarily reclassify interest income and servicing fee revenues to other income (loss) for the CMBS and RMBS VIEs that we consolidate as primary beneficiary. Such eliminations have no overall effect on net income (loss) attributable to Starwood Property Trust. The reclassified revenues, along with applicable changes in fair value of investment securities and servicing rights, comprise the other income (loss) caption “Change in net assets related to consolidated VIEs,” which represents our beneficial interest in those consolidated VIEs. The magnitude of the securitization VIE eliminations is merely a function of the number of CMBS and RMBS trusts consolidated in any given period, and as such, is not a meaningful indicator of operating results. The eliminations primarily relate to CMBS trusts for which the Investing and Servicing Segment is deemed the primary beneficiary and, to a much lesser extent, some CMBS and RMBS trusts for which the Commercial and Residential Lending Segment is deemed the primary beneficiary.

Income Tax (Provision) Benefit

Our consolidated income taxes principally relate to the taxable nature of our loan servicing and loan securitization businesses which are housed in taxable REIT subsidiaries (“TRSs”). For the three months ended June 30, 2022, our income tax provision increased $4.7 million to a provision of $2.2 million compared to a benefit of $2.5 million for the three months ended March 31, 2022 due to taxable income of our TRSs in the second quarter of 2022 compared to tax losses of our TRSs in the first quarter of 2022. The tax losses in the first quarter of 2022 were primarily attributable to net unrealized losses on our residential loans.

Net Income Attributable to Non-controlling Interests

During the three months ended June 30, 2022, net income attributable to non-controlling interests increased $9.7 million to $69.4 million, compared to $59.7 million during the three months ended March 31, 2022. The increase was primarily due to non-controlling interests in increased income of the Woodstar Fund, partially offset by non-controlling interests in decreased income of a consolidated CMBS joint venture in which we hold a 51% interest.

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Six Months Ended June 30, 2022 Compared to the Six Months Ended June 30, 2021

Commercial and Residential Lending Segment

Revenues

For the six months ended June 30, 2022, revenues of our Commercial and Residential Lending Segment increased $101.6 million to $476.6 million, compared to $375.0 million for the six months ended June 30, 2021. This increase was primarily due to increases in interest income from loans of $93.7 million and investment securities of $7.9 million. The increase in interest income from loans reflects (i) a $61.0 million increase from commercial loans, reflecting higher average balances, partially offset by the timing effect of certain loans being placed on nonaccrual, and (ii) a $32.7 million increase from residential loans principally due to higher average balances reflecting the timing of purchases and securitizations, partially offset by lower average coupon rates. The increase in interest income from investment securities was primarily due to higher commercial and RMBS average investment balances.

Costs and Expenses

For the six months ended June 30, 2022, costs and expenses of our Commercial and Residential Lending Segment increased $87.7 million to $191.7 million, compared to $104.0 million for the six months ended June 30, 2021. This increase was primarily due to (i) a $64.2 million increase in interest expense associated with the various secured financing facilities used to fund a portion of this segment’s investment portfolio and (ii) a $17.6 million increase in credit loss provision from a reversal of $13.0 million in the first half of 2021 to a provision of $4.6 million in the first half of 2022. The increase in interest expense was primarily due to higher average borrowings outstanding and higher average index rates. The credit loss provision in the first half of 2022 was primarily due to rising index rates and its potential effect on borrower cash flows in our estimate of CECL.

Net Interest Income (amounts in thousands)

	For the Six Months Ended June 30,
	2022		2021		Change
Interest income from loans	$	430,025	$	336,290	$	93,735
Interest income from investment securities	43,427		35,575		7,852
Interest expense	(156,828)		(92,651)		(64,177)
Net interest income	$	316,624	$	279,214	$	37,410

For the six months ended June 30, 2022, net interest income of our Commercial and Residential Lending Segment increased $37.4 million to $316.6 million, compared to $279.2 million for the six months ended June 30, 2021. This increase reflects the increase in interest income, partially offset by the increase in interest expense on our secured financing facilities, both as discussed in the sections above.

During the six months ended June 30, 2022 and 2021, the weighted average unlevered yields on the Commercial and Residential Lending Segment’s loans and investment securities, excluding retained RMBS and loans for which interest income is not recognized, were as follows:

	For the Six Months Ended June 30,
	2022		2021
Commercial	5.3	%	5.9	%
Residential	4.5	%	6.0	%
Overall	5.3	%	5.9	%

The weighted average unlevered yield on our commercial loans decreased primarily due to repayment of loans with higher LIBOR floors being replaced by newer loans with lower floating rate floors and the timing effect of certain loans being placed on nonaccrual. The unlevered yield on our residential loans decreased due to lower weighted average coupons which resulted from market spread tightening as well as a change in the composition of our residential loan portfolio to include agency loans which generally carry a lower coupon than non-agency loans.

During the six months ended June 30, 2022 and 2021, the Commercial and Residential Lending Segment’s weighted average secured borrowing rates, inclusive of interest rate hedging costs and the amortization of deferred financing fees, were 2.7% and 2.5%, respectively. The increase in borrowing rates primarily reflects higher index rates, partially offset by decreases

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in weighted average spreads particularly due to increased use of lower cost CLO financing and a transition in the underlying collateral mix of our investments.

Other Income (Loss)

For the six months ended June 30, 2022, other income of our Commercial and Residential Lending Segment decreased $82.8 million to a loss of $65.7 million, compared to income of $17.1 million for the six months ended June 30, 2021. This decrease primarily reflects (i) a $239.2 million unfavorable change in fair value of residential loans, (ii) a $96.7 million increase in foreign currency loss, (iii) a $32.7 million estimated loss contingency related to residential loans sold in February 2022 (refer to Note 22 to the Condensed Consolidated Financial Statements) and (iv) a $10.0 million greater decrease in fair value of investment securities, all partially offset by (v) a $224.3 million increase in gains on derivatives and (vi) a $68.9 million increased gain on sale of foreclosed properties. The unfavorable change in fair value of residential loans was principally related to a rapid rise in interest rates and widening of credit spreads in the first half of 2022, which resulted in mark-to-market losses on our fixed coupon residential loans. The increased gains on derivatives during the six months ended June 30, 2022 reflect a $120.6 million increased gain on interest rate swaps principally related to residential loans, which partially offsets the unfavorable change in fair value of those loans, and a $103.7 million increased gain on foreign currency hedges. The interest rate swaps are used primarily to hedge our interest rate risk on residential loans held-for-sale and to fix our interest rate payments on certain variable rate borrowings which fund fixed rate investments. The foreign currency hedges are used to fix the U.S. dollar amounts of cash flows (both interest and principal payments) we expect to receive from our foreign currency denominated loans and investments. The increased gain on foreign currency hedges and the increase in foreign currency loss reflect the strengthening of the U.S. dollar against the GBP, EUR and AUD during the first half of 2022 compared to a lesser overall strengthening of the U.S. dollar against the EUR and AUD, partially offset by a weakening against the GBP, during the first half of 2021.

Infrastructure Lending Segment

Revenues

For the six months ended June 30, 2022, revenues of our Infrastructure Lending Segment increased $17.9 million to $59.2 million, compared to $41.3 million for the six months ended June 30, 2021. This increase was primarily due to an increase in interest income from loans of $17.1 million, principally due to higher average balances and index rates.

Costs and Expenses

For the six months ended June 30, 2022, costs and expenses of our Infrastructure Lending Segment increased $7.3 million to $34.4 million, compared to $27.1 million for the six months ended June 30, 2021. The increase was primarily due to (i) an $8.4 million increase in interest expense associated with the various secured financing facilities used to fund this segment’s investment portfolio, partially offset by (ii) a $1.0 million decrease in credit loss provision. The increase in interest expense was primarily due to higher average borrowings outstanding and higher average index rates.

Net Interest Income (amounts in thousands)

	For the Six Months Ended June 30,
	2022		2021		Change
Interest income from loans	$	57,079	$	39,979	$	17,100
Interest income from investment securities	1,920		1,119		801
Interest expense	(26,931)		(18,535)		(8,396)
Net interest income	$	32,068	$	22,563	$	9,505

For the six months ended June 30, 2022, net interest income of our Infrastructure Lending Segment increased $9.5 million to $32.1 million, compared to $22.6 million for the six months ended June 30, 2021. The increase reflects the increase in interest income, partially offset by the increase in interest expense on the secured financing facilities, both as discussed in the sections above.

During the six months ended June 30, 2022 and 2021, the weighted average unlevered yields on the Infrastructure Lending Segment’s loans and investment securities held-for-investment were 5.3% and 4.9%, respectively. During the six

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months ended June 30, 2021, the weighted average unlevered yields on the Infrastructure Lending Segment’s loans held-for-sale were 2.8%. There were no loans held-for-sale during the six months ended June 30, 2022.

During the six months ended June 30, 2022 and 2021, the Infrastructure Lending Segment’s weighted average secured borrowing rates, inclusive of the amortization of deferred financing fees, were 3.1% and 2.9%, respectively.

Other Income (Loss)

For the six months ended June 30, 2022 and 2021, other income of our Infrastructure Lending Segment increased $1.7 million to income of $0.9 million, compared to a loss of $0.8 million for the six months ended June 30, 2021. The increase primarily reflects a $1.1 million favorable change in earnings (loss) from an unconsolidated entity and a $0.8 million lower loss on extinguishment of debt.

Property Segment

Change in Results by Portfolio (amounts in thousands)

	$ Change from prior period
	Revenues		Costs and  expenses		Gain (loss) on derivative  financial instruments		Other income (loss)		Income (loss) before  income taxes
Master Lease Portfolio	$	—	$	(41)	$	—	$	—	$	41
Medical Office Portfolio	(19)		6		18,632		—		18,607
Woodstar I Portfolio	(49,127)		(44,859)		(83)		—		(4,351)
Woodstar II Portfolio	(36,361)		(34,687)		—		141		(1,533)
Woodstar Fund	—		1,019		—		541,206		540,187
Other/Corporate	—		(787)		—		18		805
Total	$	(85,507)	$	(79,349)	$	18,549	$	541,365	$	553,756

Revenues

For the six months ended June 30, 2022, revenues of our Property Segment decreased $85.5 million to $45.1 million, compared to $130.6 million for the six months ended June 30, 2021. The decrease is primarily due to the conversion of the Woodstar Portfolios to the Woodstar Fund on November 5, 2021.

Costs and Expenses

For the six months ended June 30, 2022, costs and expenses of our Property Segment decreased $79.3 million to $41.9 million, compared to $121.2 million for the six months ended June 30, 2021, primarily due to the Woodstar Fund conversion referred to above.

Other Income

For the six months ended June 30, 2022, other income of our Property Segment increased $559.9 million to $564.1 million, compared to $4.2 million for the six months ended June 30, 2021. The increase is primarily due to (i) $541.2 million of income attributable to investments of the Woodstar Fund, including $510.4 million of unrealized increases in fair value, during the first half of 2022 and (ii) an $18.5 million increased gain on derivatives which primarily hedge our interest rate risk on borrowings secured by our Medical Office Portfolio

Investing and Servicing Segment

Revenues

For the six months ended June 30, 2022, revenues of our Investing and Servicing Segment increased $8.5 million to $110.6 million, compared to $102.1 million for the six months ended June 30, 2021. The increase in revenues was primarily due to (i) a $5.9 million increase in interest income from conduit loans and CMBS investments and (ii) a $6.6 million increase in other fee income related to the origination of certain loans contributed into CMBS transactions, partially offset by (iii) a $4.8 million decrease in rental income principally reflecting fewer properties held.

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Costs and Expenses

For the six months ended June 30, 2022, costs and expenses of our Investing and Servicing Segment decreased $0.7 million to $72.0 million, compared to $72.7 million for the six months ended June 30, 2021.

Other Income

For the six months ended June 30, 2022, other income of our Investing and Servicing Segment decreased $12.2 million to $31.7 million, compared to $43.9 million for the six months ended June 30, 2021. The decrease in other income was primarily due to (i) a $36.5 million unfavorable change in fair value of conduit loans and (ii) a $12.0 million greater decrease in fair value of CMBS investments, both partially offset by (iii) a $33.3 million increased gain on derivatives which primarily hedge our interest rate risk on conduit loans and CMBS investments.

Corporate and Other Items

Corporate Costs and Expenses

For the six months ended June 30, 2022, corporate expenses increased $32.3 million to $166.3 million, compared to $134.0 million for the six months ended June 30, 2021. This increase was primarily due to increases of (i) $19.5 million in management fees, primarily reflecting higher incentive fees principally related to operating property sales, and (ii) $11.7 million in interest expense on higher average outstanding term loan and unsecured senior note balances.

Corporate Other Loss

For the six months ended June 30, 2022, corporate other loss increased $44.5 million to $50.4 million, compared to $5.9 million for the six months ended June 30, 2021. This increase was due to an increased loss on fixed-to-floating interest rate swaps which hedge a portion of our unsecured senior notes.

Securitization VIE Eliminations

Refer to the preceding comparison of the three months ended June 30, 2022 to the three months ended March 31, 2022 for a discussion of the effect of securitization VIE eliminations.

Income Tax Benefit

Our consolidated income taxes principally relate to the taxable nature of our loan servicing and loan securitization businesses which are housed in TRSs. For the six months ended June 30, 2022, our income tax benefit decreased $0.9 million to $0.2 million, compared to $1.1 million for the six months ended June 30, 2021 due to lower tax losses of our TRSs in the first half of 2022.

Net Income Attributable to Non-controlling Interests

For the six months ended June 30, 2022, net income attributable to non-controlling interests increased $107.9 million to $129.1 million, compared to $21.2 million for the six months ended June 30, 2021. The increase was primarily due to non-controlling interests in earnings of the Woodstar Fund during the first half of 2022.

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Non-GAAP Financial Measures

Distributable Earnings is a non-GAAP financial measure. We calculate Distributable Earnings as GAAP net income (loss) excluding the following:

(i)non-cash equity compensation expense;

(ii)incentive fees due under our management agreement;

(iii)depreciation and amortization of real estate and associated intangibles;

(iv)acquisition costs associated with successful acquisitions;

(v)any unrealized gains, losses or other non-cash items recorded in net income (loss) for the period, regardless of whether such items are included in other comprehensive income or loss, or in net income (loss); and

(vi)any deductions for distributions payable with respect to equity securities of subsidiaries issued in exchange for properties or interests therein.

The CECL reserve has been excluded from Distributable Earnings consistent with other unrealized gains (losses) pursuant to our existing policy for reporting Distributable Earnings. We expect to only recognize such potential credit losses in Distributable Earnings if and when such amounts are deemed nonrecoverable upon a realization event. This is generally at the time a loan is repaid, or in the case of foreclosure, when the underlying asset is sold, but non-recoverability may also be determined if, in our determination, it is nearly certain that all amounts due will not be collected. The realized loss amount reflected in Distributable Earnings will equal the difference between the cash received, or expected to be received, and the book value of the asset, and is reflective of our economic experience as it relates to the ultimate realization of the loan.

We believe that Distributable Earnings provides meaningful information to consider in addition to our net income (loss) and cash flow from operating activities determined in accordance with GAAP. We believe Distributable Earnings is a useful financial metric for existing and potential future holders of our common stock as historically, over time, Distributable Earnings has been a strong indicator of our dividends per share. As a REIT, we generally must distribute annually at least 90% of our net taxable income, subject to certain adjustments, and therefore we believe our dividends are one of the principal reasons stockholders may invest in our common stock. Further, Distributable Earnings helps us to evaluate our performance excluding the effects of certain transactions and GAAP adjustments that we believe are not necessarily indicative of our current loan portfolio and operations, and is a performance metric we consider when declaring our dividends. We also use Distributable Earnings (previously defined as “Core Earnings”) to compute the incentive fee due under our management agreement.

Distributable Earnings does not represent net income (loss) or cash generated from operating activities and should not be considered as an alternative to GAAP net income (loss), or an indication of our GAAP cash flows from operations, a measure of our liquidity, taxable income, or an indication of funds available for our cash needs. In addition, our methodology for calculating Distributable Earnings may differ from the methodologies employed by other companies to calculate the same or similar supplemental performance measures, and accordingly, our reported Distributable Earnings may not be comparable to the Distributable Earnings reported by other companies.

The weighted average diluted share count applied to Distributable Earnings for purposes of determining Distributable Earnings per share (“EPS”) is computed using the GAAP diluted share count, adjusted for the following:

(i)Unvested stock awards – Currently, unvested stock awards are excluded from the denominator of GAAP EPS. The related compensation expense is also excluded from Distributable Earnings. In order to effectuate dilution from these awards in the Distributable Earnings computation, we adjust the GAAP diluted share count to include these shares.

(ii)Convertible Notes – Conversion of our Convertible Notes is an event that is contingent upon numerous factors, none of which are in our control, and is an event that may or may not occur. Consistent with the treatment of other unrealized adjustments to Distributable Earnings, we adjust the GAAP diluted share count to exclude the potential shares issuable upon conversion until a conversion occurs.

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(iii)Subsidiary equity – The intent of a February 2018 amendment to our management agreement (the “Amendment”) is to treat subsidiary equity in the same manner as if parent equity had been issued. The Class A Units issued in connection with the acquisition of assets in our Woodstar II Portfolio are currently excluded from our GAAP diluted share count, with the subsidiary equity represented as non-controlling interests in consolidated subsidiaries on our GAAP balance sheet. Consistent with the Amendment, we adjust GAAP diluted share count to include these subsidiary units.    

The following table presents our diluted weighted average shares used in our GAAP EPS calculation reconciled to our diluted weighted average shares used in our Distributable EPS calculation (amounts in thousands):

	For the Three Months Ended		For the Six Months Ended
	June 30, 2022	March 31, 2022	June 30, 2022	June 30, 2021
Diluted weighted average shares - GAAP EPS	314,962	313,329	313,908	293,808
Add: Unvested stock awards	3,486	3,695	3,590	4,454
Add: Woodstar II Class A Units	9,773	9,773	9,773	10,502
Less: Convertible Notes dilution	(9,649)	(9,649)	(9,649)	(9,649)
Diluted weighted average shares - Distributable EPS	318,572	317,148	317,622	299,115

The definition of Distributable Earnings allows management to make adjustments, subject to the approval of a majority of our independent directors, in situations where such adjustments are considered appropriate in order for Distributable Earnings to be calculated in a manner consistent with its definition and objective. No adjustments to the definition of Distributable Earnings became effective during the six months ended June 30, 2022.

The following table summarizes our quarterly Distributable Earnings per weighted average diluted share for the six months ended June 30, 2022 and 2021:

	Distributable Earnings For the Three-Month Periods Ended
	March 31,		June 30,
2022	$	0.76	$	0.51
2021	0.50		0.51

Distributable Earnings per weighted average diluted share for the six months ended June 30, 2021 does not equal the sum of the individual quarters due to rounding and other computational factors.

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The following table presents our summarized results of operations and reconciliation to Distributable Earnings for the three months ended June 30, 2022, by business segment (amounts in thousands, except per share data):

	Commercial and Residential Lending Segment		Infrastructure Lending Segment		Property Segment		Investing and Servicing Segment		Corporate		Total
Revenues	$	251,393	$	31,359	$	22,676	$	52,811	$	3	$	358,242
Costs and expenses	(113,248)		(19,249)		(21,446)		(35,619)		(72,854)		(262,416)
Other income (loss)	(122,744)		370		312,537		11,024		(13,183)		188,004
Income (loss) before income taxes	15,401		12,480		313,767		28,216		(86,034)		283,830
Income tax (provision) benefit	(557)		1		—		(1,650)		—		(2,206)
Income attributable to non-controlling interests	(4)		—		(67,482)		(1,851)		—		(69,337)
Net income (loss) attributable to Starwood Property Trust, Inc.	14,840		12,481		246,285		24,715		(86,034)		212,287
Add / (Deduct):
Non-controlling interests attributable to Woodstar II Class A Units	—		—		4,691		—		—		4,691
Non-controlling interests attributable to unrealized gains/losses	—		—		60,043		(1,910)		—		58,133
Non-cash equity compensation expense	2,036		345		76		1,424		6,026		9,907
Management incentive fee	—		—		—		—		5,271		5,271
Acquisition and investment pursuit costs	(39)		—		(82)		—		—		(121)
Depreciation and amortization	1,229		96		8,250		2,895		—		12,470
Interest income adjustment for securities	2,573		—		—		3,723		—		6,296
Extinguishment of debt, net	—		—		—		—		(247)		(247)
Other non-cash items	32,666		—		336		80		—		33,082
Reversal of GAAP unrealized (gains) / losses on:
Loans	121,356		—		—		(7,876)		—		113,480
Credit loss provision, net	7,925		513		—		—		—		8,438
Securities	19,312		—		—		8,150		—		27,462
Woodstar Fund investments	—		—		(307,165)		—		—		(307,165)
Derivatives	(130,811)		(290)		(6,108)		(9,818)		15,693		(131,334)
Foreign currency	78,331		289		(18)		—		—		78,602
Earnings from unconsolidated entities	(2,786)		(394)		—		(1,748)		—		(4,928)
Recognition of Distributable realized gains / (losses) on:
Loans	(36,343)		—		—		7,753		—		(28,590)
Securities	(333)		—		—		(4,413)		—		(4,746)
Woodstar Fund investments	—		—		15,175		—		—		15,175
Derivatives	42,576		—		(34)		8,247		—		50,789
Foreign currency	(2,117)		(31)		18		—		—		(2,130)
Earnings from unconsolidated entities	2,903		394		—		2,375		—		5,672
Distributable Earnings (Loss)	$	153,318	$	13,403	$	21,467	$	33,597	$	(59,291)	$	162,494
Distributable Earnings (Loss) per Weighted Average Diluted Share	$	0.48	$	0.04	$	0.07	$	0.11	$	(0.19)	$	0.51

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The following table presents our summarized results of operations and reconciliation to Distributable Earnings for the three months ended March 31, 2022, by business segment (amounts in thousands, except per share data):

	Commercial and Residential Lending Segment		Infrastructure Lending Segment		Property Segment		Investing and Servicing Segment		Corporate		Total
Revenues	$	225,180	$	27,798	$	22,415	$	57,809	$	—	$	333,202
Costs and expenses	(78,494)		(15,188)		(20,417)		(36,369)		(93,488)		(243,956)
Other income (loss)	57,084		480		251,588		20,661		(37,168)		292,645
Income (loss) before income taxes	203,770		13,090		253,586		42,101		(130,656)		381,891
Income tax benefit (provision)	5,140		4		—		(2,694)		—		2,450
Income attributable to non-controlling interests	(3)		—		(52,411)		(7,328)		—		(59,742)
Net income (loss) attributable to Starwood Property Trust, Inc.	208,907		13,094		201,175		32,079		(130,656)		324,599
Add / (Deduct):
Non-controlling interests attributable to Woodstar II Class A Units	—		—		4,691		—		—		4,691
Non-controlling interests attributable to unrealized gains/losses	—		—		44,902		2,556		—		47,458
Non-cash equity compensation expense	2,417		297		58		1,275		6,046		10,093
Management incentive fee	—		—		—		—		28,955		28,955
Acquisition and investment pursuit costs	(298)		—		(78)		(169)		—		(545)
Depreciation and amortization	234		95		8,292		3,152		—		11,773
Interest income adjustment for securities	2,490		—		—		(1,708)		—		782
Extinguishment of debt, net	—		—		—		—		(246)		(246)
Other non-cash items	3		—		456		122		—		581
Reversal of GAAP unrealized (gains) / losses on:
Loans	116,228		—		—		9,555		—		125,783
Credit loss reversal, net	(3,299)		(359)		—		—		—		(3,658)
Securities	2,105		—		—		9,291		—		11,396
Woodstar Fund investments	—		—		(234,041)		—		—		(234,041)
Derivatives	(121,172)		(685)		(19,170)		(29,089)		40,773		(129,343)
Foreign currency	27,254		28		(1)		—		—		27,281
(Earnings) loss from unconsolidated entities	1,340		(345)		—		(151)		—		844
Sales of properties	(86,610)		—		—		(11,858)		—		(98,468)
Recognition of Distributable realized gains / (losses) on:
Loans	(36,208)		—		—		(10,561)		—		(46,769)
Securities	(2,768)		—		—		26		—		(2,742)
Woodstar Fund investments	—		—		15,659		—		—		15,659
Derivatives	36,893		—		(35)		24,639		—		61,497
Foreign currency	(178)		112		1		—		—		(65)
Earnings (loss) from unconsolidated entities	(1,239)		345		—		470		—		(424)
Sales of properties	84,738		—		—		177		—		84,915
Distributable Earnings (Loss)	$	230,837	$	12,582	$	21,909	$	29,806	$	(55,128)	$	240,006
Distributable Earnings (Loss) per Weighted Average Diluted Share	$	0.73	$	0.04	$	0.07	$	0.09	$	(0.17)	$	0.76

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Three Months Ended June 30, 2022 Compared to the Three Months Ended March 31, 2022

Commercial and Residential Lending Segment

The Commercial and Residential Lending Segment’s Distributable Earnings decreased by $77.5 million, from $230.8 million during the first quarter of 2022 to $153.3 million in the second quarter of 2022. After making adjustments for the calculation of Distributable Earnings, revenues were $254.1 million, costs and expenses were $102.2 million, other income was $2.0 million and income tax provision was $0.6 million.

Revenues, consisting principally of interest income on loans, increased by $26.4 million in the second quarter of 2022, primarily due to an increase in interest income from loans of $25.1 million and investment securities of $1.8 million. The increase in interest income from loans reflects (i) a $23.4 million increase from commercial loans, reflecting higher average index rates, balances and prepayment related income and (ii) a $1.7 million increase from residential loans principally due to higher average coupon rates. The increase in interest income from investment securities was primarily due to higher average index rates on commercial investments and higher RMBS investment balances.

Costs and expenses increased by $22.8 million in the second quarter of 2022, primarily due to a $19.6 million increase in interest expense associated with the various secured financing facilities used to fund a portion of this segment’s investment portfolio reflecting higher average borrowings outstanding and higher average index rates.

Other income decreased by $75.4 million in the second quarter of 2022, primarily due to the nonrecurrence of an $84.7 million gain on sale of a distribution facility in the first quarter of 2022, partially offset by a $4.8 million increase in realized net gains on derivatives and a $4.1 million favorable change in earnings from unconsolidated entities.

Income taxes, which principally relate to the taxable nature of this segment’s residential loan securitization activities which are housed in TRSs, increased $5.7 million from a benefit of $5.1 million to a provision of $0.6 million primarily due to taxable income of those TRSs in the second quarter of 2022 compared to tax losses of those TRSs in the first quarter of 2022. The tax losses in the first quarter of 2022 were primarily attributable to net unrealized losses on our residential loans.

Infrastructure Lending Segment

The Infrastructure Lending Segment’s Distributable Earnings increased by $0.8 million, from $12.6 million during the first quarter of 2022 to $13.4 million in the second quarter of 2022. After making adjustments for the calculation of Distributable Earnings, revenues were $31.4 million, costs and expenses were $18.3 million and other income was $0.3 million.

Revenues, consisting principally of interest income on loans, increased by $3.6 million in the second quarter of 2022, primarily due to an increase in interest income from loans of $3.1 million reflecting higher average index rates and balances.

Costs and expenses increased by $3.2 million in the second quarter of 2022, primarily due to an increase in interest expense reflecting higher average index rates.

Other income increased by $0.4 million in the second quarter of 2022, primarily due to the nonrecurrence of a $0.5 million loss on extinguishment of debt in the first quarter of 2022.

Property Segment

Distributable Earnings by Portfolio (amounts in thousands)

	For the Three Months Ended
	June 30, 2022		March 31, 2022		Change
Master Lease Portfolio	$	4,317	$	4,342	$	(25)
Medical Office Portfolio	5,532		5,656		(124)
Woodstar Fund, net of non-controlling interests	12,300		12,719		(419)
Other/Corporate	(682)		(808)		126
Distributable Earnings	$	21,467	$	21,909	$	(442)

The Property Segment’s Distributable Earnings decreased by $0.4 million, from $21.9 million during the first quarter of 2022 to $21.5 million in the second quarter of 2022. After making adjustments for the calculation of Distributable Earnings, revenues were $23.1 million, costs and expenses were $13.3 million, other income was $14.4 million and the deduction of income attributable to non-controlling interests in the Woodstar Fund was $2.7 million.

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Revenues increased by $0.2 million in the second quarter of 2022.

Costs and expenses increased by $1.1 million in the second quarter of 2022, primarily due to an increase in interest expense reflecting higher index rates on variable rate borrowings.

Other income increased by $0.4 million in the second quarter of 2022.

Income attributable to non-controlling interests in the Woodstar Fund decreased $0.1 million in the second quarter of 2022.

Investing and Servicing Segment

The Investing and Servicing Segment’s Distributable Earnings increased by $3.8 million, from $29.8 million during the first quarter of 2022 to $33.6 million in the second quarter of 2022. After making adjustments for the calculation of Distributable Earnings, revenues were $56.7 million, costs and expenses were $31.4 million, other income was $13.7 million, income tax provision was $1.6 million and the deduction of income attributable to non-controlling interests was $3.8 million.

Revenues increased by $0.4 million in the second quarter of 2022, primarily due to a $1.5 million increase in servicing fees, partially offset by a $1.0 million decrease in interest income from CMBS. The treatment of CMBS interest income on a GAAP basis is complicated by our application of the ASC 810 consolidation rules. In an attempt to treat these securities similar to the trust’s other investment securities, we compute distributable interest income pursuant to an effective yield methodology. In doing so, we segregate the portfolio into various categories based on the components of the bonds’ cash flows and the volatility related to each of these components. We then accrete interest income on an effective yield basis using the components of cash flows that are reliably estimable. Other minor adjustments are made to reflect management’s expectations for other components of the projected cash flow stream.

Costs and expenses decreased by $0.8 million in the second quarter of 2022.

Other income includes profit realized upon securitization of loans by our conduit business, gains on sales of CMBS and operating properties, gains and losses on derivatives that were either effectively terminated or novated, and earnings from unconsolidated entities. These items are typically offset by a decrease in the fair value of our domestic servicing rights intangible which reflects the expected amortization of this deteriorating asset, net of increases in fair value due to the attainment of new servicing contracts. Derivatives include instruments which hedge interest rate risk and credit risk on our conduit loans and CMBS investments. For GAAP purposes, the loans, CMBS and derivatives are accounted for at fair value, with all changes in fair value (realized or unrealized) recognized in earnings. The adjustments to Distributable Earnings outlined above are also applied to the GAAP earnings of our unconsolidated entities. Other income increased by $0.5 million in the second quarter of 2022.

Income taxes, which principally relate to the taxable nature of this segment’s loan servicing and loan securitization businesses which are housed in TRSs, decreased $1.1 million due to lower taxable income of those TRSs in the second quarter of 2022.

Income attributable to non-controlling interests decreased $1.0 million, primarily due to non-controlling interests related to the sale of an operating property in the first quarter of 2022.

Corporate

Corporate loss increased by $4.2 million, from $55.1 million during the first quarter of 2022 to $59.3 million in the second quarter of 2022, primarily due to (i) a $2.3 million increase in interest expense attributable to the 2027 Senior Notes we issued in late January 2022 and higher index rates on our term loan and (ii) a $1.1 million decrease in realized gains on fixed-to-floating interest rate swaps which hedge a portion of our unsecured senior notes.

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The following table presents our summarized results of operations and reconciliation to Distributable Earnings for the six months ended June 30, 2022, by business segment (amounts in thousands, except per share data):

	Commercial and Residential Lending Segment		Infrastructure Lending Segment		Property Segment		Investing and Servicing Segment		Corporate		Total
Revenues	$	476,573	$	59,157	$	45,091	$	110,620	$	3	$	691,444
Costs and expenses	(191,742)		(34,437)		(41,863)		(71,988)		(166,342)		(506,372)
Other income (loss)	(65,660)		850		564,125		31,685		(50,351)		480,649
Income (loss) before income taxes	219,171		25,570		567,353		70,317		(216,690)		665,721
Income tax benefit (provision)	4,583		5		—		(4,344)		—		244
Income attributable to non-controlling interests	(7)		—		(119,893)		(9,179)		—		(129,079)
Net income (loss) attributable to Starwood Property Trust, Inc.	223,747		25,575		447,460		56,794		(216,690)		536,886
Add / (Deduct):
Non-controlling interests attributable to Woodstar II Class A Units	—		—		9,382		—		—		9,382
Non-controlling interests attributable to unrealized gains/losses	—		—		104,945		646		—		105,591
Non-cash equity compensation expense	4,453		642		134		2,699		12,072		20,000
Management incentive fee	—		—		—		—		34,226		34,226
Acquisition and investment pursuit costs	(337)		—		(160)		(169)		—		(666)
Depreciation and amortization	1,463		191		16,542		6,047		—		24,243
Interest income adjustment for securities	5,063		—		—		2,015		—		7,078
Extinguishment of debt, net	—		—		—		—		(493)		(493)
Other non-cash items	32,669		—		792		202		—		33,663
Reversal of GAAP unrealized (gains) / losses on:
Loans	237,584		—		—		1,679		—		239,263
Credit loss provision, net	4,626		154		—		—		—		4,780
Securities	21,417		—		—		17,441		—		38,858
Woodstar Fund investments	—		—		(541,206)		—		—		(541,206)
Derivatives	(251,983)		(975)		(25,278)		(38,907)		56,466		(260,677)
Foreign currency	105,585		317		(19)		—		—		105,883
Earnings from unconsolidated entities	(1,446)		(739)		—		(1,899)		—		(4,084)
Sales of properties	(86,610)		—		—		(11,858)		—		(98,468)
Recognition of Distributable realized gains / (losses) on:
Loans	(72,551)		—		—		(2,808)		—		(75,359)
Securities	(3,101)		—		—		(4,387)		—		(7,488)
Woodstar Fund investments	—		—		30,834		—		—		30,834
Derivatives	79,469		—		(69)		32,886		—		112,286
Foreign currency	(2,295)		81		19		—		—		(2,195)
Earnings from unconsolidated entities	1,664		739		—		2,845		—		5,248
Sales of properties	84,738		—		—		177		—		84,915
Distributable Earnings (Loss)	$	384,155	$	25,985	$	43,376	$	63,403	$	(114,419)	$	402,500
Distributable Earnings (Loss) per Weighted Average Diluted Share	$	1.21	$	0.08	$	0.14	$	0.20	$	(0.36)	$	1.27

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The following table presents our summarized results of operations and reconciliation to Distributable Earnings for the six months ended June 30, 2021, by business segment (amounts in thousands, except per share data):

	Commercial and Residential Lending Segment		Infrastructure Lending Segment		Property Segment		Investing and Servicing Segment		Corporate		Total
Revenues	$	375,021	$	41,260	$	130,598	$	102,051	$	—	$	648,930
Costs and expenses	(103,957)		(27,134)		(121,212)		(72,710)		(134,023)		(459,036)
Other income (loss)	17,110		(835)		4,211		43,864		(5,916)		58,434
Income (loss) before income taxes	288,174		13,291		13,597		73,205		(139,939)		248,328
Income tax benefit (provision)	6,538		(150)		—		(5,265)		—		1,123
Income attributable to non-controlling interests	(7)		—		(9,991)		(11,765)		—		(21,763)
Net income (loss) attributable to Starwood Property Trust, Inc.	294,705		13,141		3,606		56,175		(139,939)		227,688
Add / (Deduct):
Non-controlling interests attributable to Woodstar II Class A Units	—		—		9,991		—		—		9,991
Non-controlling interests attributable to unrealized gains/losses	—		—		—		4,599		—		4,599
Non-cash equity compensation expense	3,640		740		88		2,071		13,368		19,907
Management incentive fee	—		—		—		—		18,154		18,154
Acquisition and investment pursuit costs	(360)		—		(177)		(58)		—		(595)
Depreciation and amortization	498		181		36,130		7,415		—		44,224
Interest income adjustment for securities	(2,161)		—		—		7,657		—		5,496
Extinguishment of debt, net	—		—		—		—		(493)		(493)
Income tax (provision) benefit associated with realized (gains) losses	(6,495)		—		—		405		—		(6,090)
Other non-cash items	9		—		(599)		412		415		237
Reversal of GAAP unrealized (gains) / losses on:
Loans	(1,615)		—		—		(34,774)		—		(36,389)
Credit loss (reversal) provision, net	(12,976)		1,176		—		—		—		(11,800)
Securities	11,452		—		—		5,415		—		16,867
Derivatives	(23,577)		(918)		(7,847)		(4,792)		10,845		(26,289)
Foreign currency	8,879		111		—		64		—		9,054
(Earnings) loss from unconsolidated entities	(3,749)		324		—		(82)		—		(3,507)
Sales of properties	(17,693)		—		—		(9,723)		—		(27,416)
Recognition of Distributable realized gains / (losses) on:
Loans	25,615		—		—		35,295		—		60,910
Realized credit loss	(7,757)		—		—		—		—		(7,757)
Securities	(20,949)		—		—		(5,602)		—		(26,551)
Derivatives	(596)		—		(69)		877		—		212
Foreign currency	11,302		(41)		—		(64)		—		11,197
Earnings (loss) from unconsolidated entities	7,662		(324)		—		1,740		—		9,078
Sales of properties	8,298		—		—		4,975		—		13,273
Distributable Earnings (Loss)	$	274,132	$	14,390	$	41,123	$	72,005	$	(97,650)	$	304,000
Distributable Earnings (Loss) per Weighted Average Diluted Share	$	0.92	$	0.05	$	0.14	$	0.24	$	(0.33)	$	1.02

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Six Months Ended June 30, 2022 Compared to the Six Months Ended June 30, 2021

Commercial and Residential Lending Segment

The Commercial and Residential Lending Segment’s Distributable Earnings increased by $110.1 million, from $274.1 million during the first half of 2021 to $384.2 million in the first half of 2022. After making adjustments for the calculation of Distributable Earnings, revenues were $481.7 million, costs and expenses were $181.6 million, other income was $79.5 million and income tax benefit was $4.6 million.

Revenues, consisting principally of interest income on loans, increased by $108.8 million in the first half of 2022, primarily due to increases in interest income from loans of $93.7 million and investment securities of $15.1 million. The increase in interest income from loans reflects (i) a $61.0 million increase from commercial loans, reflecting higher average balances, partially offset by the timing effect of certain loans being placed on nonaccrual, and (ii) a $32.7 million increase from residential loans principally due to higher average balances reflecting the timing of purchases and securitizations, partially offset by lower average coupon rates. The increase in interest income from investment securities was primarily due to higher commercial and RMBS average investment balances.

Costs and expenses increased by $60.7 million in the first half of 2022, primarily due to (i) a $64.2 million increase in interest expense associated with the various secured financing facilities used to fund a portion of this segment’s investment portfolio, partially offset by (ii) the nonrecurrence of a $7.8 million write-off of an unsecured commercial loan in the first half of 2021. The increase in interest expense was primarily due to higher average borrowings outstanding and higher average index rates.

Other income increased by $57.4 million in the first half of 2022, primarily due to (i) a $76.4 million increased gain on sale of foreclosed properties and (ii) a $25.3 million decrease in recognized losses on RMBS investments, partially offset by (iii) a $33.9 million unfavorable change in gain (loss) on residential loan sales and securitizations, net of related interest rate derivatives, and (iv) a $9.2 million unfavorable change in Distributable Earnings (Loss) from an unconsolidated residential mortgage originator.

Income taxes principally relate to the taxable nature of this segment’s residential loan securitization activities which are housed in TRSs. The income tax benefit increased $4.6 million in the first half of 2022 primarily due to net unrealized losses on our residential loans during that period.

Infrastructure Lending Segment

The Infrastructure Lending Segment’s Distributable Earnings increased by $11.6 million, from $14.4 million in the first half of 2021 to $26.0 million in the first half of 2022. After making adjustments for the calculation of Distributable Earnings, revenues were $59.2 million, costs and expenses were $33.5 million and other income was $0.3 million.

Revenues, consisting principally of interest income on loans, increased by $17.9 million in the first half of 2022, primarily due to an increase in interest income from loans of $17.1 million, principally due to higher average balances and index rates.

Costs and expenses increased by $8.4 million in the first half of 2022, primarily due to an increase in interest expense reflecting higher average borrowings outstanding and higher average index rates.

Other income increased by $2.0 million from a loss in the first half of 2021 to income in the first half of 2022, primarily due to a $1.1 million favorable change in earnings (loss) from an unconsolidated entity and a $0.8 million lower loss on extinguishment of debt.

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Property Segment

Distributable Earnings by Portfolio (amounts in thousands)

	For the Six Months Ended June 30,
	2022		2021		Change
Master Lease Portfolio	$	8,659	$	8,619	$	40
Medical Office Portfolio	11,187		10,481		706
Woodstar I Portfolio	—		12,184		(12,184)
Woodstar II Portfolio	—		11,362		(11,362)
Woodstar Fund, net of non-controlling interests	25,019		—		25,019
Other/Corporate	(1,489)		(1,523)		34
Distributable Earnings	$	43,376	$	41,123	$	2,253

The Property Segment’s Distributable Earnings increased by $2.3 million, from $41.1 million in the first half of 2021 to $43.4 million in the first half of 2022. After making adjustments for the calculation of Distributable Earnings, revenues were $45.9 million, costs and expenses were $25.4 million, other income was $28.5 million and the deduction of income attributable to non-controlling interests in the Woodstar Fund was $5.6 million.

Revenues decreased by $84.1 million in the first half of 2022, primarily due to the conversion of the Woodstar Portfolios to the Woodstar Fund on November 5, 2021.

Costs and expenses decreased by $59.9 million in the first half of 2022, primarily due to the Woodstar Fund conversion referred to above.

Other income increased by $32.1 million in the first half of 2022 primarily due to $30.8 million of Distributable Earnings (before non-controlling interests of $5.6 million) from the Woodstar Fund in the first half of 2022.

Investing and Servicing Segment

The Investing and Servicing Segment’s Distributable Earnings decreased by $8.6 million from $72.0 million during the first half of 2021 to $63.4 million in the first half of 2022. After making adjustments for the calculation of Distributable Earnings, revenues were $113.0 million, costs and expenses were $63.6 million, other income was $26.8 million, income tax provision was $4.3 million and the deduction of income attributable to non-controlling interests was $8.5 million.

Revenues increased by $2.7 million in the first half of 2022, primarily due to (i) a $6.6 million increase in other fee income principally related to the origination of certain loans contributed into CMBS transactions, partially offset by (ii) a $5.1 million decrease in rental income principally reflecting fewer properties held.

Costs and expenses increased by $0.1 million in the first half of 2022.

Other income decreased by $10.3 million in the first half of 2022, primarily due to (i) a $38.1 million unfavorable change in realized gains (losses) on conduit loans and (ii) a $4.8 million decrease in gains on sales of operating properties, partially offset by (iii) a $31.2 million favorable change in realized gains (losses) on derivatives, principally related to conduit loans.

Income taxes, which principally relate to the taxable nature of this segment’s loan servicing and loan securitization businesses which are housed in TRSs, decreased $0.5 million due to lower taxable income of those TRSs during the first half of 2022.

Income attributable to non-controlling interests increased $1.4 million primarily due to non-controlling interests related to the sale of an operating property in the first half of 2022.

Corporate

Corporate loss increased by $16.8 million, from $97.6 million during the first half of 2021 to $114.4 million in the first half of 2022, primarily due to (i) a $12.1 million increase in interest expense on higher average outstanding term loan and

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unsecured senior note balances and (ii) a $4.8 million increase in base management fees, partially offset by (iii) a $1.2 million increase in realized gains on fixed-to-floating interest rate swaps which hedge a portion of our unsecured senior notes.

Liquidity and Capital Resources

Liquidity is a measure of our ability to meet our cash requirements, including ongoing commitments to repay borrowings, fund and maintain our assets and operations, make new investments where appropriate, pay dividends to our stockholders, and other general business needs. We closely monitor our liquidity position and believe that we have sufficient current liquidity and access to additional liquidity to meet our financial obligations for at least the next 12 months. Our strategy for managing liquidity and capital resources has not changed since December 31, 2021. Refer to our Form 10-K for a description of these strategies.

Sources of Liquidity

Our primary sources of liquidity are as follows:

Cash Flows for the Six Months Ended June 30, 2022 (amounts in thousands)

	GAAP		VIE Adjustments		Excluding Investing and Servicing VIEs
Net cash provided by operating activities	$	685,243	$	(1,466)	$	683,777
Cash Flows from Investing Activities:
Origination, purchase and funding of loans held-for-investment	(3,892,225)		—		(3,892,225)
Proceeds from principal collections and sale of loans	1,210,968		—		1,210,968
Purchase and funding of investment securities	(86,058)		(289,833)		(375,891)
Proceeds from sales and collections of investment securities	15,180		42,753		57,933
Proceeds from sales of real estate	147,334		—		147,334
Purchases and additions to properties and other assets	(11,276)		—		(11,276)
Net cash flows from other investments and assets	139,583		—		139,583
Net cash used in investing activities	(2,476,494)		(247,080)		(2,723,574)
Cash Flows from Financing Activities:
Proceeds from borrowings	10,035,448		—		10,035,448
Principal repayments on and repurchases of borrowings	(7,683,627)		(201)		(7,683,828)
Payment of deferred financing costs	(33,885)		—		(33,885)
Proceeds from common stock issuances, net of offering costs	33,100		—		33,100
Payment of dividends	(294,277)		—		(294,277)
Contributions from non-controlling interests	21,926		—		21,926
Distributions to non-controlling interests	(24,186)		—		(24,186)
Repayment of debt of consolidated VIEs	(290,034)		290,034		—
Distributions of cash from consolidated VIEs	42,753		(42,753)		—
Net cash provided by financing activities	1,807,218		247,080		2,054,298
Net increase in cash, cash equivalents and restricted cash	15,967		(1,466)		14,501
Cash, cash equivalents and restricted cash, beginning of period	321,914		(590)		321,324
Effect of exchange rate changes on cash	(1,075)		—		(1,075)
Cash, cash equivalents and restricted cash, end of period	$	336,806	$	(2,056)	$	334,750

The discussion below is on a non-GAAP basis, after removing adjustments principally resulting from the consolidation of the securitization VIEs under ASC 810. These adjustments principally relate to (i) the purchase of CMBS, RMBS, loans and real estate from consolidated VIEs, which are reflected as repayments of VIE debt on a GAAP basis and (ii) sales, principal collections and redemptions of CMBS and RMBS related to consolidated VIEs, which are reflected as VIE distributions on a GAAP basis. There is no significant net impact to overall cash resulting from these consolidations. Refer to Note 2 to the Condensed Consolidated Financial Statements for further discussion.

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Cash and cash equivalents increased by $14.5 million during the six months ended June 30, 2022, reflecting net cash provided by financing activities of $2.1 billion and net cash provided by operating activities of $683.8 million, partially offset by net cash used in investing activities of $2.7 billion.

Net cash provided by operating activities of $683.8 million during the six months ended June 30, 2022 related primarily to cash interest income of $388.0 million from our loans and $88.6 million from our investment securities, and sales and principal collections, net of originations and purchases, of loans held-for-sale of $469.3 million. Net rental income provided cash of $42.0 million and servicing fees provided cash of $29.2 million. Offsetting these cash inflows was cash interest expense of $227.1 million, management fees of $83.0 million and general and administrative expenses of $57.8 million.

Net cash used in investing activities of $2.7 billion for the six months ended June 30, 2022 related primarily to the origination and acquisition of loans held-for-investment of $3.9 billion and the purchase and funding of investment securities of $375.9 million, partially offset by proceeds received from principal collections and sales of loans of $1.2 billion and investment securities of $57.9 million and sales of operating properties for $147.3 million.

Net cash provided by financing activities of $2.1 billion for the six months ended June 30, 2022 related primarily to borrowings on our debt, net of repayments and deferred loan costs, of $2.3 billion, partially offset by dividend distributions of $294.3 million.

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Our Investment Portfolio

The following is a review of our investment portfolio by segment.

Commercial and Residential Lending Segment

The following table sets forth the amount of each category of investments we owned across various property types within our Commercial and Residential Lending Segment as of June 30, 2022 and December 31, 2021 (dollars in thousands):

	Face Amount		Carrying Value			Asset Specific Financing		Net Investment		Unlevered Return on Asset (6)
June 30, 2022
First mortgages (1)	$	15,198,083	$	15,104,418		$	10,965,369	$	4,139,049	5.5	%
Subordinated mortgages (2)	70,729		69,413			—		69,413		12.5	%
Mezzanine loans (1)	431,475		433,730			—		433,730		12.2	%
Residential loans, fair value option	55,580		55,301			32,527		22,774		6.0	%	(5)
Other loans	18,161		16,849			—		16,849		13.3	%
Loans held-for-sale, fair value option, residential	2,260,154		2,132,337			1,514,349		617,988		4.6	%	(5)
Loans held-for-sale, commercial	63,656		63,616			16,100		47,516		N/A
RMBS, available-for-sale	209,197		124,439			84,779		39,660		12.4	%
RMBS, fair value option	326,274		416,057		(3)	67,242		348,815		10.4	%
CMBS, fair value option	102,900		97,079		(3)	49,798		47,281		5.3	%
HTM debt securities (4)	689,833		691,858			133,143		558,715		6.8	%
Credit loss allowance	—		(58,102)			—		(58,102)
Equity security	11,128		10,193			—		10,193
Investments in unconsolidated entities	N/A		38,612			—		38,612
Properties, net	N/A		215,099			87,750		127,349
	$	19,437,170	$	19,410,899		$	12,951,057	$	6,459,842
December 31, 2021
First mortgages (1)	$	13,057,621	$	12,981,196		$	9,116,486	$	3,864,710	5.2	%
Subordinated mortgages (2)	72,371		70,771			—		70,771		11.8	%
Mezzanine loans (1)	415,155		417,504			—		417,504		10.9	%
Residential loans, fair value option	60,133		59,225			36,934		22,291		6.0	%	(5)
Other loans	19,029		17,424			—		17,424		13.3	%
Loans held-for-sale, fair value option, residential	2,525,910		2,590,005			1,808,372		781,633		4.2	%	(5)
RMBS, available-for-sale	221,806		143,980			97,354		46,626		11.8	%
RMBS, fair value option	127,437		250,424		(3)	37,213		213,211		12.6	%
CMBS, fair value option	102,900		98,211		(3)	49,798		48,413		5.2	%
HTM debt securities (4)	655,557		656,915			113,143		543,772		6.7	%
Credit loss allowance	—		(52,302)			—		(52,302)
Equity security	12,366		11,624			—		11,624
Investments in unconsolidated entities	N/A		44,938			—		44,938
Properties, net	N/A		124,503			49,483		75,020
	$	17,270,285	$	17,414,418		$	11,308,783	$	6,105,635

__________________________________________

(1)First mortgages include first mortgage loans and any contiguous mezzanine loan components because as a whole, the expected credit quality of these loans is more similar to that of a first mortgage loan. The application of this methodology resulted in mezzanine loans with carrying values of $1.2 billion and $1.4 billion being classified as first mortgages as of June 30, 2022 and December 31, 2021, respectively.

(2)Subordinated mortgages include B-Notes and junior participation in first mortgages where we do not own the senior A-Note or senior participation. If we own both the A-Note and B-Note, we categorize the loan as a first mortgage loan.

(3)Eliminated in consolidation against VIE liabilities pursuant to ASC 810.

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(4)CMBS held-to-maturity (“HTM”) and mandatorily redeemable preferred equity interests in commercial real estate entities.

(5)Represents the weighted average coupon of residential mortgage loans.

(6)Excludes loans for which interest income is not recognized.

As of June 30, 2022 and December 31, 2021, our Commercial and Residential Lending Segment’s investment portfolio, excluding residential loans, RMBS, properties and other investments, had the following characteristics based on carrying values:

Collateral Property Type	June 30, 2022		December 31, 2021
Multifamily	33.2	%	27.3	%
Office	23.5	%	29.5	%
Hotel	15.9	%	19.0	%
Mixed Use	9.8	%	11.5	%
Industrial	5.5	%	5.6	%
Residential	1.8	%	1.6	%
Retail	1.7	%	2.1	%
Other	8.6	%	3.4	%
	100.0	%	100.0	%

Geographic Location	June 30, 2022		December 31, 2021
U.S. Regions:
North East	16.1	%	20.0	%
South East	16.0	%	12.9	%
South West	15.1	%	13.0	%
West	13.0	%	15.1	%
Mid Atlantic	9.3	%	10.8	%
Midwest	2.7	%	3.4	%
International:
United Kingdom	13.5	%	15.8	%
Other Europe	4.9	%	5.1	%
Australia	7.6	%	1.8	%
Bahamas/Bermuda	1.8	%	2.1	%
	100.0	%	100.0	%

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Infrastructure Lending Segment

The following table sets forth the amount of each category of investments we owned within our Infrastructure Lending Segment as of June 30, 2022 and December 31, 2021 (dollars in thousands):

	Face Amount		Carrying Value		Asset Specific Financing		Net Investment		Unlevered Return on Asset
June 30, 2022
First priority infrastructure loans and HTM securities	$	2,389,011	$	2,354,194	$	1,837,988	$	516,206	6.0	%
Credit loss allowance	—		(23,852)		—		(23,852)
Investments in unconsolidated entities	—		27,454		—		27,454
	$	2,389,011	$	2,357,796	$	1,837,988	$	519,808
December 31, 2021
First priority infrastructure loans and HTM securities	$	2,116,836	$	2,082,927	$	1,630,866	$	452,061	5.1	%
Credit loss allowance	—		(23,578)		—		(23,578)
Investments in unconsolidated entities	—		26,255		—		26,255
	$	2,116,836	$	2,085,604	$	1,630,866	$	454,738

As of June 30, 2022 and December 31, 2021, our Infrastructure Lending Segment’s investment portfolio had the following characteristics based on carrying values:

Collateral Type	June 30, 2022		December 31, 2021
Natural gas power	61.7	%	61.0	%
Midstream/downstream oil & gas	35.8	%	33.2	%
Renewable power	1.1	%	1.8	%
Other thermal power	1.4	%	4.0	%
	100.0	%	100.0	%

Geographic Location	June 30, 2022		December 31, 2021
U.S. Regions:
North East	42.4	%	41.5	%
South West	19.9	%	19.5	%
Midwest	18.3	%	18.9	%
South East	7.5	%	8.8	%
West	5.3	%	4.3	%
Mid-Atlantic	1.9	%	1.6	%
Other	2.1	%	2.1	%
International:
Mexico	1.7	%	2.0	%
Other	0.9	%	1.3	%
	100.0	%	100.0	%

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Property Segment

The following table sets forth the amount of each category of investments held within our Property Segment as of June 30, 2022 and December 31, 2021 (amounts in thousands):

	June 30, 2022		December 31, 2021
Properties, net	$	874,119	$	887,553
Lease intangibles, net	30,749		33,151
Woodstar Fund	1,558,850		1,040,309
	$	2,463,718	$	1,961,013

The following table sets forth our net investment and other information regarding the Property Segment’s properties and lease intangibles as of June 30, 2022 (dollars in thousands):

	Carrying Value		Asset Specific Financing		Net Investment		Occupancy Rate		Weighted Average Remaining Lease Term
Office—Medical Office Portfolio	$	763,405	$	595,351	$	168,054	91.3	%	5.7 years
Retail—Master Lease Portfolio	343,790		193,206		150,584		100.0	%	19.8 years
Subtotal—undepreciated carrying value	1,107,195		788,557		318,638
Accumulated depreciation and amortization	(202,327)		—		(202,327)
Net carrying value	$	904,868	$	788,557	$	116,311

As of June 30, 2022 and December 31, 2021, our Property Segment’s investment portfolio had the following geographic characteristics based on carrying values:

Geographic Location	June 30, 2022		December 31, 2021
South East	80.1	%	77.4	%
South West	5.4	%	6.2	%
Midwest	5.3	%	6.0	%
North East	5.0	%	5.7	%
West	4.2	%	4.7	%
	100.0	%	100.0	%

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Investing and Servicing Segment

The following table sets forth the amount of each category of investments we owned within our Investing and Servicing Segment as of June 30, 2022 and December 31, 2021 (amounts in thousands):

	Face Amount		Carrying Value			Asset Specific Financing			Net Investment
June 30, 2022
CMBS, fair value option	$	2,813,097	$	1,210,361	(1)	$	409,807	(2)	$	800,554
Intangible assets - servicing rights	N/A		59,224		(3)	—			59,224
Lease intangibles, net	N/A		9,723			—			9,723
Loans held-for-sale, fair value option, commercial	44,700		40,694			30,395			10,299
Loans held-for-investment	9,742		9,742			—			9,742
Investments in unconsolidated entities	N/A		35,246		(4)	—			35,246
Properties, net	N/A		136,761			144,193			(7,432)
	$	2,867,539	$	1,501,751		$	584,395		$	917,356
December 31, 2021
CMBS, fair value option	$	2,694,413	$	1,165,395	(1)	$	380,004	(2)	$	785,391
Intangible assets - servicing rights	N/A		58,899		(3)	—			58,899
Lease intangibles, net	N/A		11,342			—			11,342
Loans held-for-sale, fair value option, commercial	289,761		286,795			173,430			113,365
Loans held-for-investment	9,903		9,903			—			9,903
Investments in unconsolidated entities	N/A		34,160		(4)	—			34,160
Properties, net	N/A		154,331			160,803			(6,472)
	$	2,994,077	$	1,720,825		$	714,237		$	1,006,588

______________________________________________

(1)Includes $1.19 billion and $1.14 billion of CMBS eliminated in consolidation against VIE liabilities pursuant to ASC 810 as of June 30, 2022 and December 31, 2021. Also includes $205.3 million and $182.6 million of non-controlling interests in the consolidated entities which hold certain of these CMBS as of June 30, 2022 and December 31, 2021, respectively.

(2)Includes $43.3 million and $35.8 million of non-controlling interests in the consolidated entities which hold certain debt balances as of June 30, 2022 and December 31, 2021, respectively.

(3)Includes $41.7 million and $42.1 million of servicing rights intangibles eliminated in consolidation against VIE assets pursuant to ASC 810 as of June 30, 2022 and December 31, 2021, respectively.

(4)Includes $15.8 million and $15.3 million of investments in unconsolidated entities eliminated in consolidation against VIE assets pursuant to ASC 810 as of June 30, 2022 and December 31, 2021, respectively.

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Our REIS Equity Portfolio, as described in Note 6 to the Condensed Consolidated Financial Statements, had the following characteristics based on carrying values as of June 30, 2022 and December 31, 2021, respectively:

Property Type	June 30, 2022		December 31, 2021
Retail	44.8	%	37.9	%
Office	27.5	%	37.4	%
Mixed Use	10.3	%	9.0	%
Self-storage	9.0	%	8.0	%
Multifamily	6.0	%	5.4	%
Hotel	2.4	%	2.3	%
	100.0	%	100.0	%

Geographic Location	June 30, 2022		December 31, 2021
North East	35.4	%	31.8	%
West	20.0	%	18.1	%
Mid Atlantic	17.7	%	14.5	%
Midwest	11.1	%	10.1	%
South East	8.3	%	18.9	%
South West	7.5	%	6.6	%
	100.0	%	100.0	%

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New Credit Facilities and Amendments

Refer to Note 10 of our Condensed Consolidated Financial Statements for a detailed discussion of new credit facilities and amendments to existing credit facilities executed since December 31, 2021.

Secured Borrowings

The following table is a summary of our secured borrowings as of June 30, 2022 (dollars in thousands):

	Current Maturity		Extended Maturity (a)		Weighted Average Pricing		Pledged Asset Carrying Value			Maximum Facility Size			Outstanding Balance			Approved but Undrawn Capacity (b)		Unallocated Financing Amount (c)
Repurchase Agreements:
Commercial Loans	Aug 2022 to Jun 2027	(d)	Jun 2025 to Dec 2030	(d)	Index + 2.03%	(e)	$	10,771,843		$	12,407,967	(f)	$	7,828,681		$	199,963	$	4,379,323
Residential Loans	May 2023 to Dec 2023		May 2023 to Dec 2024		Index + 2.11%		1,697,635			2,502,636			1,405,200			—		1,097,436
Infrastructure Loans	Sep 2024		Sep 2026		Index + 2.01%		350,599			650,000			293,673			—		356,327
Conduit Loans	Feb 2023 to Jun 2024		Feb 2024 to Jun 2025		Index + 2.28%		40,694			650,000			30,923			—		619,077
CMBS/RMBS	Mar 2023 to Apr 2032	(g)	Jun 2023 to Oct 2032	(g)	(h)		1,458,270			876,651			757,173		(i)	—		119,478
Total Repurchase Agreements							14,319,041			17,087,254			10,315,650			199,963		6,571,641
Other Secured Financing:
Borrowing Base Facility	Nov 2024		Oct 2026		SOFR + 2.11%		8,786			750,000		(j)	6,613			—		743,387
Commercial Financing Facilities	Dec 2023 to Jan 2025		Jan 2027 to Dec 2030		Index + 1.73%		299,352			445,005		(k)	234,948			—		210,057
Residential Financing Facility	Mar 2024		Mar 2027		SOFR + 2.45%		489,474			500,000			142,418			264,251		93,331
Infrastructure Financing Facilities	Oct 2022 to Jul 2025		Oct 2024 to Jul 2032		Index + 2.04%		915,824			1,750,000			737,326			—		1,012,674
Property Mortgages - Fixed rate	Nov 2024 to Sep 2029	(l)	N/A		4.48%		384,284			275,993			275,993			—		—
Property Mortgages - Variable rate	Nov 2022 to Dec 2025		N/A		(m)		775,534			742,650			730,336			—		12,314
Term Loan and Revolver	(n)		N/A		(n)		N/A		(n)	934,759			784,759			150,000		—
STWD 2022-FL3 CLO	Nov 2038		N/A		SOFR + 1.64%		1,010,536			842,500			842,500			—		—
STWD 2021-HTS SASB	Apr 2034		N/A		LIBOR + 2.22%		230,713			210,091			210,091			—		—
STWD 2021-FL2 CLO	Apr 2038		N/A		LIBOR + 1.50%		1,281,127			1,077,375			1,077,375			—		—
STWD 2019-FL1 CLO	Jul 2038		N/A		SOFR + 1.37%		996,268			830,149			830,149			—		—
STWD 2021-SIF2 CLO	Jan 2033		N/A		SOFR + 1.89%		510,807			410,000			410,000			—		—
STWD 2021-SIF1 CLO	Apr 2032		N/A		LIBOR + 1.81%		507,465			410,000			410,000			—		—
Total Other Secured Financing							7,410,170			9,178,522			6,692,508			414,251		2,071,763
							$	21,729,211		$	26,265,776		$	17,008,158		$	614,214	$	8,643,404
Unamortized net discount													(6,121)
Unamortized deferred financing costs													(90,439)
													$	16,911,598

___________________________________________

(a)Subject to certain conditions as defined in the respective facility agreement.

(b)Approved but undrawn capacity represents the total draw amount that has been approved by the lenders related to those assets that have been pledged as collateral, less the drawn amount.

(c)Unallocated financing amount represents the maximum facility size less the total draw capacity that has been approved by the lenders.

(d)For certain facilities, borrowings collateralized by loans existing at maturity may remain outstanding until such loan collateral matures, subject to certain specified conditions.

(e)Certain facilities with an outstanding balance of $2.9 billion as of June 30, 2022 are indexed to GBP LIBOR, EURIBOR, BBSY, SARON and SONIA. The remainder are indexed to USD LIBOR and SOFR.

(f)Certain facilities with an aggregate initial maximum facility size of $11.5 billion may be increased to $12.4 billion, subject to certain conditions. The $12.4 billion amount includes such upsizes.

(g)Certain facilities with an outstanding balance of $332.6 million as of June 30, 2022 carry a rolling 11-month or 12-month term which may reset monthly or quarterly with the lender's consent. These facilities carry no maximum facility size.

(h)A facility with an outstanding balance of $265.7 million as of June 30, 2022 has a weighted average fixed annual interest rate of 3.27%. All other facilities are variable rate with a weighted average rate of Index + 1.94%.

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(i)Includes: (i) $265.7 million outstanding on a repurchase facility that is not subject to margin calls; and (ii) $43.3 million outstanding on one of our repurchase facilities that represents the 49% pro rata share owed by a non-controlling partner in a consolidated joint venture (see Note 15 to the Condensed Consolidated Financial Statements).

(j)The maximum facility size as of June 30, 2022 of $650.0 million is scheduled to decline to $450.0 million as of December 31, 2022 and may be increased to $750.0 million, subject to certain conditions.

(k)Certain facilities with an aggregate initial maximum facility size of $345.0 million may be increased to $445.0 million, subject to certain conditions. The $445.0 million amount includes such upsizes.

(l)The weighted average maturity is 5.0 years as of June 30, 2022.

(m)Includes a $600.0 million first mortgage and mezzanine loan secured by our Medical Office Portfolio. This debt has a weighted average interest rate of LIBOR + 2.07% that we swapped to a fixed rate of 3.34%. The remainder have a weighted average rate of Index + 2.28%.

(n)Consists of: (i) a $784.8 million term loan facility that matures in July 2026, of which $389.0 million has an annual interest rate of LIBOR + 2.50% and $395.8 million has an annual interest rate of LIBOR + 3.25%, subject to a 0.75% LIBOR floor, and (ii) a $150.0 million revolving credit facility that matures in April 2026 with an annual interest rate of SOFR + 2.50%. These facilities are secured by the equity interests in certain of our subsidiaries which totaled $5.0 billion as of June 30, 2022.

The above table no longer reflects property mortgages of the Woodstar Portfolios which, as discussed in Notes 2 and 7 to the Condensed Consolidated Financial Statements, are now reflected within “Investments of consolidated affordable housing fund” on our condensed consolidated balance sheets.

Refer to Note 10 to the Condensed Consolidated Financial Statements for further disclosure regarding the terms of our secured financing arrangements.

Variance between Average and Quarter-End Credit Facility Borrowings Outstanding

The following table compares the average amount outstanding under our secured financing agreements during each quarter and the amount outstanding as of the end of each quarter, together with an explanation of significant variances (amounts in thousands):

Quarter Ended	Quarter-End Balance	Weighted-Average Balance During Quarter	Variance	Explanations for Significant Variances
December 31, 2021	15,288,261	14,428,687	859,574	(a)
March 31, 2022	15,419,344	15,645,668	(226,324)	(b)
June 30, 2022	17,008,158	16,151,019	857,139	(c)

_____________________________________________

(a)Variance primarily due to (i) late quarter draws on commercial, residential and infrastructure loan facilities given the majority of the quarter’s loan closings were back-ended to the last half of the quarter; offset by (ii) the accounting for the Woodstar Fund, which requires property level debt to be presented net within investments of consolidated affordable housing fund.

(b)Variance primarily due to sales and securitizations that occurred late in the quarter.

(c)Variance primarily due to late quarter timing of loan pledges and advances.

Borrowings under Unsecured Senior Notes

During the three months ended June 30, 2022 and 2021, the weighted average effective borrowing rate on our unsecured senior notes was 4.7% and 5.4%, respectively. During the six months ended June 30, 2022 and 2021, the weighted average effective borrowing rate on our unsecured senior notes was 4.8% and 5.3%, respectively. The effective borrowing rate includes the effects of underwriter purchase discount.

Refer to Note 11 to the Condensed Consolidated Financial Statements for further disclosure regarding the terms of our unsecured senior notes.

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Scheduled Principal Repayments on Investments and Overhang on Financing Facilities

The following scheduled and/or projected principal repayments on our investments were based on amounts outstanding and extended contractual maturities of those investments as of June 30, 2022. The projected and/or required repayments of financing were based on the earlier of (i) the extended contractual maturity of each credit facility or (ii) the extended contractual maturity of each of the investments that have been pledged as collateral under the respective credit facility (amounts in thousands):

	Scheduled Principal Repayments on Loans and HTM Securities		Scheduled/Projected Principal Repayments on RMBS and CMBS		Projected/Required Repayments of Financing		Scheduled Principal Inflows Net of Financing Outflows
Third Quarter 2022	$	235,583	$	10,132	$	(195,496)	$	50,219
Fourth Quarter 2022	417,206		7,589		(231,152)		193,643
First Quarter 2023	259,600		14,866		(193,531)		80,935
Second Quarter 2023	1,050,420		107,075		(2,062,605)		(905,110)		(1)
Total	$	1,962,809	$	139,662	$	(2,682,784)	$	(580,313)

__________________________________________________

(1)Shortfall primarily relates to: (i) $829.6 million of repayments under a Residential Loans repurchase facility that carries a one-year term which we can extend every three months with the lender’s consent; and (ii) $326.2 million of repayments under a securities facility which carries a rolling 12-month term. We have historically extended, and intend to continue to extend both of these facilities with the lenders’ consents.

In the normal course of business, the Company is in discussions with its lenders to extend, amend or replace any financing facilities which contain near term expirations.

Issuances of Equity Securities

We may raise funds through capital market transactions by issuing capital stock. There can be no assurance, however, that we will be able to access the capital markets at any particular time or on any particular terms. We have authorized 100,000,000 shares of preferred stock and 500,000,000 shares of common stock. At June 30, 2022, we had 100,000,000 shares of preferred stock available for issuance and 190,788,156 shares of common stock available for issuance.

Other Potential Sources of Financing

In the future, we may also use other sources of financing to fund the acquisition of our target assets and maturities of our unsecured senior notes, including other secured as well as unsecured forms of borrowing and sale of senior loan interests and other assets.

Leverage Policies

Our strategies with regards to use of leverage have not changed significantly since December 31, 2021. Refer to our Form 10-K for a description of our strategies regarding use of leverage.

Cash Requirements

Dividends

U.S. federal income tax law generally requires that a REIT distribute annually at least 90% of its REIT taxable income, without regard to the deduction for dividends paid and excluding net capital gains, and that it pay tax at regular corporate rates to the extent that it annually distributes less than 100% of its net taxable income. We generally intend to distribute substantially all of our taxable income (which does not necessarily equal our GAAP net income) to our stockholders each year, if and to the extent authorized by our board of directors. Before we pay any dividend, whether for U.S. federal income tax purposes or otherwise, we must first meet both our operating and debt service requirements. If our cash available for distribution is less than our net taxable income, we could be required to sell assets or borrow funds to make cash distributions or we may make a portion of the required distribution in the form of a taxable stock distribution or distribution of debt securities. Refer to our Form 10-K for a detailed dividend history.

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The Company’s board of directors declared the following dividends during the six months ended June 30, 2022:

Declaration Date	Record Date	Payment Date	Amount		Frequency
6/15/22	6/30/22	7/15/22	$	0.48	Quarterly
3/14/22	3/31/22	4/15/22	$	0.48	Quarterly

Contractual Obligations and Commitments

Our material contractual obligations and commitments as of June 30, 2022 are as follows (amounts in thousands):

	Total		Less than 1 year		1 to 3 years		3 to 5 years		More than 5 years
Secured financings (a)	$	13,228,043	$	1,379,163	$	2,675,091	$	7,103,311	$	2,070,478
CLOs and SASB (b)	3,780,115		416,038		1,055,635		2,225,344		83,098
Unsecured senior notes	2,350,000		250,000		1,200,000		900,000		—
Future loan commitments:
Commercial Lending (c)	2,598,593		1,709,824		809,060		79,709		—
Residential Lending (d)	130,135		130,135		—		—		—
Infrastructure Lending (e)	253,879		253,879		—		—		—

__________________________________________________

(a)Represents the contractual maturity of the respective credit facility, inclusive of available extension options.  If investments that have been pledged as collateral repay earlier than the contractual maturity of the debt, the related portion of the debt would likewise require earlier repayment. Refer to Note 10 to the Consolidated Financial Statements for the expected maturities by year.

(b)Represents the fully extended maturity of the underlying collateral.

(c)Excludes $304.5 million of loan funding commitments in which management projects the Company will not be obligated to fund in the future due to repayments made by the borrower earlier than, or in excess of, expectations.

(d)Represents outstanding residential loan purchase commitments.

(e)Represents contractual commitments of $137.0 million under revolvers and letters of credit, $4.7 million under delayed draw term loans and $112.2 million of outstanding infrastructure loan purchase commitments.

The table above does not include interest payable, amounts due under our management agreement, amounts due under our derivative agreements or amounts due under guarantees as those contracts do not have fixed and determinable payments.

Our secured financings, CLOs and SASB consist primarily of matched-term funding for our loans and investment securities and long-term mortgages on our owned properties. Repayments of such facilities are generally made from proceeds from maturities, prepayments or sales of such investments and operating cash flows from owned properties. In the normal course of business, we are in discussions with our lenders to extend, amend or replace any financing facilities which contain near term expirations.

Our unsecured senior notes are expected to be repaid from a combination of available cash on hand, approved but undrawn capacity under our secured financing agreements, and/or equity issuances or other potential sources of financing, as discussed above, including issuances of new unsecured senior notes.

Our future loan commitments are expected to be primarily matched-term funded under secured financing agreements with any difference funded from available cash on hand or other potential sources of financing discussed above.

Critical Accounting Estimates

Refer to the section of our Form 10-K entitled “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Critical Accounting Estimates” for a full discussion of our critical accounting estimates. Our critical accounting estimates have not materially changed since December 31, 2021.

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Recent Accounting Developments

Refer to Note 2 to the Condensed Consolidated Financial Statements for a discussion of recent accounting developments and the expected impact to the Company.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

We seek to manage our risks related to the credit quality of our assets, interest rates, liquidity, prepayment speeds and market value while, at the same time, seeking to provide an opportunity to stockholders to realize attractive risk-adjusted returns through ownership of our capital stock. While we do not seek to avoid risk completely, we believe the risk can be quantified from historical experience and seek to actively manage that risk, to earn sufficient compensation to justify taking those risks and to maintain capital levels consistent with the risks we undertake. Our strategies for managing risk and our exposure to such risks, as described in Item 7A of our Form 10-K, have not changed materially since December 31, 2021 except as described below.

Credit Risk

Our loans and investments are subject to credit risk. The performance and value of our loans and investments depend upon the owners’ ability to operate the properties that serve as our collateral so that they produce cash flows adequate to pay interest and principal due to us. To monitor this risk, our asset management team reviews our investment portfolios and is in regular contact with our borrowers, monitoring performance of the collateral and enforcing our rights as necessary.

We seek to further manage credit risk associated with our Investing and Servicing Segment loans held-for-sale through the purchase of credit instruments. The following table presents our credit instruments as of June 30, 2022 and December 31, 2021 (dollars in thousands):

	Face Value of Loans Held-for-Sale		Aggregate Notional Value of Credit Instruments		Number of Credit Instruments
June 30, 2022	$	11,700	$	49,000	3
December 31, 2021	$	289,761	$	49,000	3

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Interest Rate Risk

Interest rates are highly sensitive to many factors, including fiscal and monetary policies and domestic and international economic and political considerations, as well as other factors beyond our control. We are subject to interest rate risk in connection with our investments and the related financing obligations. In general, we seek to match the interest rate characteristics of our investments with the interest rate characteristics of any related financing obligations such as repurchase agreements, bank credit facilities, term loans, revolving facilities and securitizations. In instances where the interest rate characteristics of an investment and the related financing obligation are not matched, we mitigate such interest rate risk through the utilization of interest rate derivatives of the same duration. The following table presents financial instruments where we have utilized interest rate derivatives to hedge interest rate risk and the related interest rate derivatives as of June 30, 2022 and December 31, 2021 (dollars in thousands):

	Face Value of Hedged Instruments		Aggregate Notional Value of Credit Instruments		Number of Credit Instruments
Instrument hedged as of June 30, 2022
Loans held-for-sale	$	2,271,854	$	2,264,600	25
RMBS, available-for-sale	209,197		85,000		2
CMBS, fair value option	43,329		58,800		2
HTM debt securities	13,166		13,166		1
Secured financing agreements	681,329		1,348,436		8
Unsecured senior notes	1,000,000		970,000		2
	$	4,218,875	$	4,740,002	40
Instrument hedged as of December 31, 2021
Loans held-for-sale	$	2,815,671	$	2,135,800	62
RMBS, available-for-sale	221,806		85,000		2
CMBS, fair value option	79,651		71,000		2
HTM debt securities	14,283		14,283		1
Secured financing agreements	754,620		1,425,396		10
Unsecured senior notes	500,000		470,000		1
	$	4,386,031	$	4,201,479	78

The following table summarizes the estimated annual change in net investment income for our variable rate investments and our variable rate debt assuming increases or decreases in LIBOR or other applicable index rates and adjusted for the effects of our interest rate hedging activities (amounts in thousands):

Income (Expense) Subject to Interest Rate Sensitivity	Variable rate investments and indebtedness (1)		0.25% Decrease		0.50% Increase		1.00% Increase		1.50% Increase
Investment income from variable rate investments	$	18,044,910	$	(39,447)	$	86,210	$	175,778	$	265,888
Interest expense from variable rate debt, net of interest rate derivatives	(13,719,875)		34,806		(71,018)		(142,738)		(214,463)
Net investment income from variable rate instruments	$	4,325,035	$	(4,641)	$	15,192	$	33,040	$	51,425

______________________________________________________________________________________________________________________

(1)Includes the notional value of interest rate derivatives.

LIBOR Transition Risk

The United Kingdom’s Financial Conduct Authority (the authority that regulates LIBOR) stopped compelling banks to submit rates for the calculation of LIBOR and the LIBOR administrator ceased publication of non-U.S. dollar LIBOR after December 31, 2021. However, for U.S. dollar LIBOR, the relevant date has been deferred to June 30, 2023. Regulators emphasized that, despite any continued publication of U.S. dollar LIBOR through June 30, 2023, no new contracts using U.S. dollar LIBOR should be entered into after December 31, 2021. As indicated in the Interest Rate Risk section above, a substantial portion of our loans, investment securities, borrowings and interest rate derivatives are indexed to LIBOR or similar reference rates. Our U.S. dollar LIBOR-based loan agreements and borrowing arrangements generally specify alternative reference rates such as the prime rate, federal funds rate or secured overnight financing rate (“SOFR”). Our foreign denominated loan agreements and borrowing arrangements now generally specify the sterling overnight index average (“SONIA”) instead of GBP LIBOR and the bank bill swap rate (“BBSW” or “BBSY”) instead of AUD LIBOR.

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As of June 30, 2022, daily compounded SONIA is utilized as the floating benchmark rate on $2.2 billion of our loans and $1.7 billion of our debt outstanding, while SOFR is utilized as the floating benchmark rate on $3.1 billion of our loans and $5.3 billion of our debt outstanding.

At this time, it is not possible to predict how markets will respond to SOFR, SONIA, or other alternative reference rates as the transition away from USD LIBOR and GBP LIBOR proceeds. The resulting changes to benchmark interest rates could increase our financing costs and/or result in mismatches between the interest rates of our investments and the corresponding financings.

Foreign Currency Risk

Our loans and investments that are denominated in a foreign currency are also subject to risks related to fluctuations in exchange rates. We generally mitigate this exposure by matching the currency of our foreign currency assets to the currency of the borrowings that finance those assets. As a result, we substantially reduce our exposure to changes in portfolio value related to changes in foreign exchange rates.

We intend to hedge our net currency exposures in a prudent manner. However, our currency hedging strategies may not eliminate all of our currency risk due to, among other things, uncertainties in the timing and/or amount of payments received on the related investments, and/or unequal, inaccurate, or unavailable hedges to perfectly offset changes in future exchange rates. Additionally, we may be required under certain circumstances to collateralize our currency hedges for the benefit of the hedge counterparty, which could adversely affect our liquidity.

Consistent with our strategy of hedging foreign currency exposure on certain investments, we typically enter into a series of forwards to fix the U.S. dollar amount of foreign currency denominated cash flows (interest income and principal payments) we expect to receive from our foreign currency denominated investments. Accordingly, the notional values and expiration dates of our foreign currency hedges approximate the amounts and timing of future payments we expect to receive on the related investments.

The following table represents our assets and liabilities that are denominated in foreign currencies as well as our expected future net interest receipts (amounts in thousands):

	June 30, 2022
	GBP		EUR		AUD		CHF
Foreign currency assets	£	1,866,468	€	743,294	A$	1,780,919	Fr.	39,553
Foreign currency liabilities	(1,379,595)		(249,800)		(1,351,982)		(29,407)
Foreign currency contracts - notional, net	(566,009)		(573,312)		(631,794)		(9,049)
Expected future net interest cash flows	79,136		79,818		202,857		—
Net exposure to exchange rate fluctuations	£	—	€	—	A$	—	Fr.	1,097
Net exposure to exchange rate fluctuations in USD (1)	$	—	$	—	$	—	$	1,149

______________________________________________________________________________________________________________________

(1)     Represents the U.S. dollar equivalent using the GBP closing rate of 1.2175, EUR closing rate of 1.0485, AUD closing rate of 0.6901 and CHF closing rate of 1.0472 as of June 30, 2022.

Substantially all of our net asset exposure to the GBP, EUR, AUD and CHF has been hedged with foreign currency forward contracts as of June 30, 2022, as indicated in the table above. Refer to Note 13 of the Condensed Consolidated Financial Statements for further detail regarding our foreign currency derivatives and their contractual maturities.

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Item 4. Controls and Procedures.

Disclosure Controls and Procedures. We maintain disclosure controls and procedures that are designed to ensure that information required to be disclosed in our reports filed pursuant to the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is recorded, processed, summarized and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms and that such information is accumulated and communicated to our management, including our Chief Executive Officer, as appropriate, to allow timely decisions regarding required disclosures.

As of the end of the period covered by this report, we conducted an evaluation, under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, of the effectiveness of the design and operation of our disclosure controls and procedures. Based on that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective as of the end of the period covered by this report.

Changes in Internal Control Over Financial Reporting. No change in internal control over financial reporting (as defined in Rule 13a-15(f) under the Exchange Act) occurred during the quarter ended June 30, 2022 that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

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PART II—OTHER INFORMATION

Item 1.    Legal Proceedings.

Currently, no material legal proceedings are pending or, to our knowledge, threatened or contemplated against us, that could have a material adverse effect on our business, financial position or results of operations.

Item 1A. Risk Factors.

There have been no material changes to the risk factors previously disclosed in our Form 10-K.

Item 2.    Unregistered Sales of Equity Securities and Use of Proceeds.

There were no unregistered sales of securities during the three months ended June 30, 2022.

Issuer Purchases of Equity Securities

There were no purchases of common stock during the three months ended June 30, 2022.

Item 3.    Defaults Upon Senior Securities.

None.

Item 4.    Mine Safety Disclosures.

Not applicable.

Item 5.    Other Information.

None.

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Item 6.    Exhibits.

(a)Index to Exhibits

INDEX TO EXHIBITS

Exhibit No.	Description
10.1	Starwood Property Trust, Inc. Employee Stock Purchase Plan (as Amended and Restated, Effective June 16, 2022)
10.2	Starwood Property Trust, Inc. 2022 Manager Equity Plan (Incorporated by reference to Exhibit 10.2 of the Company's Quarterly Report on Form 10-Q filed May 4, 2022)
10.3	Starwood Property Trust, Inc. 2022 Equity Plan (Incorporated by reference to Exhibit 10.3 of the Company's Quarterly Report on Form 10-Q filed May 4, 2022)
31.1	Certification pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002
31.2	Certification pursuant to Section 302(a) of the Sarbanes-Oxley Act of 2002
32.1	Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
32.2	Certification pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
101.INS	XBRL Instance Document – the instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document.
101.SCH	Inline XBRL Taxonomy Extension Schema Document
101.CAL	Inline XBRL Taxonomy Extension Calculation Linkbase Document
101.DEF	Inline XBRL Taxonomy Extension Definition Linkbase Document
101.LAB	Inline XBRL Taxonomy Extension Label Linkbase Document
101.PRE	Inline XBRL Taxonomy Extension Presentation Linkbase Document
104	Cover Page Interactive Data File (embedded within the Inline XBRL document)

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SIGNATURES

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 thereunto duly authorized.

	STARWOOD PROPERTY TRUST, INC.
Date: August 4, 2022	By:	/s/ BARRY S. STERNLICHT
		Barry S. Sternlicht Chief Executive Officer Principal Executive Officer
Date: August 4, 2022	By:	/s/ RINA PANIRY
		Rina Paniry Chief Financial Officer, Treasurer, Chief Accounting Officer and Principal Financial Officer

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EX-10.1

Exhibit 10.1

STARWOOD PROPERTY TRUST, INC.

EMPLOYEE STOCK PURCHASE PLAN

(As Amended and Restated, Effective June 16, 2022)

1.Purpose. The purpose of the Plan is to provide Employees with opportunities to purchase common stock of the Company at a discounted purchase price, thereby encouraging increased efforts to promote the interests of the Company and its stockholders. It is the intention of the Company to have the Plan qualify as an “Employee Stock Purchase Plan” under Section 423 of the Code with respect to Section 423 Offerings. Accordingly, the provisions of the Plan shall be construed so as to extend and limit participation in Section 423 Offerings in a manner consistent with the requirements of Section 423 of the Code.

2.Definitions.

(a)“Board” means the Board of Directors of the Company.

(b)“Brokerage Account” means the account in which the Purchased Shares are held.

(c)“Business Day” means a day on which the New York Stock Exchange is open for trading.

(d)“Code” means the Internal Revenue Code of 1986, as amended.

(e)“Committee” means the Compensation Committee of the Board or the designee of the Compensation Committee.

(f)“Company” means Starwood Property Trust, Inc., a Maryland corporation.

(g)“Compensation” means a Participant’s base salary or wages, overtime pay, commissions, cash bonuses, and vacation, holiday, and sick pay. Compensation does not include any other forms of compensation, such as income related to stock option awards, stock grants, and other equity incentive awards, expense reimbursements, relocation-related payments, employee benefit plan payments, death benefits, income from non-cash and fringe benefits, and severance.

(h)“Employee” means any individual who either (i) is a common law employee of the Company or one of its Subsidiaries or (ii) provides full-time services directly to the Company or one of its Subsidiaries but is employed by a Participating Entity that is not a Subsidiary, and in either case whose customary employment with such entity is for (A) at least 20 hours per week and (B) more than 5 months per calendar year. Employment shall be treated as continuing while the individual is on sick leave or other leave of absence approved by the Company or the Participating Entity, as appropriate, and in the case of a Section 423 Offering, only to the extent permitted under Section 423 of the Code. For purposes of the Plan, an individual who performs services for the Companyor a Participating Entity pursuant to an agreement that classifies such individual’s relationship with the Company or a Participating Entity as other than a common law employee shall not be considered an “employee” with respect to any period preceding the date on which a court or administrative agency issues a final determination that such individual is an “employee.”

(i)“Enrollment Date” means the first Business Day of each Offering Period.

(j)“Exchange Act” means the Securities Exchange Act of 1934, as amended.

(k)“Exercise Date” means the last Business Day of each Offering Period.

(l)“Fair Market Value” means the closing transaction price of a Share as reported on the New York Stock Exchange on the date as of which such value is being determined or, if the Shares are not listed on the New York Stock Exchange, the closing transaction price of a Share on the principal national stock exchange on which the Shares are traded on the date as of which such value is being determined or, if there shall be no reported transactions for such date, on the next preceding date for which transactions were reported; provided, however, that if the Shares are not listed on a national stock exchange or if Fair Market Value for any date cannot be so determined, Fair Market Value shall be determined by the Committee by whatever means or method as the Committee, in the good faith exercise of its discretion, shall at such time deem appropriate and in compliance with Section 409A of the Code.

(m)“Non-Section 423 Offering” means an Offering that is not intended to qualify under Section 423 of the Code.

(n)“Offering” means an offer of an Option under the Plan that may be exercised on the Exercise Date of an Offering Period.Unless otherwise specified by the Committee, each such offer shall be deemed a separate Offering, even if the dates and other terms of the separate Offerings are identical, and the provisions of the Plan shall separately apply to each Offering. To the extent permitted by Section 423 of the Code, the terms of each separate Section 423 Offering need not be identical, provided that the terms of the Plan and an Offering together satisfy Section 423 of the Code. The terms of each separate Non-Section 423 Offering need not be identical in any case.

(o)“Offering Period” means every 3-month period beginning each March 16th, June 16th, September 16th and December 16th, or any other period designated by the Committee that does not exceed 27 months. The Committee shall determine the commencement of the first Offering Period under the Plan.

(p)“Option” means an option granted under the Plan that entitles a Participant to purchase Shares.

(q)“Participant” means an Employee who satisfies the requirements of Sections 3 and 5 of the Plan.

(r)“Participating Entity” means each Subsidiary of the Company and each other entity that is listed on Schedule A hereto or is otherwise designated by the Board or the Committee as a Participating Entity. Employees of Participating Entities that are not Subsidiaries shall participate in separate Non-Section 423 Offerings.

(s)“Plan” means this Starwood Property Trust, Inc. Employee Stock Purchase Plan.

(t)“Purchase Account” means the account used to purchase Shares through the exercise of Options under the Plan.

(u)“Purchase Price” means the lesser of (A) 85% of the Fair Market Value of a Share on the Enrollment Date and (B) 85% of the Fair Market Value of a Share on the Exercise Date.

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(v)“Purchased Shares” means the whole and fractional Shares issued or delivered pursuant to the exercise of Options under the Plan.

(w)“Section 423 Offering” means an Offering that is intended to qualify under Section 423 of the Code.

(x)“Securities Act” means the Securities Act of 1933, as amended.

(y)“Shares” means the shares of common stock, par value $0.01 per share, of the Company.

(z)“Subsidiary” means an entity, domestic or foreign, of which not less than 50% of the voting equity is held by the Company or a Subsidiary, whether or not such entity now exists or is hereafter organized or acquired by the Company or a Subsidiary, provided that such entity is also a “subsidiary” within the meaning of Section 424 of the Code.

(aa)“Termination Date” means the date on which a Participant terminates employment or on which the Participant ceases to provide services to the Company or one of its Subsidiaries for any reason.

3.Eligibility.

(a)Only Employees shall be eligible to be granted Options, and in no event may a Participant be granted an Option following the Participant’s Termination Date.

(b)Any provisions of the Plan to the contrary notwithstanding, no Employee shall be granted an Option if (A) immediately after the grant, the Employee (or any other person whose stock would be attributed to the Employee pursuant to Section 424(d) of the Code) would own capital stock of the Company or hold outstanding Options or options to purchase stock possessing 5% or more of the total combined voting power or value of all classes of stock of the Company or any of its Subsidiaries, or (B) the Option would permit the Employee to purchase stock under this Plan and all other employee stock purchase plans of the Company and its Subsidiaries to accrue at a rate that exceeds $25,000 of the Fair Market Value of such stock (determined at the time the Option is granted) for each calendar year in which the Option is outstanding at any time. For purposes of applying the limit described in clause (B) above to a Participant in a Non-Section 423 Offering who is employed outside of the U.S., the exchange rate shall be determined on the last day of the applicable Offering Period. No Participant may purchase more than 3,000 Shares during any Offering Period.

4.Option Exercise. Options shall be exercised on behalf of Participants in the Plan every Exercise Date, using payroll deductions that have accumulated in the Participants’ Purchase Accounts during the immediately preceding Offering Period or that have been retained from a prior Offering Period pursuant to Section 8 of the Plan.

5.Participation.

(a)An Employee shall be eligible to participate on the first Enrollment Date that occurs at least 30 calendar days after the Employee’s first date of employment with the Company or a Participating Entity by properly completing and submitting an election form by the deadline prescribed by the Company. Participation in the Plan is voluntary.

3

(b)An Employee who does not become a Participant on the first Enrollment Date on which the Employee is eligible may thereafter become a Participant on any subsequent Enrollment Date by properly completing and submitting an election form by the deadline prescribed by the Company.

(c)Payroll deductions for a Participant shall commence on the first payroll date following the Enrollment Date and shall end on the last payroll date in the Offering Period, unless sooner terminated as provided in Section 13 or Section 14 of the Plan.

6.Payroll Deductions.

(a)A Participant may elect to have payroll deductions made during an Offering Period equal to no less than 1% of the Participant’s Compensation, up to a maximum of 50% (or any greater amount established by the Committee). The amount of such payroll deductions shall be in whole percentages. All payroll deductions made by a Participant shall be credited to the Participant’s Purchase Account. A Participant may not make any additional payments into the Participant’s Purchase Account. All such payroll deductions shall be made from the Participant’s Compensation after deduction of any tax, social security, and national insurance contributions.

(b)Except as otherwise permitted in Section 13, a Participant may not increase or decrease the rate of payroll deductions during an Offering Period. A Participant may change the Participant’s payroll deduction percentage under subsection (a) above for any subsequent Offering Period by properly completing and submitting an election change form in accordance with the procedures prescribed by the Committee. The change in amount shall be effective as of the first Enrollment Date following the date of filing of the election change form. In the absence of such a change in election described in this subsection (b), the Participant’s most recently elected payroll deduction percentage shall continue in effect for any subsequent Offering Period.

(c)Notwithstanding the foregoing, to the extent necessary to comply with Section 423(b)(8) of the Code and Section 3(b) of the Plan, a Participant’s payroll deductions may be decreased to 0% at any time during an Offering Period. Payroll deductions shall resume at the rate provided in the Participant’s election form at the beginning of the first Offering Period that is scheduled to end in the following calendar year, unless terminated by the Participant as provided in Section 13 of the Plan.

7.Grant of Option. Subject to the limits in Section 3(b), on the applicable Enrollment Date, each Participant in an Offering Period shall be granted an Option to purchase, on the following Exercise Date, a number of whole and fractional Shares determined by dividing (a) the Participant’s payroll deductions accumulated prior to the Exercise Date and retained in the Participant’s Purchase Account as of the Exercise Date by (b) the applicable Purchase Price.

8.Exercise of Option. A Participant’s Option shall be exercised automatically on the Exercise Date, and the maximum number of Shares subject to the Option shall be purchased for the Participant at the applicable Purchase Price with the accumulated payroll deductions in the Participant’s Purchase Account. All other payroll deductions accumulated in a Participant’s Purchase Account and not used to purchase Shares on an Exercise Date shall be distributed to the Participant. During a Participant’s lifetime, a

4

Participant’s Option is exercisable only by the Participant. The Company shall satisfy the exercise of all Participants’ Options for the purchase of Shares through (a) the issuance of authorized but unissued Shares, (b) the transfer of treasury Shares, (c) the purchase of Shares on behalf of the applicable Participants on the open market through an independent broker, or (d) a combination of the foregoing.

9.Issuance of Stock. The Shares purchased by a Participant shall be issued in book entry form and shall be considered to be issued and outstanding to the Participant’s credit as of the end of the last day of each Offering Period. The Committee may permit or require that shares be deposited directly in a Brokerage Account with one or more brokers designated by the Committee or to one or more designated agents of the Company, and the Committee may use electronic or automated methods of share transfer. The Committee may require that Shares be retained with such brokers or agents for a designated period of time and may establish other procedures to permit tracking of disqualifying dispositions of such Shares. The Committee may also impose a transaction fee with respect to a sale of Shares issued to a Participant’s credit and held by such a broker or agent. The Committee may permit Shares purchased under the Plan to participate in a dividend reinvestment plan or program maintained by the Company, and the Committee may establish a default method for the payment of dividends.

10.Holding Period. Shares credited to a Participant’s Brokerage Account under the Plan may not be sold or otherwise transferred by the Participant until the date that is least 12 months after the Exercise Date on which such Shares were acquired under the Plan, provided that such holding period shall not apply to Shares credited to the Brokerage Account of a Participant who has died or terminated employment due to disability.

11.Approval by Stockholders. Notwithstanding the above, the Plan shall be subject to the approval of the stockholders of the Company within 12 months after the date the Plan is adopted by the Board, which shall be obtained in the manner and to the degree required under applicable federal and state law.

12.Administration.

(a)Powers and Duties of the Committee. The Plan shall be administered by the Committee. Subject to the provisions of the Plan and Section 423 of the Code and the regulations thereunder, the Committee shall have the discretionary authority to determine the time and frequency of granting Options, the terms and conditions of the Options, and the number of Shares subject to each Option. The Committee also shall have the discretionary authority to do everything necessary and appropriate to administer the Plan, including by interpreting the provisions of the Plan (consistent with the provisions of Section 423 of the Code). The Committee may delegate its duties and authority to any of the Company’s officers or employees as it determines to be appropriate. All actions, decisions, determinations, and interpretations by the Committee or its delegate with respect to the Plan shall be final and binding upon all Participants and upon their executors, administrators, personal representatives, heirs, and legatees. No member of the Board or the Committee, and no officer or director to whom the Committee has delegated its duties and authority, shall be liable for any action, decision, determination, or interpretation made in good faith with respect to the Plan or any Option. Each Section 423 Offering shall be administered so as to

5

ensure that all Participants have the same rights and privileges provided by Section 423(b)(5) of the Code.

(b)Brokerage Firm or Financial Institution. The Company, the Board, or the Committee may engage the services of a brokerage firm or financial institution to perform certain ministerial and procedural duties under the Plan. Such duties may include mailing and receiving notices contemplated under the Plan, determining the number of Purchased Shares for each Participant, maintaining or causing to be maintained the Purchase Account and the Brokerage Account, disbursing funds maintained in the Purchase Account or proceeds from the sale of Shares through the Brokerage Account, and filing proper tax returns and forms (including information returns) with the appropriate tax authorities and providing to each Participant statements as required by law or regulation.

(c)Indemnification. Each person who is or has been (A) a member of the Board, (B) a member of the Committee, or (C) an officer or employee of the Company to whom authority was delegated in relation to the Plan shall be indemnified and held harmless by the Company against and from all (x) losses, costs, liabilities, and expenses that may be imposed upon or reasonably incurred by such person in connection with or resulting from any claim, suit, proceeding, or other action to which such person may be a party or in which such person may be involved by reason of any action taken or failure to act under the Plan (any “Action”) and (y) amounts paid by such person in settlement of any Action, with the Company’s approval, or paid by such person in satisfaction of any judgment in any Action, provided that in any case such person gives the Company an opportunity, at its own expense, to handle and defend the Action before such person undertakes to handle and defend the Action on such person’s own behalf, unless such loss, cost, liability or expense is a result of such person’s own willful misconduct or except as expressly provided by statute.

The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled under the Company’s articles of incorporation or bylaws, any contract with the Company, as a matter of law, or otherwise, or of any power that the Company may have to indemnify them or hold them harmless.

13.Withdrawal. A Participant may withdraw from the Plan by properly completing and submitting to the Company a withdrawal form in accordance with the procedures prescribed by the Committee, which must be submitted prior to the date specified by the Committee before the last day of the applicable Offering Period (or such earlier day required by the Committee). Upon withdrawal, any payroll deductions credited to the Participant’s Purchase Account prior to the effective date of the Participant’s withdrawal from the Plan shall be returned to the Participant. No further payroll deductions for the purchase of Shares shall be made during subsequent Offering Periods, unless the Participant properly completes and submits an election form by the deadline prescribed by the Company. A Participant’s withdrawal from an offering shall not have any effect upon the Participant’s eligibility to participate in the Plan or in any similar plan that may hereafter be adopted by the Company.

14.Termination of Employment. On a Participant’s Termination Date occurring prior to an Exercise Date, the corresponding payroll deductions credited to the Participant’s Purchase Account shall be returned to the Participant or, in the case of the Participant’s death, to the person or persons entitled to such credited payroll deductions under Section 17, and the Participant’s Option shall be automatically terminated.

6

15.Interest. No interest shall accrue on the payroll deductions of a Participant in the Plan.

16.Stock.

(a)The stock subject to Options shall be Shares as traded on the New York Stock Exchange or on any other exchange that the Shares may be listed.

(b)Subject to adjustment upon changes in capitalization of the Company as provided in Section 19 of the Plan, the maximum number of Shares available for sale under the Plan shall be 2,000,000 Shares. On a given Exercise Date, if the number of Shares with respect to which Options are to be exercised exceeds the number of Shares then available under the Plan, the Committee shall make a pro rata allocation of the Shares remaining available for purchase in as uniform a manner as practicable and as the Committee determines to be equitable.

(c)A Participant shall have no interest or voting right in Shares covered by the Participant’s Option until the Option is exercised and the Participant becomes a holder of record of Shares acquired pursuant to such exercise.

17.Designation of Beneficiary. To the extent permitted by applicable law, the Committee may permit Participants to designate beneficiaries to receive any Purchased Shares or payroll deductions in the Participant’s Purchase Account in the event of the Participant’s death. Beneficiary designations shall be made in accordance with procedures prescribed by the Committee. If no properly designated beneficiary survives the Participant, the Purchased Shares and payroll deductions shall be distributed to the Participant’s estate.

18.Assignability of Options. Neither payroll deductions credited to a Participant’s Purchase Account nor any rights with regard to the exercise of an Option or to receive Shares under the Plan may be assigned, transferred, pledged, or otherwise disposed of in any way (other than by will, the laws of descent and distribution, or as provided in Section 17 of the Plan) by the Participant. Any such attempt at assignment, transfer, pledge, or other disposition shall be without effect, except that the Company may treat such act as an election to withdraw from an Offering Period in accordance with Section 13 of the Plan.

19.Adjustment of Number of Shares Subject to Options.

(a)Adjustment. Subject to any required action by the stockholders of the Company, the maximum number of securities available for purchase under the Plan, as well as the price per security and the number of securities covered by each Option that has not yet been exercised shall be appropriately adjusted in the event of any a stock split, reverse stock split, stock dividend, combination, or reclassification of the Shares, or any other increase or decrease in the number of Shares effected without receipt of consideration by the Company, excluding the conversion of any convertible securities of the Company. Such adjustment shall be made by the Board or the Committee, whose determination shall be final, binding, and conclusive. Except as expressly provided in this Section 19(a), no issuance by the Company of shares of stock of any class, or securities convertible into shares of stock of any class, shall affect, and no adjustment by reason thereof shall be made with respect to, the number or price of Shares subject to an Option. The Options granted pursuant to a Section 423 Offering shall not be adjusted in a manner that causes the Options to fail to qualify as options issued pursuant to an “employee stock purchase plan” within the meaning of Section 423 of the Code.

7

(b)Dissolution or Liquidation. In the event of the proposed dissolution or liquidation of the Company, the Offering Period then in progress shall terminate immediately prior to the consummation of such proposed action, unless otherwise provided by the Board, and the Board may either provide for the purchase of Shares as of the date on which such Offering Period terminates or return to each Participant the payroll deductions credited to the Participant’s Purchase Account.

(c)Merger or Asset Sale. In the event of a proposed sale of all or substantially all of the assets of the Company, or the merger of the Company with or into another corporation, each outstanding Option shall be assumed or an equivalent option substituted by the successor corporation or a parent or subsidiary of the successor corporation, unless the Board determines, in the exercise of its sole discretion, that in lieu of such assumption or substitution to either terminate all outstanding Options and return to each Participant the payroll deductions credited to such Participant’s Purchase Account or to provide for the Offering Period in progress to end on a date prior to the consummation of such sale or merger.

20.Amendments to and Termination of the Plan.

(a)The Board or the Committee may at any time and for any reason amend, modify, suspend, discontinue, or terminate the Plan without notice, provided that no Participant’s existing rights with respect to existing Options are adversely affected. To the extent necessary to comply with Section 423 of the Code (or any other applicable law, regulation, or stock exchange rule), the Company shall obtain stockholder approval in any manner and to any degree required.

(b)Without stockholder consent and without regard to whether any Participant’s rights may be considered to have been “adversely affected,” the Board or the Committee may (A) change the Purchase Price or Offering Periods, (B) limit or increase the frequency or number of changes in the amount withheld during an Offering Period, (C) establish the exchange ratio applicable to amounts withheld in a currency other than U.S. dollars, (D) permit payroll withholding in an amount less or greater than the amount designated by a Participant in order to adjust for delays or mistakes in the Company’s processing of properly completed withholding elections, (E) establish reasonable waiting and adjustment periods or accounting and crediting procedures to ensure that amounts applied toward the purchase of Shares for each Participant properly correspond with amounts withheld from the Participant’s Compensation, (F) and establish other limitations or procedures that the Board or the Committee determines in its sole discretion advisable and consistent with the Plan, except that changes to (1) the Purchase Price, (2) the Offering Period, (3) the maximum percentage of Compensation that may be deducted pursuant to Section 6(a) of the Plan, or (4) the maximum number of Shares that may be purchased in an Offering Period shall not be effective until communicated to Participants in a reasonable manner, with the determination of such reasonable manner in the sole discretion of the Board or the Committee.

21.No Other Obligations. The receipt of an Option shall not impose any obligation upon a Participant to purchase any Shares covered by the Option. The granting of an Option shall not constitute an agreement or an understanding, express or implied, on the part of the Company to employ the Participant for any specified period.

22.Notices and Communication. Any notice or other form of communication that the Company or a Participant may be required or permitted to give to the other shall be

8

provided through means designated by the Committee, which may be through any paper or electronic method.

23.Conditions for Exercise and Issuance.

(a)Shares shall not be issued with respect to an Option unless the exercise of such Option and the issuance and delivery of such Shares pursuant thereto would comply with all applicable law, domestic or foreign, including the Securities Act and the Exchange Act and the rules and regulations promulgated thereunder, and the requirements of any stock exchange upon which the Shares are then listed. Issuance of Shares with respect to an Option shall be subject to the approval of the Company’s counsel with respect to such compliance.

(b)As a condition to the exercise of an Option, the Company may require the person exercising the Option to represent and warrant, at the time of any such exercise, that the Shares are being purchased only for investment and without any present intention to sell or distribute the Shares if, in the opinion of the Company’s counsel, such a representation is required by applicable law as described in subsection (a) above.

24.General Compliance. The Plan shall be administered and Options exercised in compliance with the Securities Act, Exchange Act, and all other applicable securities laws and Company policies, including any insider trading policy of the Company.

25.Term of the Plan. The Plan shall become effective upon the earlier to occur of its adoption by the Board and its approval by the stockholders of the Company and shall continue in effect until terminated pursuant to Section 20 of the Plan.

26.Governing Law. The Plan and all Options shall be construed in accordance with and governed by the laws of the state of Maryland, without reference to choice-of-law principles and subject in all cases to the Code and regulations thereunder.

27.Non-U.S. Participants. To the extent permitted under Section 423 of the Code, without the amendment of the Plan, the Company may provide for the participation in the Plan by Employees who are subject to the laws of foreign countries or jurisdictions on terms and conditions different from those specified in the Plan, as in the judgment of the Company may be necessary or desirable to foster and promote achievement of the purposes of the Plan. In furtherance of such purposes, the Company may make modifications or establish procedures or subplans and the like as necessary or advisable to comply with provisions of laws of other countries or jurisdictions in which the Company or the Participating Entities operate or have employees. Each subplan shall constitute a separate “offering” under the Plan in accordance with Treas. Reg. §1.423-2(a).

9

Schedule A

Participating Entities

Starwood Capital Operations LLC

Subject to approval by a duly authorized officer of the Company, SPT Commercial Mortgage, LLC

EX-31.1

Exhibit 31.1

Certification Pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, Barry S. Sternlicht, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Starwood Property Trust, Inc. for the period ended June 30, 2022;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal controls over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 4, 2022	/s/ BARRY S. STERNLICHT
	Barry S. Sternlicht
	Chief Executive Officer

EX-31.2

Exhibit 31.2

Certification Pursuant to

Section 302 of the Sarbanes-Oxley Act of 2002

I, Rina Paniry, certify that:

1.I have reviewed this Quarterly Report on Form 10-Q of Starwood Property Trust, Inc. for the period ended June 30, 2022;

2.Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3.Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4.The registrant’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

a.Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b.Designed such internal controls over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

c.Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d.Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5.The registrant’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

a.All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

b.Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: August 4, 2022	/s/ RINA PANIRY
	Rina Paniry
	Chief Financial Officer

EX-32.1

Exhibit 32.1

Certification Pursuant to

18 U.S.C. Section 1350,

As Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with Starwood Property Trust, Inc.’s (the “Company”) Quarterly Report on Form 10-Q for the period ended June 30, 2022 (the “Report”), I, Barry S. Sternlicht, do hereby certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

1.The Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934; and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 4, 2022	/s/ BARRY S. STERNLICHT
	Barry S. Sternlicht
	Chief Executive Officer

EX-32.2

Exhibit 32.2

Certification Pursuant to

18 U.S.C. Section 1350,

As Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with Starwood Property Trust, Inc.’s (the “Company”) Quarterly Report on Form 10-Q for the period ended June 30, 2022 (the “Report”), I, Rina Paniry, do hereby certify, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that to my knowledge:

1.The Report fully complies with the requirements of Section 13(a) or 15(d), as applicable, of the Securities Exchange Act of 1934; and

2.The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 4, 2022	/s/ RINA PANIRY
	Rina Paniry
	Chief Financial Officer

XML

Cover Page - shares	6 Months Ended
	Jun. 30, 2022	Jul. 29, 2022
Cover [Abstract]
Document Type	10-Q
Document Quarterly Report	true
Document Period End Date	Jun. 30, 2022
Document Transition Report	false
Entity File Number	001-34436
Entity Registrant Name	Starwood Property Trust, Inc.
Entity Incorporation, State or Country Code	MD
Entity Tax Identification Number	27-0247747
Entity Address, Address Line One	591 West Putnam Avenue
Entity Address, City or Town	Greenwich
Entity Address, State or Province	CT
Entity Address, Postal Zip Code	06830
City Area Code	203
Local Phone Number	422-7700
Title of 12(b) Security	Common stock, $0.01 par value per share
Trading Symbol	STWD
Security Exchange Name	NYSE
Entity Current Reporting Status	Yes
Entity Interactive Data Current	Yes
Entity Filer Category	Large Accelerated Filer
Entity Small Business	false
Entity Emerging Growth Company	false
Entity Shell Company	false
Entity Common Stock, Shares Outstanding		309,221,274
Entity Central Index Key	0001465128
Current Fiscal Year End Date	--12-31
Document Fiscal Year Focus	2022
Document Fiscal Period Focus	Q2
Amendment Flag	false

XML

Condensed Consolidated Balance Sheets - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Assets:
Cash and cash equivalents	$ 272,174	$ 217,362
Restricted cash	64,632	104,552
Loans held-for-investment, net of credit loss allowances of $77,449 and $67,270 ($55,301 and $59,225 held at fair value)	17,895,789	15,536,849
Loans held-for-sale ($2,173,031 and $2,876,800 held at fair value)	2,236,647	2,876,800
Investment securities, net of credit loss allowances of $4,505 and $8,610 ($155,597 and $177,848 held at fair value)	913,360	860,984
Properties, net	1,225,979	1,166,387
Investments in unconsolidated entities	85,510	90,097
Goodwill	259,846	259,846
Intangible assets ($17,499 and $16,780 held at fair value)	74,964	63,564
Derivative assets	128,727	48,216
Accrued interest receivable	131,660	116,262
Other assets	257,185	188,626
Variable interest entity (“VIE”) assets, at fair value	57,993,563	61,280,543
Total Assets	83,098,886	83,850,397
Liabilities:
Accounts payable, accrued expenses and other liabilities	273,414	189,696
Related-party payable	30,754	76,371
Dividends payable	149,991	147,624
Derivative liabilities	55,137	13,421
Secured financing agreements, net	13,147,447	12,576,850
Collateralized loan obligations and single asset securitization, net	3,764,151	2,616,116
Unsecured senior notes, net	2,324,772	1,828,590
VIE liabilities, at fair value	56,256,080	59,752,922
Total Liabilities	76,001,746	77,201,590
Commitments and contingencies
Temporary Equity: Redeemable non-controlling interests	322,753	214,915
Starwood Property Trust, Inc. Stockholders’ Equity:
Preferred stock, $0.01 per share, 100,000,000 shares authorized, no shares issued and outstanding	0	0
Common stock, $0.01 per share, 500,000,000 shares authorized, 316,660,535 issued and 309,211,844 outstanding as of June 30, 2022 and 312,268,944 issued and 304,820,253 outstanding as of December 31, 2021	3,167	3,123
Additional paid-in capital	5,766,533	5,673,376
Treasury stock (7,448,691 shares)	(138,022)	(138,022)
Accumulated other comprehensive income	28,970	40,953
Retained earnings	733,348	493,106
Total Starwood Property Trust, Inc. Stockholders’ Equity	6,393,996	6,072,536
Non-controlling interests in consolidated subsidiaries	380,391	361,356
Total Permanent Equity	6,774,387	6,433,892
Total Liabilities and Equity	83,098,886	83,850,397
Primary beneficiary
Assets:
Investments of consolidated affordable housing fund, at fair value	1,558,850	$ 1,040,309
Total Assets	75,600
Liabilities:
Total Liabilities	$ 32,300

XML

Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Allowance for credit losses	$ 77,449	$ 67,270
Loans held-for-investment, net, held at fair value	55,301	59,225
Loans-held-for-sale, held at fair value	2,173,031	2,876,800
Credit loss allowance	4,505	8,610
Investment securities	155,597	177,848
Intangible assets held at fair value	$ 17,499	$ 16,780
Preferred stock, par value (in dollars per share)	$ 0.01	$ 0.01
Preferred stock, shares authorized (in shares)	100,000,000	100,000,000
Preferred stock, shares issued (in shares)	0	0
Preferred stock, shares outstanding (in shares)	0	0
Common stock, par value (in dollars per share)	$ 0.01	$ 0.01
Common stock, shares authorized (in shares)	500,000,000	500,000,000
Common stock, shares issued (in shares)	316,660,535	312,268,944
Common stock, shares outstanding (in shares)	309,211,844	304,820,253
Treasury stock, shares (in shares)	7,448,691	7,448,691
Assets	$ 83,098,886	$ 83,850,397
Liabilities	76,001,746	77,201,590
CLOs and SASB
Assets	4,500,000	3,100,000
Liabilities	$ 3,800,000	$ 2,600,000

XML

Condensed Consolidated Statements of Operations - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Revenues:
Interest income from loans	$ 261,150	$ 189,272	$ 494,769	$ 379,847
Interest income from investment securities	15,306	10,648	29,289	22,258
Servicing fees	12,553	10,864	22,545	19,266
Rental income	31,524	77,119	63,104	153,457
Other revenues	5,053	2,964	9,871	3,269
Total revenues	325,586	290,867	619,578	578,097
Costs and expenses:
Management fees	31,624	29,250	86,919	67,986
Interest expense	152,618	109,653	279,069	213,027
General and administrative	45,005	45,265	89,326	83,901
Acquisition and investment pursuit costs	517	407	939	592
Costs of rental operations	10,598	30,731	19,888	59,476
Depreciation and amortization	12,240	22,477	23,887	44,951
Credit loss provision (reversal), net	8,438	(11,844)	4,780	(11,800)
Other expense	1,258	0	1,313	685
Total costs and expenses	262,298	225,939	506,121	458,818
Other income (loss):
Change in net assets related to consolidated VIEs	8,373	12,509	35,122	52,254
Change in fair value of servicing rights	(365)	1,299	719	503
Change in fair value of investment securities, net	(1,245)	1,508	(1,600)	1,202
Change in fair value of mortgage loans, net	(113,480)	45,867	(239,263)	36,389
Earnings from unconsolidated entities	3,865	2,226	2,955	3,960
Gain on sale of investments and other assets, net	138	8,731	98,606	26,424
Gain (loss) on derivative financial instruments, net	128,583	(10,009)	255,851	23,980
Foreign currency (loss) gain, net	(78,602)	2,627	(105,883)	(9,054)
Loss on extinguishment of debt	0	(1,182)	(823)	(1,698)
Other loss, net	(33,809)	(5,473)	(34,572)	(5,452)
Total other income	220,623	58,103	552,318	128,508
Income before income taxes	283,911	123,031	665,775	247,787
Income tax (provision) benefit	(2,206)	3,353	244	1,123
Net income	281,705	126,384	666,019	248,910
Net income attributable to non-controlling interests	(69,418)	(10,074)	(129,133)	(21,222)
Net income attributable to Starwood Property Trust, Inc.	$ 212,287	$ 116,310	$ 536,886	$ 227,688
Earnings per share data attributable to Starwood Property Trust, Inc.:
Basic (in dollars per share)	$ 0.68	$ 0.40	$ 1.72	$ 0.79
Diluted (in dollars per share)	$ 0.67	$ 0.40	$ 1.69	$ 0.78
Primary beneficiary
Other income (loss):
Income from affordable housing fund investments	$ 307,165	$ 0	$ 541,206	$ 0

XML

Condensed Consolidated Statements of Comprehensive Income - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Statement of Comprehensive Income [Abstract]
Net income	$ 281,705	$ 126,384	$ 666,019	$ 248,910
Other comprehensive income (loss) (net change by component):
Available-for-sale securities	(6,699)	(344)	(11,983)	(2,747)
Foreign currency translation	0	0	0	64
Other comprehensive loss	(6,699)	(344)	(11,983)	(2,683)
Comprehensive income	275,006	126,040	654,036	246,227
Less: Comprehensive income attributable to non-controlling interests	(69,418)	(10,074)	(129,133)	(21,222)
Comprehensive income attributable to Starwood Property Trust, Inc.	$ 205,588	$ 115,966	$ 524,903	$ 225,005

XML

Condensed Consolidated Statements of Equity - USD ($) $ in Thousands	Total	Cumulative Effect, Period of Adoption, Adjustment	Total Starwood Property Trust, Inc. Stockholders’ Equity	Total Starwood Property Trust, Inc. Stockholders’ Equity Cumulative Effect, Period of Adoption, Adjustment	Common stock	Additional Paid-in Capital	Additional Paid-in Capital Cumulative Effect, Period of Adoption, Adjustment	Treasury Stock​	Retained Earnings (Accumulated Deficit)	Retained Earnings (Accumulated Deficit) Cumulative Effect, Period of Adoption, Adjustment	Accumulated Other Comprehensive Income	Non- Controlling Interests
Beginning balance at Dec. 31, 2020	$ 0
Ending balance at Jun. 30, 2021	0
Beginning balance (in shares) at Dec. 31, 2020					292,091,601
Beginning balance at Dec. 31, 2020	4,862,576	$ (1,536)	$ 4,488,898	$ (1,536)	$ 2,921	$ 5,209,739	$ (3,755)	$ (138,022)	$ (629,733)	$ 2,219	$ 43,993	$ 373,678
Beginning balance (in shares) at Dec. 31, 2020								7,448,691
Increase (Decrease) in Stockholders' Equity
Proceeds from DRIP Plan (in shares)					21,170
Proceeds from DRIP Plan	488		488			488
Redemption of Class A Units (in shares)					388,002
Redemption of Class A Units	0		8,116		$ 4	8,112						(8,116)
Equity offering costs	(22)		(22)			(22)
Share-based compensation (in shares)					2,157,745
Share-based compensation	19,907		19,907		$ 21	19,886
Manager fee paid in stock (in shares)					599,380
Manager fees paid in stock	14,048		14,048		$ 6	14,042
Net income	248,910		227,688						227,688			21,222
Dividends declared	(277,549)		(277,549)						(277,549)
Other comprehensive loss, net	(2,683)		(2,683)								(2,683)
Contributions from non-controlling interests	5,538											5,538
Distributions to non-controlling interests	(17,977)											(17,977)
Ending balance (in shares) at Jun. 30, 2021					295,257,898
Ending balance at Jun. 30, 2021	4,851,700		4,477,355		$ 2,952	5,248,490		$ (138,022)	(677,375)		41,310	374,345
Ending balance (in shares) at Jun. 30, 2021								7,448,691
Beginning balance at Mar. 31, 2021	0
Ending balance at Jun. 30, 2021	0
Beginning balance (in shares) at Mar. 31, 2021					294,300,251
Beginning balance at Mar. 31, 2021	4,854,785		4,476,862		$ 2,943	5,225,037		$ (138,022)	(654,750)		41,654	377,923
Beginning balance (in shares) at Mar. 31, 2021								7,448,691
Increase (Decrease) in Stockholders' Equity
Proceeds from DRIP Plan (in shares)					8,936
Proceeds from DRIP Plan	226		226			226
Redemption of Class A Units (in shares)					338,002
Redemption of Class A Units	0		7,077		$ 3	7,074						(7,077)
Share-based compensation (in shares)					343,331
Share-based compensation	9,597		9,597		$ 3	9,594
Manager fee paid in stock (in shares)					267,378
Manager fees paid in stock	6,562		6,562		$ 3	6,559
Net income	126,384		116,310						116,310			10,074
Dividends declared	(138,935)		(138,935)						(138,935)
Other comprehensive loss, net	(344)		(344)								(344)
Contributions from non-controlling interests	2,569											2,569
Distributions to non-controlling interests	(9,144)											(9,144)
Ending balance (in shares) at Jun. 30, 2021					295,257,898
Ending balance at Jun. 30, 2021	4,851,700		4,477,355		$ 2,952	5,248,490		$ (138,022)	(677,375)		41,310	374,345
Ending balance (in shares) at Jun. 30, 2021								7,448,691
Beginning balance at Dec. 31, 2021	214,915
Increase (Decrease) in Temporary Equity [Roll Forward]
Net income	110,503
Distributions to non-controlling interests	2,665
Ending balance at Jun. 30, 2022	$ 322,753
Beginning balance (in shares) at Dec. 31, 2021	312,268,944				312,268,944
Beginning balance at Dec. 31, 2021	$ 6,433,892		6,072,536		$ 3,123	5,673,376		$ (138,022)	493,106		40,953	361,356
Beginning balance (in shares) at Dec. 31, 2021	7,448,691							7,448,691
Increase (Decrease) in Stockholders' Equity
Proceeds from ATM Agreement (in shares)					1,415,564
Proceeds from ATM Agreement	$ 33,321		33,321		$ 14	33,307
Proceeds from DRIP Plan (in shares)					22,469
Proceeds from DRIP Plan	535		535			535
Equity offering costs	(756)		(756)			(756)
Share-based compensation (in shares)					1,237,602
Share-based compensation	20,000		20,000		$ 13	19,987
Manager fee paid in stock (in shares)					1,715,956
Manager fees paid in stock	40,101		40,101		$ 17	40,084
Net income	555,516		536,886						536,886			18,630
Dividends declared	(296,644)		(296,644)						(296,644)
Other comprehensive loss, net	(11,983)		(11,983)								(11,983)
Contributions from non-controlling interests	21,926											21,926
Distributions to non-controlling interests	$ (21,521)		0			0						(21,521)
Ending balance (in shares) at Jun. 30, 2022	316,660,535				316,660,535
Ending balance at Jun. 30, 2022	$ 6,774,387		6,393,996		$ 3,167	5,766,533		$ (138,022)	733,348		28,970	380,391
Ending balance (in shares) at Jun. 30, 2022	7,448,691							7,448,691
Beginning balance at Mar. 31, 2022	$ 261,685
Increase (Decrease) in Temporary Equity [Roll Forward]
Net income	62,783
Distributions to non-controlling interests	(1,715)
Ending balance at Jun. 30, 2022	322,753
Beginning balance (in shares) at Mar. 31, 2022					314,360,996
Beginning balance at Mar. 31, 2022	6,647,968		6,279,695		$ 3,144	5,709,027		$ (138,022)	669,877		35,669	368,273
Beginning balance (in shares) at Mar. 31, 2022								7,448,691
Increase (Decrease) in Stockholders' Equity
Proceeds from ATM Agreement (in shares)					1,415,564
Proceeds from ATM Agreement	33,321		33,321		$ 14	33,307
Proceeds from DRIP Plan (in shares)					12,208
Proceeds from DRIP Plan	284		284			284
Equity offering costs	(667)		(667)			(667)
Share-based compensation (in shares)					224,639
Share-based compensation	9,907		9,907		$ 3	9,904
Manager fee paid in stock (in shares)					647,128
Manager fees paid in stock	14,684		14,684		$ 6	14,678
Net income	218,922		212,287						212,287			6,635
Dividends declared	(148,816)		(148,816)						(148,816)
Other comprehensive loss, net	(6,699)		(6,699)								(6,699)
Contributions from non-controlling interests	17,236											17,236
Distributions to non-controlling interests	$ (11,753)											(11,753)
Ending balance (in shares) at Jun. 30, 2022	316,660,535				316,660,535
Ending balance at Jun. 30, 2022	$ 6,774,387		$ 6,393,996		$ 3,167	$ 5,766,533		$ (138,022)	$ 733,348		$ 28,970	$ 380,391
Ending balance (in shares) at Jun. 30, 2022	7,448,691							7,448,691

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Condensed Consolidated Statements of Equity (Parenthetical) - $ / shares			3 Months Ended		6 Months Ended
	Jun. 15, 2022	Mar. 14, 2022	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Statement of Stockholders' Equity [Abstract]
Dividends declared per common share (in dollars per share)	$ 0.48	$ 0.48	$ 0.48	$ 0.48	$ 0.96	$ 0.96

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Condensed Consolidated Statements of Cash Flows - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021
Cash Flows from Operating Activities:
Net income	$ 666,019	$ 248,910
Adjustments to reconcile net income to net cash provided by operating activities:
Amortization of deferred financing costs, premiums and discounts on secured borrowings	23,158	21,265
Amortization of discounts and deferred financing costs on unsecured senior notes	4,343	3,451
Accretion of net discount on investment securities	(7,010)	(6,773)
Accretion of net deferred loan fees and discounts	(30,869)	(29,739)
Share-based compensation	20,000	19,907
Manager fees paid in stock	40,101	14,048
Change in fair value of investment securities	1,600	(1,202)
Change in fair value of consolidated VIEs	36,885	19,024
Change in fair value of servicing rights	(719)	(503)
Change in fair value of loans	239,263	(36,389)
Change in fair value of affordable housing fund investments	(518,541)	0
Change in fair value of derivatives	(260,677)	(26,289)
Foreign currency loss, net	105,883	9,054
Gain on sale of investments and other assets	(98,606)	(26,424)
Impairment charges on properties and related intangibles	55	0
Credit loss provision (reversal), net	4,780	(11,800)
Depreciation and amortization	26,118	45,134
Earnings from unconsolidated entities	(2,955)	(3,960)
Distributions of earnings from unconsolidated entities	4,632	1,082
Loss on extinguishment of debt	624	1,698
Origination and purchase of loans held-for-sale, net of principal collections	(3,491,526)	(1,284,620)
Proceeds from sale of loans held-for-sale	3,960,798	1,477,579
Changes in operating assets and liabilities:
Related-party payable	(45,617)	(12,739)
Accrued and capitalized interest receivable, less purchased interest	(72,498)	(81,392)
Other assets	(60,627)	(32,132)
Accounts payable, accrued expenses and other liabilities	140,629	(19,203)
Net cash provided by operating activities	685,243	287,987
Cash Flows from Investing Activities:
Origination, purchase and funding of loans held-for-investment	(3,892,225)	(4,002,046)
Proceeds from principal collections on loans	1,204,499	2,244,935
Proceeds from loans sold	6,469	231,993
Purchase and funding of investment securities	(86,058)	0
Proceeds from principal collections on investment securities	15,180	68,867
Proceeds from sales of real estate	147,334	60,969
Purchases and additions to properties and other assets	(11,276)	(12,023)
Investments in unconsolidated entities	(461)	0
Distribution of capital from unconsolidated entities	3,375	21,263
Cash resulting from initial consolidation of entities	617	0
Payments for purchase or termination of derivatives	(16,308)	(8,111)
Proceeds from termination of derivatives	152,360	28,419
Net cash used in investing activities	(2,476,494)	(1,365,734)
Cash Flows from Financing Activities:
Proceeds from borrowings	10,035,448	6,793,363
Principal repayments on and repurchases of borrowings	(7,683,627)	(5,538,664)
Payment of deferred financing costs	(33,885)	(27,172)
Proceeds from common stock issuances	33,856	488
Payment of equity offering costs	(756)	(22)
Payment of dividends	(294,277)	(276,051)
Contributions from non-controlling interests	21,926	5,538
Distributions to non-controlling interests	(24,186)	(17,977)
Issuance of debt of consolidated VIEs	0	42,288
Repayment of debt of consolidated VIEs	(290,034)	(306,496)
Distributions of cash from consolidated VIEs	42,753	42,546
Net cash provided by financing activities	1,807,218	717,841
Net increase (decrease) in cash, cash equivalents and restricted cash	15,967	(359,906)
Cash, cash equivalents and restricted cash, beginning of period	321,914	722,162
Effect of exchange rate changes on cash	(1,075)	(1,680)
Cash, cash equivalents and restricted cash, end of period	336,806	360,576
Supplemental disclosure of cash flow information:
Cash paid for interest	227,051	183,016
Income taxes (refunded) paid, net	(8,220)	6,871
Supplemental disclosure of non-cash investing and financing activities:
Dividends declared, but not yet paid	150,556	139,985
Consolidation of VIEs (VIE asset/liability additions)	4,361,325	2,778,279
Deconsolidation of VIEs (VIE asset/liability reductions)	730,012	0
Reclassification of loans held-for-investment to loans held-for-sale	63,962	190,799
Reclassification of loans held-for-sale to loans held-for-investment	0	124,933
Transfer of loans from VIE assets to residential loans upon redemption of consolidated RMBS trusts	0	172,474
Loan principal collections temporarily held at master servicer	14,053	56,064
Redemption of Class A Units for common stock	0	8,116
Net assets acquired through foreclosure, control or conversion to equity interest:
Fair value of assets acquired, net of cash and restricted cash	145,330	36,308
Fair value of liabilities assumed	$ 95,796	$ 0

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Business and Organization

6 Months Ended

Jun. 30, 2022

Organization, Consolidation and Presentation of Financial Statements [Abstract]

Business and Organization

Business and Organization

Starwood Property Trust, Inc. (“STWD” and, together with its subsidiaries, “we” or the “Company”) is a Maryland corporation that commenced operations in August 2009, upon the completion of our initial public offering. We are focused primarily on originating, acquiring, financing and managing mortgage loans and other real estate investments in the United States (“U.S.”), Europe and Australia. As market conditions change over time, we may adjust our strategy to take advantage of changes in interest rates and credit spreads as well as economic and credit conditions.

We have four reportable business segments as of June 30, 2022 and we refer to the investments within these segments as our target assets:

•Real estate commercial and residential lending (the “Commercial and Residential Lending Segment”)—engages primarily in originating, acquiring, financing and managing commercial first mortgages, non-agency residential mortgages (“residential loans”), subordinated mortgages, mezzanine loans, preferred equity, commercial mortgage-backed securities (“CMBS”), residential mortgage-backed securities (“RMBS”) and other real estate and real estate-related debt investments in the U.S., Europe and Australia (including distressed or non-performing loans). Our residential loans are secured by a first mortgage lien on residential property and primarily consist of non-agency residential loans that are not guaranteed by any U.S. Government agency or federally chartered corporation.

•Infrastructure lending (the “Infrastructure Lending Segment”)—engages primarily in originating, acquiring, financing and managing infrastructure debt investments.

•Real estate property (the “Property Segment”)—engages primarily in acquiring and managing equity interests in stabilized commercial real estate properties, including multifamily properties and commercial properties subject to net leases, that are held for investment.

•Real estate investing and servicing (the “Investing and Servicing Segment”)—includes (i) a servicing business in the U.S. that manages and works out problem assets, (ii) an investment business that selectively acquires and manages unrated, investment grade and non-investment grade rated CMBS, including subordinated interests of securitization and resecuritization transactions, (iii) a mortgage loan business which originates conduit loans for the primary purpose of selling these loans into securitization transactions and (iv) an investment business that selectively acquires commercial real estate assets, including properties acquired from CMBS trusts.

Our segments exclude the consolidation of securitization variable interest entities (“VIEs”).

We are organized and conduct our operations to qualify as a real estate investment trust (“REIT”) under the Internal Revenue Code of 1986, as amended (the “Code”). As such, we will generally not be subject to U.S. federal corporate income tax on that portion of our net income that is distributed to stockholders if we distribute at least 90% of our taxable income to our stockholders by prescribed dates and comply with various other requirements.

We are organized as a holding company and conduct our business primarily through our various wholly-owned subsidiaries. We are externally managed and advised by SPT Management, LLC (our “Manager”) pursuant to the terms of a management agreement. Our Manager is controlled by Barry Sternlicht, our Chairman and Chief Executive Officer. Our Manager is an affiliate of Starwood Capital Group Global L.P., a privately-held private equity firm founded by Mr. Sternlicht.

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Summary of Significant Accounting Policies

6 Months Ended

Jun. 30, 2022

Accounting Policies [Abstract]

Summary of Significant Accounting Policies

Summary of Significant Accounting Policies

Balance Sheet Presentation of Securitization Variable Interest Entities

We operate investment businesses that acquire unrated, investment grade and non-investment grade rated CMBS and RMBS. These securities represent interests in securitization structures (commonly referred to as special purpose entities, or “SPEs”). These SPEs are structured as pass through entities that receive principal and interest on the underlying collateral and distribute those payments to the certificate holders. Under accounting principles generally accepted in the United States of America (“GAAP”), SPEs typically qualify as VIEs. These are entities that, by design, either (1) lack sufficient equity to permit the entity to finance its activities without additional subordinated financial support from other parties, or (2) have equity investors that do not have the ability to make significant decisions relating to the entity’s operations through voting rights, or do not have the obligation to absorb the expected losses, or do not have the right to receive the residual returns of the entity.

Because we often serve as the special servicer or servicing administrator of the trusts in which we invest, or we have the ability to remove and replace the special servicer without cause, consolidation of these structures is required pursuant to GAAP as outlined in detail below. This results in a consolidated balance sheet which presents the gross assets and liabilities of the VIEs. The assets and other instruments held by these VIEs are restricted and can only be used to fulfill the obligations of the entity. Additionally, the obligations of the VIEs do not have any recourse to the general credit of any other consolidated entities, nor to us as the consolidator of these VIEs.

The VIE liabilities initially represent investment securities on our balance sheet (pre-consolidation). Upon consolidation of these VIEs, our associated investment securities are eliminated, as is the interest income related to those securities. Similarly, the fees we earn in our roles as special servicer of the bonds issued by the consolidated VIEs or as collateral administrator of the consolidated VIEs are also eliminated. Finally, a portion of the identified servicing intangible associated with the eliminated fee streams is eliminated in consolidation.

Refer to the segment data in Note 23 for a presentation of our business segments without consolidation of these VIEs.

Basis of Accounting and Principles of Consolidation

The accompanying condensed consolidated financial statements include our accounts and those of our consolidated subsidiaries and VIEs. Intercompany amounts have been eliminated in consolidation. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows have been included.

These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021 (our “Form 10-K”), as filed with the Securities and Exchange Commission (“SEC”). The results of operations for the three and six months ended June 30, 2022 are not necessarily indicative of the operating results for the full year.

Refer to our Form 10-K for a description of our recurring accounting policies. We have included disclosure in this Note 2 regarding principles of consolidation and other accounting policies that (i) are required to be disclosed quarterly, (ii) we view as critical, (iii) became significant since December 31, 2021 due to a corporate action or increase in the significance of the underlying business activity or (iv) changed upon adoption of an Accounting Standards Update (“ASU”) issued by the Financial Accounting Standards Board (“FASB”).

Variable Interest Entities

In addition to the securitization VIEs, we have financed pools of our loans through collateralized loan obligations (“CLOs”) and a single asset securitization (“SASB”), which are considered VIEs. We also hold interests in certain other entities which are considered VIEs as the limited partners of those entities with equity at risk do not collectively possess (i) the right to remove the general partner or dissolve the partnership without cause or (ii) the right to participate in significant decisions made by the partnership.

We evaluate all of our interests in VIEs for consolidation. When our interests are determined to be variable interests, we assess whether we are deemed to be the primary beneficiary of the VIE. The primary beneficiary of a VIE is required to consolidate the VIE. Accounting Standards Codification (“ASC”) 810, Consolidation, defines the primary beneficiary as the party that has both (i) the power to direct the activities of the VIE that most significantly impact its economic performance, and (ii) the obligation to absorb losses and the right to receive benefits from the VIE which could be potentially significant. We

consider our variable interests as well as any variable interests of our related parties in making this determination. Where both of these factors are present, we are deemed to be the primary beneficiary and we consolidate the VIE. Where either one of these factors is not present, we are not the primary beneficiary and do not consolidate the VIE.

To assess whether we have the power to direct the activities of a VIE that most significantly impact the VIE’s economic performance, we consider all facts and circumstances, including our role in establishing the VIE and our ongoing rights and responsibilities. This assessment includes: (i) identifying the activities that most significantly impact the VIE’s economic performance; and (ii) identifying which party, if any, has power over those activities. In general, the parties that make the most significant decisions affecting the VIE or have the right to unilaterally remove those decision makers are deemed to have the power to direct the activities of a VIE. The right to remove the decision maker in a VIE must be exercisable without cause for the decision maker to not be deemed the party that has the power to direct the activities of a VIE.

To assess whether we have the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE, we consider all of our economic interests, including debt and equity investments, servicing fees and other arrangements deemed to be variable interests in the VIE. This assessment requires that we apply judgment in determining whether these interests, in the aggregate, are considered potentially significant to the VIE. Factors considered in assessing significance include: the design of the VIE, including its capitalization structure; subordination of interests; payment priority; relative share of interests held across various classes within the VIE’s capital structure; and the reasons why the interests are held by us.

Our purchased investment securities include unrated and non-investment grade rated securities issued by securitization trusts. In certain cases, we may contract to provide special servicing activities for these trusts, or, as holder of the controlling class, we may have the right to name and remove the special servicer for these trusts. In our role as special servicer, we provide services on defaulted loans within the trusts, such as foreclosure or work-out procedures, as permitted by the underlying contractual agreements. In exchange for these services, we receive a fee. These rights give us the ability to direct activities that could significantly impact the trust’s economic performance. However, in those instances where an unrelated third party has the right to unilaterally remove us as special servicer without cause, we do not have the power to direct activities that most significantly impact the trust’s economic performance. We evaluated all of our positions in such investments for consolidation.

For securitization VIEs in which we are determined to be the primary beneficiary, all of the underlying assets, liabilities and equity of the structures are recorded on our books, and the initial investment, along with any associated unrealized holding gains and losses, are eliminated in consolidation. Similarly, the interest income earned from these structures, as well as the fees paid by these trusts to us in our capacity as special servicer, are eliminated in consolidation. Further, a portion of the identified servicing intangible asset associated with the servicing fee streams, and the corresponding amortization or change in fair value of the servicing intangible asset, are also eliminated in consolidation.

We perform ongoing reassessments of: (i) whether any entities previously evaluated under the majority voting interest framework have become VIEs, based on certain events, and therefore subject to the VIE consolidation framework, and (ii) whether changes in the facts and circumstances regarding our involvement with a VIE causes our consolidation conclusion regarding the VIE to change.

We elect the fair value option for initial and subsequent recognition of the assets and liabilities of our consolidated securitization VIEs. Interest income and interest expense associated with these VIEs are no longer relevant on a standalone basis because these amounts are already reflected in the fair value changes. We have elected to present these items in a single line on our condensed consolidated statements of operations. The residual difference shown on our condensed consolidated statements of operations in the line item “Change in net assets related to consolidated VIEs” represents our beneficial interest in the VIEs.

We separately present the assets and liabilities of our consolidated securitization VIEs as individual line items on our condensed consolidated balance sheets. The liabilities of our consolidated securitization VIEs consist solely of obligations to the bondholders of the related trusts, and are thus presented as a single line item entitled “VIE liabilities.” The assets of our consolidated securitization VIEs consist principally of loans, but at times, also include foreclosed loans which have been temporarily converted into real estate owned (“REO”). These assets in the aggregate are likewise presented as a single line item entitled “VIE assets.”

Loans comprise the vast majority of our securitization VIE assets and are carried at fair value due to the election of the fair value option. When an asset becomes REO, it is due to non-performance of the loan. Because the loan is already at fair value, the carrying value of an REO asset is also initially at fair value. Furthermore, when we consolidate a trust, any existing

REO would be consolidated at fair value. Once an asset becomes REO, its disposition time is relatively short. As a result, the carrying value of an REO generally approximates fair value under GAAP.

In addition to sharing a similar measurement method as the loans in a trust, the securitization VIE assets as a whole can only be used to settle the obligations of the consolidated VIE. The assets of our securitization VIEs are not individually accessible by the bondholders, which creates inherent limitations from a valuation perspective. Also creating limitations from a valuation perspective is our role as special servicer, which provides us very limited visibility, if any, into the performing loans of a trust.

REO assets generally represent a very small percentage of the overall asset pool of a trust. In new issue trusts there are no REO assets. We estimate that REO assets constitute approximately 1% of our consolidated securitization VIE assets, with the remaining 99% representing loans. However, it is important to note that the fair value of our securitization VIE assets is determined by reference to our securitization VIE liabilities as permitted under ASU 2014-13, Consolidation (Topic 810): Measuring the Financial Assets and the Financial Liabilities of a Consolidated Collateralized Financing Entity. In other words, our VIE liabilities are more reliably measurable than the VIE assets, resulting in our current measurement methodology which utilizes this value to determine the fair value of our securitization VIE assets as a whole. As a result, these percentages are not necessarily indicative of the relative fair values of each of these asset categories if the assets were to be valued individually.

Due to our accounting policy election under ASU 2014-13, separately presenting two different asset categories would result in an arbitrary assignment of value to each, with one asset category representing a residual amount, as opposed to its fair value. However, as a pool, the fair value of the assets in total is equal to the fair value of the liabilities.

For these reasons, the assets of our securitization VIEs are presented in the aggregate.

Fair Value Option

The guidance in ASC 825, Financial Instruments, provides a fair value option election that allows entities to make an irrevocable election of fair value as the initial and subsequent measurement attribute for certain eligible financial assets and liabilities. Unrealized gains and losses on items for which the fair value option has been elected are reported in earnings. The decision to elect the fair value option is determined on an instrument by instrument basis and must be applied to an entire instrument and is irrevocable once elected. Assets and liabilities measured at fair value pursuant to this guidance are required to be reported separately in our consolidated balance sheets from those instruments using another accounting method.

We have elected the fair value option for certain eligible financial assets and liabilities of our consolidated securitization VIEs, residential loans held-for-investment, loans held-for-sale originated or acquired for future securitization and purchased CMBS issued by VIEs we could consolidate in the future. The fair value elections for VIE and securitization related items were made in order to mitigate accounting mismatches between the carrying value of the instruments and the related assets and liabilities that we consolidate at fair value. The fair value elections for residential loans held-for-investment were made in order to maintain consistency across all our residential loans. The fair value elections for mortgage loans held-for-sale were made due to the expected short-term holding period of these instruments.

Fair Value Measurements

We measure our mortgage-backed securities, investments of consolidated affordable housing fund, derivative assets and liabilities, domestic servicing rights intangible asset and any assets or liabilities where we have elected the fair value option at fair value. When actively quoted observable prices are not available, we either use implied pricing from similar assets and liabilities or valuation models based on net present values of estimated future cash flows, adjusted as appropriate for liquidity, credit, market and/or other risk factors.

As discussed above, we measure the assets and liabilities of consolidated securitization VIEs at fair value pursuant to our election of the fair value option. The securitization VIEs in which we invest are “static”; that is, no reinvestment is permitted, and there is no active management of the underlying assets. In determining the fair value of the assets and liabilities of the securitization VIEs, we maximize the use of observable inputs over unobservable inputs. Refer to Note 20 for further discussion regarding our fair value measurements.

Loans Held-for-Investment

Loans that are held for investment (“HFI”) are carried at cost, net of unamortized acquisition premiums or discounts, loan fees and origination costs, as applicable, and net of credit loss allowances as discussed below, unless the loans are credit deteriorated or we have elected to apply the fair value option at purchase.

Loans Held-For-Sale

Our loans that we intend to sell or liquidate in the short-term are classified as held-for-sale and are carried at the lower of amortized cost or fair value, unless we have elected to apply the fair value option at origination or purchase.

Investment Securities

We designate our debt investment securities as held-to-maturity (“HTM”), available-for-sale (“AFS”), or trading depending on our investment strategy and ability to hold such securities to maturity. HTM debt securities where we have not elected to apply the fair value option are stated at cost plus any premiums or discounts, which are amortized or accreted through the condensed consolidated statements of operations using the effective interest method. Debt securities we (i) do not hold for the purpose of selling in the near-term, or (ii) may dispose of prior to maturity, are classified as AFS and are carried at fair value in the accompanying financial statements. Unrealized gains or losses on AFS debt securities where we have not elected the fair value option are reported as a component of accumulated other comprehensive income (“AOCI”) in stockholders’ equity. Our HTM and AFS debt securities are also subject to credit loss allowances as discussed below.

Our only equity investment security is carried at fair value, with unrealized holding gains and losses recorded in earnings.

Credit Losses

Loans and Debt Securities Measured at Amortized Cost

ASC 326, Financial Instruments – Credit Losses, became effective for the Company on January 1, 2020. ASC 326 mandates the use of a current expected credit loss model (“CECL”) for estimating future credit losses of certain financial instruments measured at amortized cost, instead of the “incurred loss” credit model previously required under GAAP. The CECL model requires the consideration of possible credit losses over the life of an instrument as opposed to only estimating credit losses upon the occurrence of a discrete loss event under the previous “incurred loss” methodology. The CECL model applies to our HFI loans and our HTM debt securities which are carried at amortized cost, including future funding commitments and accrued interest receivable related to those loans and securities. However, as permitted by ASC 326, we have elected not to measure an allowance for credit losses on accrued interest receivable (which is classified separately on our condensed consolidated balance sheets), but rather write off in a timely manner by reversing interest income and/or cease accruing interest that would likely be uncollectible.

As we do not have a history of realized credit losses on our HFI loans and HTM securities, we have subscribed to third party database services to provide us with historical industry losses for both commercial real estate and infrastructure loans. Using these losses as a benchmark, we determine expected credit losses for our loans and securities on a collective basis within our commercial real estate and infrastructure portfolios. See Note 4 for further discussion of our methodologies.

We also evaluate each loan and security measured at amortized cost for credit deterioration at least quarterly. Credit deterioration occurs when it is deemed probable that we will not be able to collect all amounts due according to the contractual terms of the loan or security. If a loan or security is considered to be credit deteriorated, we depart from the industry loss rate approach described above and determine the credit loss allowance as any excess of the amortized cost basis of the loan or security over (i) the present value of expected future cash flows discounted at the contractual effective interest rate or (ii) the fair value of the collateral, if repayment is expected solely from the collateral.

Available-for-Sale Debt Securities

Separate provisions of ASC 326 apply to our AFS debt securities, which are carried at fair value with unrealized gains and losses reported as a component of AOCI. We are required to establish an initial credit loss allowance for those securities that are purchased with credit deterioration (“PCD”) by grossing up the amortized cost basis of each security and providing an offsetting credit loss allowance for the difference between expected cash flows and contractual cash flows, both on a present value basis.

Subsequently, cumulative adverse changes in expected cash flows on our AFS debt securities are recognized currently as an increase to the allowance for credit losses. However, the allowance is limited to the amount by which the AFS debt security’s amortized cost exceeds its fair value. Favorable changes in expected cash flows are first recognized as a decrease to the allowance for credit losses (recognized currently in earnings). Such changes would be recognized as a prospective yield adjustment only when the allowance for credit losses is reduced to zero. A change in expected cash flows that is attributable solely to a change in a variable interest reference rate does not result in a credit loss and is accounted for as a prospective yield adjustment.

Investments of Consolidated Affordable Housing Fund

On November 5, 2021, we established Woodstar Portfolio Holdings, LLC (the “Woodstar Fund”), an investment fund which holds our Woodstar multifamily affordable housing portfolios consisting of 59 properties with 15,057 units located in Central and South Florida. As managing member of the Woodstar Fund, we manage interests purchased by third party investors seeking capital appreciation and an ongoing return, for which we earn (i) a management fee based on each investor’s share of total Woodstar Fund equity; and (ii) an incentive distribution if the Woodstar Fund’s returns exceed an established threshold. In connection with the establishment of the Woodstar Fund, we entered into subscription and other related agreements with certain third party institutional investors to sell, through a feeder fund structure, an aggregate 20.6% interest in the Woodstar Fund for an initial aggregate subscription price of $216.0 million, which was adjusted to $214.2 million post-closing. The Woodstar Fund has an initial term of eight years.

Effective with the third party interest sale, the Woodstar Fund has the characteristics of an investment company under ASC 946, Financial Services – Investment Companies. Accordingly, the Woodstar Fund is required to carry the investments in its properties at fair value, with a cumulative effect adjustment between the fair value and previous carrying value of its investments recognized in stockholders’ equity as of November 5, 2021, the date of the Woodstar Fund’s change in status to an investment company. Because we are the primary beneficiary of the Woodstar Fund, which is a VIE (as discussed in Note 15), we consolidate the accounts of the Woodstar Fund into our consolidated financial statements, retaining the fair value basis of accounting for its investments. Realized and unrealized changes in the fair value of the Woodstar Fund’s property investments, and distributions thereon, are recognized in the “Income from affordable housing fund investments” caption within the other income (loss) section of our condensed consolidated statement of operations for the six months ended June 30, 2022. See Note 7 for further details regarding the Woodstar Fund’s investments and related income and Note 17 with respect to its contingently redeemable non-controlling interests which are classified as “Temporary Equity” in our condensed consolidated balance sheets.

Revenue Recognition

Interest Income

Interest income on performing loans and financial instruments is accrued based on the outstanding principal amount and contractual terms of the instrument. For loans where we do not elect the fair value option, origination fees and direct loan origination costs are also recognized in interest income over the loan term as a yield adjustment using the effective interest method. When we elect the fair value option, origination fees and direct loan costs are recorded directly in income and are not deferred. Discounts or premiums associated with the purchase of non-performing loans and investment securities are amortized or accreted into interest income as a yield adjustment on the effective interest method, based on expected cash flows through the expected maturity date of the investment. On at least a quarterly basis, we review and, if appropriate, make adjustments to our cash flow projections.

We cease accruing interest on non-performing loans at the earlier of (i) the loan becoming significantly past due or (ii) management concluding that a full recovery of all interest and principal is doubtful. Interest income on non-accrual loans in which management expects a full recovery of the loan’s outstanding principal balance is only recognized when received in cash. If a full recovery of principal is doubtful, the cost recovery method is applied whereby any cash received is applied to the outstanding principal balance of the loan. A non-accrual loan is returned to accrual status at such time as the loan becomes contractually current and management believes all future principal and interest will be received according to the contractual loan terms.

For loans acquired with deteriorated credit quality, interest income is only recognized to the extent that our estimate of undiscounted expected principal and interest exceeds our investment in the loan. Such excess, if any, is recognized as interest income on a level-yield basis over the life of the loan.

Upon the sale of loans or securities which are not accounted for pursuant to the fair value option, the excess (or deficiency) of net proceeds over the net carrying value of such loans or securities is recognized as a realized gain (loss).

Servicing Fees

We typically seek to be the special servicer on CMBS transactions in which we invest. When we are appointed to serve in this capacity, we earn special servicing fees from the related activities performed, which consist primarily of overseeing the workout of under-performing and non-performing loans underlying the CMBS transactions. These fees are recognized in income in the period in which the services are performed and the revenue recognition criteria have been met.

Rental Income

Rental income is recognized when earned from tenants. For leases that provide rent concessions or fixed escalations over the lease term, rental income is recognized on a straight-line basis over the noncancelable term of the lease. In net lease arrangements, costs reimbursable from tenants are recognized in rental income in the period in which the related expenses are incurred as we are generally the primary obligor with respect to purchasing goods and services for property operations. In instances where the tenant is responsible for property maintenance and repairs and contracts and settles such costs directly with third party service providers, we do not reflect those expenses in our consolidated statement of operations as the tenant is the primary obligor.

Foreign Currency Translation

Our assets and liabilities denominated in foreign currencies are translated into U.S. dollars using foreign currency exchange rates at the end of the reporting period. Income and expenses are translated at the average exchange rates for each reporting period. The effects of translating the assets, liabilities and income of our foreign investments held by entities with a U.S. dollar functional currency are included in foreign currency gain (loss) in the consolidated statements of operations or other comprehensive income (“OCI”) for debt securities available-for-sale for which the fair value option has not been elected. The effects of translating the assets, liabilities and income of our foreign investments held by entities with functional currencies other than the U.S. dollar are included in OCI. Realized foreign currency gains and losses and changes in the value of foreign currency denominated monetary assets and liabilities are included in the determination of net income and are reported as foreign currency gain (loss) in our condensed consolidated statements of operations.

Earnings Per Share

We present both basic and diluted earnings per share (“EPS”) amounts in our financial statements. Basic EPS excludes dilution and is computed by dividing income available to common stockholders by the weighted-average number of shares of common stock outstanding for the period. Diluted EPS reflects the maximum potential dilution that could occur from (i) our share-based compensation, consisting of unvested restricted stock awards (“RSAs”) and restricted stock units (“RSUs”), (ii) shares contingently issuable to our Manager, (iii) the conversion options associated with our senior convertible notes (the “Convertible Notes”) (see Notes 11 and 18) and (iv) non-controlling interests that are redeemable with our common stock (see Note 17). Potential dilutive shares are excluded from the calculation if they have an anti-dilutive effect in the period.

Nearly all of the Company’s unvested RSUs and RSAs contain rights to receive non-forfeitable dividends and thus are participating securities. In addition, the non-controlling interests that are redeemable with our common stock are considered participating securities because they earn a preferred return indexed to the dividend rate on our common stock (see Note 17). Due to the existence of these participating securities, the two-class method of computing EPS is required, unless another method is determined to be more dilutive. Under the two-class method, undistributed earnings are reallocated between shares of common stock and participating securities. For the three and six months ended June 30, 2022 and 2021, the two-class method resulted in the most dilutive EPS calculation.

Use of Estimates

The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting periods. The most significant and subjective estimate that we make is the projection of cash flows we expect to receive on our investments, which has a significant impact on the amount of income that we record and/or disclose. The fair value of assets and liabilities that are estimated using a discounted cash flows method is significantly impacted by the rates at which we estimate market participants would discount the expected cash flows. In addition, the fair value of the Woodstar Fund’s investments are dependent upon the real estate and capital markets, which are cyclical in nature. Property and investment values are affected by, among other things, capitalization rates, the availability of capital, occupancy, rental rates and interest and inflation rates. Amounts ultimately realized from our investments may vary significantly from the fair values presented.

We believe the estimates and assumptions underlying our consolidated financial statements are reasonable and supportable based on the information available as of June 30, 2022. However, uncertainty over the ultimate impact the COVID-19 pandemic, including variants and resurgences, will have on the global economy generally, and our business in particular, makes any estimates and assumptions as of June 30, 2022 inherently less certain than they would be absent the current and potential impacts of COVID-19 and geopolitical events. Actual results may ultimately differ from those estimates.

Recent Accounting Developments

On March 12, 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting, and on January 11, 2021, issued ASU 2021-01, Reference Rate Reform (Topic 848) – Scope, both of which provide optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions that reference LIBOR or other reference rates expected to be discontinued because of reference rate reform. These ASUs are effective through December 31, 2022. The Company has not adopted any of the optional expedients or exceptions through June 30, 2022, but will continue to evaluate the possible adoption of any such expedients or exceptions during the effective period as circumstances evolve.

On March 31, 2022, the FASB issued ASU 2022-2, Troubled Debt Restructurings and Vintage Disclosures (Topic 326). ASU 2022-2 eliminates the recognition and measurement guidance for troubled debt restructurings (“TDRs”) and, instead, requires that an entity evaluate (consistent with the accounting for other loan modifications) whether the modification represents a new loan or a continuation of an existing loan. The ASU also enhances existing disclosure requirements and introduces new requirements related to certain modifications of receivables made to borrowers experiencing financial difficulty. The ASU is effective for the Company beginning January 1, 2023 and is generally to be applied prospectively. Early adoption is permitted. We do not expect the application of this ASU to materially impact our consolidated financial statements as our operating practice is generally not to enter into TDRs for troubled loans.

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Acquisitions and Divestitures

6 Months Ended

Jun. 30, 2022

Business Combination and Asset Acquisition [Abstract]

Acquisitions and Divestitures

Acquisitions and Divestitures

Investing and Servicing Segment Property Portfolio ("REIS Equity Portfolio")

During the six months ended June 30, 2022, we sold an operating property for $34.5 million. In connection with this sale, we recognized a total gain of $11.7 million within gain on sale of investments and other assets in our condensed consolidated statement of operations. During the three and six months ended June 30, 2021, we sold an operating property for $30.9 million. In connection with this sale, we recognized a gain of $9.7 million within gain on sale of investments and other assets in our condensed consolidated statements of operations.

Commercial and Residential Lending Segment

During the six months ended June 30, 2022, we sold a distribution facility located in Orlando, Florida that was previously acquired in April 2019 through foreclosure of a loan with a carrying value of $18.5 million. The property was sold for $114.8 million and we recognized a gain of $86.6 million within gain on sale of investments and other assets in our condensed consolidated statement of operations. During the six months ended June 30, 2021, we sold an operating property relating to a grocery distribution facility located in Montgomery, Alabama that was previously acquired in March 2019 through foreclosure of a loan with a carrying value of $9.0 million ($20.9 million unpaid principal balance net of an $8.3 million allowance and $3.6 million of unamortized discount) at the foreclosure date. The operating property was sold for $31.2 million and we recognized a gain of $17.7 million within gain on sale of investments and other assets in our condensed consolidated statement of operations.

During the three and six months ended June 30, 2022 and 2021, we had no significant acquisitions of properties or businesses.

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Loans

6 Months Ended

Jun. 30, 2022

Receivables [Abstract]

Loans

Loans

Our loans held-for-investment are accounted for at amortized cost and our loans held-for-sale are accounted for at the lower of cost or fair value, unless we have elected the fair value option for either. The following tables summarize our investments in mortgages and loans as of June 30, 2022 and December 31, 2021 (dollars in thousands):

June 30, 2022	Carrying Value		Face Amount		Weighted Average Coupon (1)		Weighted Average Life (“WAL”) (years)(2)
Loans held-for-investment:
Commercial loans:
First mortgages (3)	$	15,114,160	$	15,207,825	5.5	%	2.0
Subordinated mortgages (4)	69,413		70,729		11.2	%	2.3
Mezzanine loans (3)	433,730		431,475		10.3	%	1.2
Other	16,849		18,161		8.2	%	1.8
Total commercial loans	15,634,152		15,728,190
Infrastructure first priority loans	2,283,785		2,308,602		6.0	%	4.1
Residential loans, fair value option (5)	55,301		55,580		6.0	%	N/A	(6)
Total loans held-for-investment	17,973,238		18,092,372
Loans held-for-sale:
Residential, fair value option (5)	2,132,337		2,260,154		4.6	%	N/A	(6)
Commercial, $40,694 under fair value option (7)	104,310		108,356		4.2	%	7.6
Total loans held-for-sale	2,236,647		2,368,510
Total gross loans	20,209,885		$	20,460,882
Credit loss allowances:
Commercial loans held-for-investment	(56,671)
Infrastructure loans held-for-investment	(20,778)
Total allowances	(77,449)
Total net loans	$	20,132,436
December 31, 2021
Loans held-for-investment:
Commercial loans:
First mortgages (3)	$	12,991,099	$	13,067,524	4.5	%	1.9
Subordinated mortgages (4)	70,771		72,371		10.0	%	2.8
Mezzanine loans (3)	417,504		415,155		9.4	%	1.4
Other	17,424		19,029		8.2	%	2.1
Total commercial loans	13,496,798		13,574,079
Infrastructure first priority loans	2,048,096		2,071,912		4.4	%	4.3
Residential loans, fair value option	59,225		60,133		6.0	%	N/A	(6)
Total loans held-for-investment	15,604,119		15,706,124
Loans held-for-sale:
Residential, fair value option	2,590,005		2,525,910		4.2	%	N/A	(6)
Commercial, fair value option	286,795		289,761		4.0	%	9.0
Total loans held-for-sale	2,876,800		2,815,671
Total gross loans	18,480,919		$	18,521,795
Credit loss allowances:
Commercial loans held-for-investment	(46,600)
Infrastructure loans held-for-investment	(20,670)
Total allowances	(67,270)
Total net loans	$	18,413,649

______________________________________________________________________________________________________________________

(1)Calculated using applicable index rates as of June 30, 2022 and December 31, 2021 for variable rate loans and excludes loans for which interest income is not recognized.

(2)Represents the WAL of each respective group of loans, excluding loans for which interest income is not recognized, as of the respective balance sheet date. The WAL of each individual loan is calculated using amounts and timing of future principal payments, as projected at origination or acquisition.

(3)First mortgages include first mortgage loans and any contiguous mezzanine loan components because as a whole, the expected credit quality of these loans is more similar to that of a first mortgage loan.  The application of this methodology resulted in mezzanine loans with carrying values of $1.2 billion and $1.4 billion being classified as first mortgages as of June 30, 2022 and December 31, 2021, respectively.

(4)Subordinated mortgages include B-Notes and junior participation in first mortgages where we do not own the senior A-Note or senior participation. If we own both the A-Note and B-Note, we categorize the loan as a first mortgage loan.

(5)During the six months ended June 30, 2022, $0.3 million of residential loans held-for-investment were reclassified into loans held-for-sale.

(6)Residential loans have a weighted average remaining contractual life of 29.3 years and 29.4 years as of June 30, 2022 and December 31, 2021, respectively.

(7)During the six months ended June 30, 2022, $63.6 million of commercial loans held-for-investment were reclassified into loans held-for-sale.

As of June 30, 2022, our variable rate loans held-for-investment, excluding loans for which interest income is not recognized, were as follows (dollars in thousands):

June 30, 2022	Carrying Value		Weighted-average Spread Above Index
Commercial loans	$	14,941,518	4.0	%
Infrastructure loans	2,283,785		3.9	%
Total variable rate loans held-for-investment	$	17,225,303	4.0	%

Credit Loss Allowances

As discussed in Note 2, we do not have a history of realized credit losses on our HFI loans and HTM securities, so we have subscribed to third party database services to provide us with industry losses for both commercial real estate and infrastructure loans. Using these losses as a benchmark, we determine expected credit losses for our loans and securities on a collective basis within our commercial real estate and infrastructure portfolios.

For our commercial loans, we utilize a loan loss model that is widely used among banks and commercial mortgage REITs and is marketed by a leading CMBS data analytics provider. It employs logistic regression to forecast expected losses at the loan level based on a commercial real estate loan securitization database that contains activity dating back to 1998. We provide specific loan-level inputs which include loan-to-stabilized-value (“LTV”) and debt service coverage ratio (DSCR) metrics, as well as principal balances, property type, location, coupon, origination year, term, subordination, expected repayment dates and future fundings. We also select from a group of independent five-year macroeconomic forecasts included in the model that are updated regularly based on current economic trends. We categorize the results by LTV range, which we consider the most significant indicator of credit quality for our commercial loans, as set forth in the credit quality indicator table below. A lower LTV ratio typically indicates a lower credit loss risk.

The macroeconomic forecasts do not differentiate among property types or asset classes. Instead, these forecasts reference general macroeconomic growth factors which apply broadly across all assets. However, the COVID-19 pandemic has had a more negative impact on certain property types, principally retail and hospitality, which were initially impacted by lockdowns and partial reopenings and reduced consumer travel. The office sector has also been adversely affected due to the increase in remote working arrangements. The broad macroeconomic forecasts do not account for such differentiation. Accordingly, we have selected a more adverse macroeconomic recovery forecast related to these property types in determining our credit loss allowance.

For our infrastructure loans, we utilize a database of historical infrastructure loan performance that is shared among a consortium of banks and other lenders and compiled by a major bond credit rating agency. The database is representative of industry-wide project finance activity dating back to 1983. We derive historical loss rates from the database filtered by industry, sub-industry, term and construction status for each of our infrastructure loans. Those historical loss rates reflect global economic cycles over a long period of time as well as average recovery rates. We categorize the results between the power and oil and gas industries, which we consider the most significant indicator of credit quality for our infrastructure loans, as set forth in the credit quality indicator table below.

As discussed in Note 2, we use a discounted cash flow or collateral value approach, rather than the industry loan loss approach described above, to determine credit loss allowances for any credit deteriorated loans.

We regularly evaluate the extent and impact of any credit deterioration associated with the performance and/or value of the underlying collateral, as well as the financial and operating capability of the borrower. Specifically, the collateral’s operating results and any cash reserves are analyzed and used to assess (i) whether cash flow from operations is sufficient to cover the debt service requirements currently and into the future, (ii) the ability of the borrower to refinance the loan and/or (iii) the collateral’s liquidation value. We also evaluate the financial wherewithal of any loan guarantors as well as the borrower’s competency in managing and operating the collateral. In addition, we consider the overall economic environment, real estate or industry sector, and geographic sub-market in which the borrower operates. Such analyses are completed and reviewed by asset management and finance personnel who utilize various data sources, including (i) periodic financial data such as property operating statements, occupancy, tenant profile, rental rates, operating expenses, the borrower’s exit plan, and capitalization and discount rates, (ii) site inspections and (iii) current credit spreads and discussions with market participants.

The significant credit quality indicators for our loans measured at amortized cost, which excludes loans held-for-sale, were as follows as of June 30, 2022 (dollars in thousands):

	Term Loans Amortized Cost Basis by Origination Year												Revolving Loans Amortized Cost Total		Total Amortized Cost Basis		Credit Loss Allowance
As of June 30, 2022	2022		2021		2020		2019		2018		Prior
Commercial loans:
Credit quality indicator:
LTV < 60%	$	446,275	$	2,613,440	$	501,609	$	947,347	$	384,309	$	703,459	$	—	$	5,596,439	$	4,287
LTV 60% - 70%	2,318,864		4,151,281		246,709		1,104,966		457,469		68,379		—		8,347,668		15,849
LTV > 70%	99,746		321,271		247,756		422,725		312,890		263,883		—		1,668,271		31,610
Credit deteriorated	—		—		—		—		—		4,925		—		4,925		4,925
Defeased and other	—		—		—		—		—		16,849		—		16,849		—
Total commercial	$	2,864,885	$	7,085,992	$	996,074	$	2,475,038	$	1,154,668	$	1,057,495	$	—	$	15,634,152	$	56,671
Infrastructure loans:
Credit quality indicator:
Power	$	93,913	$	229,627	$	108,491	$	268,362	$	393,708	$	338,268	$	7,378	$	1,439,747	$	5,366
Oil and gas	—		346,373		40,670		287,062		84,692		50,004		1,949		810,750		5,291
Credit deteriorated	—		—		—		—		—		33,288		—		33,288		10,121
Total infrastructure	$	93,913	$	576,000	$	149,161	$	555,424	$	478,400	$	421,560	$	9,327	$	2,283,785	$	20,778
Residential loans held-for-investment, fair value option															55,301		—
Loans held-for-sale															2,236,647		—
Total gross loans															$	20,209,885	$	77,449

Non-Credit Deteriorated Loans

As of June 30, 2022, we had the following loans with a combined amortized cost basis of $501.0 million that were 90 days or greater past due at June 30, 2022: (i) a $201.2 million senior loan on a retail and entertainment project in New Jersey, of which $7.3 million was converted into equity interests (see Note 8); (ii) a $222.5 million senior loan on an office building in California; (iii) a $37.8 million leasehold mortgage loan on a luxury resort in California destroyed by wildfire; (iv) $30.3 million of residential loans; and (v) a $9.2 million loan on a hospitality asset in New York that our Investing and Servicing Segment acquired as nonperforming in October 2021. Loans on nonaccrual as of June 30, 2022 include (i) - (iv) above. None of these loans are considered credit deteriorated as we presently expect to recover all amounts due.

Credit Deteriorated Loans

As of June 30, 2022, we had the following loans with a combined amortized cost basis of $38.2 million which were deemed credit deteriorated and are on nonaccrual status: (i) a $33.3 million senior loan participation secured by a natural gas-fired power plant in Massachusetts, for which we recorded a credit loss allowance of $10.1 million in 2021 based on our share of the estimated fair value of the asset and for which interest collections were current as of June 30, 2022; and (ii) a $4.9 million subordinated loan secured by a department store in Chicago which is fully reserved.

Foreclosures and Equity Control

In May 2022, we obtained control over the pledged equity interests of a mezzanine borrower entity related to an office building located in Texas, which resulted in our consolidating the mezzanine borrower entity including the underlying property collateral and related debt. The net carrying value of our loans related to this property totaled $50.2 million and consisted of first mortgage and mezzanine loans which are now eliminated in consolidation. In connection with the consolidation of the mezzanine borrower entity, we recorded properties of $110.8 million, lease intangible assets of $15.4 million, net working capital of $11.8 million and third-party first mortgage debt of $87.8 million in accordance with the asset acquisition provisions of ASC 805, Business Combinations.

The following tables present the activity in our credit loss allowance for funded loans and unfunded commitments (amounts in thousands):

	Funded Commitments Credit Loss Allowance
	Loans Held-for-Investment				Total Funded Loans
Six Months Ended June 30, 2022	Commercial		Infrastructure
Credit loss allowance at December 31, 2021	$	46,600	$	20,670	$	67,270
Credit loss provision, net	10,071		108		10,179
Credit loss allowance at June 30, 2022	$	56,671	$	20,778	$	77,449

	Unfunded Commitments Credit Loss Allowance (1)
	Loans Held-for-Investment				HTM Preferred
Six Months Ended June 30, 2022	Commercial		Infrastructure		Interests (2)		CMBS (2)		Total
Credit loss allowance at December 31, 2021	$	6,692	$	145	$	—	$	—	$	6,837
Credit loss (reversal) provision, net	(1,469)		(120)		248		47		(1,294)
Credit loss allowance at June 30, 2022	$	5,223	$	25	$	248	$	47	$	5,543
Memo: Unfunded commitments as of June 30, 2022 (3)	$	2,550,117	$	4,667	$	12,500	$	35,976	$	2,603,260

______________________________________________________________________________________________________________________

(1)Included in accounts payable, accrued expenses and other liabilities in our consolidated balance sheets.

(2)See Note 5 for further details.

(3)Represents amounts expected to be funded (see Note 22).

Loan Portfolio Activity

The activity in our loan portfolio was as follows (amounts in thousands):

	Held-for-Investment Loans
Six Months Ended June 30, 2022	Commercial		Infrastructure		Residential		Held-for-Sale Loans		Total Loans
Balance at December 31, 2021	$	13,450,198	$	2,027,426	$	59,225	$	2,876,800	$	18,413,649
Acquisitions/originations/additional funding	3,510,157		382,068		—		3,607,070		7,499,295
Capitalized interest (1)	54,414		242		—		147		54,803
Basis of loans sold (2)	(6,330)		—		—		(3,960,798)		(3,967,128)
Loan maturities/principal repayments	(1,034,439)		(148,225)		(4,207)		(110,642)		(1,297,513)
Discount accretion/premium amortization	26,525		4,344		—		—		30,869
Changes in fair value	—		—		629		(239,892)		(239,263)
Foreign currency translation gain/(loss), net	(299,206)		(2,740)		—		—		(301,946)
Credit loss provision, net	(10,071)		(108)		—		—		(10,179)
Transfer to/from other asset classifications or between segments	(113,767)		—		(346)		63,962		(50,151)		(3)
Balance at June 30, 2022	$	15,577,481	$	2,263,007	$	55,301	$	2,236,647	$	20,132,436

	Held-for-Investment Loans
Six Months Ended June 30, 2021	Commercial		Infrastructure		Residential		Held-for-Sale Loans		Total Loans
Balance at December 31, 2020	$	9,583,949	$	1,412,440	$	90,684	$	1,052,835	$	12,139,908
Acquisitions/originations/additional funding	3,713,142		288,904		—		1,367,574		5,369,620
Capitalized interest (1)	63,538		—		—		—		63,538
Basis of loans sold (2)	(207,975)		—		—		(1,502,588)		(1,710,563)
Loan maturities/principal repayments	(2,025,641)		(100,624)		(18,868)		(206,119)		(2,351,252)
Discount accretion/premium amortization	27,067		2,168		—		504		29,739
Changes in fair value	—		—		1,384		35,005		36,389
Foreign currency translation gain/(loss), net	1,987		(345)		—		—		1,642
Credit loss reversal (provision), net	11,381		(1,519)		—		—		9,862
Loan foreclosure and conversion to equity interest	(36,308)		—		—		—		(36,308)		(4)
Transfer to/from other asset classifications or between segments	(204,583)		93,085		69,506		214,466		172,474		(5)
Balance at June 30, 2021	$	10,926,557	$	1,694,109	$	142,706	$	961,677	$	13,725,049

______________________________________________________________________________________________________________________

(1)Represents accrued interest income on loans whose terms do not require current payment of interest.

(2)See Note 12 for additional disclosure on these transactions.

(3)Represents the net carrying value of first mortgage and contiguous mezzanine loans related to an office building in Texas that is eliminated as a result of consolidating the net assets of the mezzanine borrower entity upon obtaining control over its pledged equity interests in May 2022 (see discussion above).

(4)Includes (i) a $29.0 million credit deteriorated loan related to a residential conversion project which was foreclosed in April 2021 and (ii) $7.3 million of a commercial loan that was converted to equity interests in March 2021 (see Note 8) pursuant to a consensual transfer under pre-existing equity pledges of additional collateral.

(5)Net transfers represent residential loans transferred from VIE assets upon redemption of a consolidated RMBS trust.

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Investment Securities

6 Months Ended

Jun. 30, 2022

Investments, Debt and Equity Securities [Abstract]

Investment Securities

Investment Securities

Investment securities were comprised of the following as of June 30, 2022 and December 31, 2021 (amounts in thousands):

	Carrying Value as of
	June 30, 2022		December 31, 2021
RMBS, available-for-sale	$	124,439	$	143,980
RMBS, fair value option (1)	416,057		250,424
CMBS, fair value option (1), (2)	1,307,440		1,263,606
HTM debt securities, amortized cost net of credit loss allowance of $4,505 and $8,610	757,763		683,136
Equity security, fair value	10,193		11,624
Subtotal—Investment securities	2,615,892		2,352,770
VIE eliminations (1)	(1,702,532)		(1,491,786)
Total investment securities	$	913,360	$	860,984

______________________________________________________________________________________________________________________

(1)Certain fair value option CMBS and RMBS are eliminated in consolidation against VIE liabilities pursuant to ASC 810.

(2)Includes $205.3 million and $182.6 million of non-controlling interests in the consolidated entities which hold certain of these CMBS as of June 30, 2022 and December 31, 2021, respectively.

Purchases, sales, principal collections and redemptions for all investment securities were as follows (amounts in thousands):

	RMBS, available-for-sale		RMBS, fair value option		CMBS, fair value option		HTM Securities		Securitization VIEs (1)		Total
Three Months Ended June 30, 2022
Purchases/fundings	$	—	$	141,795	$	63,681	$	67,919	$	(205,476)	$	67,919
Sales	—		—		—		—		—		—
Principal collections	5,893		20,325		641		1,276		(20,739)		7,396
Three Months Ended June 30, 2021
Purchases	$	—	$	52,351	$	54,082	$	—	$	(106,433)	$	—
Sales	—		30,684		—				(30,684)		—
Principal collections	7,863		14,687		2,013		879		(16,089)		9,353
Redemptions	—		11,976		—		—		(11,976)		—

	RMBS, available-for-sale		RMBS, fair value option		CMBS, fair value option		HTM Securities		Securitization VIEs (1)		Total
Six Months Ended June 30, 2022
Purchases/fundings	$	—	$	226,152	$	63,681	$	86,058	$	(289,833)	$	86,058
Sales	—		—		—		—		—		—
Principal collections	12,788		41,929		1,276		1,940		(42,753)		15,180
Six Months Ended June 30, 2021
Purchases	$	—	$	79,684	$	54,082	$	—	$	(133,766)	$	—
Sales	—		30,684		11,604				(42,288)		—
Principal collections	15,114		28,031		3,723		52,569		(30,570)		68,867
Redemptions	—		11,976		—		—		(11,976)		—

______________________________________________________________________________________________________________________

(1)Represents RMBS and CMBS, fair value option amounts eliminated due to our consolidation of securitization VIEs. These amounts are reflected as issuance or repayment of debt of, or distributions from, consolidated VIEs in our consolidated statements of cash flows.

RMBS, Available-for-Sale

The Company classified all of its RMBS not eliminated in consolidation as available-for-sale as of June 30, 2022 and December 31, 2021. These RMBS are reported at fair value in the balance sheet with changes in fair value recorded in accumulated other comprehensive income (“AOCI”).

The tables below summarize various attributes of our investments in available-for-sale RMBS as of June 30, 2022 and December 31, 2021 (amounts in thousands):

							Unrealized Gains or (Losses) Recognized in AOCI
	Amortized Cost		Credit Loss Allowance		Net Basis		Gross Unrealized Gains		Gross Unrealized Losses		Net Fair Value Adjustment		Fair Value
June 30, 2022
RMBS	$	95,469	$	—	$	95,469	$	29,278	$	(308)	$	28,970	$	124,439
December 31, 2021
RMBS	$	103,027	$	—	$	103,027	$	41,052	$	(99)	$	40,953	$	143,980

	Weighted Average Coupon (1)		WAL  (Years) (2)
June 30, 2022
RMBS	2.6	%	6.1

______________________________________________________________________________________________________________________

(1)Calculated using the June 30, 2022 one-month LIBOR rate of 1.787% for floating rate securities.

(2)Represents the remaining WAL of each respective group of securities as of the balance sheet date. The WAL of each individual security is calculated using projected amounts and projected timing of future principal payments.

As of June 30, 2022, approximately $109.7 million, or 88%, of RMBS were variable rate. We purchased all of the RMBS at a discount, a portion of which is accreted into income over the expected remaining life of the security. The majority of the income from this strategy is earned from the accretion of this accretable discount.

We have engaged a third party manager who specializes in RMBS to execute the trading of RMBS, the cost of which was $0.2 million and $0.3 million for the three months ended June 30, 2022 and 2021, and $0.5 million and $0.6 million for the six months ended June 30, 2022 and 2021, respectively, recorded as management fees in the accompanying condensed consolidated statements of operations.

The following table presents the gross unrealized losses and estimated fair value of any available-for-sale securities that were in an unrealized loss position as of June 30, 2022 and December 31, 2021, and for which an allowance for credit losses has not been recorded (amounts in thousands):

	Estimated Fair Value				Unrealized Losses
	Securities with a loss less than 12 months		Securities with a loss greater than 12 months		Securities with a loss less than 12 months		Securities with a loss greater than 12 months
As of June 30, 2022
RMBS	$	4,691	$	—	$	(308)	$	—
As of December 31, 2021
RMBS	$	2,478	$	—	$	(99)	$	—

As of June 30, 2022 and December 31, 2021, there were seven securities and one security, respectively, with unrealized losses reflected in the table above. After evaluating the securities and recording adjustments for credit losses, we concluded that the remaining unrealized losses reflected above were noncredit-related and would be recovered from the securities’ estimated future cash flows. We considered a number of factors in reaching this conclusion, including that we did not intend to sell the securities, it was not considered more likely than not that we would be forced to sell the securities prior to recovering our amortized cost, and there were no material credit events that would have caused us to otherwise conclude that we would not recover our cost. Credit losses are calculated by comparing (i) the estimated future cash flows of each security discounted at the yield determined as of the initial acquisition date or, if since revised, as of the last date previously revised, to (ii) our net amortized cost basis. Significant judgment is used in projecting cash flows for our non-agency RMBS. As a result, actual income and/or credit losses could be materially different from what is currently projected and/or reported.

CMBS and RMBS, Fair Value Option

As discussed in the “Fair Value Option” section of Note 2 herein, we elect the fair value option for certain CMBS and RMBS in an effort to eliminate accounting mismatches resulting from the current or potential consolidation of securitization VIEs. As of June 30, 2022, the fair value and unpaid principal balance of CMBS where we have elected the fair value option, excluding the notional value of interest-only securities and before consolidation of securitization VIEs, were $1.3 billion and $2.9 billion, respectively. As of June 30, 2022, the fair value and unpaid principal balance of RMBS where we have elected the fair value option, excluding the notional value of interest-only securities and before consolidation of securitization VIEs, were $416.1 million and $326.3 million, respectively. The $1.7 billion total fair value balance of CMBS and RMBS represents our economic interests in these assets. However, as a result of our consolidation of securitization VIEs, the vast majority of this fair value (all except $21.0 million at June 30, 2022) is eliminated against VIE liabilities before arriving at our GAAP balance for fair value option investment securities.

As of June 30, 2022, $97.1 million of our CMBS were variable rate and none of our RMBS were variable rate.

HTM Debt Securities, Amortized Cost

The table below summarizes our investments in HTM debt securities as of June 30, 2022 and December 31, 2021 (amounts in thousands):

	Amortized Cost Basis		Credit Loss Allowance		Net Carrying Amount		Gross Unrealized Holding Gains		Gross Unrealized Holding Losses		Fair Value
June 30, 2022
CMBS	$	571,959	$	(1,169)	$	570,790	$	198	$	(31,239)	$	539,749
Preferred interests	119,899		(262)		119,637		125		(5,851)		113,911
Infrastructure bonds	70,410		(3,074)		67,336		604		(959)		66,981
Total	$	762,268	$	(4,505)	$	757,763	$	927	$	(38,049)	$	720,641
December 31, 2021
CMBS	$	538,506	$	(3,140)	$	535,366	$	195	$	(25,029)	$	510,532
Preferred interests	118,409		(2,562)		115,847		450		(2,449)		113,848
Infrastructure bonds	34,831		(2,908)		31,923		561		—		32,484
Total	$	691,746	$	(8,610)	$	683,136	$	1,206	$	(27,478)	$	656,864

The following table presents the activity in our credit loss allowance for HTM debt securities (amounts in thousands):

	CMBS		Preferred Interests		Infrastructure Bonds		Total HTM Credit Loss Allowance
Six Months Ended June 30, 2022
Credit loss allowance at December 31, 2021	$	3,140	$	2,562	$	2,908	$	8,610
Credit loss (reversal) provision, net	(1,971)		(2,300)		166		(4,105)
Credit loss allowance at June 30, 2022	$	1,169	$	262	$	3,074	$	4,505

The table below summarizes the maturities of our HTM debt securities by type as of June 30, 2022 (amounts in thousands):

	CMBS		Preferred Interests		Infrastructure Bonds		Total
Less than one year	$	314,026	$	91,368	$	—	$	405,394
One to three years	24,382		28,269		—		52,651
Three to five years	232,382		—		37,906		270,288
Thereafter	—		—		29,430		29,430
Total	$	570,790	$	119,637	$	67,336	$	757,763

Equity Security, Fair Value

During 2012, we acquired 9,140,000 ordinary shares from a related-party in Starwood European Real Estate Finance Limited (“SEREF”), a debt fund that is externally managed by an affiliate of our Manager and is listed on the London Stock Exchange. The fair value of the investment remeasured in USD was $10.2 million and $11.6 million as of June 30, 2022 and December 31, 2021, respectively. As of June 30, 2022, our shares represent an approximate 2% interest in SEREF.

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Properties

6 Months Ended

Jun. 30, 2022

Real Estate [Abstract]

Properties

Properties

Our properties are held within the following portfolios:

Medical Office Portfolio

The Medical Office Portfolio is comprised of 34 medical office buildings acquired during the year ended December 31, 2016. These properties, which collectively comprise 1.9 million square feet, are geographically dispersed throughout the U.S. and primarily affiliated with major hospitals or located on or adjacent to major hospital campuses. The Medical Office Portfolio includes total gross properties and lease intangibles of $763.4 million and debt of $595.4 million as of June 30, 2022.

Master Lease Portfolio

The Master Lease Portfolio is comprised of 16 retail properties geographically dispersed throughout the U.S., with more than 50% of the portfolio, by carrying value, located in Florida, Texas and Minnesota. These properties, which we acquired in September 2017, collectively comprise 1.9 million square feet and were leased back to the seller under corporate guaranteed master net lease agreements with initial terms of 24.6 years and periodic rent escalations. The Master Lease Portfolio includes total gross properties of $343.8 million and debt of $193.2 million as of June 30, 2022.

Investing and Servicing Segment Property Portfolio

The REIS Equity Portfolio is comprised of 12 commercial real estate properties and one equity interest in an unconsolidated commercial real estate property which were acquired from CMBS trusts during the previous six years. The REIS Equity Portfolio includes total gross properties and lease intangibles of $200.9 million and debt of $144.2 million as of June 30, 2022.

Woodstar Portfolios

Refer to Note 7 for a discussion of our Woodstar I and Woodstar II Portfolios which are not included in the table below.

The table below summarizes our properties held as of June 30, 2022 and December 31, 2021 (dollars in thousands):

	Depreciable Life	June 30, 2022		December 31, 2021
Property Segment
Land and land improvements	0 - 15 years	$	175,836	$	175,810
Buildings and building improvements	0 - 45 years	851,919		851,274
Furniture & fixtures	3 - 5 years	288		260
Investing and Servicing Segment
Land and land improvements	0 - 15 years	36,910		41,771
Buildings and building improvements	3 - 40 years	133,748		149,399
Furniture & fixtures	2 - 5 years	3,181		3,143
Commercial and Residential Lending Segment (1)
Land and land improvements	N/A	33,681		9,691
Buildings and building improvements	0 - 24 years	77,941		12,408
Construction in progress	N/A	104,184		104,088
Properties, cost		1,417,688		1,347,844
Less: accumulated depreciation		(191,709)		(181,457)
Properties, net		$	1,225,979	$	1,166,387

______________________________________________________________________________________________________________________

(1)Represents properties acquired through loan foreclosure or exercise of control over a mezzanine loan borrower’s pledged equity interests.

During the six months ended June 30, 2022, we sold an operating property within the REIS Equity Portfolio for $34.5 million and recognized a total gain of $11.7 million within gain on sale of investments and other assets in our consolidated statement of operations. During the three and six months ended June 30, 2021, we sold an operating property within the REIS Equity Portfolio for $30.9 million and recognized a gain of $9.7 million within gain on sale of investments and other assets in our condensed consolidated statements of operations.

During the six months ended June 30, 2022, we sold an operating property within the Commercial and Residential Lending Segment for $114.8 million and recognized a gain of $86.6 million within gain on sale of investments and other assets in our condensed consolidated statement of operations. During the six months ended June 30, 2021, we sold an operating property within the Commercial and Residential Lending Segment for $31.2 million and recognized a gain of $17.7 million within gain on sale of investments and other assets in our condensed consolidated statement of operations. Refer to Note 3 for further discussion.

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Investments of Consolidated Affordable Housing Fund

6 Months Ended

Jun. 30, 2022

Equity Method Investments and Joint Ventures [Abstract]

Investments of Consolidated Affordable Housing Fund

Investments of Consolidated Affordable Housing Fund

As discussed in Note 2, we established the Woodstar Fund effective November 5, 2021, an investment fund which holds our Woodstar multifamily affordable housing portfolios. The Woodstar portfolios consist of the following:

Woodstar I Portfolio

The Woodstar I Portfolio is comprised of 32 affordable housing communities with 8,948 units concentrated primarily in the Tampa, Orlando and West Palm Beach metropolitan areas. During the year ended December 31, 2015, we acquired 18 of the 32 affordable housing communities of the Woodstar I Portfolio, with the final 14 communities acquired during the year ended December 31, 2016. The Woodstar I Portfolio includes properties at fair value of $1.5 billion and debt at fair value of $719.2 million as of June 30, 2022.

Woodstar II Portfolio

The Woodstar II Portfolio is comprised of 27 affordable housing communities with 6,109 units concentrated primarily in Central and South Florida. We acquired eight of the 27 affordable housing communities in December 2017, with the final 19 communities acquired during the year ended December 31, 2018. The Woodstar II Portfolio includes properties at fair value of $1.2 billion and debt at fair value of $492.5 million as of June 30, 2022.

Income from the Woodstar Fund’s investments reflects the following components for the three and six months ended June 30, 2022 (in thousands):

	For the Three Months Ended June 30, 2022		For the Six Months Ended June 30, 2022
Distributions from affordable housing fund investments	$	12,475	$	22,665
Unrealized change in fair value of investments	294,690		518,541
Income from affordable housing fund investments	$	307,165	$	541,206

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Investment in Unconsolidated Entities

6 Months Ended

Jun. 30, 2022

Equity Method Investments and Joint Ventures [Abstract]

Investment in Unconsolidated Entities

Investments in Unconsolidated Entities

The table below summarizes our investments in unconsolidated entities as of June 30, 2022 and December 31, 2021 (dollars in thousands):

	Participation / Ownership % (1)	Carrying value as of
		June 30, 2022		December 31, 2021
Equity method investments:
Equity interest in a natural gas power plant	10%	$	26,994	$	26,255
Investor entity which owns equity in an online real estate company	50%	5,288		5,206
Equity interest in and advances to a residential mortgage originator (2)	N/A	15,920		20,327
Various	25% - 50%	14,317		12,528
		62,519		64,316
Other equity investments:
Equity interest in a servicing and advisory business	2%	12,955		12,955
Investment funds which own equity in a loan servicer and other real estate assets (3)	4% - 6%	940		4,194
Investor entities which own equity interests in two entertainment and retail centers (4)	15%	7,320		7,320
Various	1% - 3%	1,776		1,312
		22,991		25,781
		$	85,510	$	90,097

______________________________________________________________________________________________________________________

(1)None of these investments are publicly traded and therefore quoted market prices are not available.

(2)Included a $4.5 million subordinated loan as of both June 30, 2022 and December 31, 2021.

(3)During the three and six months ended June 30, 2022, we received distributions of $7.3 million, of which $3.3 million were considered returns of capital which reduced the carrying value of two of our investments.

(4)In March 2021, we obtained equity interests in two investor entities that own interests in two entertainment and retail centers in satisfaction of $7.3 million principal amount of a commercial loan. The interests were obtained in order to facilitate repayment of a portion of that loan for which these interests represented underlying collateral. The interests are entitled to preferred treatment in the distribution waterfall and are intended to repay us the $7.3 million principal amount of the loan plus interest. See further discussion in Note 4.

As of June 30, 2022, the carrying value of our equity investment in a residential mortgage originator exceeded the underlying equity in net assets of such investee by $1.6 million. This difference is the result of the Company recording its investment in the investee at its acquisition date fair value, which included certain non-amortizing intangible assets not recognized by the investee. Should the Company determine these intangible assets held by the investee are impaired, the Company will recognize such impairment loss through earnings from unconsolidated entities in our consolidated statement of operations, otherwise, such difference between the carrying value of our equity investment in the residential mortgage originator and the underlying equity in the net assets of the residential mortgage originator will continue to exist.

Other than our equity interest in the residential mortgage originator, there were no differences between the carrying value of our equity method investments and the underlying equity in the net assets of the investees as of June 30, 2022.

During the three and six months ended June 30, 2022, we did not become aware of (i) any observable price changes in our other equity investments accounted for under the fair value practicability election or (ii) any indicators of impairment.

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Goodwill and Intangibles

6 Months Ended

Jun. 30, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Intangibles

Goodwill and Intangibles

Goodwill

Goodwill is tested for impairment annually in the fourth quarter, or more frequently if an event occurs or circumstances change that would more likely than not reduce the fair value of a reporting unit below its carrying amount.

Infrastructure Lending Segment

The Infrastructure Lending Segment’s goodwill of $119.4 million at both June 30, 2022 and December 31, 2021 represents the excess of consideration transferred over the fair value of net assets acquired on September 19, 2018 and October 15, 2018. The goodwill recognized is attributable to value embedded in the acquired Infrastructure Lending Segment’s lending platform.

LNR Property LLC (“LNR”)

The Investing and Servicing Segment’s goodwill of $140.4 million at both June 30, 2022 and December 31, 2021 represents the excess of consideration transferred over the fair value of net assets of LNR acquired on April 19, 2013. The goodwill recognized is attributable to value embedded in LNR’s existing platform, which includes a network of commercial real estate asset managers, work-out specialists, underwriters and administrative support professionals as well as proprietary historical performance data on commercial real estate assets.

Intangible Assets

Servicing Rights Intangibles

In connection with the LNR acquisition, we identified domestic servicing rights that existed at the purchase date, based upon the expected future cash flows of the associated servicing contracts. As of June 30, 2022 and December 31, 2021, the balance of the domestic servicing intangible was net of $41.7 million and $42.1 million, respectively, which was eliminated in consolidation pursuant to ASC 810 against VIE assets in connection with our consolidation of securitization VIEs. Before VIE consolidation, as of June 30, 2022 and December 31, 2021, the domestic servicing intangible had a balance of $59.2 million and $58.9 million, respectively, which represents our economic interest in this asset.

Lease Intangibles

In connection with our acquisitions of commercial real estate, we recognized in-place lease intangible assets and favorable lease intangible assets associated with certain non-cancelable operating leases of the acquired properties.

The following table summarizes our intangible assets, which are comprised of servicing rights intangibles and lease intangibles, as of June 30, 2022 and December 31, 2021 (amounts in thousands):

	As of June 30, 2022						As of December 31, 2021
	Gross Carrying Value		Accumulated Amortization		Net Carrying Value		Gross Carrying Value		Accumulated Amortization		Net Carrying Value
Domestic servicing rights, at fair value	$	17,499	$	—	$	17,499	$	16,780	$	—	$	16,780
In-place lease intangible assets	100,797		(60,874)		39,923		94,712		(62,721)		31,991
Favorable lease intangible assets	26,762		(9,220)		17,542		23,746		(8,953)		14,793
Total net intangible assets	$	145,058	$	(70,094)	$	74,964	$	135,238	$	(71,674)	$	63,564

The following table summarizes the activity within intangible assets for the six months ended June 30, 2022 (amounts in thousands):

	Domestic Servicing Rights		In-place Lease Intangible Assets		Favorable Lease Intangible Assets		Total
Balance as of January 1, 2022	$	16,780	$	31,991	$	14,793	$	63,564
Acquisition (1)	—		11,910		3,520		15,430
Amortization	—		(3,434)		(729)		(4,163)
Impairment (2)	—		(43)		(4)		(47)
Sales	—		(501)		(38)		(539)
Changes in fair value due to changes in inputs and assumptions	719		—		—		719
Balance as of June 30, 2022	$	17,499	$	39,923	$	17,542	$	74,964

_________________________________________________

(1)    Represents lease intangibles related to an office building in Texas that are consolidated upon exercising control over a mezzanine loan borrower’s pledged equity interests in May 2022 (see Note 4).

(2)     Impairment of intangible lease assets is recognized within other expense in our condensed consolidated statement of operations.

The following table sets forth the estimated aggregate amortization of our in-place lease intangible assets and favorable lease intangible assets for the next five years and thereafter (amounts in thousands):

2022 (remainder of)	$	4,760
2023	8,639
2024	6,941
2025	5,827
2026	4,301
Thereafter	26,997
Total	$	57,465

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Secured Borrowings

6 Months Ended

Jun. 30, 2022

Secured Debt [Abstract]

Secured Borrowings

Secured Borrowings

Secured Financing Agreements

The following table is a summary of our secured financing agreements in place as of June 30, 2022 and December 31, 2021 (dollars in thousands):

													Outstanding Balance at
	Current Maturity		Extended Maturity (a)		Weighted Average Pricing		Pledged Asset Carrying Value			Maximum Facility Size			June 30, 2022			December 31, 2021
Repurchase Agreements:
Commercial Loans	Aug 2022 to Jun 2027	(b)	Jun 2025 to Dec 2030	(b)	Index + 2.03%	(c)	$	10,771,843		$	12,407,967	(d)	$	7,828,681		$	6,556,438
Residential Loans	May 2023 to Dec 2023		May 2023 to Dec 2024		Index + 2.11%		1,697,635			2,502,636			1,405,200			1,744,225
Infrastructure Loans	Sep 2024		Sep 2026		Index + 2.01%		350,599			650,000			293,673			379,095
Conduit Loans	Feb 2023 to Jun 2024		Feb 2024 to Jun 2025		Index + 2.28%		40,694			650,000			30,923			174,130
CMBS/RMBS	Mar 2023 to Apr 2032	(e)	Jun 2023 to Oct 2032	(e)	(f)		1,458,270			876,651			757,173		(g)	688,146
Total Repurchase Agreements							14,319,041			17,087,254			10,315,650			9,542,034
Other Secured Financing:
Borrowing Base Facility	Nov 2024		Oct 2026		SOFR + 2.11%		8,786			750,000		(h)	6,613			213,478
Commercial Financing Facilities	Dec 2023 to Jan 2025		Jan 2027 to Dec 2030		Index + 1.73%		299,352			445,005		(i)	234,948			167,476
Residential Financing Facility	Mar 2024		Mar 2027		SOFR + 2.45%		489,474			500,000			142,418			102,018
Infrastructure Financing Facilities	Oct 2022 to Jul 2025		Oct 2024 to Jul 2032		Index + 2.04%		915,824			1,750,000			737,326			855,646
Property Mortgages - Fixed rate	Nov 2024 to Sep 2029	(j)	N/A		4.48%		384,284			275,993			275,993			272,522
Property Mortgages - Variable rate	Nov 2022 to Dec 2025		N/A		(k)		775,534			742,650			730,336			712,493
Term Loan and Revolver	(l)		N/A		(l)		N/A		(l)	934,759			784,759			788,753
Total Other Secured Financing							2,873,254			5,398,407			2,912,393			3,112,386
							$	17,192,295		$	22,485,661		13,228,043			12,654,420
Unamortized net discount													(13,813)			(13,350)
Unamortized deferred financing costs													(66,783)			(64,220)
													$	13,147,447		$	12,576,850

______________________________________________________________________________________________________________________

(a)Subject to certain conditions as defined in the respective facility agreement.

(b)For certain facilities, borrowings collateralized by loans existing at maturity may remain outstanding until such loan collateral matures, subject to certain specified conditions.

(c)Certain facilities with an outstanding balance of $2.9 billion as of June 30, 2022 are indexed to GBP LIBOR, EURIBOR, BBSY, SARON and SONIA. The remainder are indexed to USD LIBOR or SOFR.

(d)Certain facilities with an aggregate initial maximum facility size of $11.5 billion may be increased to $12.4 billion, subject to certain conditions. The $12.4 billion amount includes such upsizes.

(e)Certain facilities with an outstanding balance of $332.6 million as of June 30, 2022 carry a rolling 11-month or 12-month term which may reset monthly or quarterly with the lender’s consent. These facilities carry no maximum facility size.

(f)A facility with an outstanding balance of $265.7 million as of June 30, 2022 has a weighted average fixed annual interest rate of 3.27%. All other facilities are variable rate with a weighted average rate of Index + 1.94%.

(g)Includes: (i) $265.7 million outstanding on a repurchase facility that is not subject to margin calls; and (ii) $43.3 million outstanding on one of our repurchase facilities that represents the 49% pro rata share owed by a non-controlling partner in a consolidated joint venture (see Note 15).

(h)The maximum facility size as of June 30, 2022 of $650.0 million is scheduled to decline to $450.0 million as of December 31, 2022 and may be increased to $750.0 million, subject to certain conditions.

(i)Certain facilities with an aggregate initial maximum facility size of $345.0 million may be increased to $445.0 million, subject to certain conditions. The $445.0 million amount includes such upsizes.

(j)The weighted average maturity is 5.0 years as of June 30, 2022.

(k)Includes a $600.0 million first mortgage and mezzanine loan secured by our Medical Office Portfolio. This debt has a weighted average interest rate of LIBOR + 2.07% that we swapped to a fixed rate of 3.34%. The remainder have a weighted average rate of Index + 2.28%.

(l)Consists of: (i) a $784.8 million term loan facility that matures in July 2026, of which $389.0 million has an annual interest rate of LIBOR + 2.50% and $395.8 million has an annual interest rate of LIBOR + 3.25%, subject to a 0.75% LIBOR floor, and (ii) a $150.0 million revolving credit facility that matures in April 2026 with an annual interest rate of SOFR + 2.50%. These facilities are secured by the equity interests in certain of our subsidiaries which totaled $5.0 billion as of June 30, 2022.

The above table no longer reflects property mortgages of the Woodstar Portfolios which, as discussed in Notes 2 and 7, are now reflected within “Investments of consolidated affordable housing fund” on our condensed consolidated balance sheets.

In the normal course of business, the Company is in discussions with its lenders to extend, amend or replace any financing facilities which contain near term expirations.

In March 2022, we amended a Residential Loans credit facility to increase the available borrowings to $500.0 million from $250.0 million and extend the initial maturity for 18 months to March 2024 with a three-year extension option. The margin call provisions under this facility do not permit valuation adjustments based on capital market events and are limited to collateral-specific credit marks.

In June 2022, we entered into a credit facility to finance loans within the Infrastructure Lending Segment. The maximum facility size is $500.0 million and carries a three-year revolving period with two one-year extension options. The margin call provisions under this facility do not permit valuation adjustments based on capital market events and are limited to collateral-specific credit marks.

During the six months ended June 30, 2022, we entered into commercial credit facilities of $1.4 billion. In addition, we amended several commercial credit facilities resulting in an aggregate upsize of $924.7 million.

Our secured financing agreements contain certain financial tests and covenants. As of June 30, 2022, we were in compliance with all such covenants.

We seek to mitigate risks associated with our repurchase agreements by managing risk related to the credit quality of our assets, interest rates, liquidity, prepayment speeds and market value. The margin call provisions under the majority of our repurchase facilities, consisting of 70% of these agreements, do not permit valuation adjustments based on capital market events and are limited to collateral-specific credit marks generally determined on a commercially reasonable basis. To monitor credit risk associated with the performance and value of our loans and investments, our asset management team regularly reviews our investment portfolios and is in regular contact with our borrowers, monitoring performance of the collateral and enforcing our rights as necessary. For the 30% of repurchase agreements which do permit valuation adjustments based on capital market events, approximately 12% of these pertain to our loans held-for-sale, for which we manage credit risk through the purchase of credit instruments. We further seek to manage risks associated with our repurchase agreements by matching the maturities and interest rate characteristics of our loans with the related repurchase agreement.

For the three and six months ended June 30, 2022, approximately $9.2 million and $18.8 million, respectively, of amortization of deferred financing costs from secured financing agreements was included in interest expense on our condensed consolidated statements of operations. For the three and six months ended June 30, 2021, approximately $8.9 million and $18.4 million, respectively, of amortization of deferred financing costs from secured financing agreements was included in interest expense on our condensed consolidated statements of operations.

As of June 30, 2022, Morgan Stanley Bank, N.A. held collateral sold under certain of our repurchase agreements with carrying values that exceeded the respective repurchase obligations by $719.9 million. The weighted average extended maturity of those repurchase agreements is 3.9 years.

Collateralized Loan Obligations and Single Asset Securitization

Commercial and Residential Lending Segment

In February 2022, we refinanced a pool of our commercial loans held-for-investment through a CLO, STWD 2022-FL3. On the closing date, the CLO issued $1.0 billion of notes and preferred shares, of which $842.5 million of notes were purchased by third party investors. We retained $82.5 million of notes along with preferred shares with a liquidation preference of $75.0 million. The CLO contains a reinvestment feature that, subject to certain eligibility criteria, allows us to contribute new

loans or participation interests in loans to the CLO for a period of two years. The reinvestment feature was not utilized during the six months ended June 30, 2022.

In July 2021, we contributed into a single asset securitization, STWD 2021-HTS, a previously originated $230.0 million first mortgage and mezzanine loan on a portfolio of 41 extended stay hotels with $210.1 million of third party financing.

In May 2021, we refinanced a pool of our commercial loans held-for-investment through a CLO, STWD 2021-FL2. On the closing date, the CLO issued $1.3 billion of notes and preferred shares, of which $1.1 billion of notes was purchased by third party investors. We retained $70.1 million of notes, along with preferred shares with a liquidation preference of $127.5 million. The CLO contains a reinvestment feature that, subject to certain eligibility criteria, allows us to contribute new loans or participation interests in loans to the CLO in exchange for cash. During the six months ended June 30, 2022, we utilized the reinvestment feature, contributing $123.7 million of additional interests into the CLO.

In August 2019, we refinanced a pool of our commercial loans held-for-investment through a CLO, STWD 2019-FL1. On the closing date, the CLO issued $1.1 billion of notes and preferred shares, of which $936.4 million of notes was purchased by third party investors. We retained $86.6 million of notes, along with preferred shares with a liquidation preference of $77.0 million. The CLO contains a reinvestment feature that, subject to certain eligibility criteria, allows us to contribute new loans or participation interests in loans to the CLO in exchange for cash. During the six months ended June 30, 2022, the reinvestment period expired, and we repaid CLO debt in the amount of $106.2 million.

Infrastructure Lending Segment

In January 2022, we refinanced a pool of our infrastructure loans held-for-investment through a CLO, STWD 2021-SIF2. On the closing date, the CLO issued $500.0 million of notes and preferred shares, of which $410.0 million of notes were purchased by third party investors. We retained preferred shares with a liquidation preference of $90.0 million. The CLO contains a reinvestment feature that, subject to certain eligibility criteria, allows us to contribute new loans or participation interests in loans to the CLO for a period of three years. During the six months ended June 30, 2022, we utilized the reinvestment feature, contributing $86.2 million of additional interests into the CLO.

In April 2021, we refinanced a pool of our infrastructure loans held-for-investment through a CLO, STWD 2021-SIF1. On the closing date, the CLO issued $500.0 million of notes and preferred shares, of which $410.0 million of notes were purchased by third party investors. We retained preferred shares with a liquidation preference of $90.0 million. The CLO contains a reinvestment feature that, subject to certain eligibility criteria, allows us to contribute new loans or participation interests in loans to the CLO in exchange for cash. During the six months ended June 30, 2022, we utilized the reinvestment feature, contributing $57.7 million of additional interests into the CLO.

The following table is a summary of our CLOs and our SASB as of June 30, 2022 and December 31, 2021 (amounts in thousands):

June 30, 2022	Count	Face Amount		Carrying Value		Weighted Average Spread		Maturity
STWD 2022-FL3
Collateral assets	24	$	1,000,000	$	1,010,536	Index + 3.58%	(a)	January 2026	(b)
Financing	1	842,500		843,681		SOFR + 1.91%	(c)	November 2038	(d)
STWD 2021-HTS
Collateral assets	1	230,000		230,713		LIBOR + 3.85%	(a)	April 2026	(b)
Financing	1	210,091		208,509		LIBOR + 2.69%	(c)	April 2034	(d)
STWD 2021-FL2
Collateral assets	24	1,275,275		1,281,127		Index + 4.09%	(a)	April 2025	(b)
Financing	1	1,077,375		1,071,047		LIBOR + 1.78%	(c)	April 2038	(d)
STWD 2019-FL1
Collateral assets	18	993,774		996,268		LIBOR + 3.82%	(a)	January 2025	(b)
Financing	1	830,149		828,071		SOFR + 1.65%	(c)	July 2038	(d)
STWD 2021-SIF2
Collateral assets	32	494,789		510,807		LIBOR + 3.71%	(a)	January 2027	(b)
Financing	1	410,000		406,807		SOFR + 2.11%	(c)	January 2033	(d)
STWD 2021-SIF1
Collateral assets	31	496,249		507,465		Index + 3.87%	(a)	July 2026	(b)
Financing	1	410,000		406,036		LIBOR + 2.15%	(c)	April 2032	(d)
Total
Collateral assets		$	4,490,087	$	4,536,916
Financing		$	3,780,115	$	3,764,151

December 31, 2021	Count	Face Amount		Carrying Value		Weighted Average Spread		Maturity
STWD 2021-HTS
Collateral assets	1	$	230,000	$	230,587	LIBOR + 4.12%	(a)	April 2026	(b)
Financing	1	210,091		208,057		LIBOR + 2.48%	(c)	April 2034	(d)
STWD 2021-FL2
Collateral assets	25	1,272,133		1,279,678		LIBOR + 4.22%	(a)	February 2025	(b)
Financing	1	1,077,375		1,069,691		LIBOR + 1.78%	(c)	April 2038	(d)
STWD 2019-FL1
Collateral assets	24	1,092,887		1,103,513		LIBOR + 4.19%	(a)	November 2024	(b)
Financing	1	936,375		933,049		SOFR + 1.63%	(c)	July 2038	(d)
STWD 2021-SIF1
Collateral assets	31	491,299		506,666		LIBOR + 3.91%	(a)	March 2026	(b)
Financing	1	410,000		405,319		LIBOR + 2.15%	(c)	April 2032	(d)
Total
Collateral assets		$	3,086,319	$	3,120,444
Financing		$	2,633,841	$	2,616,116

______________________________________________________________________________________________________________________________

(a)Represents the weighted-average coupon earned on variable rate loans during the respective year-to-date period. Of the loans financed by the STWD 2021-FL2 CLO as of June 30, 2022, 7% earned fixed-rate weighted average interest of 7.44%. Of the investments financed by the STWD 2021-SIF2 CLO as of June 30, 2022, 5% earned fixed-rate weighted average interest of 7.75%. Of the investments financed by the STWD 2021-SIF1 CLO as of June 30, 2022, 3% earned fixed-rate weighted average interest of 5.95%.

(b)Represents the weighted-average maturity, assuming the extended contractual maturity of the collateral assets.

(c)Represents the weighted-average cost of financing incurred during the respective year-to-date period, inclusive of deferred issuance costs.

(d)Repayments of the CLOs and SASB are tied to timing of the related collateral asset repayments. The term of the CLOs and SASB financing obligations represents the legal final maturity date.

We incurred $37.9 million of issuance costs in connection with the CLOs and SASB, which are amortized on an effective yield basis over the estimated life of the CLOs and SASB. For the three and six months ended June 30, 2022, approximately $2.7 million and $5.1 million, respectively, of amortization of deferred financing costs was included in interest expense on our condensed consolidated statements of operations. For the three and six months ended June 30, 2021,

approximately $1.4 million and $2.0 million, respectively, of amortization of deferred financing costs was included in interest expense on our condensed consolidated statements of operations. As of June 30, 2022 and December 31, 2021, our unamortized issuance costs were $23.7 million and $17.7 million, respectively.

The CLOs and SASB are considered VIEs, for which we are deemed the primary beneficiary. We therefore consolidate the CLOs and SASB. Refer to Note 15 for further discussion.

Maturities

Our credit facilities generally require principal to be paid down prior to the facilities’ respective maturities if and when we receive principal payments on, or sell, the investment collateral that we have pledged. The following table sets forth our principal repayments schedule for secured financings based on the earlier of (i) the extended contractual maturity of each credit facility or (ii) the extended contractual maturity of each of the investments that have been pledged as collateral under the respective credit facility (amounts in thousands):

	Repurchase Agreements		Other Secured Financing		CLOs and SASB (a)		Total
2022 (remainder of)	$	258,961	$	24,259	$	143,428	$	426,648
2023	2,120,093		736,558		652,016		3,508,667
2024	1,097,580		235,871		434,434		1,767,885
2025	2,742,149		246,581		678,448		3,667,178
2026	1,797,262		974,237		1,732,148		4,503,647
Thereafter	2,299,605		694,887		139,641		3,134,133
Total	$	10,315,650	$	2,912,393	$	3,780,115	$	17,008,158

______________________________________________________________________________________________________________________

(a)For the CLOs, the above does not assume utilization of their reinvestment features. The SASB does not have a reinvestment feature.

Unsecured Senior Notes

The following table is a summary of our unsecured senior notes outstanding as of June 30, 2022 and December 31, 2021 (dollars in thousands):

	Coupon Rate			Effective Rate (1)		Maturity Date	Remaining Period of Amortization	Carrying Value at
								June 30, 2022		December 31, 2021
2023 Senior Notes	5.50	%		5.71	%	11/1/2023	1.3 years	300,000		300,000
2023 Convertible Notes	4.38	%		4.57	%	4/1/2023	0.8 years	250,000		250,000
2024 Senior Notes	3.75	%		3.94	%	12/31/2024	2.5 years	400,000		400,000
2025 Senior Notes	4.75	%	(2)	5.04	%	3/15/2025	2.7 years	500,000		500,000
2026 Senior Notes	3.63	%		3.77	%	7/15/2026	4.0 years	400,000		400,000
2027 Senior Notes	4.38	%	(3)	4.49	%	1/15/2027	4.6 years	500,000		—
Total principal amount								2,350,000		1,850,000
Unamortized discount—Convertible Notes								(351)		(578)
Unamortized discount—Senior Notes								(10,847)		(10,067)
Unamortized deferred financing costs								(14,030)		(10,765)
Total carrying amount								$	2,324,772	$	1,828,590

______________________________________________________________________________________________________________________

(1)Effective rate includes the effects of underwriter purchase discount.

(2)The coupon on the 2025 Senior Notes is 4.75%.  At closing, we swapped $470.0 million of the notes to a floating rate of LIBOR + 2.53%.

(3)The coupon on the 2027 Senior Notes is 4.375%.  At closing, we swapped the notes to a floating rate of SOFR + 2.95%.

Our unsecured senior notes contain certain financial tests and covenants. As of June 30, 2022, we were in compliance with all such covenants.

Senior Notes

On January 25, 2022, we issued $500.0 million of 4.375% Senior Notes due 2027 (the “2027 Senior Notes”). The 2027 Senior Notes mature on January 15, 2027. Prior to July 15, 2026, we may redeem some or all of the 2027 Senior Notes at a price equal to 100% of the principal amount thereof, plus the applicable “make-whole” premium as of the applicable date of redemption. On and after July 15, 2026, we may redeem some or all of the 2027 Senior Notes at a price equal to 100% of the principal amount thereof. In addition, prior to July 15, 2025, we may redeem up to 40% of the 2027 Senior Notes at the applicable redemption price using the proceeds of certain equity offerings.

Convertible Senior Notes

On March 29, 2017, we issued $250.0 million of 4.375% Convertible Senior Notes due 2023 (the “2023 Convertible Notes”) which remain outstanding at June 30, 2022 and mature on April 1, 2023.

We recognized interest expense of $2.9 million and $5.8 million, respectively, during the three and six months ended June 30, 2022 and 2021 from our Convertible Notes.

The following table details the conversion attributes of our Convertible Notes outstanding as of June 30, 2022 (amounts in thousands, except rates):

	June 30, 2022
	Conversion	Conversion
	Rate (1)	Price (2)
2023 Convertible Notes	38.5959	$	25.91

______________________________________________________________________________________________________________________

(1)The conversion rate represents the number of shares of common stock issuable per $1,000 principal amount of 2023 Convertible Notes converted, as adjusted in accordance with the indenture governing the 2023 Convertible Notes (including the applicable supplemental indenture).

(2)As of June 30, 2022, the market price of the Company’s common stock was $20.89.

The if-converted value of the 2023 Convertible Notes was less than their principal amount by $48.4 million at June 30, 2022 as the closing market price of the Company’s common stock of $20.89 was less than the implicit conversion price of $25.91 per share. The if-converted value of the principal amount of the 2023 Convertible Notes was $201.6 million as of June 30, 2022. As of June 30, 2022, the net carrying amount and fair value of the 2023 Convertible Notes was $249.5 million and $246.3 million, respectively.

Upon conversion of the 2023 Convertible Notes, settlement may be made in common stock, cash or a combination of both, at the option of the Company.

Conditions for Conversion

Prior to October 1, 2022, the 2023 Convertible Notes will be convertible only upon satisfaction of one or more of the following conditions: (1) the closing market price of the Company’s common stock is at least 110% of the conversion price of the 2023 Convertible Notes for at least 20 out of 30 trading days prior to the end of the preceding fiscal quarter, (2) the trading price of the 2023 Convertible Notes is less than 98% of the product of (i) the conversion rate and (ii) the closing price of the Company’s common stock during any five consecutive trading day period, (3) the Company issues certain equity instruments at less than the 10-day average closing market price of its common stock or the per-share value of certain distributions exceeds the market price of the Company’s common stock by more than 10% or (4) certain other specified corporate events (significant consolidation, sale, merger, share exchange, fundamental change, etc.) occur.

On or after October 1, 2022, holders of the 2023 Convertible Notes may convert each of their notes at the applicable conversion rate at any time prior to the close of business on the second scheduled trading day immediately preceding the maturity date.

XML

Unsecured Senior Notes

6 Months Ended

Jun. 30, 2022

Debt Instruments [Abstract]

Unsecured Senior Notes

Secured Borrowings

Secured Financing Agreements

The following table is a summary of our secured financing agreements in place as of June 30, 2022 and December 31, 2021 (dollars in thousands):

													Outstanding Balance at
	Current Maturity		Extended Maturity (a)		Weighted Average Pricing		Pledged Asset Carrying Value			Maximum Facility Size			June 30, 2022			December 31, 2021
Repurchase Agreements:
Commercial Loans	Aug 2022 to Jun 2027	(b)	Jun 2025 to Dec 2030	(b)	Index + 2.03%	(c)	$	10,771,843		$	12,407,967	(d)	$	7,828,681		$	6,556,438
Residential Loans	May 2023 to Dec 2023		May 2023 to Dec 2024		Index + 2.11%		1,697,635			2,502,636			1,405,200			1,744,225
Infrastructure Loans	Sep 2024		Sep 2026		Index + 2.01%		350,599			650,000			293,673			379,095
Conduit Loans	Feb 2023 to Jun 2024		Feb 2024 to Jun 2025		Index + 2.28%		40,694			650,000			30,923			174,130
CMBS/RMBS	Mar 2023 to Apr 2032	(e)	Jun 2023 to Oct 2032	(e)	(f)		1,458,270			876,651			757,173		(g)	688,146
Total Repurchase Agreements							14,319,041			17,087,254			10,315,650			9,542,034
Other Secured Financing:
Borrowing Base Facility	Nov 2024		Oct 2026		SOFR + 2.11%		8,786			750,000		(h)	6,613			213,478
Commercial Financing Facilities	Dec 2023 to Jan 2025		Jan 2027 to Dec 2030		Index + 1.73%		299,352			445,005		(i)	234,948			167,476
Residential Financing Facility	Mar 2024		Mar 2027		SOFR + 2.45%		489,474			500,000			142,418			102,018
Infrastructure Financing Facilities	Oct 2022 to Jul 2025		Oct 2024 to Jul 2032		Index + 2.04%		915,824			1,750,000			737,326			855,646
Property Mortgages - Fixed rate	Nov 2024 to Sep 2029	(j)	N/A		4.48%		384,284			275,993			275,993			272,522
Property Mortgages - Variable rate	Nov 2022 to Dec 2025		N/A		(k)		775,534			742,650			730,336			712,493
Term Loan and Revolver	(l)		N/A		(l)		N/A		(l)	934,759			784,759			788,753
Total Other Secured Financing							2,873,254			5,398,407			2,912,393			3,112,386
							$	17,192,295		$	22,485,661		13,228,043			12,654,420
Unamortized net discount													(13,813)			(13,350)
Unamortized deferred financing costs													(66,783)			(64,220)
													$	13,147,447		$	12,576,850

______________________________________________________________________________________________________________________

(a)Subject to certain conditions as defined in the respective facility agreement.

(b)For certain facilities, borrowings collateralized by loans existing at maturity may remain outstanding until such loan collateral matures, subject to certain specified conditions.

(c)Certain facilities with an outstanding balance of $2.9 billion as of June 30, 2022 are indexed to GBP LIBOR, EURIBOR, BBSY, SARON and SONIA. The remainder are indexed to USD LIBOR or SOFR.

(d)Certain facilities with an aggregate initial maximum facility size of $11.5 billion may be increased to $12.4 billion, subject to certain conditions. The $12.4 billion amount includes such upsizes.

(e)Certain facilities with an outstanding balance of $332.6 million as of June 30, 2022 carry a rolling 11-month or 12-month term which may reset monthly or quarterly with the lender’s consent. These facilities carry no maximum facility size.

(f)A facility with an outstanding balance of $265.7 million as of June 30, 2022 has a weighted average fixed annual interest rate of 3.27%. All other facilities are variable rate with a weighted average rate of Index + 1.94%.

(g)Includes: (i) $265.7 million outstanding on a repurchase facility that is not subject to margin calls; and (ii) $43.3 million outstanding on one of our repurchase facilities that represents the 49% pro rata share owed by a non-controlling partner in a consolidated joint venture (see Note 15).

(h)The maximum facility size as of June 30, 2022 of $650.0 million is scheduled to decline to $450.0 million as of December 31, 2022 and may be increased to $750.0 million, subject to certain conditions.

(i)Certain facilities with an aggregate initial maximum facility size of $345.0 million may be increased to $445.0 million, subject to certain conditions. The $445.0 million amount includes such upsizes.

(j)The weighted average maturity is 5.0 years as of June 30, 2022.

(k)Includes a $600.0 million first mortgage and mezzanine loan secured by our Medical Office Portfolio. This debt has a weighted average interest rate of LIBOR + 2.07% that we swapped to a fixed rate of 3.34%. The remainder have a weighted average rate of Index + 2.28%.

(l)Consists of: (i) a $784.8 million term loan facility that matures in July 2026, of which $389.0 million has an annual interest rate of LIBOR + 2.50% and $395.8 million has an annual interest rate of LIBOR + 3.25%, subject to a 0.75% LIBOR floor, and (ii) a $150.0 million revolving credit facility that matures in April 2026 with an annual interest rate of SOFR + 2.50%. These facilities are secured by the equity interests in certain of our subsidiaries which totaled $5.0 billion as of June 30, 2022.

The above table no longer reflects property mortgages of the Woodstar Portfolios which, as discussed in Notes 2 and 7, are now reflected within “Investments of consolidated affordable housing fund” on our condensed consolidated balance sheets.

In the normal course of business, the Company is in discussions with its lenders to extend, amend or replace any financing facilities which contain near term expirations.

In March 2022, we amended a Residential Loans credit facility to increase the available borrowings to $500.0 million from $250.0 million and extend the initial maturity for 18 months to March 2024 with a three-year extension option. The margin call provisions under this facility do not permit valuation adjustments based on capital market events and are limited to collateral-specific credit marks.

In June 2022, we entered into a credit facility to finance loans within the Infrastructure Lending Segment. The maximum facility size is $500.0 million and carries a three-year revolving period with two one-year extension options. The margin call provisions under this facility do not permit valuation adjustments based on capital market events and are limited to collateral-specific credit marks.

During the six months ended June 30, 2022, we entered into commercial credit facilities of $1.4 billion. In addition, we amended several commercial credit facilities resulting in an aggregate upsize of $924.7 million.

Our secured financing agreements contain certain financial tests and covenants. As of June 30, 2022, we were in compliance with all such covenants.

We seek to mitigate risks associated with our repurchase agreements by managing risk related to the credit quality of our assets, interest rates, liquidity, prepayment speeds and market value. The margin call provisions under the majority of our repurchase facilities, consisting of 70% of these agreements, do not permit valuation adjustments based on capital market events and are limited to collateral-specific credit marks generally determined on a commercially reasonable basis. To monitor credit risk associated with the performance and value of our loans and investments, our asset management team regularly reviews our investment portfolios and is in regular contact with our borrowers, monitoring performance of the collateral and enforcing our rights as necessary. For the 30% of repurchase agreements which do permit valuation adjustments based on capital market events, approximately 12% of these pertain to our loans held-for-sale, for which we manage credit risk through the purchase of credit instruments. We further seek to manage risks associated with our repurchase agreements by matching the maturities and interest rate characteristics of our loans with the related repurchase agreement.

For the three and six months ended June 30, 2022, approximately $9.2 million and $18.8 million, respectively, of amortization of deferred financing costs from secured financing agreements was included in interest expense on our condensed consolidated statements of operations. For the three and six months ended June 30, 2021, approximately $8.9 million and $18.4 million, respectively, of amortization of deferred financing costs from secured financing agreements was included in interest expense on our condensed consolidated statements of operations.

As of June 30, 2022, Morgan Stanley Bank, N.A. held collateral sold under certain of our repurchase agreements with carrying values that exceeded the respective repurchase obligations by $719.9 million. The weighted average extended maturity of those repurchase agreements is 3.9 years.

Collateralized Loan Obligations and Single Asset Securitization

Commercial and Residential Lending Segment

In February 2022, we refinanced a pool of our commercial loans held-for-investment through a CLO, STWD 2022-FL3. On the closing date, the CLO issued $1.0 billion of notes and preferred shares, of which $842.5 million of notes were purchased by third party investors. We retained $82.5 million of notes along with preferred shares with a liquidation preference of $75.0 million. The CLO contains a reinvestment feature that, subject to certain eligibility criteria, allows us to contribute new

loans or participation interests in loans to the CLO for a period of two years. The reinvestment feature was not utilized during the six months ended June 30, 2022.

In July 2021, we contributed into a single asset securitization, STWD 2021-HTS, a previously originated $230.0 million first mortgage and mezzanine loan on a portfolio of 41 extended stay hotels with $210.1 million of third party financing.

In May 2021, we refinanced a pool of our commercial loans held-for-investment through a CLO, STWD 2021-FL2. On the closing date, the CLO issued $1.3 billion of notes and preferred shares, of which $1.1 billion of notes was purchased by third party investors. We retained $70.1 million of notes, along with preferred shares with a liquidation preference of $127.5 million. The CLO contains a reinvestment feature that, subject to certain eligibility criteria, allows us to contribute new loans or participation interests in loans to the CLO in exchange for cash. During the six months ended June 30, 2022, we utilized the reinvestment feature, contributing $123.7 million of additional interests into the CLO.

In August 2019, we refinanced a pool of our commercial loans held-for-investment through a CLO, STWD 2019-FL1. On the closing date, the CLO issued $1.1 billion of notes and preferred shares, of which $936.4 million of notes was purchased by third party investors. We retained $86.6 million of notes, along with preferred shares with a liquidation preference of $77.0 million. The CLO contains a reinvestment feature that, subject to certain eligibility criteria, allows us to contribute new loans or participation interests in loans to the CLO in exchange for cash. During the six months ended June 30, 2022, the reinvestment period expired, and we repaid CLO debt in the amount of $106.2 million.

Infrastructure Lending Segment

In January 2022, we refinanced a pool of our infrastructure loans held-for-investment through a CLO, STWD 2021-SIF2. On the closing date, the CLO issued $500.0 million of notes and preferred shares, of which $410.0 million of notes were purchased by third party investors. We retained preferred shares with a liquidation preference of $90.0 million. The CLO contains a reinvestment feature that, subject to certain eligibility criteria, allows us to contribute new loans or participation interests in loans to the CLO for a period of three years. During the six months ended June 30, 2022, we utilized the reinvestment feature, contributing $86.2 million of additional interests into the CLO.

In April 2021, we refinanced a pool of our infrastructure loans held-for-investment through a CLO, STWD 2021-SIF1. On the closing date, the CLO issued $500.0 million of notes and preferred shares, of which $410.0 million of notes were purchased by third party investors. We retained preferred shares with a liquidation preference of $90.0 million. The CLO contains a reinvestment feature that, subject to certain eligibility criteria, allows us to contribute new loans or participation interests in loans to the CLO in exchange for cash. During the six months ended June 30, 2022, we utilized the reinvestment feature, contributing $57.7 million of additional interests into the CLO.

The following table is a summary of our CLOs and our SASB as of June 30, 2022 and December 31, 2021 (amounts in thousands):

June 30, 2022	Count	Face Amount		Carrying Value		Weighted Average Spread		Maturity
STWD 2022-FL3
Collateral assets	24	$	1,000,000	$	1,010,536	Index + 3.58%	(a)	January 2026	(b)
Financing	1	842,500		843,681		SOFR + 1.91%	(c)	November 2038	(d)
STWD 2021-HTS
Collateral assets	1	230,000		230,713		LIBOR + 3.85%	(a)	April 2026	(b)
Financing	1	210,091		208,509		LIBOR + 2.69%	(c)	April 2034	(d)
STWD 2021-FL2
Collateral assets	24	1,275,275		1,281,127		Index + 4.09%	(a)	April 2025	(b)
Financing	1	1,077,375		1,071,047		LIBOR + 1.78%	(c)	April 2038	(d)
STWD 2019-FL1
Collateral assets	18	993,774		996,268		LIBOR + 3.82%	(a)	January 2025	(b)
Financing	1	830,149		828,071		SOFR + 1.65%	(c)	July 2038	(d)
STWD 2021-SIF2
Collateral assets	32	494,789		510,807		LIBOR + 3.71%	(a)	January 2027	(b)
Financing	1	410,000		406,807		SOFR + 2.11%	(c)	January 2033	(d)
STWD 2021-SIF1
Collateral assets	31	496,249		507,465		Index + 3.87%	(a)	July 2026	(b)
Financing	1	410,000		406,036		LIBOR + 2.15%	(c)	April 2032	(d)
Total
Collateral assets		$	4,490,087	$	4,536,916
Financing		$	3,780,115	$	3,764,151

December 31, 2021	Count	Face Amount		Carrying Value		Weighted Average Spread		Maturity
STWD 2021-HTS
Collateral assets	1	$	230,000	$	230,587	LIBOR + 4.12%	(a)	April 2026	(b)
Financing	1	210,091		208,057		LIBOR + 2.48%	(c)	April 2034	(d)
STWD 2021-FL2
Collateral assets	25	1,272,133		1,279,678		LIBOR + 4.22%	(a)	February 2025	(b)
Financing	1	1,077,375		1,069,691		LIBOR + 1.78%	(c)	April 2038	(d)
STWD 2019-FL1
Collateral assets	24	1,092,887		1,103,513		LIBOR + 4.19%	(a)	November 2024	(b)
Financing	1	936,375		933,049		SOFR + 1.63%	(c)	July 2038	(d)
STWD 2021-SIF1
Collateral assets	31	491,299		506,666		LIBOR + 3.91%	(a)	March 2026	(b)
Financing	1	410,000		405,319		LIBOR + 2.15%	(c)	April 2032	(d)
Total
Collateral assets		$	3,086,319	$	3,120,444
Financing		$	2,633,841	$	2,616,116

______________________________________________________________________________________________________________________________

(a)Represents the weighted-average coupon earned on variable rate loans during the respective year-to-date period. Of the loans financed by the STWD 2021-FL2 CLO as of June 30, 2022, 7% earned fixed-rate weighted average interest of 7.44%. Of the investments financed by the STWD 2021-SIF2 CLO as of June 30, 2022, 5% earned fixed-rate weighted average interest of 7.75%. Of the investments financed by the STWD 2021-SIF1 CLO as of June 30, 2022, 3% earned fixed-rate weighted average interest of 5.95%.

(b)Represents the weighted-average maturity, assuming the extended contractual maturity of the collateral assets.

(c)Represents the weighted-average cost of financing incurred during the respective year-to-date period, inclusive of deferred issuance costs.

(d)Repayments of the CLOs and SASB are tied to timing of the related collateral asset repayments. The term of the CLOs and SASB financing obligations represents the legal final maturity date.

We incurred $37.9 million of issuance costs in connection with the CLOs and SASB, which are amortized on an effective yield basis over the estimated life of the CLOs and SASB. For the three and six months ended June 30, 2022, approximately $2.7 million and $5.1 million, respectively, of amortization of deferred financing costs was included in interest expense on our condensed consolidated statements of operations. For the three and six months ended June 30, 2021,

approximately $1.4 million and $2.0 million, respectively, of amortization of deferred financing costs was included in interest expense on our condensed consolidated statements of operations. As of June 30, 2022 and December 31, 2021, our unamortized issuance costs were $23.7 million and $17.7 million, respectively.

The CLOs and SASB are considered VIEs, for which we are deemed the primary beneficiary. We therefore consolidate the CLOs and SASB. Refer to Note 15 for further discussion.

Maturities

Our credit facilities generally require principal to be paid down prior to the facilities’ respective maturities if and when we receive principal payments on, or sell, the investment collateral that we have pledged. The following table sets forth our principal repayments schedule for secured financings based on the earlier of (i) the extended contractual maturity of each credit facility or (ii) the extended contractual maturity of each of the investments that have been pledged as collateral under the respective credit facility (amounts in thousands):

	Repurchase Agreements		Other Secured Financing		CLOs and SASB (a)		Total
2022 (remainder of)	$	258,961	$	24,259	$	143,428	$	426,648
2023	2,120,093		736,558		652,016		3,508,667
2024	1,097,580		235,871		434,434		1,767,885
2025	2,742,149		246,581		678,448		3,667,178
2026	1,797,262		974,237		1,732,148		4,503,647
Thereafter	2,299,605		694,887		139,641		3,134,133
Total	$	10,315,650	$	2,912,393	$	3,780,115	$	17,008,158

______________________________________________________________________________________________________________________

(a)For the CLOs, the above does not assume utilization of their reinvestment features. The SASB does not have a reinvestment feature.

Unsecured Senior Notes

The following table is a summary of our unsecured senior notes outstanding as of June 30, 2022 and December 31, 2021 (dollars in thousands):

	Coupon Rate			Effective Rate (1)		Maturity Date	Remaining Period of Amortization	Carrying Value at
								June 30, 2022		December 31, 2021
2023 Senior Notes	5.50	%		5.71	%	11/1/2023	1.3 years	300,000		300,000
2023 Convertible Notes	4.38	%		4.57	%	4/1/2023	0.8 years	250,000		250,000
2024 Senior Notes	3.75	%		3.94	%	12/31/2024	2.5 years	400,000		400,000
2025 Senior Notes	4.75	%	(2)	5.04	%	3/15/2025	2.7 years	500,000		500,000
2026 Senior Notes	3.63	%		3.77	%	7/15/2026	4.0 years	400,000		400,000
2027 Senior Notes	4.38	%	(3)	4.49	%	1/15/2027	4.6 years	500,000		—
Total principal amount								2,350,000		1,850,000
Unamortized discount—Convertible Notes								(351)		(578)
Unamortized discount—Senior Notes								(10,847)		(10,067)
Unamortized deferred financing costs								(14,030)		(10,765)
Total carrying amount								$	2,324,772	$	1,828,590

______________________________________________________________________________________________________________________

(1)Effective rate includes the effects of underwriter purchase discount.

(2)The coupon on the 2025 Senior Notes is 4.75%.  At closing, we swapped $470.0 million of the notes to a floating rate of LIBOR + 2.53%.

(3)The coupon on the 2027 Senior Notes is 4.375%.  At closing, we swapped the notes to a floating rate of SOFR + 2.95%.

Our unsecured senior notes contain certain financial tests and covenants. As of June 30, 2022, we were in compliance with all such covenants.

Senior Notes

On January 25, 2022, we issued $500.0 million of 4.375% Senior Notes due 2027 (the “2027 Senior Notes”). The 2027 Senior Notes mature on January 15, 2027. Prior to July 15, 2026, we may redeem some or all of the 2027 Senior Notes at a price equal to 100% of the principal amount thereof, plus the applicable “make-whole” premium as of the applicable date of redemption. On and after July 15, 2026, we may redeem some or all of the 2027 Senior Notes at a price equal to 100% of the principal amount thereof. In addition, prior to July 15, 2025, we may redeem up to 40% of the 2027 Senior Notes at the applicable redemption price using the proceeds of certain equity offerings.

Convertible Senior Notes

On March 29, 2017, we issued $250.0 million of 4.375% Convertible Senior Notes due 2023 (the “2023 Convertible Notes”) which remain outstanding at June 30, 2022 and mature on April 1, 2023.

We recognized interest expense of $2.9 million and $5.8 million, respectively, during the three and six months ended June 30, 2022 and 2021 from our Convertible Notes.

The following table details the conversion attributes of our Convertible Notes outstanding as of June 30, 2022 (amounts in thousands, except rates):

	June 30, 2022
	Conversion	Conversion
	Rate (1)	Price (2)
2023 Convertible Notes	38.5959	$	25.91

______________________________________________________________________________________________________________________

(1)The conversion rate represents the number of shares of common stock issuable per $1,000 principal amount of 2023 Convertible Notes converted, as adjusted in accordance with the indenture governing the 2023 Convertible Notes (including the applicable supplemental indenture).

(2)As of June 30, 2022, the market price of the Company’s common stock was $20.89.

The if-converted value of the 2023 Convertible Notes was less than their principal amount by $48.4 million at June 30, 2022 as the closing market price of the Company’s common stock of $20.89 was less than the implicit conversion price of $25.91 per share. The if-converted value of the principal amount of the 2023 Convertible Notes was $201.6 million as of June 30, 2022. As of June 30, 2022, the net carrying amount and fair value of the 2023 Convertible Notes was $249.5 million and $246.3 million, respectively.

Upon conversion of the 2023 Convertible Notes, settlement may be made in common stock, cash or a combination of both, at the option of the Company.

Conditions for Conversion

Prior to October 1, 2022, the 2023 Convertible Notes will be convertible only upon satisfaction of one or more of the following conditions: (1) the closing market price of the Company’s common stock is at least 110% of the conversion price of the 2023 Convertible Notes for at least 20 out of 30 trading days prior to the end of the preceding fiscal quarter, (2) the trading price of the 2023 Convertible Notes is less than 98% of the product of (i) the conversion rate and (ii) the closing price of the Company’s common stock during any five consecutive trading day period, (3) the Company issues certain equity instruments at less than the 10-day average closing market price of its common stock or the per-share value of certain distributions exceeds the market price of the Company’s common stock by more than 10% or (4) certain other specified corporate events (significant consolidation, sale, merger, share exchange, fundamental change, etc.) occur.

On or after October 1, 2022, holders of the 2023 Convertible Notes may convert each of their notes at the applicable conversion rate at any time prior to the close of business on the second scheduled trading day immediately preceding the maturity date.

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Loan Securitization/Sale Activities

6 Months Ended

Jun. 30, 2022

Loan Securitization/Sale Activities

Loan Securitization/Sale Activities

Loan Securitization/Sale Activities

As described below, we regularly sell loans and notes under various strategies. We evaluate such sales as to whether they meet the criteria for treatment as a sale—legal isolation, ability of transferee to pledge or exchange the transferred assets without constraint and transfer of control.

Loan Securitizations

Within the Investing and Servicing Segment, we originate commercial mortgage loans with the intent to sell these mortgage loans to VIEs for the purposes of securitization. These VIEs then issue CMBS that are collateralized in part by these assets, as well as other assets transferred to the VIE by third parties. Within the Commercial and Residential Lending Segment, we acquire residential loans with the intent to sell these mortgage loans to VIEs for the purpose of securitization. These VIEs then issue RMBS that are collateralized by these assets.

In certain instances, we retain an interest in the CMBS or RMBS VIE and serve as special servicer or servicing administrator for the VIE. In these circumstances, we generally consolidate the VIE into which the loans were sold. The securitizations are subject to optional redemption after a certain period of time or when the pool balance falls below a specified threshold.

The following summarizes the face amount and proceeds of commercial and residential loans securitized for the three and six months ended June 30, 2022 and 2021 (amounts in thousands):

	Commercial Loans				Residential Loans
	Face Amount		Proceeds		Face Amount		Proceeds
For the Three Months Ended June 30,
2022	$	658,447	$	649,730	$	827,871	$	813,175
2021	304,604		321,377		564,429		583,877
For the Six Months Ended June 30,
2022	$	1,005,889	$	991,797	$	1,905,829	$	1,913,459
2021	389,641		411,087		947,978		973,675

The securitization of these commercial and residential loans does not result in a discrete gain or loss since they are carried under the fair value option.

Our securitizations have each been structured as bankruptcy-remote entities whose assets are not intended to be available to the creditors of any other party.

Commercial and Residential Loan Sales

Within the Commercial and Residential Lending Segment, we originate or acquire commercial mortgage loans, subsequently selling all or a portion thereof. Typically, our motivation for entering into these transactions is to effectively create leverage on the subordinated position that we will retain and hold for investment. We also may sell certain of our previously-acquired residential loans to third parties outside a securitization. The following table summarizes our loans sold by the Commercial and Residential Lending Segment, net of expenses (amounts in thousands):

	Loan Transfers Accounted for as Sales
	Commercial Loans				Residential Loans
	Face amount (1)		Proceeds (1)		Face Amount (2)		Proceeds (2)
For the Three Months Ended June 30,
2022	$	6,980	$	6,469	$	220,101	$	219,426
2021	232,670		229,490		383		398
For the Six Months Ended June 30,
2022	$	6,980	$	6,469	$	1,055,861	$	1,055,542
2021	232,670		229,490		89,801		92,817

______________________________________________________________________________________________________________________

(1)During both the three and six months ended June 30, 2022, we sold $7.0 million of senior interests in a first mortgage loan for proceeds of $6.5 million. During both the three and six months ended June 30, 2021, we sold $210.1 million of senior interests in first mortgage loans and $22.6 million of whole loan interests for proceeds of $208.0 million and $21.5 million, respectively.

(2)In February 2022, we sold $745.0 million of agency-eligible residential loans at face amount which was subject to a post-closing contingent sales price adjustment based on the gain or loss to the purchaser/securitization underwriter, less underwriting costs, if those loans were sold into a future securitization. Given spread widening which occurred in the residential markets during the three months ended June 30, 2022, we estimated the amount of this contingency to be $32.7 million at June 30, 2022 based on the probability and timing of executing a disposition strategy on these loans and the amount at which such a disposition could be executed. In June 2022, in lieu of the buyer executing a securitization or sale of the loans, we entered into a forward settlement agreement to acquire $729.1 million of these loans at par. The loan purchase is subject to a financing contingency, whereby the seller is to provide us financing under a mutually agreed repurchase agreement within 120 days. If such mutually agreed financing is not completed, we are not obligated to complete the forward settlement, and the previous post-closing contingency referenced above would be reinstated.

During both the three and six months ended June 30, 2022, losses recognized by the Commercial and Residential Lending Segment on sales of commercial loans were $0.1 million. During both the three and six months ended June 30, 2021, losses recognized by the Commercial and Residential Lending Segment on sales of commercial loans were $1.0 million.

Infrastructure Loan Sales

There were no sales of loans by the Infrastructure Lending Segment during the three and six months ended June 30, 2022. During both the three and six months ended June 30, 2021, the Infrastructure Lending Segment sold loans held-for-sale with an aggregate face amount of $2.5 million for proceeds of $2.5 million, recognizing immaterial gains.

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Derivatives and Hedging Activity

6 Months Ended

Jun. 30, 2022

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Derivatives and Hedging Activity

Derivatives and Hedging Activity

Risk Management Objective of Using Derivatives

We are exposed to certain risks arising from both our business operations and economic conditions. Refer to Note 14 to the consolidated financial statements included in our Form 10-K for further discussion of our risk management objectives and policies.

Designated Hedges

The Company does not generally elect to apply the hedge accounting designation to its hedging instruments. As of June 30, 2022 and December 31, 2021, the Company did not have any designated hedges.

Non-designated Hedges and Derivatives

We have entered into the following types of non-designated hedges and derivatives:

•Foreign exchange (“Fx”) forwards whereby we agree to buy or sell a specified amount of foreign currency for a specified amount of USD at a future date, economically fixing the USD amounts of foreign denominated cash flows we expect to receive or pay related to certain foreign denominated loan investments;

•Interest rate contracts which hedge a portion of our exposure to changes in interest rates;

•Credit instruments which hedge a portion of our exposure to the credit risk of our commercial loans held-for-sale; and

•Interest rate swap guarantees whereby we guarantee the interest rate swap obligations of certain Infrastructure Lending borrowers. Our interest rate swap guarantees were assumed in connection with the acquisition of the Infrastructure Lending Segment.

The following table summarizes our non-designated derivatives as of June 30, 2022 (notional amounts in thousands):

Type of Derivative	Number of Contracts	Aggregate Notional Amount	Notional Currency	Maturity
Fx contracts – Buy Euros ("EUR")	20	43,684	EUR	July 2022 - June 2023
Fx contracts – Buy Pounds Sterling ("GBP")	8	9,772	GBP	July 2022 - October 2024
Fx contracts – Buy Australian dollar ("AUD")	5	8,915	AUD	July 2022 - August 2023
Fx contracts – Buy Swiss Franc ("CHF")	1	29,400	CHF	July 2022
Fx contracts – Sell EUR	225	616,996	EUR	July 2022 - April 2026
Fx contracts – Sell GBP	196	575,781	GBP	July 2022 - April 2027
Fx contracts – Sell AUD	93	640,709	AUD	July 2022 - January 2026
Fx contracts – Sell CHF	1	38,449	CHF	July 2022
Interest rate swaps – Paying fixed rates	32	3,061,834	USD	April 2024 - June 2032
Interest rate swaps – Receiving fixed rates	2	970,000	USD	March 2025 - January 2027
Interest rate caps	5	633,900	USD	November 2022 - April 2025
Interest rate caps	1	61,000	GBP	April 2024
Credit instruments	3	49,000	USD	September 2058 - August 2061
Interest rate swap guarantees	4	271,363	USD	August 2022 - June 2025
Total	596

The table below presents the fair value of our derivative financial instruments as well as their classification on the condensed consolidated balance sheets as of June 30, 2022 and December 31, 2021 (amounts in thousands):

	Fair Value of Derivatives in an Asset Position (1) as of				Fair Value of Derivatives in a Liability Position (2) as of
	June 30, 2022		December 31, 2021		June 30, 2022		December 31, 2021
Interest rate contracts	$	7,487	$	17,728	$	49,642	$	16
Interest rate swap guarantees	—		—		—		260
Foreign exchange contracts	120,637		30,478		5,495		12,870
Credit instruments	603		10		—		275
Total derivatives	$	128,727	$	48,216	$	55,137	$	13,421

___________________________________________________

(1)Classified as derivative assets in our condensed consolidated balance sheets.

(2)Classified as derivative liabilities in our condensed consolidated balance sheets.

The table below presents the effect of our derivative financial instruments on the condensed consolidated statements of operations for the three and six months ended June 30, 2022 and 2021 (amounts in thousands):

Derivatives Not Designated as Hedging Instruments	Location of Gain (Loss) Recognized in Income	Amount of Gain (Loss) Recognized in Income for the Three Months Ended June 30,				Amount of Gain (Loss) Recognized in Income for the Six Months Ended June 30,
		2022		2021		2022		2021
Interest rate contracts	Gain (loss) on derivative financial instruments	$	37,257	$	(7,344)	$	140,190	$	12,814
Interest rate swap guarantees	Gain (loss) on derivative financial instruments	100		145		259		496
Foreign exchange contracts	Gain (loss) on derivative financial instruments	90,543		(2,540)		114,685		11,061
Credit instruments	Gain (loss) on derivative financial instruments	683		(270)		717		(391)
		$	128,583	$	(10,009)	$	255,851	$	23,980

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Offsetting Assets and Liabilities

6 Months Ended

Jun. 30, 2022

Offsetting [Abstract]

Offsetting Assets and Liabilities

Offsetting Assets and Liabilities

The following tables present the potential effects of netting arrangements on our financial position for financial assets and liabilities within the scope of ASC 210-20, Balance Sheet—Offsetting, which for us are derivative assets and liabilities as well as repurchase agreement liabilities (amounts in thousands):

			(ii)   Gross Amounts Offset in the Statement of Financial Position		(iii) = (i) - (ii) Net Amounts Presented in the Statement of Financial Position		(iv) Gross Amounts Not Offset in the Statement of Financial Position
	(i) Gross Amounts Recognized						Financial Instruments		Cash Collateral Received / Pledged		(v) = (iii) - (iv) Net Amount
As of June 30, 2022
Derivative assets	$	128,727	$	—	$	128,727	$	52,137	$	—	$	76,590
Derivative liabilities	$	55,137	$	—	$	55,137	$	52,137	$	3,000	$	—
Repurchase agreements	10,315,650		—		10,315,650		10,315,650		—		—
	$	10,370,787	$	—	$	10,370,787	$	10,367,787	$	3,000	$	—
As of December 31, 2021
Derivative assets	$	48,216	$	—	$	48,216	$	12,870	$	21,290	$	14,056
Derivative liabilities	$	13,421	$	—	$	13,421	$	12,870	$	291	$	260
Repurchase agreements	9,542,034		—		9,542,034		9,542,034		—		—
	$	9,555,455	$	—	$	9,555,455	$	9,554,904	$	291	$	260

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Variable Interest Entities

6 Months Ended

Jun. 30, 2022

Variable Interest Entities

Variable Interest Entities

Variable Interest Entities

Investment Securities

As discussed in Note 2, we evaluate all of our investments and other interests in entities for consolidation, including our investments in CMBS, RMBS and our retained interests in securitization transactions we initiated, all of which are generally considered to be variable interests in VIEs.

Securitization VIEs consolidated in accordance with ASC 810 are structured as pass through entities that receive principal and interest on the underlying collateral and distribute those payments to the certificate holders. The assets and other instruments held by these securitization entities are restricted and can only be used to fulfill the obligations of the entity. Additionally, the obligations of the securitization entities do not have any recourse to the general credit of any other consolidated entities, nor to us as the primary beneficiary. The VIE liabilities initially represent investment securities on our balance sheet (pre-consolidation). Upon consolidation of these VIEs, our associated investment securities are eliminated, as is the interest income related to those securities. Similarly, the fees we earn in our roles as special servicer of the bonds issued by the consolidated VIEs or as collateral administrator of the consolidated VIEs are also eliminated. Finally, a portion of the identified servicing intangible associated with the eliminated fee streams is eliminated in consolidation.

VIEs in which we are the Primary Beneficiary

The inclusion of the assets and liabilities of securitization VIEs in which we are deemed the primary beneficiary has no economic effect on us. Our exposure to the obligations of securitization VIEs is generally limited to our investment in these entities. We are not obligated to provide, nor have we provided, any financial support for any of these consolidated structures.

As discussed in Note 10, we have refinanced various pools of our commercial and infrastructure loans held-for-investment through five CLOs and one SASB, which are considered to be VIEs. We are the primary beneficiary of, and therefore consolidate, the CLOs and SASB in our financial statements as we have both (i) the power to direct the activities in our role as collateral manager, collateral advisor, or controlling class representative that most significantly impact the CLOs’ and SASB's economic performance, and (ii) the obligation to absorb losses and the right to receive benefits from the CLOs and SASB that could be potentially significant through the subordinate interests we own.

The following table details the assets and liabilities of our consolidated CLOs and SASB as of June 30, 2022 and December 31, 2021 (amounts in thousands):

	June 30, 2022		December 31, 2021
Assets:
Cash and cash equivalents	$	28,169	$	15,297
Loans held-for-investment	4,458,435		3,073,572
Investment securities	37,427		11,426
Accrued interest receivable	12,424		8,936
Other assets	461		11,213
Total Assets	$	4,536,916	$	3,120,444
Liabilities
Accounts payable, accrued expenses and other liabilities	$	10,813	$	3,335
Collateralized loan obligations and single asset securitization, net	3,764,151		2,616,116
Total Liabilities	$	3,774,964	$	2,619,451

Assets held by the CLOs and SASB are restricted and can be used only to settle obligations of the CLOs and SASB, including the subordinate interests owned by us. The liabilities of the CLOs and SASB are non-recourse to us and can only be satisfied from the assets of the CLOs and SASB.

We also hold controlling interests in other non-securitization entities that are considered VIEs. The Woodstar Fund, Woodstar Feeder Fund, L.P. and one of the Woodstar Fund’s indirect investees, SPT Dolphin Intermediate LLC (“SPT Dolphin”), the entity which holds the Woodstar II Portfolio, are each VIEs because the third party interest holders do not carry kick-out rights or substantive participating rights. We were deemed to be the primary beneficiary of those VIEs because we possess both the power to direct the activities of the VIEs that most significantly impact their economic performance and a significant economic interest in each entity. The Woodstar Fund had total assets of $1.6 billion, including its indirect investment in SPT Dolphin, and no significant liabilities as of June 30, 2022. As of June 30, 2022, Woodstar Feeder Fund, L.P. and its consolidated subsidiary which is also considered a VIE, Woodstar Feeder REIT, LLC, had a $0.4 billion investment in the Woodstar Fund, had no significant liabilities and had temporary equity of $0.3 billion consisting of the contingently redeemable non-controlling interests of the third party investors (see Note 17).

We also hold a 51% controlling interest in a joint venture (the “CMBS JV”) within our Investing and Servicing Segment, which is considered a VIE because the third party interest holder does not carry kick-out rights or substantive participating rights. We are deemed the primary beneficiary of the CMBS JV. This VIE had total assets of $367.2 million and liabilities of $89.1 million as of June 30, 2022. Refer to Note 17 for further discussion.

In addition to the above non-securitization entities, we have smaller VIEs with total assets of $75.6 million and liabilities of $32.3 million as of June 30, 2022.

VIEs in which we are not the Primary Beneficiary

In certain instances, we hold a variable interest in a VIE in the form of CMBS, but either (i) we are not appointed, or do not serve as, special servicer or servicing administrator or (ii) an unrelated third party has the rights to unilaterally remove us as special servicer without cause. In these instances, we do not have the power to direct activities that most significantly impact the VIE’s economic performance. In other cases, the variable interest we hold does not obligate us to absorb losses or provide us with the right to receive benefits from the VIE which could potentially be significant. For these structures, we are not deemed to be the primary beneficiary of the VIE, and we do not consolidate these VIEs.

As noted above, we are not obligated to provide, nor have we provided, any financial support for any of our securitization VIEs, whether or not we are deemed to be the primary beneficiary. As such, the risk associated with our involvement in these VIEs is limited to the carrying value of our investment in the entity. As of June 30, 2022, our maximum risk of loss related to securitization VIEs in which we were not the primary beneficiary was $21.0 million on a fair value basis.

As of June 30, 2022, the securitization VIEs which we do not consolidate had debt obligations to beneficial interest holders with unpaid principal balances, excluding the notional value of interest-only securities, of $4.8 billion. The corresponding assets are comprised primarily of commercial mortgage loans with unpaid principal balances corresponding to the amounts of the outstanding debt obligations.

We also hold passive non-controlling interests in certain unconsolidated entities that are considered VIEs. We are not the primary beneficiaries of these VIEs as we do not possess the power to direct the activities of the VIEs that most significantly impact their economic performance and therefore report our interests, which totaled $16.9 million as of June 30, 2022, within investments in unconsolidated entities on our consolidated balance sheet. Our maximum risk of loss is limited to our carrying value of the investments.

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Related-Party Transactions

6 Months Ended

Jun. 30, 2022

Related Party Transactions [Abstract]

Related-Party Transactions

Related-Party Transactions

Management Agreement

We are party to a management agreement (the “Management Agreement”) with our Manager. Under the Management Agreement, our Manager, subject to the oversight of our board of directors, is required to manage our day to day activities, for which our Manager receives a base management fee and is eligible for an incentive fee and stock awards. Our Manager’s personnel perform certain due diligence, legal, management and other services that outside professionals or consultants would otherwise perform. As such, in accordance with the terms of our Management Agreement, our Manager is paid or reimbursed for the documented costs of performing such tasks, provided that such costs and reimbursements are in amounts no greater than those which would be payable to outside professionals or consultants engaged to perform such services pursuant to agreements negotiated on an arm’s-length basis. Refer to Note 17 to the consolidated financial statements included in our Form 10-K for further discussion of this agreement.

Base Management Fee. For the three months ended June 30, 2022 and 2021, approximately $21.6 million and $19.2 million, respectively, was incurred for base management fees. For the six months ended June 30, 2022 and 2021, approximately $43.1 million and $38.3 million, respectively, was incurred for base management fees. As of June 30, 2022 and December 31, 2021, there were $21.6 million and $20.3 million, respectively, of unpaid base management fees included in related-party payable in our condensed consolidated balance sheets.

Incentive Fee. For the three months ended June 30, 2022 and 2021, approximately $5.2 million and $5.0 million, respectively, was incurred for incentive fees. For the six months ended June 30, 2022 and 2021, approximately $34.2 million and $18.2 million, respectively, was incurred for incentive fees. As of June 30, 2022 and December 31, 2021, there were $5.2 million and $51.2 million of unpaid incentive fees included in related-party payable in our condensed consolidated balance sheets.

Expense Reimbursement. For the three months ended June 30, 2022 and 2021, approximately $1.9 million and $1.6 million, respectively, was incurred for executive compensation and other reimbursable expenses and recognized within general and administrative expenses in our condensed consolidated statements of operations. For the six months ended June 30, 2022 and 2021, approximately $3.6 million and $3.1 million, respectively, was incurred for executive compensation and other reimbursable expenses. As of June 30, 2022 and December 31, 2021, there were $4.0 million and $4.9 million, respectively, of unpaid reimbursable executive compensation and other expenses included in related-party payable in our condensed consolidated balance sheets.

Equity Awards. In certain instances, we issue RSAs to certain employees of affiliates of our Manager who perform services for us. There were no RSAs granted during the three months ended June 30, 2022 and 2021. Expenses related to the vesting of awards to employees of affiliates of our Manager were $2.3 million and $2.2 million during the three months ended June 30, 2022 and 2021, respectively, and are reflected in general and administrative expenses in our condensed consolidated statements of operations. During the six months ended June 30, 2022 and 2021, we granted 200,972 and 981,951 RSAs, respectively, at grant date fair values of $4.8 million and $19.6 million, respectively. Expenses related to the vesting of awards to employees of affiliates of our Manager were $5.0 million and $4.5 million during the six months ended June 30, 2022 and 2021, respectively. These shares generally vest over a three-year period.

Manager Equity Plan

In April 2022, the Company’s shareholders approved the Starwood Property Trust, Inc. 2022 Manager Equity Plan (the “2022 Manager Equity Plan”) which replaces the Starwood Property Trust, Inc. 2017 Manager Equity Plan (the “2017 Manager Equity Plan”). In November 2020, we granted 1,800,000 RSUs to our Manager under the 2017 Manager Equity Plan. In September 2019, we granted 1,200,000 RSUs to our Manager under the 2017 Manager Equity Plan. In April 2018, we granted 775,000 RSUs to our Manager under the 2017 Manager Equity Plan. In connection with these grants and prior similar grants, we recognized share-based compensation expense of $4.5 million within management fees in our condensed consolidated statements of operations for both the three months ended June 30, 2022 and 2021. For the six months ended June 30, 2022 and 2021, we recognized $9.0 million and $10.4 million, respectively, related to these awards. Refer to Note 17 for further discussion.

Investments in Loans and Securities

In March 2022, we originated a new loan on the development and recapitalization of luxury rental cabins with a total commitment of $200.0 million, of which $92.7 million was outstanding as of June 30, 2022. The loan bears interest at SOFR + 6.50% plus fees and contains a term of 24 months with three one-year extension options. The proceeds were partially used to repay an existing $99.0 million first mortgage loan that we originated in February 2020. Certain members of our executive team and board of directors own equity interests in the borrower.

During the three and six months ended June 30, 2022, the Company acquired $332.9 million and $956.8 million, respectively, of loans from a residential mortgage originator in which it holds an equity interest. Additionally, as of June 30, 2022, the Company had outstanding residential mortgage loan purchase commitments of $130.1 million to this residential mortgage originator. Refer to Note 8 for further discussion. During the six months ended June 30, 2022, the Company received proceeds of $4.4 million from the sale of loans to the residential mortgage originator. No proceeds were received from the sale of loans to the residential mortgage originator during the three months ended June 30, 2022.

Lease Arrangements

In March 2020, we entered into an office lease agreement with an entity which is controlled by our Chairman and CEO through majority equity ownership of the entity. The leased premises serve as our new Miami Beach office following the expiration of our former lease in Miami Beach. The lease is for approximately 65,000 square feet of office space, has an initial term of 15 years and requires monthly lease payments starting in the tenth month after lease commencement, which is pending final completion of the premises. The lease payments are based on an annual base rate of $52.00 per square foot that increases by 3% each anniversary following commencement, plus our pro rata share of building operating expenses. Prior to the execution of this lease, we engaged an independent third party leasing firm and external counsel to advise the independent directors of our board of directors on market terms for the lease.  The terms of the lease were approved by our independent directors. In April 2020 we provided a $1.9 million cash security deposit to the landlord. During the six months ended June 30, 2022, we made payments to the landlord of $1.8 million for reimbursements relating to tenant improvements under the terms of the lease. No payments were made to the landlord for reimbursements relating to tenant improvements during the three months ended June 30, 2022.

Other Related-Party Arrangements

Highmark Residential (“Highmark”), an affiliate of our Manager, provides property management services for properties within our Woodstar I and Woodstar II Portfolios. Fees paid to Highmark are calculated as a percentage of gross receipts and are at market terms. During the three months ended June 30, 2022 and 2021, property management fees to Highmark of $1.3 million and $0.7 million, respectively, were recognized within our Woodstar Portfolios. During the six months ended June 30, 2022 and 2021, property management fees to Highmark were $2.7 million and $1.5 million, respectively.

Refer to Note 17 to the consolidated financial statements included in our Form 10-K for further discussion of related-party agreements.

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Stockholders' Equity and Non-Controlling Interests

6 Months Ended

Jun. 30, 2022

Stockholders' Equity Note [Abstract]

Stockholders' Equity and Non-Controlling Interests

Stockholders’ Equity and Non-Controlling Interests

During the six months ended June 30, 2022, our board of directors declared the following dividends:

Declaration Date	Record Date	Ex-Dividend Date	Payment Date	Amount		Frequency
6/15/22	6/30/22	6/29/22	7/15/22	$	0.48	Quarterly
3/14/22	3/31/22	3/30/22	4/15/22	0.48		Quarterly

In May 2022, we entered into a Starwood Property Trust, Inc. Common Stock Sales Agreement (the “ATM Agreement”) with a syndicate of financial institutions to sell shares of the Company’s common stock of up to $500.0 million from time to time, through an “at the market” equity offering program. Sales of shares under the ATM Agreement are made by means of ordinary brokers’ transactions on the New York Stock Exchange or otherwise at market prices prevailing at the time of sale or at negotiated prices. The ATM Agreement replaces a similar agreement previously entered into in May 2014 with Merrill Lynch, Pierce, Fenner and Smith Incorporated. During the three and six months ended June 30, 2022, we issued 1,415,564 shares of common stock under our ATM Agreement for gross proceeds of $33.3 million at an average share price of $23.54 and paid related commission costs of $0.7 million. During the three and six months ended June 30, 2021, there were no shares issued under our previous ATM agreement.

During the six months ended June 30, 2022 and 2021, shares issued under the Starwood Property Trust, Inc. Dividend Reinvestment and Direct Stock Purchase Plan (the “DRIP Plan”) were not material.

In April 2022, the Company’s shareholders approved the Starwood Property Trust, Inc. Employee Stock Purchase Plan (the “ESPP”) which allows eligible employees to purchase common stock of the Company at a discounted purchase price. The discounted purchase price of a share of the Company's common stock is 85% of the fair market value at the lower of the beginning or the end of the quarterly offering period. Participants may purchase shares not exceeding an aggregate fair market value of $25,000 in any calendar year. The maximum aggregate number of shares subject to issuance in accordance with the ESPP is 2,000,000 shares. No shares have been issued under the ESPP through June 30, 2022.

Equity Incentive Plans

In April 2022, the Company’s shareholders approved the 2022 Manager Equity Plan and the Starwood Property Trust, Inc. 2022 Equity Plan (the “2022 Equity Plan”), which allow for the issuance of up to 18,700,000 stock options, stock appreciation rights, RSAs, RSUs or other equity-based awards or any combination thereof to the Manager, directors, employees, consultants or any other party providing services to the Company. The 2022 Manager Equity Plan succeeds and replaces the 2017 Manager Equity Plan and the 2022 Equity Plan succeeds and replaces the Starwood Property Trust, Inc. 2017 Equity Plan (the “2017 Equity Plan”).

The table below summarizes our share awards granted or vested under the 2017 Manager Equity Plan (none under the 2022 Manager Equity Plan) during the six months ended June 30, 2022 and 2021 (dollar amounts in thousands):

Grant Date	Type	Amount Granted	Grant Date Fair Value		Vesting Period
November 2020	RSU	1,800,000	$	30,078	3 years
September 2019	RSU	1,200,000	29,484		(1)
April 2018	RSU	775,000	16,329		3 years

______________________________________________________________________________________________________________________

(1)Of the amount granted, 218,898 vested immediately on the grant date and the remaining amount vests over a three-year period.

Schedule of Non-Vested Shares and Share Equivalents (1)

	2022 Equity Plan	2022 Manager Equity Plan	Total	Weighted Average Grant Date Fair Value (per share)
Balance as of January 1, 2022	2,406,730	1,295,277	3,702,007	$	18.90
Granted	784,893	—	784,893	23.81
Vested	(600,902)	(463,518)	(1,064,420)	18.11
Forfeited	(10,809)	—	(10,809)	23.17
Balance as of June 30, 2022	2,579,912	831,759	3,411,671	20.26

(1)    Equity-based award activity for awards granted under the 2017 Equity Plan is reflected within the 2022 Equity Plan column, and for awards granted under the 2017 Manager Equity Plan, within the 2022 Manager Equity Plan column.

As of June 30, 2022, there were 18.7 million shares of common stock available for future grants under the 2022 Manager Equity Plan and the 2022 Equity Plan.

Non-Controlling Interests in Consolidated Subsidiaries

As discussed in Note 2, on November 5, 2021 we sold a 20.6% non-controlling interest in the Woodstar Fund to third party investors for net cash proceeds of $214.2 million. Under the Woodstar Fund operating agreement, such interests are contingently redeemable by us, at the option of the interest holder, for cash at liquidation fair value if any assets remain upon termination of the Woodstar Fund. The Woodstar Fund operating agreement specifies an eight-year term with two one-year extension options, the first at our option and the second subject to consent of an advisory committee representing the non-controlling interest holders. Accordingly, these contingently redeemable non-controlling interests have been classified as “Temporary Equity” in our condensed consolidated balance sheets and represent the fair value of the Woodstar Fund’s net assets allocable to those interests. During the three and six months ended June 30, 2022, net income attributable to these non-controlling interests was $62.8 million and $110.5 million, respectively.

In connection with our Woodstar II Portfolio acquisitions, we issued 10.2 million Class A Units in our subsidiary, SPT Dolphin, and rights to receive an additional 1.9 million Class A Units if certain contingent events occur. As of June 30, 2022, all of the 1.9 million contingent Class A Units were issued. The Class A Units are redeemable for consideration equal to the current share price of the Company’s common stock on a one-for-one basis, with the consideration paid in either cash or the Company’s common stock, at the determination of the Company. There were 9.8 million Class A Units outstanding as of June 30, 2022. The outstanding Class A Units are reflected as non-controlling interests in consolidated subsidiaries on our consolidated balance sheets, the balance of which was $208.5 million as of June 30, 2022 and December 31, 2021.

To the extent SPT Dolphin has sufficient cash available, the Class A Units earn a preferred return indexed to the dividend rate of the Company’s common stock. Any distributions made pursuant to this waterfall are recognized within net income attributable to non-controlling interests in our condensed consolidated statements of operations. During the three and six months ended June 30, 2022, we recognized net income attributable to non-controlling interests of $4.7 million and $9.4 million, respectively, associated with these Class A Units. During the three and six months ended June 30, 2021, we recognized net income attributable to non-controlling interests of $4.9 million and $10.0 million, respectively, associated with these Class A Units.

As discussed in Note 15, we hold a 51% controlling interest in the CMBS JV within our Investing and Servicing Segment. Because the CMBS JV is deemed a VIE for which we are the primary beneficiary, the 49% interest of our joint venture partner is reflected as a non-controlling interest in consolidated subsidiaries on our condensed consolidated balance sheets, and any net income attributable to this 49% joint venture interest is reflected within net income attributable to non-controlling interests in our condensed consolidated statement of operations. The non-controlling interests in the CMBS JV were $153.0 million and $131.9 million as of June 30, 2022 and December 31, 2021, respectively. During the three and six months ended June 30, 2022, net income attributable to these non-controlling interests was $1.3 million and $4.9 million, respectively. During the three and six months ended June 30, 2021, net income attributable to these non-controlling interests was $4.7 million and $10.1 million, respectively.

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Earnings per Share

6 Months Ended

Jun. 30, 2022

Earnings Per Share [Abstract]

Earnings per Share

Earnings per Share

The following table provides a reconciliation of net income and the number of shares of common stock used in the computation of basic EPS and diluted EPS (amounts in thousands, except per share amounts):

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2022		2021		2022		2021
Basic Earnings
Income attributable to STWD common stockholders	$	212,287	$	116,310	$	536,886	$	227,688
Less: Income attributable to participating shares not already deducted as non-controlling interests	(3,990)		(1,791)		(12,811)		(3,716)
Basic earnings	$	208,297	$	114,519	$	524,075	$	223,972
Diluted Earnings
Income attributable to STWD common stockholders	$	212,287	$	116,310	$	536,886	$	227,688
Less: Income attributable to participating shares not already deducted as non-controlling interests	(3,990)		(1,791)		(12,811)		(3,716)
Add: Interest expense on Convertible Notes	2,915		2,900		5,818		5,816
Add: Undistributed earnings to participating shares	2,584		—		9,879		—
Less: Undistributed earnings reallocated to participating shares	(2,506)		—		(9,579)		—
Diluted earnings	$	211,290	$	117,419	$	530,193	$	229,788
Number of Shares:
Basic — Average shares outstanding	305,035		284,710		303,995		284,018
Effect of dilutive securities — Convertible Notes	9,649		9,649		9,649		9,649
Effect of dilutive securities — Contingently issuable shares	120		95		120		95
Effect of dilutive securities — Unvested non-participating shares	158		117		144		46
Diluted — Average shares outstanding	314,962		294,571		313,908		293,808
Earnings Per Share Attributable to STWD Common Stockholders:
Basic	$	0.68	$	0.40	$	1.72	$	0.79
Diluted	$	0.67	$	0.40	$	1.69	$	0.78

As of June 30, 2022 and 2021, participating shares of 12.7 million and 14.0 million, respectively, were excluded from the computation of diluted shares as their effect was already considered under the more dilutive two-class method used above. Such participating shares at June 30, 2022 and 2021 included 9.8 million and 10.2 million potential shares, respectively, of our common stock issuable upon redemption of the Class A Units in SPT Dolphin, as discussed in Note 17.

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Accumulated Other Comprehensive Income

6 Months Ended

Jun. 30, 2022

Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract]

Accumulated Other Comprehensive Income

Accumulated Other Comprehensive Income

The changes in AOCI by component are as follows (amounts in thousands):

	Cumulative Unrealized Gain (Loss) on Available-for- Sale Securities		Foreign Currency Translation		Total
Three Months Ended June 30, 2022
Balance at April 1, 2022	$	35,669	$	—	$	35,669
OCI before reclassifications	(6,699)		—		(6,699)
Amounts reclassified from AOCI	—		—		—
Net period OCI	(6,699)		—		(6,699)
Balance at June 30, 2022	$	28,970	$	—	$	28,970
Three Months Ended June 30, 2021
Balance at April 1, 2021	$	41,654	$	—	$	41,654
OCI before reclassifications	(344)		—		(344)
Amounts reclassified from AOCI	—		—		—
Net period OCI	(344)		—		(344)
Balance at June 30, 2021	$	41,310	$	—	$	41,310
Six Months Ended June 30, 2022
Balance at January 1, 2022	$	40,953	$	—	$	40,953
OCI before reclassifications	(11,983)		—		(11,983)
Amounts reclassified from AOCI	—		—		—
Net period OCI	(11,983)		—		(11,983)
Balance at June 30, 2022	$	28,970	$	—	$	28,970
Six Months Ended June 30, 2021
Balance at January 1, 2021	$	44,057	$	(64)	$	43,993
OCI before reclassifications	(2,747)		—		(2,747)
Amounts reclassified from AOCI	—		64		64
Net period OCI	(2,747)		64		(2,683)
Balance at June 30, 2021	$	41,310	$	—	$	41,310

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Fair Value

6 Months Ended

Jun. 30, 2022

Fair Value Disclosures [Abstract]

Fair Value

Fair Value

GAAP establishes a hierarchy of valuation techniques based on the observability of inputs utilized in measuring financial assets and liabilities at fair value. GAAP establishes market-based or observable inputs as the preferred source of values, followed by valuation models using management assumptions in the absence of market inputs. The three levels of the hierarchy are described below:

Level I—Inputs are unadjusted, quoted prices in active markets for identical assets or liabilities at the measurement date.

Level II—Inputs (other than quoted prices included in Level I) are either directly or indirectly observable for the asset or liability through correlation with market data at the measurement date and for the duration of the instrument’s anticipated life.

Level III—Inputs reflect management’s best estimate of what market participants would use in pricing the asset or liability at the measurement date. Consideration is given to the risk inherent in the valuation technique and the risk inherent in the inputs to the model.

Valuation Process

We have valuation control processes in place to validate the fair value of the Company’s financial assets and liabilities measured at fair value including those derived from pricing models. These control processes are designed to assure that the values used for financial reporting are based on observable inputs wherever possible. In the event that observable inputs are not available, the control processes are designed to assure that the valuation approach utilized is appropriate and consistently applied and the assumptions are reasonable.

Pricing Verification—We use recently executed transactions, other observable market data such as exchange data, broker/dealer quotes, third party pricing vendors and aggregation services for validating the fair values generated using valuation models. Pricing data provided by approved external sources is evaluated using a number of approaches; for example, by corroborating the external sources’ prices to executed trades, analyzing the methodology and assumptions used by the external source to generate a price and/or by evaluating how active the third party pricing source (or originating sources used by the third party pricing source) is in the market.

Unobservable Inputs—Where inputs are not observable, we review the appropriateness of the proposed valuation methodology to ensure it is consistent with how a market participant would arrive at the unobservable input. The valuation methodologies utilized in the absence of observable inputs may include extrapolation techniques and the use of comparable observable inputs.

Any changes to the valuation methodology will be reviewed by our management to ensure the changes are appropriate. The methods used may produce a fair value calculation that is not indicative of net realizable value or reflective of future fair values. Furthermore, while we anticipate that our valuation methods are appropriate and consistent with other market participants, the use of different methodologies, or assumptions, to determine the fair value could result in a different estimate of fair value at the reporting date.

Fair Value on a Recurring Basis

We determine the fair value of our financial assets and liabilities measured at fair value on a recurring basis as follows:

Loans held-for-sale, commercial

We measure the fair value of our commercial mortgage loans held-for-sale using a discounted cash flow analysis unless observable market data (i.e., securitized pricing) is available. A discounted cash flow analysis requires management to make estimates regarding future interest rates and credit spreads. The most significant of these inputs relates to credit spreads and is unobservable. Thus, we have determined that the fair values of mortgage loans valued using a discounted cash flow analysis should be classified in Level III of the fair value hierarchy, while mortgage loans valued using securitized pricing should be classified in Level II of the fair value hierarchy. Mortgage loans classified in Level III are transferred to Level II if securitized pricing becomes available.

Loans held-for-sale and loans held-for-investment, residential

We measure the fair value of our residential loans held-for-sale and held-for-investment based on the net present value of expected future cash flows using a combination of observable and unobservable inputs. Observable market participant assumptions include pricing related to trades of residential loans with similar characteristics. Unobservable inputs include the expectation of future cash flows, which involves judgments about the underlying collateral, the creditworthiness of the borrower, estimated prepayment speeds, estimated future credit losses, forward interest rates, investor yield requirements and certain other factors. At each measurement date, we consider both the observable and unobservable valuation inputs in the determination of fair value. However, given the significance of the unobservable inputs, these loans have been classified within Level III.

RMBS

RMBS are valued utilizing observable and unobservable market inputs. The observable market inputs include recent transactions, broker quotes and vendor prices (“market data”). However, given the implied price dispersion amongst the market data, the fair value determination for RMBS has also utilized significant unobservable inputs in discounted cash flow models including prepayments, default and severity estimates based on the recent performance of the collateral, the underlying collateral characteristics, industry trends, as well as expectations of macroeconomic events (e.g., housing price curves, interest rate curves, etc.). At each measurement date, we consider both the observable and unobservable valuation inputs in the determination of fair value. However, given the significance of the unobservable inputs these securities have been classified within Level III.

CMBS

CMBS are valued utilizing both observable and unobservable market inputs. These factors include projected future cash flows, ratings, subordination levels, vintage, remaining lives, credit issues, recent trades of similar securities and the spreads used in the prior valuation. We obtain current market spread information where available and use this information in evaluating and validating the market price of all CMBS. Depending upon the significance of the fair value inputs used in determining these fair values, these securities are classified in either Level II or Level III of the fair value hierarchy. CMBS may shift between Level II and Level III of the fair value hierarchy if the significant fair value inputs used to price the CMBS become or cease to be observable.

Equity security

The equity security is publicly registered and traded in the U.S. and its market price is listed on the London Stock Exchange. The security has been classified within Level I.

Woodstar Fund Investments

The fair value of investments held by the Woodstar Fund is determined based on observable and unobservable market inputs. The initial fair value of the Woodstar Fund's investments at its November 5, 2021 establishment date was determined by reference to the purchase price paid by third party investors, which was consistent with both a recent external appraisal as well as our extensive marketing efforts to sell interests in the Woodstar Fund, plus working capital.

For the properties, the third party appraisal applied the income capitalization approach with corroborative support from the sales comparison approach. The cost approach was not employed, as it is typically not emphasized by potential investors in the multifamily affordable housing sector. The income capitalization approach estimates an income stream for a property over a 10-year period and discounts this income plus a reversion (presumed sale) into a present value at a risk adjusted discount rate. Terminal capitalization rates and discount rates utilized in this approach are derived from market transactions as well as other financial and industry data.

For secured financing, the third party appraisal discounted the contractual cash flows at the interest rate at which such arrangements would bear if executed in the current market. The fair value of investment level working capital is assumed to approximate carrying value due to its primarily short-term monetary nature. The fair value of interest rate derivatives is determined using the methodology described in the Derivatives discussion below.

Internal valuations at interim quarter ends are prepared by management. The valuation of properties is based on a direct income capitalization approach, whereby a direct capitalization market rate is applied to annualized in-place net operating income at the portfolio level. The direct capitalization rate is initially calibrated to the implied rate from the latest appraisal and

adjusted for subsequent changes in current market capitalization rates for sales of comparable multifamily properties. The valuations of secured financing agreements, working capital and interest rate derivatives are consistent with the methodologies described in the paragraph above.

Given the significance of the unobservable inputs used in the respective valuations, the Woodstar Fund’s investments have been classified within Level III of the fair value hierarchy.

Domestic servicing rights

The fair value of this intangible is determined using discounted cash flow modeling techniques which require management to make estimates regarding future net servicing cash flows, including forecasted loan defeasance, control migration, delinquency and anticipated maturity defaults which are calculated assuming a debt yield at which default occurs. Since the most significant of these inputs are unobservable, we have determined that the fair values of this intangible in its entirety should be classified in Level III of the fair value hierarchy.

Derivatives

The valuation of derivative contracts are determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market based inputs, including interest rate curves, spot and market forward points and implied volatilities. The fair values of interest rate swaps are determined using the market standard methodology of netting the discounted future fixed cash payments and the discounted expected variable cash receipts. The variable cash receipts are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves.

We incorporate credit valuation adjustments to appropriately reflect both our own non-performance risk and the respective counterparty’s non-performance risk in the fair value measurements. In adjusting the fair value of our derivative contracts for the effect of non-performance risk, we have considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts, and guarantees.

The valuation of over the counter derivatives are determined using discounted cash flows based on Overnight Index Swap (“OIS”) rates. Fully collateralized trades are discounted using OIS with no additional economic adjustments to arrive at fair value. Uncollateralized or partially collateralized trades are also discounted at OIS, but include appropriate economic adjustments for funding costs (i.e., a LIBOR OIS basis adjustment to approximate uncollateralized cost of funds) and credit risk. For credit instruments, fair value is determined based on changes in the relevant indices from the date of initiation of the instrument to the reporting date, as these changes determine the amount of any future cash settlement between us and the counterparty. These indices are considered Level II inputs as they are directly observable.

Although we have determined that the majority of the inputs used to value our derivatives fall within Level II of the fair value hierarchy, the credit valuation adjustments associated with our derivatives utilize Level III inputs, such as estimates of current credit spreads to evaluate the likelihood of default by us and our counterparties. However, as of June 30, 2022 and December 31, 2021, we have assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative positions and have determined that the credit valuation adjustments are not significant to the overall valuation of our derivatives. As a result, we have determined that our derivative valuations in their entirety are classified in Level II of the fair value hierarchy.

Liabilities of consolidated VIEs

Our consolidated VIE liabilities generally represent bonds that are not owned by us. The majority of these are either traded in the marketplace or can be analogized to similar securities that are traded in the marketplace. For these liabilities, pricing is considered to be Level II, where the valuation is based upon quoted prices for similar instruments traded in active markets. We generally utilize third party pricing service providers for valuing these liabilities. In order to determine whether to utilize the valuations provided by third parties, we conduct an ongoing evaluation of their valuation methodologies and processes, as well as a review of the individual valuations themselves. In evaluating third party pricing for reasonableness, we consider a variety of factors, including market transaction information for the particular bond, market transaction information for bonds within the same trust, market transaction information for similar bonds, the bond’s ratings and the bond’s subordination levels.

For the minority portion of our consolidated VIE liabilities which consist of unrated or non-investment grade bonds that are not owned by us, pricing may be either Level II or Level III. If independent third party pricing similar to that noted above is available, we consider the valuation to be Level II. If such third party pricing is not available, the valuation is generated from model-based techniques that use significant unobservable assumptions, and we consider the valuation to be Level III. For VIE liabilities classified as Level III, valuation is determined based on discounted expected future cash flows which take into consideration expected duration and yields based on market transaction information, ratings, subordination levels, vintage and current market spread. VIE liabilities may shift between Level II and Level III of the fair value hierarchy if the significant fair value inputs used to price the VIE liabilities become or cease to be observable.

Assets of consolidated VIEs

The securitization VIEs in which we invest are “static”; that is, no reinvestment is permitted, and there is no active management of the underlying assets. In determining the fair value of the assets of the VIE, we maximize the use of observable inputs over unobservable inputs. The individual assets of a VIE are inherently incapable of precise measurement given their illiquid nature and the limitations on available information related to these assets. Because our methodology for valuing these assets does not value the individual assets of a VIE, but rather uses the value of the VIE liabilities as an indicator of the fair value of VIE assets as a whole, we have determined that our valuations of VIE assets in their entirety should be classified in Level III of the fair value hierarchy.

Fair Value Only Disclosed

We determine the fair value of our financial instruments and assets where fair value is disclosed as follows:

Loans held-for-investment and loans held-for-sale

We estimate the fair values of our loans not carried at fair value on a recurring basis by discounting their expected cash flows at a rate we estimate would be demanded by the market participants that are most likely to buy our loans. The expected cash flows used are generally the same as those used to calculate our level yield income in the financial statements. Since these inputs are unobservable, we have determined that the fair value of these loans in their entirety would be classified in Level III of the fair value hierarchy.

HTM debt securities

We estimate the fair value of our mandatorily redeemable preferred equity interests in commercial real estate companies and infrastructure bonds using the same methodology described for our loans held-for-investment. We estimate the fair value of our HTM CMBS using the same methodology described for our CMBS carried at fair value on a recurring basis.

Secured financing agreements, CLOs and SASB

The fair value of the secured financing agreements, CLOs and SASB are determined by discounting the contractual cash flows at the interest rate we estimate such arrangements would bear if executed in the current market. We have determined that our valuation of these instruments should be classified in Level III of the fair value hierarchy.

Unsecured senior notes

The fair value of our unsecured senior notes is determined based on the last available bid price for the respective notes in the current market. As these prices represent observable market data, we have determined that the fair value of these instruments would be classified in Level II of the fair value hierarchy.

Fair Value Disclosures

The following tables present our financial assets and liabilities carried at fair value on a recurring basis in the consolidated balance sheets by their level in the fair value hierarchy as of June 30, 2022 and December 31, 2021 (amounts in thousands):

	June 30, 2022
	Total		Level I		Level II		Level III
Financial Assets:
Loans under fair value option	$	2,228,332	$	—	$	30,831	$	2,197,501
RMBS	124,439		—		—		124,439
CMBS	20,965		—		—		20,965
Equity security	10,193		10,193		—		—
Woodstar Fund investments	1,558,850		—		—		1,558,850
Domestic servicing rights	17,499		—		—		17,499
Derivative assets	128,727		—		128,727		—
VIE assets	57,993,563		—		—		57,993,563
Total	$	62,082,568	$	10,193	$	159,558	$	61,912,817
Financial Liabilities:
Derivative liabilities	$	55,137	$	—	$	55,137	$	—
VIE liabilities	56,256,080		—		50,275,446		5,980,634
Total	$	56,311,217	$	—	$	50,330,583	$	5,980,634

	December 31, 2021
	Total		Level I		Level II		Level III
Financial Assets:
Loans under fair value option	$	2,936,025	$	—	$	—	$	2,936,025
RMBS	143,980		—		—		143,980
CMBS	22,244		—		—		22,244
Equity security	11,624		11,624		—		—
Woodstar Fund investments	1,040,309		—		—		1,040,309
Domestic servicing rights	16,780		—		—		16,780
Derivative assets	48,216		—		48,216		—
VIE assets	61,280,543		—		—		61,280,543
Total	$	65,499,721	$	11,624	$	48,216	$	65,439,881
Financial Liabilities:
Derivative liabilities	$	13,421	$	—	$	13,421	$	—
VIE liabilities	59,752,922		—		54,972,701		4,780,221
Total	$	59,766,343	$	—	$	54,986,122	$	4,780,221

The changes in financial assets and liabilities classified as Level III are as follows for the three and six months ended June 30, 2022 and 2021 (amounts in thousands):

Three Months Ended June 30, 2022	Loans at Fair Value		RMBS		CMBS		Woodstar Fund Investments		Domestic Servicing Rights		VIE Assets		VIE Liabilities		Total
April 1, 2022 balance	$	2,367,022	$	134,406	$	21,858	$	1,264,160	$	17,864	$	57,763,543	$	(5,479,288)	$	56,089,565
Total realized and unrealized gains (losses):
Included in earnings:
Change in fair value / gain on sale	(113,480)		—		(665)		294,690		(365)		(3,021,691)		447,311		(2,394,200)
Net accretion	—		2,625		—		—		—		—		—		2,625
Included in OCI	—		(6,699)		—		—		—		—		—		(6,699)
Purchases / Originations	1,340,371		—		—		—		—		—		—		1,340,371
Sales	(1,309,220)		—		—		—		—		—		—		(1,309,220)
Cash repayments / receipts	(56,415)		(5,893)		(228)		—		—		—		(415)		(62,951)
Transfers into Level III	54		—		—		—		—		—		(426,237)		(426,183)
Transfers out of Level III	(30,831)		—		—		—		—		—		262,839		232,008
Consolidation of VIEs	—		—		—		—		—		3,251,711		(784,844)		2,466,867
June 30, 2022 balance	$	2,197,501	$	124,439	$	20,965	$	1,558,850	$	17,499	$	57,993,563	$	(5,980,634)	$	55,932,183
Amount of unrealized gains (losses) attributable to     assets still held at June 30, 2022:
Included in earnings	$	(108,411)	$	2,340	$	(665)	$	294,690	$	(365)	$	(3,021,691)	$	447,311	$	(2,386,791)
Included in OCI	$	—	$	(6,375)	$	—	$	—	$	—	$	—	$	—	$	(6,375)

Three Months Ended June 30, 2021	Loans at Fair Value		RMBS		CMBS		Woodstar Fund Investments		Domestic Servicing Rights		VIE Assets		VIE Liabilities		Total
April 1, 2021 balance	$	763,773	$	160,301	$	19,256	$	—	$	12,406	$	62,367,110	$	(2,227,428)	$	61,095,418
Total realized and unrealized gains (losses):
Included in earnings:
Change in fair value / gain on sale	45,867		—		320		—		1,299		(1,085,746)		1,294		(1,036,966)
Net accretion	—		2,610		—		—		—		—		—		2,610
Included in OCI	—		(344)		—		—		—		—		—		(344)
Purchases / Originations	992,304		—		—		—		—		—		—		992,304
Sales	(905,653)		—		—		—		—		—		—		(905,653)
Cash repayments / receipts	(50,257)		(7,863)		(611)		—		—		—		(1,401)		(60,132)
Transfers into Level III	—		—		—		—		—		—		(2,431,880)		(2,431,880)
Transfers out of Level III	(250,687)		—		—		—		—		—		365,456		114,769
Transfers within Level III	172,474		—		—						(172,474)		—		—
Consolidation of VIEs	—		—		—		—		—		2,384,906		(542,233)		1,842,673
June 30, 2021 balance	$	767,821	$	154,704	$	18,965	$	—	$	13,705	$	63,493,796	$	(4,836,192)	$	59,612,799
Amount of unrealized gains (losses) attributable to     assets still held at June 30, 2021:
Included in earnings	$	3,274	$	2,610	$	320	$	—	$	1,299	$	(1,258,220)	$	1,294	$	(1,249,423)
Included in OCI	$	—	$	(344)	$	—	$	—	$	—	$	—	$	—	$	(344)

Six Months Ended June 30, 2022	Loans at Fair Value		RMBS		CMBS		Woodstar Fund Investments		Domestic Servicing Rights		VIE Assets		VIE Liabilities		Total
January 1, 2022 balance	$	2,936,025	$	143,980	$	22,244	$	1,040,309	$	16,780	$	61,280,543	$	(4,780,221)	$	60,659,660
Total realized and unrealized gains (losses):
Included in earnings:
Change in fair value / gain on sale	(239,263)		—		(1,357)		518,541		719		(6,918,293)		922,222		(5,717,431)
Net accretion	—		5,230		—		—		—		—		—		5,230
Included in OCI	—		(11,983)		—		—		—		—		—		(11,983)
Purchases / Originations	3,607,070		—		—		—		—		—		—		3,607,070
Sales	(3,587,687)		—		—		—		—		—		—		(3,587,687)
Cash repayments / receipts	(114,849)		(12,788)		(452)		—		—		—		(825)		(128,914)
Transfers into Level III	147		—		—		—		—		—		(630,117)		(629,970)
Transfers out of Level III	(403,942)		—		—		—		—		—		317,449		(86,493)
Consolidation of VIEs	—		—		—		—		—		4,361,325		(1,810,101)		2,551,224
Deconsolidation of VIEs	—		—		530		—		—		(730,012)		959		(728,523)
June 30, 2022 balance	$	2,197,501	$	124,439	$	20,965	$	1,558,850	$	17,499	$	57,993,563	$	(5,980,634)	$	55,932,183
Amount of unrealized gains (losses) attributable to     assets still held at June 30, 2022:
Included in earnings	$	(168,610)	$	4,896	$	(827)	$	518,541	$	719	$	(6,918,293)	$	922,222	$	(5,641,352)
Included in OCI	$	—	$	(11,577)	$	—	$	—	$	—	$	—	$	—	$	(11,577)

Six Months Ended June 30, 2021	Loans at Fair Value		RMBS		CMBS		Woodstar Fund Investments		Domestic Servicing Rights		VIE Assets		VIE Liabilities		Total
January 1, 2021 balance	$	1,022,979	$	167,349	$	19,457	$	—	$	13,202	$	64,238,328	$	(2,019,876)	$	63,441,439
Total realized and unrealized gains (losses):
Included in earnings:
Change in fair value / gain on sale	36,389		—		692		—		503		(3,350,337)		66,975		(3,245,778)
Net accretion	—		5,216		—		—		—		—		—		5,216
Included in OCI	—		(2,747)		—		—		—		—		—		(2,747)
Purchases / Originations	1,367,574		—		—		—		—		—		—		1,367,574
Sales	(1,477,580)		—		—		—		—		—		—		(1,477,580)
Issuances	—		—		—		—		—		—		(11,604)		(11,604)
Cash repayments / receipts	(103,328)		(15,114)		(1,184)		—		—		—		(2,538)		(122,164)
Transfers into Level III	—		—		—		—		—		—		(2,841,147)		(2,841,147)
Transfers out of Level III	(250,687)		—		—		—		—		—		514,231		263,544
Transfers within Level III	172,474		—		—		—		—		(172,474)		—		—
Consolidation of VIEs	—		—		—		—		—		2,778,279		(542,233)		2,236,046
June 30, 2021 balance	$	767,821	$	154,704	$	18,965	$	—	$	13,705	$	63,493,796	$	(4,836,192)	$	59,612,799
Amount of unrealized gains (losses) attributable to     assets still held at June 30, 2021:
Included in earnings	$	2,902	$	5,216	$	692	$	—	$	503	$	(3,522,811)	$	66,975	$	(3,446,523)
Included in OCI	$	—	$	(2,747)	$	—	$	—	$	—	$	—	$	—	$	(2,747)

Amounts were transferred from Level II to Level III due to a decrease in the observable relevant market activity and amounts were transferred from Level III to Level II due to an increase in the observable relevant market activity.

The following table presents the fair values of our financial instruments not carried at fair value on the consolidated balance sheets (amounts in thousands):

	June 30, 2022				December 31, 2021
	Carrying Value		Fair Value		Carrying Value		Fair Value
Financial assets not carried at fair value:
Loans	$	17,904,104	$	17,684,507	$	15,477,624	$	15,526,235
HTM debt securities	757,763		720,641		683,136		656,864
Financial liabilities not carried at fair value:
Secured financing agreements, CLOs and SASB	$	16,911,598	$	16,751,875	$	15,192,966	$	15,266,440
Unsecured senior notes	2,324,772		2,149,983		1,828,590		1,893,065

The following is quantitative information about significant unobservable inputs in our Level III measurements for those assets and liabilities measured at fair value on a recurring basis (dollars in thousands):

	Carrying Value at June 30, 2022		Valuation Technique	Unobservable Input	Range (Weighted Average) as of (1)
					June 30, 2022	December 31, 2021
Loans under fair value option	$	2,197,501	Discounted cash flow, market pricing	Coupon (d)	2.8% - 9.2% (4.6%)	2.6% - 9.2% (4.2%)
				Remaining contractual term (d)	5.8 - 40.0 years (29.2 years)	6.3 - 39.9 years (27.4 years)
				FICO score (a)	584 - 900 (745)	582 - 829 (748)
				LTV (b)	5% - 94% (68%)	1% - 94% (66%)
				Purchase price (d)	80.0% - 108.6% (101.8%)	80.0% - 108.6% (102.3%)
RMBS	124,439		Discounted cash flow	Constant prepayment rate (a)	3.4% - 14.6% (6.6%)	4.8% - 19.2% (9.9%)
				Constant default rate (b)	0.9% - 4.7% (2.0%)	0.8% - 6.0% (2.1%)
				Loss severity (b)	0% - 76% (16%) (f)	0% - 86% (26%) (f)
				Delinquency rate (c)	6% - 30% (15%)	10.4% - 35% (19%)
				Servicer advances (a)	25% - 79% (53%)	19% - 83% (52%)
				Annual coupon deterioration (b)	0% - 2.5% (0.1%)	0% - 1.7% (0.1%)
				Putback amount per projected total collateral loss (e)	0% - 8% (0.5%)	0% - 8% (0.5%)
CMBS	20,965		Discounted cash flow	Yield (b)	0% - 67.3% (8.9%)	0% - 613.6% (9.3%)
				Duration (c)	0 - 8.2 years (3.1 years)	0 - 7.2 years (5.2 years)
Woodstar Fund investments	1,558,850		Discounted cash flow	Discount rate - properties (b)	N/A	5.8% - 6.3% (6.0%)
				Discount rate - debt (a)	4.7% - 5.0% (4.8%)	2.6% - 3.3% (2.9%)
				Terminal capitalization rate (b)	N/A	4.8% - 5.3% (4.9%)
				Direct capitalization rate (b)	4.2% (4.2%)	4.1% - 4.2% (4.2%) (Implied)
Domestic servicing rights	17,499		Discounted cash flow	Debt yield (a)	7.50% (7.50%)	7.30% (7.30%)
				Discount rate (b)	15% (15%)	15% (15%)
VIE assets	57,993,563		Discounted cash flow	Yield (b)	0% - 253.1% (13.2%)	0% - 615.3% (13.0%)
				Duration (c)	0 - 11.3 years (3.2 years)	0 - 11.0 years (3.2 years)
VIE liabilities	5,980,634		Discounted cash flow	Yield (b)	0% - 253.1% (8.4%)	0% - 615.3% (6.4%)
				Duration (c)	0 - 11.3 years (2.2 years)	0 - 11.0 years (2.3 years)

______________________________________________________________________________________________________________________

(1)Unobservable inputs were weighted by the relative carrying value of the instruments as of June 30, 2022 and December 31, 2021.

Information about Uncertainty of Fair Value Measurements

(a)Significant increase (decrease) in the unobservable input in isolation would result in a significantly higher (lower) fair value measurement.

(b)Significant increase (decrease) in the unobservable input in isolation would result in a significantly lower (higher) fair value measurement.

(c)Significant increase (decrease) in the unobservable input in isolation would result in either a significantly lower or higher (higher or lower) fair value measurement depending on the structural features of the security in question.

(d)This unobservable input is not subject to variability as of the respective reporting dates.

(e)Any delay in the putback recovery date leads to a decrease in fair value for the majority of securities in our RMBS portfolio.

(f)6% and 18% of the portfolio falls within a range of 45% - 80% as of June 30, 2022 and December 31, 2021, respectively.

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Income Taxes

6 Months Ended

Jun. 30, 2022

Income Tax Disclosure [Abstract]

Income Taxes

Income Taxes

Certain of our domestic subsidiaries have elected to be treated as taxable REIT subsidiaries (“TRSs”). TRSs permit us to participate in certain activities from which REITs are generally precluded, as long as these activities meet specific criteria, are conducted within the parameters of certain limitations established by the Code and are conducted in entities which elect to be treated as taxable subsidiaries under the Code. To the extent these criteria are met, we will continue to maintain our qualification as a REIT.

Our TRSs engage in various real estate-related operations, including special servicing of commercial real estate, originating and securitizing mortgage loans, and investing in entities which engage in real estate-related operations. As of June 30, 2022 and December 31, 2021, approximately $2.5 billion and $3.2 billion, respectively, of assets were owned by TRS entities. Our TRSs are not consolidated for U.S. federal income tax purposes, but are instead taxed as corporations. For financial reporting purposes, a provision for current and deferred taxes is established for the portion of earnings recognized by us with respect to our interest in TRSs.

The following table is a reconciliation of our U.S. federal income tax provision determined using our statutory federal tax rate to our reported income tax provision (benefit) for the three and six months ended June 30, 2022 and 2021 (dollars in thousands):

	For the Three Months Ended June 30,								For the Six Months Ended June 30,
	2022				2021				2022				2021
Federal statutory tax rate	$	59,622	21.0	%	$	25,836	21.0	%	$	139,813	21.0	%	$	52,035	21.0	%
REIT and other non-taxable income	(58,233)		(20.6)	%	(24,018)		(19.5)	%	(137,431)		(20.6)	%	(48,519)		(19.6)	%
State income taxes	456		0.2	%	597		0.5	%	782		0.1	%	1,155		0.5	%
Federal benefit of state tax deduction	(95)		—	%	(126)		(0.1)	%	(164)		—	%	(243)		(0.1)	%
Intra-entity transfers	—		—	%	(6,037)		(4.9)	%	(3,868)		(0.6)	%	(6,052)		(2.4)	%
Other	456		0.2	%	395		0.3	%	624		0.1	%	501		0.1	%
Effective tax rate	$	2,206	0.8	%	$	(3,353)	(2.7)	%	$	(244)	—	%	$	(1,123)	(0.5)	%

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Commitments and Contingencies

6 Months Ended

Jun. 30, 2022

Commitments and Contingencies Disclosure [Abstract]

Commitments and Contingencies

Commitments and Contingencies

As of June 30, 2022, our Commercial and Residential Lending Segment had future commercial loan funding commitments totaling $2.9 billion, of which we expect to fund $2.6 billion. These future funding commitments primarily relate to construction projects, capital improvements, tenant improvements and leasing commissions. Additionally, as of June 30, 2022, our Commercial and Residential Lending Segment had outstanding residential loan purchase commitments of $130.1 million.

As discussed in Note 12, in February 2022, our Commercial and Residential Lending Segment sold $745.0 million of agency-eligible residential loans at face amount which was subject to a post-closing contingent sales price adjustment based on the gain or loss to the purchaser/securitization underwriter, less underwriting costs, if those loans were sold into a future securitization. Given spread widening which occurred in the residential markets during the three months ended June 30, 2022, we estimated the amount of this contingency to be $32.7 million at June 30, 2022 based on the probability and timing of executing a disposition strategy on these loans and the amount at which such a disposition could be executed. In June 2022, in lieu of the buyer executing a securitization or sale of the loans, we entered into a forward settlement agreement to acquire $729.1 million of these loans at par. The loan purchase is subject to a financing contingency, whereby the seller is to provide us financing under a mutually agreed repurchase agreement within 120 days. If such mutually agreed financing is not completed, we are not obligated to complete the forward settlement, and the previous post-closing contingency referenced above would be reinstated.

As of June 30, 2022, our Infrastructure Lending Segment had future infrastructure loan funding commitments totaling $141.7 million, including $137.0 million under revolvers and letters of credit (“LCs”), and $4.7 million under delayed draw term loans. As of June 30, 2022, $10.8 million of revolvers and LCs were outstanding. Additionally, as of June 30, 2022, our Infrastructure Lending Segment had outstanding loan purchase commitments of $112.2 million.

In connection with the Infrastructure Lending Segment acquisition, we assumed guarantees of certain borrowers’ performance under existing interest rate swaps. As of June 30, 2022, we had four outstanding guarantees on interest rate swaps maturing between August 2022 and June 2025. Refer to Note 13 for further discussion.

Generally, funding commitments are subject to certain conditions that must be met, such as customary construction draw certifications, minimum debt service coverage ratios or executions of new leases before advances are made to the borrower.

Management is not aware of any other contractual obligations, legal proceedings, or any other contingent obligations incurred in the normal course of business that would have a material adverse effect on our consolidated financial statements.

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Segment Data

6 Months Ended

Jun. 30, 2022

Segment Reporting [Abstract]

Segment Data

Segment DataIn 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 three months ended June 30, 2022 by business segment (amounts in thousands):

	Commercial and Residential Lending Segment		Infrastructure Lending Segment		Property Segment		Investing and Servicing Segment		Corporate		Subtotal		Securitization VIEs		Total
Revenues:
Interest income from loans	$	227,555	$	30,096	$	—	$	3,499	$	—	$	261,150	$	—	$	261,150
Interest income from investment securities	22,591		1,173		—		20,990		—		44,754		(29,448)		15,306
Servicing fees	142		—		—		15,616		—		15,758		(3,205)		12,553
Rental income	1,044		—		22,628		7,852		—		31,524		—		31,524
Other revenues	61		90		48		4,854		3		5,056		(3)		5,053
Total revenues	251,393		31,359		22,676		52,811		3		358,242		(32,656)		325,586
Costs and expenses:
Management fees	254		—		—		—		31,370		31,624		—		31,624
Interest expense	88,226		15,001		7,074		6,391		36,142		152,834		(216)		152,618
General and administrative	11,845		3,631		975		23,114		5,342		44,907		98		45,005
Acquisition and investment pursuit costs	738		—		2		(223)		—		517		—		517
Costs of rental operations	1,826		—		5,216		3,556		—		10,598		—		10,598
Depreciation and amortization	1,183		104		8,179		2,774		—		12,240		—		12,240
Credit loss provision, net	7,925		513		—		—		—		8,438		—		8,438
Other expense	1,251		—		—		7		—		1,258		—		1,258
Total costs and expenses	113,248		19,249		21,446		35,619		72,854		262,416		(118)		262,298
Other income (loss):
Change in net assets related to consolidated VIEs	—		—		—		—		—		—		8,373		8,373
Change in fair value of servicing rights	—		—		—		543		—		543		(908)		(365)
Change in fair value of investment securities, net	(19,312)		—		—		(8,150)		—		(27,462)		26,217		(1,245)
Change in fair value of mortgage loans, net	(121,356)		—		—		7,876		—		(113,480)		—		(113,480)
Income from affordable housing fund investments	—		—		307,165		—		—		307,165		—		307,165
Earnings (loss) from unconsolidated entities	2,786		394		—		1,748		—		4,928		(1,063)		3,865
Gain on sale of investments and other assets, net	138		—		—		—		—		138		—		138
Gain (loss) on derivative financial instruments, net	127,140		265		5,354		9,007		(13,183)		128,583		—		128,583
Foreign currency (loss) gain, net	(78,331)		(289)		18		—		—		(78,602)		—		(78,602)
Other loss, net	(33,809)		—		—		—		—		(33,809)		—		(33,809)
Total other income (loss)	(122,744)		370		312,537		11,024		(13,183)		188,004		32,619		220,623
Income (loss) before income taxes	15,401		12,480		313,767		28,216		(86,034)		283,830		81		283,911
Income tax (provision) benefit	(557)		1		—		(1,650)		—		(2,206)		—		(2,206)
Net income (loss)	14,844		12,481		313,767		26,566		(86,034)		281,624		81		281,705
Net income attributable to non-controlling interests	(4)		—		(67,482)		(1,851)		—		(69,337)		(81)		(69,418)
Net income (loss) attributable to Starwood Property Trust, Inc.	$	14,840	$	12,481	$	246,285	$	24,715	$	(86,034)	$	212,287	$	—	$	212,287

The table below presents our results of operations for the three months ended June 30, 2021 by business segment (amounts in thousands):

	Commercial and Residential Lending Segment		Infrastructure Lending Segment		Property Segment		Investing and Servicing Segment		Corporate		Subtotal		Securitization VIEs		Total
Revenues:
Interest income from loans	$	165,697	$	21,171	$	—	$	2,404	$	—	$	189,272	$	—	$	189,272
Interest income from investment securities	17,190		555		—		25,668		—		43,413		(32,765)		10,648
Servicing fees	110		—		—		16,365		—		16,475		(5,611)		10,864
Rental income	1,419		—		65,410		10,290		—		77,119		—		77,119
Other revenues	74		69		44		2,777		—		2,964		—		2,964
Total revenues	184,490		21,795		65,454		57,504		—		329,243		(38,376)		290,867
Costs and expenses:
Management fees	300		—		—		224		28,716		29,240		10		29,250
Interest expense	48,356		9,694		16,863		5,789		29,171		109,873		(220)		109,653
General and administrative	10,411		3,532		1,028		25,720		4,489		45,180		85		45,265
Acquisition and investment pursuit costs	179		249		—		(21)		—		407		—		407
Costs of rental operations	433		—		25,922		4,376		—		30,731		—		30,731
Depreciation and amortization	311		100		17,901		4,165		—		22,477		—		22,477
Credit loss (reversal) provision, net	(12,447)		603		—		—		—		(11,844)		—		(11,844)
Other expense	—		—		—		—		—		—		—		—
Total costs and expenses	47,543		14,178		61,714		40,253		62,376		226,064		(125)		225,939
Other income (loss):
Change in net assets related to consolidated VIEs	—		—		—		—		—		—		12,509		12,509
Change in fair value of servicing rights	—		—		—		460		—		460		839		1,299
Change in fair value of investment securities, net	(9,402)		—		—		(12,585)		—		(21,987)		23,495		1,508
Change in fair value of mortgage loans, net	12,329		—		—		33,538		—		45,867		—		45,867
Earnings (loss) from unconsolidated entities	1,996		(70)		—		(507)		—		1,419		807		2,226
(Loss) gain on sale of investments and other assets, net	(1,019)		27		—		9,723		—		8,731		—		8,731
(Loss) gain on derivative financial instruments, net	(4,945)		112		(372)		(5,731)		927		(10,009)		—		(10,009)
Foreign currency gain (loss), net	2,715		(62)		(25)		(1)		—		2,627		—		2,627
Loss on extinguishment of debt	(221)		(939)		—		(22)		—		(1,182)		—		(1,182)
Other (loss) income, net	(5,504)		2		—		29		—		(5,473)		—		(5,473)
Total other income (loss)	(4,051)		(930)		(397)		24,904		927		20,453		37,650		58,103
Income (loss) before income taxes	132,896		6,687		3,343		42,155		(61,449)		123,632		(601)		123,031
Income tax benefit (provision)	8,043		(58)		—		(4,632)		—		3,353		—		3,353
Net income (loss)	140,939		6,629		3,343		37,523		(61,449)		126,985		(601)		126,384
Net (income) loss attributable to non-controlling interests	(4)		—		(4,914)		(5,757)		—		(10,675)		601		(10,074)
Net income (loss) attributable to Starwood Property Trust, Inc.	$	140,935	$	6,629	$	(1,571)	$	31,766	$	(61,449)	$	116,310	$	—	$	116,310

The table below presents our consolidated balance sheet as of June 30, 2022 by business segment (amounts in thousands):

	Commercial and Residential Lending Segment		Infrastructure Lending Segment		Property Segment		Investing and Servicing Segment		Corporate		Subtotal		Securitization VIEs		Total
Assets:
Cash and cash equivalents	$	67,812	$	26,325	$	27,926	$	27,863	$	120,192	$	270,118	$	2,056	$	272,174
Restricted cash	2,889		38,835		958		10,011		11,939		64,632		—		64,632
Loans held-for-investment, net	15,623,041		2,263,006		—		9,742		—		17,895,789		—		17,895,789
Loans held-for-sale	2,195,953		—		—		40,694		—		2,236,647		—		2,236,647
Investment securities	1,338,195		67,336		—		1,210,361		—		2,615,892		(1,702,532)		913,360
Properties, net	215,099		—		874,119		136,761		—		1,225,979		—		1,225,979
Investments of consolidated affordable housing fund	—		—		1,558,850		—		—		1,558,850		—		1,558,850
Investments in unconsolidated entities	38,612		27,454		—		35,246		—		101,312		(15,802)		85,510
Goodwill	—		119,409		—		140,437		—		259,846		—		259,846
Intangible assets	14,948		—		32,050		69,691		—		116,689		(41,725)		74,964
Derivative assets	126,546		232		371		1,578		—		128,727		—		128,727
Accrued interest receivable	117,918		4,941		14		1,118		7,827		131,818		(158)		131,660
Other assets	126,936		6,952		66,483		34,667		22,453		257,491		(306)		257,185
VIE assets, at fair value	—		—		—		—		—		—		57,993,563		57,993,563
Total Assets	$	19,867,949	$	2,554,490	$	2,560,771	$	1,718,169	$	162,411	$	26,863,790	$	56,235,096	$	83,098,886
Liabilities and Equity
Liabilities:
Accounts payable, accrued expenses and other liabilities	$	152,679	$	24,052	$	10,161	$	48,634	$	37,823	$	273,349	$	65	$	273,414
Related-party payable	—		—		—		—		30,754		30,754		—		30,754
Dividends payable	—		—		—		—		149,991		149,991		—		149,991
Derivative liabilities	11,899		197		—		—		43,041		55,137		—		55,137
Secured financing agreements, net	9,999,749		1,025,145		788,557		584,395		770,965		13,168,811		(21,364)		13,147,447
Collateralized loan obligations and single asset securitization, net	2,951,308		812,843		—		—		—		3,764,151		—		3,764,151
Unsecured senior notes, net	—		—		—		—		2,324,772		2,324,772		—		2,324,772
VIE liabilities, at fair value	—		—		—		—		—		—		56,256,080		56,256,080
Total Liabilities	13,115,635		1,862,237		798,718		633,029		3,357,346		19,766,965		56,234,781		76,001,746
Temporary Equity: Redeemable non-controlling interests	—		—		322,753		—		—		322,753		—		322,753
Permanent Equity:
Starwood Property Trust, Inc. Stockholders’ Equity:
Common stock	—		—		—		—		3,167		3,167		—		3,167
Additional paid-in capital	1,926,108		624,101		(378,128)		(556,122)		4,150,574		5,766,533		—		5,766,533
Treasury stock	—		—		—		—		(138,022)		(138,022)		—		(138,022)
Accumulated other comprehensive income	28,970		—		—		—		—		28,970		—		28,970
Retained earnings (accumulated deficit)	4,797,121		68,152		1,608,794		1,469,935		(7,210,654)		733,348		—		733,348
Total Starwood Property Trust, Inc. Stockholders’ Equity	6,752,199		692,253		1,230,666		913,813		(3,194,935)		6,393,996		—		6,393,996
Non-controlling interests in consolidated subsidiaries	115		—		208,634		171,327		—		380,076		315		380,391
Total Permanent Equity	6,752,314		692,253		1,439,300		1,085,140		(3,194,935)		6,774,072		315		6,774,387
Total Liabilities and Equity	$	19,867,949	$	2,554,490	$	2,560,771	$	1,718,169	$	162,411	$	26,863,790	$	56,235,096	$	83,098,886

The table below presents our consolidated balance sheet as of December 31, 2021 by business segment (amounts in thousands):

	Commercial and Residential Lending Segment		Infrastructure Lending Segment		Property Segment		Investing and Servicing Segment		Corporate		Subtotal		Securitization VIEs		Total
Assets:
Cash and cash equivalents	$	65,064	$	17,011	$	14,136	$	26,700	$	93,861	$	216,772	$	590	$	217,362
Restricted cash	39,853		43,408		954		20,337		—		104,552		—		104,552
Loans held-for-investment, net	13,499,520		2,027,426		—		9,903		—		15,536,849		—		15,536,849
Loans held-for-sale	2,590,005		—		—		286,795		—		2,876,800		—		2,876,800
Investment securities	1,155,452		31,923		—		1,165,395		—		2,352,770		(1,491,786)		860,984
Properties, net	124,503		—		887,553		154,331		—		1,166,387		—		1,166,387
Investments of consolidated affordable housing fund	—		—		1,040,309		—		—		1,040,309		—		1,040,309
Investments in unconsolidated entities	44,938		26,255		—		34,160		—		105,353		(15,256)		90,097
Goodwill	—		119,409		—		140,437		—		259,846		—		259,846
Intangible assets	—		—		34,619		71,064		—		105,683		(42,119)		63,564
Derivative assets	34,265		128		8		391		13,424		48,216		—		48,216
Accrued interest receivable	106,251		3,207		—		947		5,988		116,393		(131)		116,262
Other assets	68,908		14,265		43,420		40,395		21,800		188,788		(162)		188,626
VIE assets, at fair value	—		—		—		—		—		—		61,280,543		61,280,543
Total Assets	$	17,728,759	$	2,283,032	$	2,020,999	$	1,950,855	$	135,073	$	24,118,718	$	59,731,679	$	83,850,397
Liabilities and Equity
Liabilities:
Accounts payable, accrued expenses and other liabilities	$	57,267	$	8,917	$	14,757	$	58,920	$	49,779	$	189,640	$	56	$	189,696
Related-party payable	—		—		—		—		76,371		76,371		—		76,371
Dividends payable	—		—		—		—		147,624		147,624		—		147,624
Derivative liabilities	12,870		260		—		291		—		13,421		—		13,421
Secured financing agreements, net	9,097,985		1,225,548		787,396		714,237		773,244		12,598,410		(21,560)		12,576,850
Collateralized loan obligations and single asset securitization, net	2,210,798		405,318		—		—		—		2,616,116		—		2,616,116
Unsecured senior notes, net	—		—		—		—		1,828,590		1,828,590		—		1,828,590
VIE liabilities, at fair value	—		—		—		—		—		—		59,752,922		59,752,922
Total Liabilities	11,378,920		1,640,043		802,153		773,448		2,875,608		17,470,172		59,731,418		77,201,590
Temporary Equity: Redeemable non-controlling interests	—		—		214,915		—		—		214,915		—		214,915
Permanent Equity:
Starwood Property Trust, Inc. Stockholders’ Equity:
Common stock	—		—		—		—		3,123		3,123		—		3,123
Additional paid-in capital	1,735,397		600,412		(365,922)		(388,196)		4,091,685		5,673,376		—		5,673,376
Treasury stock	—		—		—		—		(138,022)		(138,022)		—		(138,022)
Accumulated other comprehensive income	40,953		—		—		—		—		40,953		—		40,953
Retained earnings (accumulated deficit)	4,573,374		42,577		1,161,334		1,413,142		(6,697,321)		493,106		—		493,106
Total Starwood Property Trust, Inc. Stockholders’ Equity	6,349,724		642,989		795,412		1,024,946		(2,740,535)		6,072,536		—		6,072,536
Non-controlling interests in consolidated subsidiaries	115		—		208,519		152,461		—		361,095		261		361,356
Total Permanent Equity	6,349,839		642,989		1,003,931		1,177,407		(2,740,535)		6,433,631		261		6,433,892
Total Liabilities and Equity	$	17,728,759	$	2,283,032	$	2,020,999	$	1,950,855	$	135,073	$	24,118,718	$	59,731,679	$	83,850,397

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Subsequent Events

6 Months Ended

Jun. 30, 2022

Subsequent Events [Abstract]

Subsequent Events

Subsequent Events

Our significant events subsequent to June 30, 2022 were as follows:

Commercial Loan Sale

In July 2022, the Company sold a $63.6 million first mortgage loan secured by a hotel in San Francisco at its carrying value.

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Summary of Significant Accounting Policies (Policies)

6 Months Ended

Jun. 30, 2022

Accounting Policies [Abstract]

Balance Sheet Presentation of Securitization Variable Interest Entities

Balance Sheet Presentation of Securitization Variable Interest Entities

We operate investment businesses that acquire unrated, investment grade and non-investment grade rated CMBS and RMBS. These securities represent interests in securitization structures (commonly referred to as special purpose entities, or “SPEs”). These SPEs are structured as pass through entities that receive principal and interest on the underlying collateral and distribute those payments to the certificate holders. Under accounting principles generally accepted in the United States of America (“GAAP”), SPEs typically qualify as VIEs. These are entities that, by design, either (1) lack sufficient equity to permit the entity to finance its activities without additional subordinated financial support from other parties, or (2) have equity investors that do not have the ability to make significant decisions relating to the entity’s operations through voting rights, or do not have the obligation to absorb the expected losses, or do not have the right to receive the residual returns of the entity.

Because we often serve as the special servicer or servicing administrator of the trusts in which we invest, or we have the ability to remove and replace the special servicer without cause, consolidation of these structures is required pursuant to GAAP as outlined in detail below. This results in a consolidated balance sheet which presents the gross assets and liabilities of the VIEs. The assets and other instruments held by these VIEs are restricted and can only be used to fulfill the obligations of the entity. Additionally, the obligations of the VIEs do not have any recourse to the general credit of any other consolidated entities, nor to us as the consolidator of these VIEs.

The VIE liabilities initially represent investment securities on our balance sheet (pre-consolidation). Upon consolidation of these VIEs, our associated investment securities are eliminated, as is the interest income related to those securities. Similarly, the fees we earn in our roles as special servicer of the bonds issued by the consolidated VIEs or as collateral administrator of the consolidated VIEs are also eliminated. Finally, a portion of the identified servicing intangible associated with the eliminated fee streams is eliminated in consolidation.

Basis of Accounting and Principles of Consolidation

Basis of Accounting and Principles of Consolidation

The accompanying condensed consolidated financial statements include our accounts and those of our consolidated subsidiaries and VIEs. Intercompany amounts have been eliminated in consolidation. In the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to present fairly the financial position, results of operations, and cash flows have been included.

These unaudited condensed consolidated financial statements should be read in conjunction with the consolidated financial statements and notes thereto included in our Annual Report on Form 10-K for the fiscal year ended December 31, 2021 (our “Form 10-K”), as filed with the Securities and Exchange Commission (“SEC”). The results of operations for the three and six months ended June 30, 2022 are not necessarily indicative of the operating results for the full year.

Refer to our Form 10-K for a description of our recurring accounting policies. We have included disclosure in this Note 2 regarding principles of consolidation and other accounting policies that (i) are required to be disclosed quarterly, (ii) we view as critical, (iii) became significant since December 31, 2021 due to a corporate action or increase in the significance of the underlying business activity or (iv) changed upon adoption of an Accounting Standards Update (“ASU”) issued by the Financial Accounting Standards Board (“FASB”).

Variable Interest Entities

Variable Interest Entities

In addition to the securitization VIEs, we have financed pools of our loans through collateralized loan obligations (“CLOs”) and a single asset securitization (“SASB”), which are considered VIEs. We also hold interests in certain other entities which are considered VIEs as the limited partners of those entities with equity at risk do not collectively possess (i) the right to remove the general partner or dissolve the partnership without cause or (ii) the right to participate in significant decisions made by the partnership.

We evaluate all of our interests in VIEs for consolidation. When our interests are determined to be variable interests, we assess whether we are deemed to be the primary beneficiary of the VIE. The primary beneficiary of a VIE is required to consolidate the VIE. Accounting Standards Codification (“ASC”) 810, Consolidation, defines the primary beneficiary as the party that has both (i) the power to direct the activities of the VIE that most significantly impact its economic performance, and (ii) the obligation to absorb losses and the right to receive benefits from the VIE which could be potentially significant. We

consider our variable interests as well as any variable interests of our related parties in making this determination. Where both of these factors are present, we are deemed to be the primary beneficiary and we consolidate the VIE. Where either one of these factors is not present, we are not the primary beneficiary and do not consolidate the VIE.

To assess whether we have the power to direct the activities of a VIE that most significantly impact the VIE’s economic performance, we consider all facts and circumstances, including our role in establishing the VIE and our ongoing rights and responsibilities. This assessment includes: (i) identifying the activities that most significantly impact the VIE’s economic performance; and (ii) identifying which party, if any, has power over those activities. In general, the parties that make the most significant decisions affecting the VIE or have the right to unilaterally remove those decision makers are deemed to have the power to direct the activities of a VIE. The right to remove the decision maker in a VIE must be exercisable without cause for the decision maker to not be deemed the party that has the power to direct the activities of a VIE.

To assess whether we have the obligation to absorb losses of the VIE or the right to receive benefits from the VIE that could potentially be significant to the VIE, we consider all of our economic interests, including debt and equity investments, servicing fees and other arrangements deemed to be variable interests in the VIE. This assessment requires that we apply judgment in determining whether these interests, in the aggregate, are considered potentially significant to the VIE. Factors considered in assessing significance include: the design of the VIE, including its capitalization structure; subordination of interests; payment priority; relative share of interests held across various classes within the VIE’s capital structure; and the reasons why the interests are held by us.

Our purchased investment securities include unrated and non-investment grade rated securities issued by securitization trusts. In certain cases, we may contract to provide special servicing activities for these trusts, or, as holder of the controlling class, we may have the right to name and remove the special servicer for these trusts. In our role as special servicer, we provide services on defaulted loans within the trusts, such as foreclosure or work-out procedures, as permitted by the underlying contractual agreements. In exchange for these services, we receive a fee. These rights give us the ability to direct activities that could significantly impact the trust’s economic performance. However, in those instances where an unrelated third party has the right to unilaterally remove us as special servicer without cause, we do not have the power to direct activities that most significantly impact the trust’s economic performance. We evaluated all of our positions in such investments for consolidation.

For securitization VIEs in which we are determined to be the primary beneficiary, all of the underlying assets, liabilities and equity of the structures are recorded on our books, and the initial investment, along with any associated unrealized holding gains and losses, are eliminated in consolidation. Similarly, the interest income earned from these structures, as well as the fees paid by these trusts to us in our capacity as special servicer, are eliminated in consolidation. Further, a portion of the identified servicing intangible asset associated with the servicing fee streams, and the corresponding amortization or change in fair value of the servicing intangible asset, are also eliminated in consolidation.

We perform ongoing reassessments of: (i) whether any entities previously evaluated under the majority voting interest framework have become VIEs, based on certain events, and therefore subject to the VIE consolidation framework, and (ii) whether changes in the facts and circumstances regarding our involvement with a VIE causes our consolidation conclusion regarding the VIE to change.

We elect the fair value option for initial and subsequent recognition of the assets and liabilities of our consolidated securitization VIEs. Interest income and interest expense associated with these VIEs are no longer relevant on a standalone basis because these amounts are already reflected in the fair value changes. We have elected to present these items in a single line on our condensed consolidated statements of operations. The residual difference shown on our condensed consolidated statements of operations in the line item “Change in net assets related to consolidated VIEs” represents our beneficial interest in the VIEs.

We separately present the assets and liabilities of our consolidated securitization VIEs as individual line items on our condensed consolidated balance sheets. The liabilities of our consolidated securitization VIEs consist solely of obligations to the bondholders of the related trusts, and are thus presented as a single line item entitled “VIE liabilities.” The assets of our consolidated securitization VIEs consist principally of loans, but at times, also include foreclosed loans which have been temporarily converted into real estate owned (“REO”). These assets in the aggregate are likewise presented as a single line item entitled “VIE assets.”

Loans comprise the vast majority of our securitization VIE assets and are carried at fair value due to the election of the fair value option. When an asset becomes REO, it is due to non-performance of the loan. Because the loan is already at fair value, the carrying value of an REO asset is also initially at fair value. Furthermore, when we consolidate a trust, any existing

REO would be consolidated at fair value. Once an asset becomes REO, its disposition time is relatively short. As a result, the carrying value of an REO generally approximates fair value under GAAP.

In addition to sharing a similar measurement method as the loans in a trust, the securitization VIE assets as a whole can only be used to settle the obligations of the consolidated VIE. The assets of our securitization VIEs are not individually accessible by the bondholders, which creates inherent limitations from a valuation perspective. Also creating limitations from a valuation perspective is our role as special servicer, which provides us very limited visibility, if any, into the performing loans of a trust.

REO assets generally represent a very small percentage of the overall asset pool of a trust. In new issue trusts there are no REO assets. We estimate that REO assets constitute approximately 1% of our consolidated securitization VIE assets, with the remaining 99% representing loans. However, it is important to note that the fair value of our securitization VIE assets is determined by reference to our securitization VIE liabilities as permitted under ASU 2014-13, Consolidation (Topic 810): Measuring the Financial Assets and the Financial Liabilities of a Consolidated Collateralized Financing Entity. In other words, our VIE liabilities are more reliably measurable than the VIE assets, resulting in our current measurement methodology which utilizes this value to determine the fair value of our securitization VIE assets as a whole. As a result, these percentages are not necessarily indicative of the relative fair values of each of these asset categories if the assets were to be valued individually.

Due to our accounting policy election under ASU 2014-13, separately presenting two different asset categories would result in an arbitrary assignment of value to each, with one asset category representing a residual amount, as opposed to its fair value. However, as a pool, the fair value of the assets in total is equal to the fair value of the liabilities.

For these reasons, the assets of our securitization VIEs are presented in the aggregate.

Fair Value Option

Fair Value Option

The guidance in ASC 825, Financial Instruments, provides a fair value option election that allows entities to make an irrevocable election of fair value as the initial and subsequent measurement attribute for certain eligible financial assets and liabilities. Unrealized gains and losses on items for which the fair value option has been elected are reported in earnings. The decision to elect the fair value option is determined on an instrument by instrument basis and must be applied to an entire instrument and is irrevocable once elected. Assets and liabilities measured at fair value pursuant to this guidance are required to be reported separately in our consolidated balance sheets from those instruments using another accounting method.

We have elected the fair value option for certain eligible financial assets and liabilities of our consolidated securitization VIEs, residential loans held-for-investment, loans held-for-sale originated or acquired for future securitization and purchased CMBS issued by VIEs we could consolidate in the future. The fair value elections for VIE and securitization related items were made in order to mitigate accounting mismatches between the carrying value of the instruments and the related assets and liabilities that we consolidate at fair value. The fair value elections for residential loans held-for-investment were made in order to maintain consistency across all our residential loans. The fair value elections for mortgage loans held-for-sale were made due to the expected short-term holding period of these instruments.

Fair Value Measurements

Fair Value Measurements

We measure our mortgage-backed securities, investments of consolidated affordable housing fund, derivative assets and liabilities, domestic servicing rights intangible asset and any assets or liabilities where we have elected the fair value option at fair value. When actively quoted observable prices are not available, we either use implied pricing from similar assets and liabilities or valuation models based on net present values of estimated future cash flows, adjusted as appropriate for liquidity, credit, market and/or other risk factors.

As discussed above, we measure the assets and liabilities of consolidated securitization VIEs at fair value pursuant to our election of the fair value option. The securitization VIEs in which we invest are “static”; that is, no reinvestment is permitted, and there is no active management of the underlying assets. In determining the fair value of the assets and liabilities of the securitization VIEs, we maximize the use of observable inputs over unobservable inputs. Refer to Note 20 for further discussion regarding our fair value measurements.

Valuation Process

We have valuation control processes in place to validate the fair value of the Company’s financial assets and liabilities measured at fair value including those derived from pricing models. These control processes are designed to assure that the values used for financial reporting are based on observable inputs wherever possible. In the event that observable inputs are not available, the control processes are designed to assure that the valuation approach utilized is appropriate and consistently applied and the assumptions are reasonable.

Pricing Verification—We use recently executed transactions, other observable market data such as exchange data, broker/dealer quotes, third party pricing vendors and aggregation services for validating the fair values generated using valuation models. Pricing data provided by approved external sources is evaluated using a number of approaches; for example, by corroborating the external sources’ prices to executed trades, analyzing the methodology and assumptions used by the external source to generate a price and/or by evaluating how active the third party pricing source (or originating sources used by the third party pricing source) is in the market.

Unobservable Inputs—Where inputs are not observable, we review the appropriateness of the proposed valuation methodology to ensure it is consistent with how a market participant would arrive at the unobservable input. The valuation methodologies utilized in the absence of observable inputs may include extrapolation techniques and the use of comparable observable inputs.

Any changes to the valuation methodology will be reviewed by our management to ensure the changes are appropriate. The methods used may produce a fair value calculation that is not indicative of net realizable value or reflective of future fair values. Furthermore, while we anticipate that our valuation methods are appropriate and consistent with other market participants, the use of different methodologies, or assumptions, to determine the fair value could result in a different estimate of fair value at the reporting date.

Fair Value on a Recurring Basis

We determine the fair value of our financial assets and liabilities measured at fair value on a recurring basis as follows:

Loans held-for-sale, commercial

We measure the fair value of our commercial mortgage loans held-for-sale using a discounted cash flow analysis unless observable market data (i.e., securitized pricing) is available. A discounted cash flow analysis requires management to make estimates regarding future interest rates and credit spreads. The most significant of these inputs relates to credit spreads and is unobservable. Thus, we have determined that the fair values of mortgage loans valued using a discounted cash flow analysis should be classified in Level III of the fair value hierarchy, while mortgage loans valued using securitized pricing should be classified in Level II of the fair value hierarchy. Mortgage loans classified in Level III are transferred to Level II if securitized pricing becomes available.

Loans held-for-sale and loans held-for-investment, residential

We measure the fair value of our residential loans held-for-sale and held-for-investment based on the net present value of expected future cash flows using a combination of observable and unobservable inputs. Observable market participant assumptions include pricing related to trades of residential loans with similar characteristics. Unobservable inputs include the expectation of future cash flows, which involves judgments about the underlying collateral, the creditworthiness of the borrower, estimated prepayment speeds, estimated future credit losses, forward interest rates, investor yield requirements and certain other factors. At each measurement date, we consider both the observable and unobservable valuation inputs in the determination of fair value. However, given the significance of the unobservable inputs, these loans have been classified within Level III.

RMBS

RMBS are valued utilizing observable and unobservable market inputs. The observable market inputs include recent transactions, broker quotes and vendor prices (“market data”). However, given the implied price dispersion amongst the market data, the fair value determination for RMBS has also utilized significant unobservable inputs in discounted cash flow models including prepayments, default and severity estimates based on the recent performance of the collateral, the underlying collateral characteristics, industry trends, as well as expectations of macroeconomic events (e.g., housing price curves, interest rate curves, etc.). At each measurement date, we consider both the observable and unobservable valuation inputs in the determination of fair value. However, given the significance of the unobservable inputs these securities have been classified within Level III.

CMBS

CMBS are valued utilizing both observable and unobservable market inputs. These factors include projected future cash flows, ratings, subordination levels, vintage, remaining lives, credit issues, recent trades of similar securities and the spreads used in the prior valuation. We obtain current market spread information where available and use this information in evaluating and validating the market price of all CMBS. Depending upon the significance of the fair value inputs used in determining these fair values, these securities are classified in either Level II or Level III of the fair value hierarchy. CMBS may shift between Level II and Level III of the fair value hierarchy if the significant fair value inputs used to price the CMBS become or cease to be observable.

Equity security

The equity security is publicly registered and traded in the U.S. and its market price is listed on the London Stock Exchange. The security has been classified within Level I.

Woodstar Fund Investments

The fair value of investments held by the Woodstar Fund is determined based on observable and unobservable market inputs. The initial fair value of the Woodstar Fund's investments at its November 5, 2021 establishment date was determined by reference to the purchase price paid by third party investors, which was consistent with both a recent external appraisal as well as our extensive marketing efforts to sell interests in the Woodstar Fund, plus working capital.

For the properties, the third party appraisal applied the income capitalization approach with corroborative support from the sales comparison approach. The cost approach was not employed, as it is typically not emphasized by potential investors in the multifamily affordable housing sector. The income capitalization approach estimates an income stream for a property over a 10-year period and discounts this income plus a reversion (presumed sale) into a present value at a risk adjusted discount rate. Terminal capitalization rates and discount rates utilized in this approach are derived from market transactions as well as other financial and industry data.

For secured financing, the third party appraisal discounted the contractual cash flows at the interest rate at which such arrangements would bear if executed in the current market. The fair value of investment level working capital is assumed to approximate carrying value due to its primarily short-term monetary nature. The fair value of interest rate derivatives is determined using the methodology described in the Derivatives discussion below.

Internal valuations at interim quarter ends are prepared by management. The valuation of properties is based on a direct income capitalization approach, whereby a direct capitalization market rate is applied to annualized in-place net operating income at the portfolio level. The direct capitalization rate is initially calibrated to the implied rate from the latest appraisal and

adjusted for subsequent changes in current market capitalization rates for sales of comparable multifamily properties. The valuations of secured financing agreements, working capital and interest rate derivatives are consistent with the methodologies described in the paragraph above.

Given the significance of the unobservable inputs used in the respective valuations, the Woodstar Fund’s investments have been classified within Level III of the fair value hierarchy.

Domestic servicing rights

The fair value of this intangible is determined using discounted cash flow modeling techniques which require management to make estimates regarding future net servicing cash flows, including forecasted loan defeasance, control migration, delinquency and anticipated maturity defaults which are calculated assuming a debt yield at which default occurs. Since the most significant of these inputs are unobservable, we have determined that the fair values of this intangible in its entirety should be classified in Level III of the fair value hierarchy.

Derivatives

The valuation of derivative contracts are determined using widely accepted valuation techniques including discounted cash flow analysis on the expected cash flows of each derivative. This analysis reflects the contractual terms of the derivatives, including the period to maturity, and uses observable market based inputs, including interest rate curves, spot and market forward points and implied volatilities. The fair values of interest rate swaps are determined using the market standard methodology of netting the discounted future fixed cash payments and the discounted expected variable cash receipts. The variable cash receipts are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curves.

We incorporate credit valuation adjustments to appropriately reflect both our own non-performance risk and the respective counterparty’s non-performance risk in the fair value measurements. In adjusting the fair value of our derivative contracts for the effect of non-performance risk, we have considered the impact of netting and any applicable credit enhancements, such as collateral postings, thresholds, mutual puts, and guarantees.

The valuation of over the counter derivatives are determined using discounted cash flows based on Overnight Index Swap (“OIS”) rates. Fully collateralized trades are discounted using OIS with no additional economic adjustments to arrive at fair value. Uncollateralized or partially collateralized trades are also discounted at OIS, but include appropriate economic adjustments for funding costs (i.e., a LIBOR OIS basis adjustment to approximate uncollateralized cost of funds) and credit risk. For credit instruments, fair value is determined based on changes in the relevant indices from the date of initiation of the instrument to the reporting date, as these changes determine the amount of any future cash settlement between us and the counterparty. These indices are considered Level II inputs as they are directly observable.

Although we have determined that the majority of the inputs used to value our derivatives fall within Level II of the fair value hierarchy, the credit valuation adjustments associated with our derivatives utilize Level III inputs, such as estimates of current credit spreads to evaluate the likelihood of default by us and our counterparties. However, as of June 30, 2022 and December 31, 2021, we have assessed the significance of the impact of the credit valuation adjustments on the overall valuation of our derivative positions and have determined that the credit valuation adjustments are not significant to the overall valuation of our derivatives. As a result, we have determined that our derivative valuations in their entirety are classified in Level II of the fair value hierarchy.

Liabilities of consolidated VIEs

Our consolidated VIE liabilities generally represent bonds that are not owned by us. The majority of these are either traded in the marketplace or can be analogized to similar securities that are traded in the marketplace. For these liabilities, pricing is considered to be Level II, where the valuation is based upon quoted prices for similar instruments traded in active markets. We generally utilize third party pricing service providers for valuing these liabilities. In order to determine whether to utilize the valuations provided by third parties, we conduct an ongoing evaluation of their valuation methodologies and processes, as well as a review of the individual valuations themselves. In evaluating third party pricing for reasonableness, we consider a variety of factors, including market transaction information for the particular bond, market transaction information for bonds within the same trust, market transaction information for similar bonds, the bond’s ratings and the bond’s subordination levels.

For the minority portion of our consolidated VIE liabilities which consist of unrated or non-investment grade bonds that are not owned by us, pricing may be either Level II or Level III. If independent third party pricing similar to that noted above is available, we consider the valuation to be Level II. If such third party pricing is not available, the valuation is generated from model-based techniques that use significant unobservable assumptions, and we consider the valuation to be Level III. For VIE liabilities classified as Level III, valuation is determined based on discounted expected future cash flows which take into consideration expected duration and yields based on market transaction information, ratings, subordination levels, vintage and current market spread. VIE liabilities may shift between Level II and Level III of the fair value hierarchy if the significant fair value inputs used to price the VIE liabilities become or cease to be observable.

Assets of consolidated VIEs

The securitization VIEs in which we invest are “static”; that is, no reinvestment is permitted, and there is no active management of the underlying assets. In determining the fair value of the assets of the VIE, we maximize the use of observable inputs over unobservable inputs. The individual assets of a VIE are inherently incapable of precise measurement given their illiquid nature and the limitations on available information related to these assets. Because our methodology for valuing these assets does not value the individual assets of a VIE, but rather uses the value of the VIE liabilities as an indicator of the fair value of VIE assets as a whole, we have determined that our valuations of VIE assets in their entirety should be classified in Level III of the fair value hierarchy.

Fair Value Only Disclosed

We determine the fair value of our financial instruments and assets where fair value is disclosed as follows:

Loans held-for-investment and loans held-for-sale

We estimate the fair values of our loans not carried at fair value on a recurring basis by discounting their expected cash flows at a rate we estimate would be demanded by the market participants that are most likely to buy our loans. The expected cash flows used are generally the same as those used to calculate our level yield income in the financial statements. Since these inputs are unobservable, we have determined that the fair value of these loans in their entirety would be classified in Level III of the fair value hierarchy.

HTM debt securities

We estimate the fair value of our mandatorily redeemable preferred equity interests in commercial real estate companies and infrastructure bonds using the same methodology described for our loans held-for-investment. We estimate the fair value of our HTM CMBS using the same methodology described for our CMBS carried at fair value on a recurring basis.

Secured financing agreements, CLOs and SASB

The fair value of the secured financing agreements, CLOs and SASB are determined by discounting the contractual cash flows at the interest rate we estimate such arrangements would bear if executed in the current market. We have determined that our valuation of these instruments should be classified in Level III of the fair value hierarchy.

Unsecured senior notes

The fair value of our unsecured senior notes is determined based on the last available bid price for the respective notes in the current market. As these prices represent observable market data, we have determined that the fair value of these instruments would be classified in Level II of the fair value hierarchy.

Loans Held-for-Investment

Loans Held-for-Investment

Loans that are held for investment (“HFI”) are carried at cost, net of unamortized acquisition premiums or discounts, loan fees and origination costs, as applicable, and net of credit loss allowances as discussed below, unless the loans are credit deteriorated or we have elected to apply the fair value option at purchase.

Loans Held-For-Sale

Loans Held-For-Sale

Our loans that we intend to sell or liquidate in the short-term are classified as held-for-sale and are carried at the lower of amortized cost or fair value, unless we have elected to apply the fair value option at origination or purchase.

Investment Securities

Investment Securities

We designate our debt investment securities as held-to-maturity (“HTM”), available-for-sale (“AFS”), or trading depending on our investment strategy and ability to hold such securities to maturity. HTM debt securities where we have not elected to apply the fair value option are stated at cost plus any premiums or discounts, which are amortized or accreted through the condensed consolidated statements of operations using the effective interest method. Debt securities we (i) do not hold for the purpose of selling in the near-term, or (ii) may dispose of prior to maturity, are classified as AFS and are carried at fair value in the accompanying financial statements. Unrealized gains or losses on AFS debt securities where we have not elected the fair value option are reported as a component of accumulated other comprehensive income (“AOCI”) in stockholders’ equity. Our HTM and AFS debt securities are also subject to credit loss allowances as discussed below.

Our only equity investment security is carried at fair value, with unrealized holding gains and losses recorded in earnings.

Credit Losses

Credit Losses

Loans and Debt Securities Measured at Amortized Cost

ASC 326, Financial Instruments – Credit Losses, became effective for the Company on January 1, 2020. ASC 326 mandates the use of a current expected credit loss model (“CECL”) for estimating future credit losses of certain financial instruments measured at amortized cost, instead of the “incurred loss” credit model previously required under GAAP. The CECL model requires the consideration of possible credit losses over the life of an instrument as opposed to only estimating credit losses upon the occurrence of a discrete loss event under the previous “incurred loss” methodology. The CECL model applies to our HFI loans and our HTM debt securities which are carried at amortized cost, including future funding commitments and accrued interest receivable related to those loans and securities. However, as permitted by ASC 326, we have elected not to measure an allowance for credit losses on accrued interest receivable (which is classified separately on our condensed consolidated balance sheets), but rather write off in a timely manner by reversing interest income and/or cease accruing interest that would likely be uncollectible.

As we do not have a history of realized credit losses on our HFI loans and HTM securities, we have subscribed to third party database services to provide us with historical industry losses for both commercial real estate and infrastructure loans. Using these losses as a benchmark, we determine expected credit losses for our loans and securities on a collective basis within our commercial real estate and infrastructure portfolios. See Note 4 for further discussion of our methodologies.

We also evaluate each loan and security measured at amortized cost for credit deterioration at least quarterly. Credit deterioration occurs when it is deemed probable that we will not be able to collect all amounts due according to the contractual terms of the loan or security. If a loan or security is considered to be credit deteriorated, we depart from the industry loss rate approach described above and determine the credit loss allowance as any excess of the amortized cost basis of the loan or security over (i) the present value of expected future cash flows discounted at the contractual effective interest rate or (ii) the fair value of the collateral, if repayment is expected solely from the collateral.

Available-for-Sale Debt Securities

Separate provisions of ASC 326 apply to our AFS debt securities, which are carried at fair value with unrealized gains and losses reported as a component of AOCI. We are required to establish an initial credit loss allowance for those securities that are purchased with credit deterioration (“PCD”) by grossing up the amortized cost basis of each security and providing an offsetting credit loss allowance for the difference between expected cash flows and contractual cash flows, both on a present value basis.

Subsequently, cumulative adverse changes in expected cash flows on our AFS debt securities are recognized currently as an increase to the allowance for credit losses. However, the allowance is limited to the amount by which the AFS debt security’s amortized cost exceeds its fair value. Favorable changes in expected cash flows are first recognized as a decrease to the allowance for credit losses (recognized currently in earnings). Such changes would be recognized as a prospective yield adjustment only when the allowance for credit losses is reduced to zero. A change in expected cash flows that is attributable solely to a change in a variable interest reference rate does not result in a credit loss and is accounted for as a prospective yield adjustment.

Revenue Recognition

Revenue Recognition

Interest Income

Interest income on performing loans and financial instruments is accrued based on the outstanding principal amount and contractual terms of the instrument. For loans where we do not elect the fair value option, origination fees and direct loan origination costs are also recognized in interest income over the loan term as a yield adjustment using the effective interest method. When we elect the fair value option, origination fees and direct loan costs are recorded directly in income and are not deferred. Discounts or premiums associated with the purchase of non-performing loans and investment securities are amortized or accreted into interest income as a yield adjustment on the effective interest method, based on expected cash flows through the expected maturity date of the investment. On at least a quarterly basis, we review and, if appropriate, make adjustments to our cash flow projections.

We cease accruing interest on non-performing loans at the earlier of (i) the loan becoming significantly past due or (ii) management concluding that a full recovery of all interest and principal is doubtful. Interest income on non-accrual loans in which management expects a full recovery of the loan’s outstanding principal balance is only recognized when received in cash. If a full recovery of principal is doubtful, the cost recovery method is applied whereby any cash received is applied to the outstanding principal balance of the loan. A non-accrual loan is returned to accrual status at such time as the loan becomes contractually current and management believes all future principal and interest will be received according to the contractual loan terms.

For loans acquired with deteriorated credit quality, interest income is only recognized to the extent that our estimate of undiscounted expected principal and interest exceeds our investment in the loan. Such excess, if any, is recognized as interest income on a level-yield basis over the life of the loan.

Upon the sale of loans or securities which are not accounted for pursuant to the fair value option, the excess (or deficiency) of net proceeds over the net carrying value of such loans or securities is recognized as a realized gain (loss).

Servicing Fees

We typically seek to be the special servicer on CMBS transactions in which we invest. When we are appointed to serve in this capacity, we earn special servicing fees from the related activities performed, which consist primarily of overseeing the workout of under-performing and non-performing loans underlying the CMBS transactions. These fees are recognized in income in the period in which the services are performed and the revenue recognition criteria have been met.

Rental Income

Rental income is recognized when earned from tenants. For leases that provide rent concessions or fixed escalations over the lease term, rental income is recognized on a straight-line basis over the noncancelable term of the lease. In net lease arrangements, costs reimbursable from tenants are recognized in rental income in the period in which the related expenses are incurred as we are generally the primary obligor with respect to purchasing goods and services for property operations. In instances where the tenant is responsible for property maintenance and repairs and contracts and settles such costs directly with third party service providers, we do not reflect those expenses in our consolidated statement of operations as the tenant is the primary obligor.

Foreign Currency Translation

Foreign Currency Translation

Our assets and liabilities denominated in foreign currencies are translated into U.S. dollars using foreign currency exchange rates at the end of the reporting period. Income and expenses are translated at the average exchange rates for each reporting period. The effects of translating the assets, liabilities and income of our foreign investments held by entities with a U.S. dollar functional currency are included in foreign currency gain (loss) in the consolidated statements of operations or other comprehensive income (“OCI”) for debt securities available-for-sale for which the fair value option has not been elected. The effects of translating the assets, liabilities and income of our foreign investments held by entities with functional currencies other than the U.S. dollar are included in OCI. Realized foreign currency gains and losses and changes in the value of foreign currency denominated monetary assets and liabilities are included in the determination of net income and are reported as foreign currency gain (loss) in our condensed consolidated statements of operations.

Earnings Per Share

Earnings Per Share

We present both basic and diluted earnings per share (“EPS”) amounts in our financial statements. Basic EPS excludes dilution and is computed by dividing income available to common stockholders by the weighted-average number of shares of common stock outstanding for the period. Diluted EPS reflects the maximum potential dilution that could occur from (i) our share-based compensation, consisting of unvested restricted stock awards (“RSAs”) and restricted stock units (“RSUs”), (ii) shares contingently issuable to our Manager, (iii) the conversion options associated with our senior convertible notes (the “Convertible Notes”) (see Notes 11 and 18) and (iv) non-controlling interests that are redeemable with our common stock (see Note 17). Potential dilutive shares are excluded from the calculation if they have an anti-dilutive effect in the period.

Nearly all of the Company’s unvested RSUs and RSAs contain rights to receive non-forfeitable dividends and thus are participating securities. In addition, the non-controlling interests that are redeemable with our common stock are considered participating securities because they earn a preferred return indexed to the dividend rate on our common stock (see Note 17). Due to the existence of these participating securities, the two-class method of computing EPS is required, unless another method is determined to be more dilutive. Under the two-class method, undistributed earnings are reallocated between shares of common stock and participating securities. For the three and six months ended June 30, 2022 and 2021, the two-class method resulted in the most dilutive EPS calculation.

Use of Estimates

Use of Estimates

The preparation of financial statements in conformity with GAAP requires us to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, as well as the reported amounts of revenues and expenses during the reporting periods. The most significant and subjective estimate that we make is the projection of cash flows we expect to receive on our investments, which has a significant impact on the amount of income that we record and/or disclose. The fair value of assets and liabilities that are estimated using a discounted cash flows method is significantly impacted by the rates at which we estimate market participants would discount the expected cash flows. In addition, the fair value of the Woodstar Fund’s investments are dependent upon the real estate and capital markets, which are cyclical in nature. Property and investment values are affected by, among other things, capitalization rates, the availability of capital, occupancy, rental rates and interest and inflation rates. Amounts ultimately realized from our investments may vary significantly from the fair values presented.

We believe the estimates and assumptions underlying our consolidated financial statements are reasonable and supportable based on the information available as of June 30, 2022. However, uncertainty over the ultimate impact the COVID-19 pandemic, including variants and resurgences, will have on the global economy generally, and our business in particular, makes any estimates and assumptions as of June 30, 2022 inherently less certain than they would be absent the current and potential impacts of COVID-19 and geopolitical events. Actual results may ultimately differ from those estimates.

Recent Accounting Developments

Recent Accounting Developments

On March 12, 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848) – Facilitation of the Effects of Reference Rate Reform on Financial Reporting, and on January 11, 2021, issued ASU 2021-01, Reference Rate Reform (Topic 848) – Scope, both of which provide optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions that reference LIBOR or other reference rates expected to be discontinued because of reference rate reform. These ASUs are effective through December 31, 2022. The Company has not adopted any of the optional expedients or exceptions through June 30, 2022, but will continue to evaluate the possible adoption of any such expedients or exceptions during the effective period as circumstances evolve.

On March 31, 2022, the FASB issued ASU 2022-2, Troubled Debt Restructurings and Vintage Disclosures (Topic 326). ASU 2022-2 eliminates the recognition and measurement guidance for troubled debt restructurings (“TDRs”) and, instead, requires that an entity evaluate (consistent with the accounting for other loan modifications) whether the modification represents a new loan or a continuation of an existing loan. The ASU also enhances existing disclosure requirements and introduces new requirements related to certain modifications of receivables made to borrowers experiencing financial difficulty. The ASU is effective for the Company beginning January 1, 2023 and is generally to be applied prospectively. Early adoption is permitted. We do not expect the application of this ASU to materially impact our consolidated financial statements as our operating practice is generally not to enter into TDRs for troubled loans.

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Loans (Tables)

6 Months Ended

Jun. 30, 2022

Receivables [Abstract]

Summary of Investments in Mortgages and Loans by Subordination Class

The following tables summarize our investments in mortgages and loans as of June 30, 2022 and December 31, 2021 (dollars in thousands):

June 30, 2022	Carrying Value		Face Amount		Weighted Average Coupon (1)		Weighted Average Life (“WAL”) (years)(2)
Loans held-for-investment:
Commercial loans:
First mortgages (3)	$	15,114,160	$	15,207,825	5.5	%	2.0
Subordinated mortgages (4)	69,413		70,729		11.2	%	2.3
Mezzanine loans (3)	433,730		431,475		10.3	%	1.2
Other	16,849		18,161		8.2	%	1.8
Total commercial loans	15,634,152		15,728,190
Infrastructure first priority loans	2,283,785		2,308,602		6.0	%	4.1
Residential loans, fair value option (5)	55,301		55,580		6.0	%	N/A	(6)
Total loans held-for-investment	17,973,238		18,092,372
Loans held-for-sale:
Residential, fair value option (5)	2,132,337		2,260,154		4.6	%	N/A	(6)
Commercial, $40,694 under fair value option (7)	104,310		108,356		4.2	%	7.6
Total loans held-for-sale	2,236,647		2,368,510
Total gross loans	20,209,885		$	20,460,882
Credit loss allowances:
Commercial loans held-for-investment	(56,671)
Infrastructure loans held-for-investment	(20,778)
Total allowances	(77,449)
Total net loans	$	20,132,436
December 31, 2021
Loans held-for-investment:
Commercial loans:
First mortgages (3)	$	12,991,099	$	13,067,524	4.5	%	1.9
Subordinated mortgages (4)	70,771		72,371		10.0	%	2.8
Mezzanine loans (3)	417,504		415,155		9.4	%	1.4
Other	17,424		19,029		8.2	%	2.1
Total commercial loans	13,496,798		13,574,079
Infrastructure first priority loans	2,048,096		2,071,912		4.4	%	4.3
Residential loans, fair value option	59,225		60,133		6.0	%	N/A	(6)
Total loans held-for-investment	15,604,119		15,706,124
Loans held-for-sale:
Residential, fair value option	2,590,005		2,525,910		4.2	%	N/A	(6)
Commercial, fair value option	286,795		289,761		4.0	%	9.0
Total loans held-for-sale	2,876,800		2,815,671
Total gross loans	18,480,919		$	18,521,795
Credit loss allowances:
Commercial loans held-for-investment	(46,600)
Infrastructure loans held-for-investment	(20,670)
Total allowances	(67,270)
Total net loans	$	18,413,649

______________________________________________________________________________________________________________________

(1)Calculated using applicable index rates as of June 30, 2022 and December 31, 2021 for variable rate loans and excludes loans for which interest income is not recognized.

(2)Represents the WAL of each respective group of loans, excluding loans for which interest income is not recognized, as of the respective balance sheet date. The WAL of each individual loan is calculated using amounts and timing of future principal payments, as projected at origination or acquisition.

(3)First mortgages include first mortgage loans and any contiguous mezzanine loan components because as a whole, the expected credit quality of these loans is more similar to that of a first mortgage loan.  The application of this methodology resulted in mezzanine loans with carrying values of $1.2 billion and $1.4 billion being classified as first mortgages as of June 30, 2022 and December 31, 2021, respectively.

(4)Subordinated mortgages include B-Notes and junior participation in first mortgages where we do not own the senior A-Note or senior participation. If we own both the A-Note and B-Note, we categorize the loan as a first mortgage loan.

(5)During the six months ended June 30, 2022, $0.3 million of residential loans held-for-investment were reclassified into loans held-for-sale.

(6)Residential loans have a weighted average remaining contractual life of 29.3 years and 29.4 years as of June 30, 2022 and December 31, 2021, respectively.

(7)During the six months ended June 30, 2022, $63.6 million of commercial loans held-for-investment were reclassified into loans held-for-sale.

Summary of Variable Rate Loans Held-for-Investment

As of June 30, 2022, our variable rate loans held-for-investment, excluding loans for which interest income is not recognized, were as follows (dollars in thousands):

June 30, 2022	Carrying Value		Weighted-average Spread Above Index
Commercial loans	$	14,941,518	4.0	%
Infrastructure loans	2,283,785		3.9	%
Total variable rate loans held-for-investment	$	17,225,303	4.0	%

Schedule of Risk Ratings by Class of Loan

The significant credit quality indicators for our loans measured at amortized cost, which excludes loans held-for-sale, were as follows as of June 30, 2022 (dollars in thousands):

	Term Loans Amortized Cost Basis by Origination Year												Revolving Loans Amortized Cost Total		Total Amortized Cost Basis		Credit Loss Allowance
As of June 30, 2022	2022		2021		2020		2019		2018		Prior
Commercial loans:
Credit quality indicator:
LTV < 60%	$	446,275	$	2,613,440	$	501,609	$	947,347	$	384,309	$	703,459	$	—	$	5,596,439	$	4,287
LTV 60% - 70%	2,318,864		4,151,281		246,709		1,104,966		457,469		68,379		—		8,347,668		15,849
LTV > 70%	99,746		321,271		247,756		422,725		312,890		263,883		—		1,668,271		31,610
Credit deteriorated	—		—		—		—		—		4,925		—		4,925		4,925
Defeased and other	—		—		—		—		—		16,849		—		16,849		—
Total commercial	$	2,864,885	$	7,085,992	$	996,074	$	2,475,038	$	1,154,668	$	1,057,495	$	—	$	15,634,152	$	56,671
Infrastructure loans:
Credit quality indicator:
Power	$	93,913	$	229,627	$	108,491	$	268,362	$	393,708	$	338,268	$	7,378	$	1,439,747	$	5,366
Oil and gas	—		346,373		40,670		287,062		84,692		50,004		1,949		810,750		5,291
Credit deteriorated	—		—		—		—		—		33,288		—		33,288		10,121
Total infrastructure	$	93,913	$	576,000	$	149,161	$	555,424	$	478,400	$	421,560	$	9,327	$	2,283,785	$	20,778
Residential loans held-for-investment, fair value option															55,301		—
Loans held-for-sale															2,236,647		—
Total gross loans															$	20,209,885	$	77,449

Schedule of Activity in Allowance for Loan Losses

The following tables present the activity in our credit loss allowance for funded loans and unfunded commitments (amounts in thousands):

	Funded Commitments Credit Loss Allowance
	Loans Held-for-Investment				Total Funded Loans
Six Months Ended June 30, 2022	Commercial		Infrastructure
Credit loss allowance at December 31, 2021	$	46,600	$	20,670	$	67,270
Credit loss provision, net	10,071		108		10,179
Credit loss allowance at June 30, 2022	$	56,671	$	20,778	$	77,449

	Unfunded Commitments Credit Loss Allowance (1)
	Loans Held-for-Investment				HTM Preferred
Six Months Ended June 30, 2022	Commercial		Infrastructure		Interests (2)		CMBS (2)		Total
Credit loss allowance at December 31, 2021	$	6,692	$	145	$	—	$	—	$	6,837
Credit loss (reversal) provision, net	(1,469)		(120)		248		47		(1,294)
Credit loss allowance at June 30, 2022	$	5,223	$	25	$	248	$	47	$	5,543
Memo: Unfunded commitments as of June 30, 2022 (3)	$	2,550,117	$	4,667	$	12,500	$	35,976	$	2,603,260

______________________________________________________________________________________________________________________

(1)Included in accounts payable, accrued expenses and other liabilities in our consolidated balance sheets.

(2)See Note 5 for further details.

(3)Represents amounts expected to be funded (see Note 22).

Schedule of Activity in Loan Portfolio

The activity in our loan portfolio was as follows (amounts in thousands):

	Held-for-Investment Loans
Six Months Ended June 30, 2022	Commercial		Infrastructure		Residential		Held-for-Sale Loans		Total Loans
Balance at December 31, 2021	$	13,450,198	$	2,027,426	$	59,225	$	2,876,800	$	18,413,649
Acquisitions/originations/additional funding	3,510,157		382,068		—		3,607,070		7,499,295
Capitalized interest (1)	54,414		242		—		147		54,803
Basis of loans sold (2)	(6,330)		—		—		(3,960,798)		(3,967,128)
Loan maturities/principal repayments	(1,034,439)		(148,225)		(4,207)		(110,642)		(1,297,513)
Discount accretion/premium amortization	26,525		4,344		—		—		30,869
Changes in fair value	—		—		629		(239,892)		(239,263)
Foreign currency translation gain/(loss), net	(299,206)		(2,740)		—		—		(301,946)
Credit loss provision, net	(10,071)		(108)		—		—		(10,179)
Transfer to/from other asset classifications or between segments	(113,767)		—		(346)		63,962		(50,151)		(3)
Balance at June 30, 2022	$	15,577,481	$	2,263,007	$	55,301	$	2,236,647	$	20,132,436

	Held-for-Investment Loans
Six Months Ended June 30, 2021	Commercial		Infrastructure		Residential		Held-for-Sale Loans		Total Loans
Balance at December 31, 2020	$	9,583,949	$	1,412,440	$	90,684	$	1,052,835	$	12,139,908
Acquisitions/originations/additional funding	3,713,142		288,904		—		1,367,574		5,369,620
Capitalized interest (1)	63,538		—		—		—		63,538
Basis of loans sold (2)	(207,975)		—		—		(1,502,588)		(1,710,563)
Loan maturities/principal repayments	(2,025,641)		(100,624)		(18,868)		(206,119)		(2,351,252)
Discount accretion/premium amortization	27,067		2,168		—		504		29,739
Changes in fair value	—		—		1,384		35,005		36,389
Foreign currency translation gain/(loss), net	1,987		(345)		—		—		1,642
Credit loss reversal (provision), net	11,381		(1,519)		—		—		9,862
Loan foreclosure and conversion to equity interest	(36,308)		—		—		—		(36,308)		(4)
Transfer to/from other asset classifications or between segments	(204,583)		93,085		69,506		214,466		172,474		(5)
Balance at June 30, 2021	$	10,926,557	$	1,694,109	$	142,706	$	961,677	$	13,725,049

______________________________________________________________________________________________________________________

(1)Represents accrued interest income on loans whose terms do not require current payment of interest.

(2)See Note 12 for additional disclosure on these transactions.

(3)Represents the net carrying value of first mortgage and contiguous mezzanine loans related to an office building in Texas that is eliminated as a result of consolidating the net assets of the mezzanine borrower entity upon obtaining control over its pledged equity interests in May 2022 (see discussion above).

(4)Includes (i) a $29.0 million credit deteriorated loan related to a residential conversion project which was foreclosed in April 2021 and (ii) $7.3 million of a commercial loan that was converted to equity interests in March 2021 (see Note 8) pursuant to a consensual transfer under pre-existing equity pledges of additional collateral.

(5)Net transfers represent residential loans transferred from VIE assets upon redemption of a consolidated RMBS trust.

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Investment Securities (Tables)

6 Months Ended

Jun. 30, 2022

Investments, Debt and Equity Securities [Abstract]

Schedule of Investment Securities

Investment securities were comprised of the following as of June 30, 2022 and December 31, 2021 (amounts in thousands):

	Carrying Value as of
	June 30, 2022		December 31, 2021
RMBS, available-for-sale	$	124,439	$	143,980
RMBS, fair value option (1)	416,057		250,424
CMBS, fair value option (1), (2)	1,307,440		1,263,606
HTM debt securities, amortized cost net of credit loss allowance of $4,505 and $8,610	757,763		683,136
Equity security, fair value	10,193		11,624
Subtotal—Investment securities	2,615,892		2,352,770
VIE eliminations (1)	(1,702,532)		(1,491,786)
Total investment securities	$	913,360	$	860,984

______________________________________________________________________________________________________________________

(1)Certain fair value option CMBS and RMBS are eliminated in consolidation against VIE liabilities pursuant to ASC 810.

(2)Includes $205.3 million and $182.6 million of non-controlling interests in the consolidated entities which hold certain of these CMBS as of June 30, 2022 and December 31, 2021, respectively.

Schedule of Purchases, Sales and Principal Collections for all Investment Securities

Purchases, sales, principal collections and redemptions for all investment securities were as follows (amounts in thousands):

	RMBS, available-for-sale		RMBS, fair value option		CMBS, fair value option		HTM Securities		Securitization VIEs (1)		Total
Three Months Ended June 30, 2022
Purchases/fundings	$	—	$	141,795	$	63,681	$	67,919	$	(205,476)	$	67,919
Sales	—		—		—		—		—		—
Principal collections	5,893		20,325		641		1,276		(20,739)		7,396
Three Months Ended June 30, 2021
Purchases	$	—	$	52,351	$	54,082	$	—	$	(106,433)	$	—
Sales	—		30,684		—				(30,684)		—
Principal collections	7,863		14,687		2,013		879		(16,089)		9,353
Redemptions	—		11,976		—		—		(11,976)		—

	RMBS, available-for-sale		RMBS, fair value option		CMBS, fair value option		HTM Securities		Securitization VIEs (1)		Total
Six Months Ended June 30, 2022
Purchases/fundings	$	—	$	226,152	$	63,681	$	86,058	$	(289,833)	$	86,058
Sales	—		—		—		—		—		—
Principal collections	12,788		41,929		1,276		1,940		(42,753)		15,180
Six Months Ended June 30, 2021
Purchases	$	—	$	79,684	$	54,082	$	—	$	(133,766)	$	—
Sales	—		30,684		11,604				(42,288)		—
Principal collections	15,114		28,031		3,723		52,569		(30,570)		68,867
Redemptions	—		11,976		—		—		(11,976)		—

______________________________________________________________________________________________________________________

(1)Represents RMBS and CMBS, fair value option amounts eliminated due to our consolidation of securitization VIEs. These amounts are reflected as issuance or repayment of debt of, or distributions from, consolidated VIEs in our consolidated statements of cash flows.

Summary of Investments in Available-for-Sale RMBS

The tables below summarize various attributes of our investments in available-for-sale RMBS as of June 30, 2022 and December 31, 2021 (amounts in thousands):

							Unrealized Gains or (Losses) Recognized in AOCI
	Amortized Cost		Credit Loss Allowance		Net Basis		Gross Unrealized Gains		Gross Unrealized Losses		Net Fair Value Adjustment		Fair Value
June 30, 2022
RMBS	$	95,469	$	—	$	95,469	$	29,278	$	(308)	$	28,970	$	124,439
December 31, 2021
RMBS	$	103,027	$	—	$	103,027	$	41,052	$	(99)	$	40,953	$	143,980

	Weighted Average Coupon (1)		WAL  (Years) (2)
June 30, 2022
RMBS	2.6	%	6.1

______________________________________________________________________________________________________________________

(1)Calculated using the June 30, 2022 one-month LIBOR rate of 1.787% for floating rate securities.

(2)Represents the remaining WAL of each respective group of securities as of the balance sheet date. The WAL of each individual security is calculated using projected amounts and projected timing of future principal payments.

Schedule of Gross Unrealized Losses and Estimated Fair Value of Securities With No Recorded Allowance for Credit Loss

The following table presents the gross unrealized losses and estimated fair value of any available-for-sale securities that were in an unrealized loss position as of June 30, 2022 and December 31, 2021, and for which an allowance for credit losses has not been recorded (amounts in thousands):

	Estimated Fair Value				Unrealized Losses
	Securities with a loss less than 12 months		Securities with a loss greater than 12 months		Securities with a loss less than 12 months		Securities with a loss greater than 12 months
As of June 30, 2022
RMBS	$	4,691	$	—	$	(308)	$	—
As of December 31, 2021
RMBS	$	2,478	$	—	$	(99)	$	—

Summary of Investments in HTM Securities

The table below summarizes our investments in HTM debt securities as of June 30, 2022 and December 31, 2021 (amounts in thousands):

	Amortized Cost Basis		Credit Loss Allowance		Net Carrying Amount		Gross Unrealized Holding Gains		Gross Unrealized Holding Losses		Fair Value
June 30, 2022
CMBS	$	571,959	$	(1,169)	$	570,790	$	198	$	(31,239)	$	539,749
Preferred interests	119,899		(262)		119,637		125		(5,851)		113,911
Infrastructure bonds	70,410		(3,074)		67,336		604		(959)		66,981
Total	$	762,268	$	(4,505)	$	757,763	$	927	$	(38,049)	$	720,641
December 31, 2021
CMBS	$	538,506	$	(3,140)	$	535,366	$	195	$	(25,029)	$	510,532
Preferred interests	118,409		(2,562)		115,847		450		(2,449)		113,848
Infrastructure bonds	34,831		(2,908)		31,923		561		—		32,484
Total	$	691,746	$	(8,610)	$	683,136	$	1,206	$	(27,478)	$	656,864

Summary of Activity in Credit Loss Allowance for HTM Debt Securities

The following table presents the activity in our credit loss allowance for HTM debt securities (amounts in thousands):

	CMBS		Preferred Interests		Infrastructure Bonds		Total HTM Credit Loss Allowance
Six Months Ended June 30, 2022
Credit loss allowance at December 31, 2021	$	3,140	$	2,562	$	2,908	$	8,610
Credit loss (reversal) provision, net	(1,971)		(2,300)		166		(4,105)
Credit loss allowance at June 30, 2022	$	1,169	$	262	$	3,074	$	4,505

Summary of Maturities of Preferred Equity Interests in Limited Liability Companies

The table below summarizes the maturities of our HTM debt securities by type as of June 30, 2022 (amounts in thousands):

	CMBS		Preferred Interests		Infrastructure Bonds		Total
Less than one year	$	314,026	$	91,368	$	—	$	405,394
One to three years	24,382		28,269		—		52,651
Three to five years	232,382		—		37,906		270,288
Thereafter	—		—		29,430		29,430
Total	$	570,790	$	119,637	$	67,336	$	757,763

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Properties (Tables)

6 Months Ended

Jun. 30, 2022

Real Estate [Abstract]

Summary of Properties

The table below summarizes our properties held as of June 30, 2022 and December 31, 2021 (dollars in thousands):

	Depreciable Life	June 30, 2022		December 31, 2021
Property Segment
Land and land improvements	0 - 15 years	$	175,836	$	175,810
Buildings and building improvements	0 - 45 years	851,919		851,274
Furniture & fixtures	3 - 5 years	288		260
Investing and Servicing Segment
Land and land improvements	0 - 15 years	36,910		41,771
Buildings and building improvements	3 - 40 years	133,748		149,399
Furniture & fixtures	2 - 5 years	3,181		3,143
Commercial and Residential Lending Segment (1)
Land and land improvements	N/A	33,681		9,691
Buildings and building improvements	0 - 24 years	77,941		12,408
Construction in progress	N/A	104,184		104,088
Properties, cost		1,417,688		1,347,844
Less: accumulated depreciation		(191,709)		(181,457)
Properties, net		$	1,225,979	$	1,166,387

______________________________________________________________________________________________________________________

(1)Represents properties acquired through loan foreclosure or exercise of control over a mezzanine loan borrower’s pledged equity interests.

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Investments of Consolidated Affordable Housing Fund (Tables)

6 Months Ended

Jun. 30, 2022

Equity Method Investments and Joint Ventures [Abstract]

Summary of Investment Income

Income from the Woodstar Fund’s investments reflects the following components for the three and six months ended June 30, 2022 (in thousands):

	For the Three Months Ended June 30, 2022		For the Six Months Ended June 30, 2022
Distributions from affordable housing fund investments	$	12,475	$	22,665
Unrealized change in fair value of investments	294,690		518,541
Income from affordable housing fund investments	$	307,165	$	541,206

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Investment in Unconsolidated Entities (Tables)

6 Months Ended

Jun. 30, 2022

Equity Method Investments and Joint Ventures [Abstract]

Summary of Investments in Unconsolidated Entities

The table below summarizes our investments in unconsolidated entities as of June 30, 2022 and December 31, 2021 (dollars in thousands):

	Participation / Ownership % (1)	Carrying value as of
		June 30, 2022		December 31, 2021
Equity method investments:
Equity interest in a natural gas power plant	10%	$	26,994	$	26,255
Investor entity which owns equity in an online real estate company	50%	5,288		5,206
Equity interest in and advances to a residential mortgage originator (2)	N/A	15,920		20,327
Various	25% - 50%	14,317		12,528
		62,519		64,316
Other equity investments:
Equity interest in a servicing and advisory business	2%	12,955		12,955
Investment funds which own equity in a loan servicer and other real estate assets (3)	4% - 6%	940		4,194
Investor entities which own equity interests in two entertainment and retail centers (4)	15%	7,320		7,320
Various	1% - 3%	1,776		1,312
		22,991		25,781
		$	85,510	$	90,097

______________________________________________________________________________________________________________________

(1)None of these investments are publicly traded and therefore quoted market prices are not available.

(2)Included a $4.5 million subordinated loan as of both June 30, 2022 and December 31, 2021.

(3)During the three and six months ended June 30, 2022, we received distributions of $7.3 million, of which $3.3 million were considered returns of capital which reduced the carrying value of two of our investments.

(4)In March 2021, we obtained equity interests in two investor entities that own interests in two entertainment and retail centers in satisfaction of $7.3 million principal amount of a commercial loan. The interests were obtained in order to facilitate repayment of a portion of that loan for which these interests represented underlying collateral. The interests are entitled to preferred treatment in the distribution waterfall and are intended to repay us the $7.3 million principal amount of the loan plus interest. See further discussion in Note 4.

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Goodwill and Intangibles (Tables)

6 Months Ended

Jun. 30, 2022

Goodwill and Intangible Assets Disclosure [Abstract]

Summary of Intangibles Assets

The following table summarizes our intangible assets, which are comprised of servicing rights intangibles and lease intangibles, as of June 30, 2022 and December 31, 2021 (amounts in thousands):

	As of June 30, 2022						As of December 31, 2021
	Gross Carrying Value		Accumulated Amortization		Net Carrying Value		Gross Carrying Value		Accumulated Amortization		Net Carrying Value
Domestic servicing rights, at fair value	$	17,499	$	—	$	17,499	$	16,780	$	—	$	16,780
In-place lease intangible assets	100,797		(60,874)		39,923		94,712		(62,721)		31,991
Favorable lease intangible assets	26,762		(9,220)		17,542		23,746		(8,953)		14,793
Total net intangible assets	$	145,058	$	(70,094)	$	74,964	$	135,238	$	(71,674)	$	63,564

Summary of Activity Within Intangible Assets

The following table summarizes the activity within intangible assets for the six months ended June 30, 2022 (amounts in thousands):

	Domestic Servicing Rights		In-place Lease Intangible Assets		Favorable Lease Intangible Assets		Total
Balance as of January 1, 2022	$	16,780	$	31,991	$	14,793	$	63,564
Acquisition (1)	—		11,910		3,520		15,430
Amortization	—		(3,434)		(729)		(4,163)
Impairment (2)	—		(43)		(4)		(47)
Sales	—		(501)		(38)		(539)
Changes in fair value due to changes in inputs and assumptions	719		—		—		719
Balance as of June 30, 2022	$	17,499	$	39,923	$	17,542	$	74,964

_________________________________________________

(1)    Represents lease intangibles related to an office building in Texas that are consolidated upon exercising control over a mezzanine loan borrower’s pledged equity interests in May 2022 (see Note 4).

(2)     Impairment of intangible lease assets is recognized within other expense in our condensed consolidated statement of operations.

Schedule of Future Amortization Expense

The following table sets forth the estimated aggregate amortization of our in-place lease intangible assets and favorable lease intangible assets for the next five years and thereafter (amounts in thousands):

2022 (remainder of)	$	4,760
2023	8,639
2024	6,941
2025	5,827
2026	4,301
Thereafter	26,997
Total	$	57,465

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Secured Borrowings (Tables)

6 Months Ended

Jun. 30, 2022

Secured Debt [Abstract]

Summary of Secured Financing Agreements

The following table is a summary of our secured financing agreements in place as of June 30, 2022 and December 31, 2021 (dollars in thousands):

													Outstanding Balance at
	Current Maturity		Extended Maturity (a)		Weighted Average Pricing		Pledged Asset Carrying Value			Maximum Facility Size			June 30, 2022			December 31, 2021
Repurchase Agreements:
Commercial Loans	Aug 2022 to Jun 2027	(b)	Jun 2025 to Dec 2030	(b)	Index + 2.03%	(c)	$	10,771,843		$	12,407,967	(d)	$	7,828,681		$	6,556,438
Residential Loans	May 2023 to Dec 2023		May 2023 to Dec 2024		Index + 2.11%		1,697,635			2,502,636			1,405,200			1,744,225
Infrastructure Loans	Sep 2024		Sep 2026		Index + 2.01%		350,599			650,000			293,673			379,095
Conduit Loans	Feb 2023 to Jun 2024		Feb 2024 to Jun 2025		Index + 2.28%		40,694			650,000			30,923			174,130
CMBS/RMBS	Mar 2023 to Apr 2032	(e)	Jun 2023 to Oct 2032	(e)	(f)		1,458,270			876,651			757,173		(g)	688,146
Total Repurchase Agreements							14,319,041			17,087,254			10,315,650			9,542,034
Other Secured Financing:
Borrowing Base Facility	Nov 2024		Oct 2026		SOFR + 2.11%		8,786			750,000		(h)	6,613			213,478
Commercial Financing Facilities	Dec 2023 to Jan 2025		Jan 2027 to Dec 2030		Index + 1.73%		299,352			445,005		(i)	234,948			167,476
Residential Financing Facility	Mar 2024		Mar 2027		SOFR + 2.45%		489,474			500,000			142,418			102,018
Infrastructure Financing Facilities	Oct 2022 to Jul 2025		Oct 2024 to Jul 2032		Index + 2.04%		915,824			1,750,000			737,326			855,646
Property Mortgages - Fixed rate	Nov 2024 to Sep 2029	(j)	N/A		4.48%		384,284			275,993			275,993			272,522
Property Mortgages - Variable rate	Nov 2022 to Dec 2025		N/A		(k)		775,534			742,650			730,336			712,493
Term Loan and Revolver	(l)		N/A		(l)		N/A		(l)	934,759			784,759			788,753
Total Other Secured Financing							2,873,254			5,398,407			2,912,393			3,112,386
							$	17,192,295		$	22,485,661		13,228,043			12,654,420
Unamortized net discount													(13,813)			(13,350)
Unamortized deferred financing costs													(66,783)			(64,220)
													$	13,147,447		$	12,576,850

______________________________________________________________________________________________________________________

(a)Subject to certain conditions as defined in the respective facility agreement.

(b)For certain facilities, borrowings collateralized by loans existing at maturity may remain outstanding until such loan collateral matures, subject to certain specified conditions.

(c)Certain facilities with an outstanding balance of $2.9 billion as of June 30, 2022 are indexed to GBP LIBOR, EURIBOR, BBSY, SARON and SONIA. The remainder are indexed to USD LIBOR or SOFR.

(d)Certain facilities with an aggregate initial maximum facility size of $11.5 billion may be increased to $12.4 billion, subject to certain conditions. The $12.4 billion amount includes such upsizes.

(e)Certain facilities with an outstanding balance of $332.6 million as of June 30, 2022 carry a rolling 11-month or 12-month term which may reset monthly or quarterly with the lender’s consent. These facilities carry no maximum facility size.

(f)A facility with an outstanding balance of $265.7 million as of June 30, 2022 has a weighted average fixed annual interest rate of 3.27%. All other facilities are variable rate with a weighted average rate of Index + 1.94%.

(g)Includes: (i) $265.7 million outstanding on a repurchase facility that is not subject to margin calls; and (ii) $43.3 million outstanding on one of our repurchase facilities that represents the 49% pro rata share owed by a non-controlling partner in a consolidated joint venture (see Note 15).

(h)The maximum facility size as of June 30, 2022 of $650.0 million is scheduled to decline to $450.0 million as of December 31, 2022 and may be increased to $750.0 million, subject to certain conditions.

(i)Certain facilities with an aggregate initial maximum facility size of $345.0 million may be increased to $445.0 million, subject to certain conditions. The $445.0 million amount includes such upsizes.

(j)The weighted average maturity is 5.0 years as of June 30, 2022.

(k)Includes a $600.0 million first mortgage and mezzanine loan secured by our Medical Office Portfolio. This debt has a weighted average interest rate of LIBOR + 2.07% that we swapped to a fixed rate of 3.34%. The remainder have a weighted average rate of Index + 2.28%.

(l)Consists of: (i) a $784.8 million term loan facility that matures in July 2026, of which $389.0 million has an annual interest rate of LIBOR + 2.50% and $395.8 million has an annual interest rate of LIBOR + 3.25%, subject to a 0.75% LIBOR floor, and (ii) a $150.0 million revolving credit facility that matures in April 2026 with an annual interest rate of SOFR + 2.50%. These facilities are secured by the equity interests in certain of our subsidiaries which totaled $5.0 billion as of June 30, 2022.

Schedule of Collateralized Loan Obligations

The following table is a summary of our CLOs and our SASB as of June 30, 2022 and December 31, 2021 (amounts in thousands):

June 30, 2022	Count	Face Amount		Carrying Value		Weighted Average Spread		Maturity
STWD 2022-FL3
Collateral assets	24	$	1,000,000	$	1,010,536	Index + 3.58%	(a)	January 2026	(b)
Financing	1	842,500		843,681		SOFR + 1.91%	(c)	November 2038	(d)
STWD 2021-HTS
Collateral assets	1	230,000		230,713		LIBOR + 3.85%	(a)	April 2026	(b)
Financing	1	210,091		208,509		LIBOR + 2.69%	(c)	April 2034	(d)
STWD 2021-FL2
Collateral assets	24	1,275,275		1,281,127		Index + 4.09%	(a)	April 2025	(b)
Financing	1	1,077,375		1,071,047		LIBOR + 1.78%	(c)	April 2038	(d)
STWD 2019-FL1
Collateral assets	18	993,774		996,268		LIBOR + 3.82%	(a)	January 2025	(b)
Financing	1	830,149		828,071		SOFR + 1.65%	(c)	July 2038	(d)
STWD 2021-SIF2
Collateral assets	32	494,789		510,807		LIBOR + 3.71%	(a)	January 2027	(b)
Financing	1	410,000		406,807		SOFR + 2.11%	(c)	January 2033	(d)
STWD 2021-SIF1
Collateral assets	31	496,249		507,465		Index + 3.87%	(a)	July 2026	(b)
Financing	1	410,000		406,036		LIBOR + 2.15%	(c)	April 2032	(d)
Total
Collateral assets		$	4,490,087	$	4,536,916
Financing		$	3,780,115	$	3,764,151

December 31, 2021	Count	Face Amount		Carrying Value		Weighted Average Spread		Maturity
STWD 2021-HTS
Collateral assets	1	$	230,000	$	230,587	LIBOR + 4.12%	(a)	April 2026	(b)
Financing	1	210,091		208,057		LIBOR + 2.48%	(c)	April 2034	(d)
STWD 2021-FL2
Collateral assets	25	1,272,133		1,279,678		LIBOR + 4.22%	(a)	February 2025	(b)
Financing	1	1,077,375		1,069,691		LIBOR + 1.78%	(c)	April 2038	(d)
STWD 2019-FL1
Collateral assets	24	1,092,887		1,103,513		LIBOR + 4.19%	(a)	November 2024	(b)
Financing	1	936,375		933,049		SOFR + 1.63%	(c)	July 2038	(d)
STWD 2021-SIF1
Collateral assets	31	491,299		506,666		LIBOR + 3.91%	(a)	March 2026	(b)
Financing	1	410,000		405,319		LIBOR + 2.15%	(c)	April 2032	(d)
Total
Collateral assets		$	3,086,319	$	3,120,444
Financing		$	2,633,841	$	2,616,116

______________________________________________________________________________________________________________________________

(a)Represents the weighted-average coupon earned on variable rate loans during the respective year-to-date period. Of the loans financed by the STWD 2021-FL2 CLO as of June 30, 2022, 7% earned fixed-rate weighted average interest of 7.44%. Of the investments financed by the STWD 2021-SIF2 CLO as of June 30, 2022, 5% earned fixed-rate weighted average interest of 7.75%. Of the investments financed by the STWD 2021-SIF1 CLO as of June 30, 2022, 3% earned fixed-rate weighted average interest of 5.95%.

(b)Represents the weighted-average maturity, assuming the extended contractual maturity of the collateral assets.

(c)Represents the weighted-average cost of financing incurred during the respective year-to-date period, inclusive of deferred issuance costs.

(d)Repayments of the CLOs and SASB are tied to timing of the related collateral asset repayments. The term of the CLOs and SASB financing obligations represents the legal final maturity date.

Schedule of Five-Year Principal Repayments for Secured Financings

The following table sets forth our principal repayments schedule for secured financings based on the earlier of (i) the extended contractual maturity of each credit facility or (ii) the extended contractual maturity of each of the investments that have been pledged as collateral under the respective credit facility (amounts in thousands):

	Repurchase Agreements		Other Secured Financing		CLOs and SASB (a)		Total
2022 (remainder of)	$	258,961	$	24,259	$	143,428	$	426,648
2023	2,120,093		736,558		652,016		3,508,667
2024	1,097,580		235,871		434,434		1,767,885
2025	2,742,149		246,581		678,448		3,667,178
2026	1,797,262		974,237		1,732,148		4,503,647
Thereafter	2,299,605		694,887		139,641		3,134,133
Total	$	10,315,650	$	2,912,393	$	3,780,115	$	17,008,158

______________________________________________________________________________________________________________________

(a)For the CLOs, the above does not assume utilization of their reinvestment features. The SASB does not have a reinvestment feature.

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Unsecured Senior Notes (Tables)

6 Months Ended

Jun. 30, 2022

Debt Instruments [Abstract]

Schedule of Unsecured Convertible Senior Notes Outstanding

The following table is a summary of our unsecured senior notes outstanding as of June 30, 2022 and December 31, 2021 (dollars in thousands):

	Coupon Rate			Effective Rate (1)		Maturity Date	Remaining Period of Amortization	Carrying Value at
								June 30, 2022		December 31, 2021
2023 Senior Notes	5.50	%		5.71	%	11/1/2023	1.3 years	300,000		300,000
2023 Convertible Notes	4.38	%		4.57	%	4/1/2023	0.8 years	250,000		250,000
2024 Senior Notes	3.75	%		3.94	%	12/31/2024	2.5 years	400,000		400,000
2025 Senior Notes	4.75	%	(2)	5.04	%	3/15/2025	2.7 years	500,000		500,000
2026 Senior Notes	3.63	%		3.77	%	7/15/2026	4.0 years	400,000		400,000
2027 Senior Notes	4.38	%	(3)	4.49	%	1/15/2027	4.6 years	500,000		—
Total principal amount								2,350,000		1,850,000
Unamortized discount—Convertible Notes								(351)		(578)
Unamortized discount—Senior Notes								(10,847)		(10,067)
Unamortized deferred financing costs								(14,030)		(10,765)
Total carrying amount								$	2,324,772	$	1,828,590

______________________________________________________________________________________________________________________

(1)Effective rate includes the effects of underwriter purchase discount.

(2)The coupon on the 2025 Senior Notes is 4.75%.  At closing, we swapped $470.0 million of the notes to a floating rate of LIBOR + 2.53%.

(3)The coupon on the 2027 Senior Notes is 4.375%.  At closing, we swapped the notes to a floating rate of SOFR + 2.95%.

Schedule of Conversion Attributes on Convertible Notes Outstanding

The following table details the conversion attributes of our Convertible Notes outstanding as of June 30, 2022 (amounts in thousands, except rates):

	June 30, 2022
	Conversion	Conversion
	Rate (1)	Price (2)
2023 Convertible Notes	38.5959	$	25.91

______________________________________________________________________________________________________________________

(1)The conversion rate represents the number of shares of common stock issuable per $1,000 principal amount of 2023 Convertible Notes converted, as adjusted in accordance with the indenture governing the 2023 Convertible Notes (including the applicable supplemental indenture).

(2)As of June 30, 2022, the market price of the Company’s common stock was $20.89.

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Loan Securitization/Sale Activities (Tables)

6 Months Ended

Jun. 30, 2022

Loan Securitization/Sale Activities

Summary of Face Amount and Proceeds of Loans

The following summarizes the face amount and proceeds of commercial and residential loans securitized for the three and six months ended June 30, 2022 and 2021 (amounts in thousands):

	Commercial Loans				Residential Loans
	Face Amount		Proceeds		Face Amount		Proceeds
For the Three Months Ended June 30,
2022	$	658,447	$	649,730	$	827,871	$	813,175
2021	304,604		321,377		564,429		583,877
For the Six Months Ended June 30,
2022	$	1,005,889	$	991,797	$	1,905,829	$	1,913,459
2021	389,641		411,087		947,978		973,675

Summary of Loans Sold

The following table summarizes our loans sold by the Commercial and Residential Lending Segment, net of expenses (amounts in thousands):

	Loan Transfers Accounted for as Sales
	Commercial Loans				Residential Loans
	Face amount (1)		Proceeds (1)		Face Amount (2)		Proceeds (2)
For the Three Months Ended June 30,
2022	$	6,980	$	6,469	$	220,101	$	219,426
2021	232,670		229,490		383		398
For the Six Months Ended June 30,
2022	$	6,980	$	6,469	$	1,055,861	$	1,055,542
2021	232,670		229,490		89,801		92,817

______________________________________________________________________________________________________________________

(1)During both the three and six months ended June 30, 2022, we sold $7.0 million of senior interests in a first mortgage loan for proceeds of $6.5 million. During both the three and six months ended June 30, 2021, we sold $210.1 million of senior interests in first mortgage loans and $22.6 million of whole loan interests for proceeds of $208.0 million and $21.5 million, respectively.

(2)In February 2022, we sold $745.0 million of agency-eligible residential loans at face amount which was subject to a post-closing contingent sales price adjustment based on the gain or loss to the purchaser/securitization underwriter, less underwriting costs, if those loans were sold into a future securitization. Given spread widening which occurred in the residential markets during the three months ended June 30, 2022, we estimated the amount of this contingency to be $32.7 million at June 30, 2022 based on the probability and timing of executing a disposition strategy on these loans and the amount at which such a disposition could be executed. In June 2022, in lieu of the buyer executing a securitization or sale of the loans, we entered into a forward settlement agreement to acquire $729.1 million of these loans at par. The loan purchase is subject to a financing contingency, whereby the seller is to provide us financing under a mutually agreed repurchase agreement within 120 days. If such mutually agreed financing is not completed, we are not obligated to complete the forward settlement, and the previous post-closing contingency referenced above would be reinstated.

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Derivatives and Hedging Activity (Tables)

6 Months Ended

Jun. 30, 2022

Derivative Instruments and Hedging Activities Disclosure [Abstract]

Summary of Non-Designated Derivatives

The following table summarizes our non-designated derivatives as of June 30, 2022 (notional amounts in thousands):

Type of Derivative	Number of Contracts	Aggregate Notional Amount	Notional Currency	Maturity
Fx contracts – Buy Euros ("EUR")	20	43,684	EUR	July 2022 - June 2023
Fx contracts – Buy Pounds Sterling ("GBP")	8	9,772	GBP	July 2022 - October 2024
Fx contracts – Buy Australian dollar ("AUD")	5	8,915	AUD	July 2022 - August 2023
Fx contracts – Buy Swiss Franc ("CHF")	1	29,400	CHF	July 2022
Fx contracts – Sell EUR	225	616,996	EUR	July 2022 - April 2026
Fx contracts – Sell GBP	196	575,781	GBP	July 2022 - April 2027
Fx contracts – Sell AUD	93	640,709	AUD	July 2022 - January 2026
Fx contracts – Sell CHF	1	38,449	CHF	July 2022
Interest rate swaps – Paying fixed rates	32	3,061,834	USD	April 2024 - June 2032
Interest rate swaps – Receiving fixed rates	2	970,000	USD	March 2025 - January 2027
Interest rate caps	5	633,900	USD	November 2022 - April 2025
Interest rate caps	1	61,000	GBP	April 2024
Credit instruments	3	49,000	USD	September 2058 - August 2061
Interest rate swap guarantees	4	271,363	USD	August 2022 - June 2025
Total	596

Schedule of Fair Value of Derivatives

The table below presents the fair value of our derivative financial instruments as well as their classification on the condensed consolidated balance sheets as of June 30, 2022 and December 31, 2021 (amounts in thousands):

	Fair Value of Derivatives in an Asset Position (1) as of				Fair Value of Derivatives in a Liability Position (2) as of
	June 30, 2022		December 31, 2021		June 30, 2022		December 31, 2021
Interest rate contracts	$	7,487	$	17,728	$	49,642	$	16
Interest rate swap guarantees	—		—		—		260
Foreign exchange contracts	120,637		30,478		5,495		12,870
Credit instruments	603		10		—		275
Total derivatives	$	128,727	$	48,216	$	55,137	$	13,421

___________________________________________________

(1)Classified as derivative assets in our condensed consolidated balance sheets.

(2)Classified as derivative liabilities in our condensed consolidated balance sheets.

Schedule of Effect of Derivative Financial Instruments

The table below presents the effect of our derivative financial instruments on the condensed consolidated statements of operations for the three and six months ended June 30, 2022 and 2021 (amounts in thousands):

Derivatives Not Designated as Hedging Instruments	Location of Gain (Loss) Recognized in Income	Amount of Gain (Loss) Recognized in Income for the Three Months Ended June 30,				Amount of Gain (Loss) Recognized in Income for the Six Months Ended June 30,
		2022		2021		2022		2021
Interest rate contracts	Gain (loss) on derivative financial instruments	$	37,257	$	(7,344)	$	140,190	$	12,814
Interest rate swap guarantees	Gain (loss) on derivative financial instruments	100		145		259		496
Foreign exchange contracts	Gain (loss) on derivative financial instruments	90,543		(2,540)		114,685		11,061
Credit instruments	Gain (loss) on derivative financial instruments	683		(270)		717		(391)
		$	128,583	$	(10,009)	$	255,851	$	23,980

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Offsetting Assets and Liabilities (Tables)

6 Months Ended

Jun. 30, 2022

Offsetting [Abstract]

Schedule of Offsetting Assets and Liabilities

The following tables present the potential effects of netting arrangements on our financial position for financial assets and liabilities within the scope of ASC 210-20, Balance Sheet—Offsetting, which for us are derivative assets and liabilities as well as repurchase agreement liabilities (amounts in thousands):

			(ii)   Gross Amounts Offset in the Statement of Financial Position		(iii) = (i) - (ii) Net Amounts Presented in the Statement of Financial Position		(iv) Gross Amounts Not Offset in the Statement of Financial Position
	(i) Gross Amounts Recognized						Financial Instruments		Cash Collateral Received / Pledged		(v) = (iii) - (iv) Net Amount
As of June 30, 2022
Derivative assets	$	128,727	$	—	$	128,727	$	52,137	$	—	$	76,590
Derivative liabilities	$	55,137	$	—	$	55,137	$	52,137	$	3,000	$	—
Repurchase agreements	10,315,650		—		10,315,650		10,315,650		—		—
	$	10,370,787	$	—	$	10,370,787	$	10,367,787	$	3,000	$	—
As of December 31, 2021
Derivative assets	$	48,216	$	—	$	48,216	$	12,870	$	21,290	$	14,056
Derivative liabilities	$	13,421	$	—	$	13,421	$	12,870	$	291	$	260
Repurchase agreements	9,542,034		—		9,542,034		9,542,034		—		—
	$	9,555,455	$	—	$	9,555,455	$	9,554,904	$	291	$	260

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Variable Interest Entities (Tables)

6 Months Ended

Jun. 30, 2022

Variable Interest Entities

Summary of Assets and Liabilities of Our Consolidated CLO

The following table details the assets and liabilities of our consolidated CLOs and SASB as of June 30, 2022 and December 31, 2021 (amounts in thousands):

	June 30, 2022		December 31, 2021
Assets:
Cash and cash equivalents	$	28,169	$	15,297
Loans held-for-investment	4,458,435		3,073,572
Investment securities	37,427		11,426
Accrued interest receivable	12,424		8,936
Other assets	461		11,213
Total Assets	$	4,536,916	$	3,120,444
Liabilities
Accounts payable, accrued expenses and other liabilities	$	10,813	$	3,335
Collateralized loan obligations and single asset securitization, net	3,764,151		2,616,116
Total Liabilities	$	3,774,964	$	2,619,451

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Stockholders' Equity and Non-Controlling Interests (Tables)

6 Months Ended

Jun. 30, 2022

Stockholders' Equity Note [Abstract]

Schedule of Dividends Declared by Board of Directors

During the six months ended June 30, 2022, our board of directors declared the following dividends:

Declaration Date	Record Date	Ex-Dividend Date	Payment Date	Amount		Frequency
6/15/22	6/30/22	6/29/22	7/15/22	$	0.48	Quarterly
3/14/22	3/31/22	3/30/22	4/15/22	0.48		Quarterly

Summary of Share Awards Granted Under the Manager Equity Plan

The table below summarizes our share awards granted or vested under the 2017 Manager Equity Plan (none under the 2022 Manager Equity Plan) during the six months ended June 30, 2022 and 2021 (dollar amounts in thousands):

Grant Date	Type	Amount Granted	Grant Date Fair Value		Vesting Period
November 2020	RSU	1,800,000	$	30,078	3 years
September 2019	RSU	1,200,000	29,484		(1)
April 2018	RSU	775,000	16,329		3 years

______________________________________________________________________________________________________________________

(1)Of the amount granted, 218,898 vested immediately on the grant date and the remaining amount vests over a three-year period.

Schedule of Non-Vested Shares and Share Equivalents

	2022 Equity Plan	2022 Manager Equity Plan	Total	Weighted Average Grant Date Fair Value (per share)
Balance as of January 1, 2022	2,406,730	1,295,277	3,702,007	$	18.90
Granted	784,893	—	784,893	23.81
Vested	(600,902)	(463,518)	(1,064,420)	18.11
Forfeited	(10,809)	—	(10,809)	23.17
Balance as of June 30, 2022	2,579,912	831,759	3,411,671	20.26

(1)    Equity-based award activity for awards granted under the 2017 Equity Plan is reflected within the 2022 Equity Plan column, and for awards granted under the 2017 Manager Equity Plan, within the 2022 Manager Equity Plan column.

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Earnings per Share (Tables)

6 Months Ended

Jun. 30, 2022

Earnings Per Share [Abstract]

Reconciliation of Net Income and Number of Shares Used in Computation of Earnings Per Share

The following table provides a reconciliation of net income and the number of shares of common stock used in the computation of basic EPS and diluted EPS (amounts in thousands, except per share amounts):

	For the Three Months Ended June 30,				For the Six Months Ended June 30,
	2022		2021		2022		2021
Basic Earnings
Income attributable to STWD common stockholders	$	212,287	$	116,310	$	536,886	$	227,688
Less: Income attributable to participating shares not already deducted as non-controlling interests	(3,990)		(1,791)		(12,811)		(3,716)
Basic earnings	$	208,297	$	114,519	$	524,075	$	223,972
Diluted Earnings
Income attributable to STWD common stockholders	$	212,287	$	116,310	$	536,886	$	227,688
Less: Income attributable to participating shares not already deducted as non-controlling interests	(3,990)		(1,791)		(12,811)		(3,716)
Add: Interest expense on Convertible Notes	2,915		2,900		5,818		5,816
Add: Undistributed earnings to participating shares	2,584		—		9,879		—
Less: Undistributed earnings reallocated to participating shares	(2,506)		—		(9,579)		—
Diluted earnings	$	211,290	$	117,419	$	530,193	$	229,788
Number of Shares:
Basic — Average shares outstanding	305,035		284,710		303,995		284,018
Effect of dilutive securities — Convertible Notes	9,649		9,649		9,649		9,649
Effect of dilutive securities — Contingently issuable shares	120		95		120		95
Effect of dilutive securities — Unvested non-participating shares	158		117		144		46
Diluted — Average shares outstanding	314,962		294,571		313,908		293,808
Earnings Per Share Attributable to STWD Common Stockholders:
Basic	$	0.68	$	0.40	$	1.72	$	0.79
Diluted	$	0.67	$	0.40	$	1.69	$	0.78

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Accumulated Other Comprehensive Income (Tables)

6 Months Ended

Jun. 30, 2022

Comprehensive Income (Loss), Net of Tax, Attributable to Parent [Abstract]

Schedule of Changes in AOCI by Component

The changes in AOCI by component are as follows (amounts in thousands):

	Cumulative Unrealized Gain (Loss) on Available-for- Sale Securities		Foreign Currency Translation		Total
Three Months Ended June 30, 2022
Balance at April 1, 2022	$	35,669	$	—	$	35,669
OCI before reclassifications	(6,699)		—		(6,699)
Amounts reclassified from AOCI	—		—		—
Net period OCI	(6,699)		—		(6,699)
Balance at June 30, 2022	$	28,970	$	—	$	28,970
Three Months Ended June 30, 2021
Balance at April 1, 2021	$	41,654	$	—	$	41,654
OCI before reclassifications	(344)		—		(344)
Amounts reclassified from AOCI	—		—		—
Net period OCI	(344)		—		(344)
Balance at June 30, 2021	$	41,310	$	—	$	41,310
Six Months Ended June 30, 2022
Balance at January 1, 2022	$	40,953	$	—	$	40,953
OCI before reclassifications	(11,983)		—		(11,983)
Amounts reclassified from AOCI	—		—		—
Net period OCI	(11,983)		—		(11,983)
Balance at June 30, 2022	$	28,970	$	—	$	28,970
Six Months Ended June 30, 2021
Balance at January 1, 2021	$	44,057	$	(64)	$	43,993
OCI before reclassifications	(2,747)		—		(2,747)
Amounts reclassified from AOCI	—		64		64
Net period OCI	(2,747)		64		(2,683)
Balance at June 30, 2021	$	41,310	$	—	$	41,310

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Fair Value (Tables)

6 Months Ended

Jun. 30, 2022

Fair Value Disclosures [Abstract]

Schedule of Financial Assets and Liabilities Carried at Fair Value on a Recurring Basis

The following tables present our financial assets and liabilities carried at fair value on a recurring basis in the consolidated balance sheets by their level in the fair value hierarchy as of June 30, 2022 and December 31, 2021 (amounts in thousands):

	June 30, 2022
	Total		Level I		Level II		Level III
Financial Assets:
Loans under fair value option	$	2,228,332	$	—	$	30,831	$	2,197,501
RMBS	124,439		—		—		124,439
CMBS	20,965		—		—		20,965
Equity security	10,193		10,193		—		—
Woodstar Fund investments	1,558,850		—		—		1,558,850
Domestic servicing rights	17,499		—		—		17,499
Derivative assets	128,727		—		128,727		—
VIE assets	57,993,563		—		—		57,993,563
Total	$	62,082,568	$	10,193	$	159,558	$	61,912,817
Financial Liabilities:
Derivative liabilities	$	55,137	$	—	$	55,137	$	—
VIE liabilities	56,256,080		—		50,275,446		5,980,634
Total	$	56,311,217	$	—	$	50,330,583	$	5,980,634

	December 31, 2021
	Total		Level I		Level II		Level III
Financial Assets:
Loans under fair value option	$	2,936,025	$	—	$	—	$	2,936,025
RMBS	143,980		—		—		143,980
CMBS	22,244		—		—		22,244
Equity security	11,624		11,624		—		—
Woodstar Fund investments	1,040,309		—		—		1,040,309
Domestic servicing rights	16,780		—		—		16,780
Derivative assets	48,216		—		48,216		—
VIE assets	61,280,543		—		—		61,280,543
Total	$	65,499,721	$	11,624	$	48,216	$	65,439,881
Financial Liabilities:
Derivative liabilities	$	13,421	$	—	$	13,421	$	—
VIE liabilities	59,752,922		—		54,972,701		4,780,221
Total	$	59,766,343	$	—	$	54,986,122	$	4,780,221

Schedule of Changes in Financial Assets and Liabilities Classified as Level III

The changes in financial assets and liabilities classified as Level III are as follows for the three and six months ended June 30, 2022 and 2021 (amounts in thousands):

Three Months Ended June 30, 2022	Loans at Fair Value		RMBS		CMBS		Woodstar Fund Investments		Domestic Servicing Rights		VIE Assets		VIE Liabilities		Total
April 1, 2022 balance	$	2,367,022	$	134,406	$	21,858	$	1,264,160	$	17,864	$	57,763,543	$	(5,479,288)	$	56,089,565
Total realized and unrealized gains (losses):
Included in earnings:
Change in fair value / gain on sale	(113,480)		—		(665)		294,690		(365)		(3,021,691)		447,311		(2,394,200)
Net accretion	—		2,625		—		—		—		—		—		2,625
Included in OCI	—		(6,699)		—		—		—		—		—		(6,699)
Purchases / Originations	1,340,371		—		—		—		—		—		—		1,340,371
Sales	(1,309,220)		—		—		—		—		—		—		(1,309,220)
Cash repayments / receipts	(56,415)		(5,893)		(228)		—		—		—		(415)		(62,951)
Transfers into Level III	54		—		—		—		—		—		(426,237)		(426,183)
Transfers out of Level III	(30,831)		—		—		—		—		—		262,839		232,008
Consolidation of VIEs	—		—		—		—		—		3,251,711		(784,844)		2,466,867
June 30, 2022 balance	$	2,197,501	$	124,439	$	20,965	$	1,558,850	$	17,499	$	57,993,563	$	(5,980,634)	$	55,932,183
Amount of unrealized gains (losses) attributable to     assets still held at June 30, 2022:
Included in earnings	$	(108,411)	$	2,340	$	(665)	$	294,690	$	(365)	$	(3,021,691)	$	447,311	$	(2,386,791)
Included in OCI	$	—	$	(6,375)	$	—	$	—	$	—	$	—	$	—	$	(6,375)

Three Months Ended June 30, 2021	Loans at Fair Value		RMBS		CMBS		Woodstar Fund Investments		Domestic Servicing Rights		VIE Assets		VIE Liabilities		Total
April 1, 2021 balance	$	763,773	$	160,301	$	19,256	$	—	$	12,406	$	62,367,110	$	(2,227,428)	$	61,095,418
Total realized and unrealized gains (losses):
Included in earnings:
Change in fair value / gain on sale	45,867		—		320		—		1,299		(1,085,746)		1,294		(1,036,966)
Net accretion	—		2,610		—		—		—		—		—		2,610
Included in OCI	—		(344)		—		—		—		—		—		(344)
Purchases / Originations	992,304		—		—		—		—		—		—		992,304
Sales	(905,653)		—		—		—		—		—		—		(905,653)
Cash repayments / receipts	(50,257)		(7,863)		(611)		—		—		—		(1,401)		(60,132)
Transfers into Level III	—		—		—		—		—		—		(2,431,880)		(2,431,880)
Transfers out of Level III	(250,687)		—		—		—		—		—		365,456		114,769
Transfers within Level III	172,474		—		—						(172,474)		—		—
Consolidation of VIEs	—		—		—		—		—		2,384,906		(542,233)		1,842,673
June 30, 2021 balance	$	767,821	$	154,704	$	18,965	$	—	$	13,705	$	63,493,796	$	(4,836,192)	$	59,612,799
Amount of unrealized gains (losses) attributable to     assets still held at June 30, 2021:
Included in earnings	$	3,274	$	2,610	$	320	$	—	$	1,299	$	(1,258,220)	$	1,294	$	(1,249,423)
Included in OCI	$	—	$	(344)	$	—	$	—	$	—	$	—	$	—	$	(344)

Six Months Ended June 30, 2022	Loans at Fair Value		RMBS		CMBS		Woodstar Fund Investments		Domestic Servicing Rights		VIE Assets		VIE Liabilities		Total
January 1, 2022 balance	$	2,936,025	$	143,980	$	22,244	$	1,040,309	$	16,780	$	61,280,543	$	(4,780,221)	$	60,659,660
Total realized and unrealized gains (losses):
Included in earnings:
Change in fair value / gain on sale	(239,263)		—		(1,357)		518,541		719		(6,918,293)		922,222		(5,717,431)
Net accretion	—		5,230		—		—		—		—		—		5,230
Included in OCI	—		(11,983)		—		—		—		—		—		(11,983)
Purchases / Originations	3,607,070		—		—		—		—		—		—		3,607,070
Sales	(3,587,687)		—		—		—		—		—		—		(3,587,687)
Cash repayments / receipts	(114,849)		(12,788)		(452)		—		—		—		(825)		(128,914)
Transfers into Level III	147		—		—		—		—		—		(630,117)		(629,970)
Transfers out of Level III	(403,942)		—		—		—		—		—		317,449		(86,493)
Consolidation of VIEs	—		—		—		—		—		4,361,325		(1,810,101)		2,551,224
Deconsolidation of VIEs	—		—		530		—		—		(730,012)		959		(728,523)
June 30, 2022 balance	$	2,197,501	$	124,439	$	20,965	$	1,558,850	$	17,499	$	57,993,563	$	(5,980,634)	$	55,932,183
Amount of unrealized gains (losses) attributable to     assets still held at June 30, 2022:
Included in earnings	$	(168,610)	$	4,896	$	(827)	$	518,541	$	719	$	(6,918,293)	$	922,222	$	(5,641,352)
Included in OCI	$	—	$	(11,577)	$	—	$	—	$	—	$	—	$	—	$	(11,577)

Six Months Ended June 30, 2021	Loans at Fair Value		RMBS		CMBS		Woodstar Fund Investments		Domestic Servicing Rights		VIE Assets		VIE Liabilities		Total
January 1, 2021 balance	$	1,022,979	$	167,349	$	19,457	$	—	$	13,202	$	64,238,328	$	(2,019,876)	$	63,441,439
Total realized and unrealized gains (losses):
Included in earnings:
Change in fair value / gain on sale	36,389		—		692		—		503		(3,350,337)		66,975		(3,245,778)
Net accretion	—		5,216		—		—		—		—		—		5,216
Included in OCI	—		(2,747)		—		—		—		—		—		(2,747)
Purchases / Originations	1,367,574		—		—		—		—		—		—		1,367,574
Sales	(1,477,580)		—		—		—		—		—		—		(1,477,580)
Issuances	—		—		—		—		—		—		(11,604)		(11,604)
Cash repayments / receipts	(103,328)		(15,114)		(1,184)		—		—		—		(2,538)		(122,164)
Transfers into Level III	—		—		—		—		—		—		(2,841,147)		(2,841,147)
Transfers out of Level III	(250,687)		—		—		—		—		—		514,231		263,544
Transfers within Level III	172,474		—		—		—		—		(172,474)		—		—
Consolidation of VIEs	—		—		—		—		—		2,778,279		(542,233)		2,236,046
June 30, 2021 balance	$	767,821	$	154,704	$	18,965	$	—	$	13,705	$	63,493,796	$	(4,836,192)	$	59,612,799
Amount of unrealized gains (losses) attributable to     assets still held at June 30, 2021:
Included in earnings	$	2,902	$	5,216	$	692	$	—	$	503	$	(3,522,811)	$	66,975	$	(3,446,523)
Included in OCI	$	—	$	(2,747)	$	—	$	—	$	—	$	—	$	—	$	(2,747)

Schedule of Fair Value of Financial Instruments not Carried at Fair Value

The following table presents the fair values of our financial instruments not carried at fair value on the consolidated balance sheets (amounts in thousands):

	June 30, 2022				December 31, 2021
	Carrying Value		Fair Value		Carrying Value		Fair Value
Financial assets not carried at fair value:
Loans	$	17,904,104	$	17,684,507	$	15,477,624	$	15,526,235
HTM debt securities	757,763		720,641		683,136		656,864
Financial liabilities not carried at fair value:
Secured financing agreements, CLOs and SASB	$	16,911,598	$	16,751,875	$	15,192,966	$	15,266,440
Unsecured senior notes	2,324,772		2,149,983		1,828,590		1,893,065

Schedule of Quantitative Information for Level 3 Measurements for Assets and Liabilities Measured at Fair Value on Recurring Basis

The following is quantitative information about significant unobservable inputs in our Level III measurements for those assets and liabilities measured at fair value on a recurring basis (dollars in thousands):

	Carrying Value at June 30, 2022		Valuation Technique	Unobservable Input	Range (Weighted Average) as of (1)
					June 30, 2022	December 31, 2021
Loans under fair value option	$	2,197,501	Discounted cash flow, market pricing	Coupon (d)	2.8% - 9.2% (4.6%)	2.6% - 9.2% (4.2%)
				Remaining contractual term (d)	5.8 - 40.0 years (29.2 years)	6.3 - 39.9 years (27.4 years)
				FICO score (a)	584 - 900 (745)	582 - 829 (748)
				LTV (b)	5% - 94% (68%)	1% - 94% (66%)
				Purchase price (d)	80.0% - 108.6% (101.8%)	80.0% - 108.6% (102.3%)
RMBS	124,439		Discounted cash flow	Constant prepayment rate (a)	3.4% - 14.6% (6.6%)	4.8% - 19.2% (9.9%)
				Constant default rate (b)	0.9% - 4.7% (2.0%)	0.8% - 6.0% (2.1%)
				Loss severity (b)	0% - 76% (16%) (f)	0% - 86% (26%) (f)
				Delinquency rate (c)	6% - 30% (15%)	10.4% - 35% (19%)
				Servicer advances (a)	25% - 79% (53%)	19% - 83% (52%)
				Annual coupon deterioration (b)	0% - 2.5% (0.1%)	0% - 1.7% (0.1%)
				Putback amount per projected total collateral loss (e)	0% - 8% (0.5%)	0% - 8% (0.5%)
CMBS	20,965		Discounted cash flow	Yield (b)	0% - 67.3% (8.9%)	0% - 613.6% (9.3%)
				Duration (c)	0 - 8.2 years (3.1 years)	0 - 7.2 years (5.2 years)
Woodstar Fund investments	1,558,850		Discounted cash flow	Discount rate - properties (b)	N/A	5.8% - 6.3% (6.0%)
				Discount rate - debt (a)	4.7% - 5.0% (4.8%)	2.6% - 3.3% (2.9%)
				Terminal capitalization rate (b)	N/A	4.8% - 5.3% (4.9%)
				Direct capitalization rate (b)	4.2% (4.2%)	4.1% - 4.2% (4.2%) (Implied)
Domestic servicing rights	17,499		Discounted cash flow	Debt yield (a)	7.50% (7.50%)	7.30% (7.30%)
				Discount rate (b)	15% (15%)	15% (15%)
VIE assets	57,993,563		Discounted cash flow	Yield (b)	0% - 253.1% (13.2%)	0% - 615.3% (13.0%)
				Duration (c)	0 - 11.3 years (3.2 years)	0 - 11.0 years (3.2 years)
VIE liabilities	5,980,634		Discounted cash flow	Yield (b)	0% - 253.1% (8.4%)	0% - 615.3% (6.4%)
				Duration (c)	0 - 11.3 years (2.2 years)	0 - 11.0 years (2.3 years)

______________________________________________________________________________________________________________________

(1)Unobservable inputs were weighted by the relative carrying value of the instruments as of June 30, 2022 and December 31, 2021.

Information about Uncertainty of Fair Value Measurements

(a)Significant increase (decrease) in the unobservable input in isolation would result in a significantly higher (lower) fair value measurement.

(b)Significant increase (decrease) in the unobservable input in isolation would result in a significantly lower (higher) fair value measurement.

(c)Significant increase (decrease) in the unobservable input in isolation would result in either a significantly lower or higher (higher or lower) fair value measurement depending on the structural features of the security in question.

(d)This unobservable input is not subject to variability as of the respective reporting dates.

(e)Any delay in the putback recovery date leads to a decrease in fair value for the majority of securities in our RMBS portfolio.

(f)6% and 18% of the portfolio falls within a range of 45% - 80% as of June 30, 2022 and December 31, 2021, respectively.

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Income Taxes (Tables)

6 Months Ended

Jun. 30, 2022

Income Tax Disclosure [Abstract]

Schedule of Income Tax Rate Reconciliation

The following table is a reconciliation of our U.S. federal income tax provision determined using our statutory federal tax rate to our reported income tax provision (benefit) for the three and six months ended June 30, 2022 and 2021 (dollars in thousands):

	For the Three Months Ended June 30,								For the Six Months Ended June 30,
	2022				2021				2022				2021
Federal statutory tax rate	$	59,622	21.0	%	$	25,836	21.0	%	$	139,813	21.0	%	$	52,035	21.0	%
REIT and other non-taxable income	(58,233)		(20.6)	%	(24,018)		(19.5)	%	(137,431)		(20.6)	%	(48,519)		(19.6)	%
State income taxes	456		0.2	%	597		0.5	%	782		0.1	%	1,155		0.5	%
Federal benefit of state tax deduction	(95)		—	%	(126)		(0.1)	%	(164)		—	%	(243)		(0.1)	%
Intra-entity transfers	—		—	%	(6,037)		(4.9)	%	(3,868)		(0.6)	%	(6,052)		(2.4)	%
Other	456		0.2	%	395		0.3	%	624		0.1	%	501		0.1	%
Effective tax rate	$	2,206	0.8	%	$	(3,353)	(2.7)	%	$	(244)	—	%	$	(1,123)	(0.5)	%

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Segment Data (Tables)

6 Months Ended

Jun. 30, 2022

Segment Reporting [Abstract]

Schedule of Results of Operations by Business Segment

The table below presents our results of operations for the three months ended June 30, 2022 by business segment (amounts in thousands):

	Commercial and Residential Lending Segment		Infrastructure Lending Segment		Property Segment		Investing and Servicing Segment		Corporate		Subtotal		Securitization VIEs		Total
Revenues:
Interest income from loans	$	227,555	$	30,096	$	—	$	3,499	$	—	$	261,150	$	—	$	261,150
Interest income from investment securities	22,591		1,173		—		20,990		—		44,754		(29,448)		15,306
Servicing fees	142		—		—		15,616		—		15,758		(3,205)		12,553
Rental income	1,044		—		22,628		7,852		—		31,524		—		31,524
Other revenues	61		90		48		4,854		3		5,056		(3)		5,053
Total revenues	251,393		31,359		22,676		52,811		3		358,242		(32,656)		325,586
Costs and expenses:
Management fees	254		—		—		—		31,370		31,624		—		31,624
Interest expense	88,226		15,001		7,074		6,391		36,142		152,834		(216)		152,618
General and administrative	11,845		3,631		975		23,114		5,342		44,907		98		45,005
Acquisition and investment pursuit costs	738		—		2		(223)		—		517		—		517
Costs of rental operations	1,826		—		5,216		3,556		—		10,598		—		10,598
Depreciation and amortization	1,183		104		8,179		2,774		—		12,240		—		12,240
Credit loss provision, net	7,925		513		—		—		—		8,438		—		8,438
Other expense	1,251		—		—		7		—		1,258		—		1,258
Total costs and expenses	113,248		19,249		21,446		35,619		72,854		262,416		(118)		262,298
Other income (loss):
Change in net assets related to consolidated VIEs	—		—		—		—		—		—		8,373		8,373
Change in fair value of servicing rights	—		—		—		543		—		543		(908)		(365)
Change in fair value of investment securities, net	(19,312)		—		—		(8,150)		—		(27,462)		26,217		(1,245)
Change in fair value of mortgage loans, net	(121,356)		—		—		7,876		—		(113,480)		—		(113,480)
Income from affordable housing fund investments	—		—		307,165		—		—		307,165		—		307,165
Earnings (loss) from unconsolidated entities	2,786		394		—		1,748		—		4,928		(1,063)		3,865
Gain on sale of investments and other assets, net	138		—		—		—		—		138		—		138
Gain (loss) on derivative financial instruments, net	127,140		265		5,354		9,007		(13,183)		128,583		—		128,583
Foreign currency (loss) gain, net	(78,331)		(289)		18		—		—		(78,602)		—		(78,602)
Other loss, net	(33,809)		—		—		—		—		(33,809)		—		(33,809)
Total other income (loss)	(122,744)		370		312,537		11,024		(13,183)		188,004		32,619		220,623
Income (loss) before income taxes	15,401		12,480		313,767		28,216		(86,034)		283,830		81		283,911
Income tax (provision) benefit	(557)		1		—		(1,650)		—		(2,206)		—		(2,206)
Net income (loss)	14,844		12,481		313,767		26,566		(86,034)		281,624		81		281,705
Net income attributable to non-controlling interests	(4)		—		(67,482)		(1,851)		—		(69,337)		(81)		(69,418)
Net income (loss) attributable to Starwood Property Trust, Inc.	$	14,840	$	12,481	$	246,285	$	24,715	$	(86,034)	$	212,287	$	—	$	212,287

The table below presents our results of operations for the three months ended June 30, 2021 by business segment (amounts in thousands):

	Commercial and Residential Lending Segment		Infrastructure Lending Segment		Property Segment		Investing and Servicing Segment		Corporate		Subtotal		Securitization VIEs		Total
Revenues:
Interest income from loans	$	165,697	$	21,171	$	—	$	2,404	$	—	$	189,272	$	—	$	189,272
Interest income from investment securities	17,190		555		—		25,668		—		43,413		(32,765)		10,648
Servicing fees	110		—		—		16,365		—		16,475		(5,611)		10,864
Rental income	1,419		—		65,410		10,290		—		77,119		—		77,119
Other revenues	74		69		44		2,777		—		2,964		—		2,964
Total revenues	184,490		21,795		65,454		57,504		—		329,243		(38,376)		290,867
Costs and expenses:
Management fees	300		—		—		224		28,716		29,240		10		29,250
Interest expense	48,356		9,694		16,863		5,789		29,171		109,873		(220)		109,653
General and administrative	10,411		3,532		1,028		25,720		4,489		45,180		85		45,265
Acquisition and investment pursuit costs	179		249		—		(21)		—		407		—		407
Costs of rental operations	433		—		25,922		4,376		—		30,731		—		30,731
Depreciation and amortization	311		100		17,901		4,165		—		22,477		—		22,477
Credit loss (reversal) provision, net	(12,447)		603		—		—		—		(11,844)		—		(11,844)
Other expense	—		—		—		—		—		—		—		—
Total costs and expenses	47,543		14,178		61,714		40,253		62,376		226,064		(125)		225,939
Other income (loss):
Change in net assets related to consolidated VIEs	—		—		—		—		—		—		12,509		12,509
Change in fair value of servicing rights	—		—		—		460		—		460		839		1,299
Change in fair value of investment securities, net	(9,402)		—		—		(12,585)		—		(21,987)		23,495		1,508
Change in fair value of mortgage loans, net	12,329		—		—		33,538		—		45,867		—		45,867
Earnings (loss) from unconsolidated entities	1,996		(70)		—		(507)		—		1,419		807		2,226
(Loss) gain on sale of investments and other assets, net	(1,019)		27		—		9,723		—		8,731		—		8,731
(Loss) gain on derivative financial instruments, net	(4,945)		112		(372)		(5,731)		927		(10,009)		—		(10,009)
Foreign currency gain (loss), net	2,715		(62)		(25)		(1)		—		2,627		—		2,627
Loss on extinguishment of debt	(221)		(939)		—		(22)		—		(1,182)		—		(1,182)
Other (loss) income, net	(5,504)		2		—		29		—		(5,473)		—		(5,473)
Total other income (loss)	(4,051)		(930)		(397)		24,904		927		20,453		37,650		58,103
Income (loss) before income taxes	132,896		6,687		3,343		42,155		(61,449)		123,632		(601)		123,031
Income tax benefit (provision)	8,043		(58)		—		(4,632)		—		3,353		—		3,353
Net income (loss)	140,939		6,629		3,343		37,523		(61,449)		126,985		(601)		126,384
Net (income) loss attributable to non-controlling interests	(4)		—		(4,914)		(5,757)		—		(10,675)		601		(10,074)
Net income (loss) attributable to Starwood Property Trust, Inc.	$	140,935	$	6,629	$	(1,571)	$	31,766	$	(61,449)	$	116,310	$	—	$	116,310

The table below presents our results of operations for the six months ended June 30, 2022 by business segment (amounts in thousands):

	Commercial and Residential Lending Segment		Infrastructure Lending Segment		Property Segment		Investing and Servicing Segment		Corporate		Subtotal		Securitization VIEs		Total
Revenues:
Interest income from loans	$	430,025	$	57,079	$	—	$	7,665	$	—	$	494,769	$	—	$	494,769
Interest income from investment securities	43,427		1,920		—		48,379		—		93,726		(64,437)		29,289
Servicing fees	278		—		—		29,687		—		29,965		(7,420)		22,545
Rental income	2,730		—		44,993		15,381		—		63,104		—		63,104
Other revenues	113		158		98		9,508		3		9,880		(9)		9,871
Total revenues	476,573		59,157		45,091		110,620		3		691,444		(71,866)		619,578
Costs and expenses:
Management fees	531		—		—		—		86,388		86,919		—		86,919
Interest expense	156,828		26,931		13,155		12,601		69,984		279,499		(430)		279,069
General and administrative	23,447		7,142		2,031		46,557		9,970		89,147		179		89,326
Acquisition and investment pursuit costs	1,237		1		7		(306)		—		939		—		939
Costs of rental operations	2,345		—		10,217		7,326		—		19,888		—		19,888
Depreciation and amortization	1,477		209		16,398		5,803		—		23,887		—		23,887
Credit loss provision, net	4,626		154		—		—		—		4,780		—		4,780
Other expense	1,251		—		55		7		—		1,313		—		1,313
Total costs and expenses	191,742		34,437		41,863		71,988		166,342		506,372		(251)		506,121
Other income (loss):
Change in net assets related to consolidated VIEs	—		—		—		—		—		—		35,122		35,122
Change in fair value of servicing rights	—		—		—		326		—		326		393		719
Change in fair value of investment securities, net	(21,417)		—		—		(17,441)		—		(38,858)		37,258		(1,600)
Change in fair value of mortgage loans, net	(237,584)		—		—		(1,679)		—		(239,263)		—		(239,263)
Income from affordable housing fund investments	—		—		541,206		—		—		541,206		—		541,206
Earnings (loss) from unconsolidated entities	1,446		739		—		1,899		—		4,084		(1,129)		2,955
Gain on sale of investments and other assets, net	86,748		—		—		11,858		—		98,606		—		98,606
Gain (loss) on derivative financial instruments, net	245,535		897		22,900		36,870		(50,351)		255,851		—		255,851
Foreign currency (loss) gain, net	(105,585)		(317)		19		—		—		(105,883)		—		(105,883)
Loss on extinguishment of debt	(206)		(469)		—		(148)		—		(823)		—		(823)
Other (loss) income, net	(34,597)		—		—		—		—		(34,597)		25		(34,572)
Total other income (loss)	(65,660)		850		564,125		31,685		(50,351)		480,649		71,669		552,318
Income (loss) before income taxes	219,171		25,570		567,353		70,317		(216,690)		665,721		54		665,775
Income tax benefit (provision)	4,583		5		—		(4,344)		—		244		—		244
Net income (loss)	223,754		25,575		567,353		65,973		(216,690)		665,965		54		666,019
Net income attributable to non-controlling interests	(7)		—		(119,893)		(9,179)		—		(129,079)		(54)		(129,133)
Net income (loss) attributable to Starwood Property Trust, Inc.	$	223,747	$	25,575	$	447,460	$	56,794	$	(216,690)	$	536,886	$	—	$	536,886

The table below presents our results of operations for the six months ended June 30, 2021 by business segment (amounts in thousands):

	Commercial and Residential Lending Segment		Infrastructure Lending Segment		Property Segment		Investing and Servicing Segment		Corporate		Subtotal		Securitization VIEs		Total
Revenues:
Interest income from loans	$	336,290	$	39,979	$	—	$	3,578	$	—	$	379,847	$	—	$	379,847
Interest income from investment securities	35,575		1,119		—		46,608		—		83,302		(61,044)		22,258
Servicing fees	234		—		—		28,821		—		29,055		(9,789)		19,266
Rental income	2,758		—		130,514		20,185		—		153,457		—		153,457
Other revenues	164		162		84		2,859		—		3,269		—		3,269
Total revenues	375,021		41,260		130,598		102,051		—		648,930		(70,833)		578,097
Costs and expenses:
Management fees	615		—		—		446		66,904		67,965		21		67,986
Interest expense	92,651		18,535		32,695		11,238		58,319		213,438		(411)		213,027
General and administrative	21,744		6,974		2,051		44,160		8,800		83,729		172		83,901
Acquisition and investment pursuit costs	364		249		—		(21)		—		592		—		592
Costs of rental operations	910		—		49,882		8,684		—		59,476		—		59,476
Depreciation and amortization	618		200		36,001		8,132		—		44,951		—		44,951
Credit loss (reversal) provision, net	(12,976)		1,176		—		—		—		(11,800)		—		(11,800)
Other expense	31		—		583		71		—		685		—		685
Total costs and expenses	103,957		27,134		121,212		72,710		134,023		459,036		(218)		458,818
Other income (loss):
Change in net assets related to consolidated VIEs	—		—		—		—		—		—		52,254		52,254
Change in fair value of servicing rights	—		—		—		1,205		—		1,205		(702)		503
Change in fair value of investment securities, net	(11,452)		—		—		(5,415)		—		(16,867)		18,069		1,202
Change in fair value of mortgage loans, net	1,615		—		—		34,774		—		36,389		—		36,389
Earnings (loss) from unconsolidated entities	3,749		(324)		—		82		—		3,507		453		3,960
Gain on sale of investments and other assets, net	16,674		27		—		9,723		—		26,424		—		26,424
Gain (loss) on derivative financial instruments, net	21,196		796		4,352		3,552		(5,916)		23,980		—		23,980
Foreign currency loss, net	(8,879)		(111)		—		(64)		—		(9,054)		—		(9,054)
Loss on extinguishment of debt	(289)		(1,246)		(141)		(22)		—		(1,698)		—		(1,698)
Other (loss) income, net	(5,504)		23		—		29		—		(5,452)		—		(5,452)
Total other income (loss)	17,110		(835)		4,211		43,864		(5,916)		58,434		70,074		128,508
Income (loss) before income taxes	288,174		13,291		13,597		73,205		(139,939)		248,328		(541)		247,787
Income tax benefit (provision)	6,538		(150)		—		(5,265)		—		1,123		—		1,123
Net income (loss)	294,712		13,141		13,597		67,940		(139,939)		249,451		(541)		248,910
Net (income) loss attributable to non-controlling interests	(7)		—		(9,991)		(11,765)		—		(21,763)		541		(21,222)
Net income (loss) attributable to Starwood Property Trust, Inc.	$	294,705	$	13,141	$	3,606	$	56,175	$	(139,939)	$	227,688	$	—	$	227,688

Schedule of Consolidated Balance Sheet by Business Segment

The table below presents our consolidated balance sheet as of June 30, 2022 by business segment (amounts in thousands):

	Commercial and Residential Lending Segment		Infrastructure Lending Segment		Property Segment		Investing and Servicing Segment		Corporate		Subtotal		Securitization VIEs		Total
Assets:
Cash and cash equivalents	$	67,812	$	26,325	$	27,926	$	27,863	$	120,192	$	270,118	$	2,056	$	272,174
Restricted cash	2,889		38,835		958		10,011		11,939		64,632		—		64,632
Loans held-for-investment, net	15,623,041		2,263,006		—		9,742		—		17,895,789		—		17,895,789
Loans held-for-sale	2,195,953		—		—		40,694		—		2,236,647		—		2,236,647
Investment securities	1,338,195		67,336		—		1,210,361		—		2,615,892		(1,702,532)		913,360
Properties, net	215,099		—		874,119		136,761		—		1,225,979		—		1,225,979
Investments of consolidated affordable housing fund	—		—		1,558,850		—		—		1,558,850		—		1,558,850
Investments in unconsolidated entities	38,612		27,454		—		35,246		—		101,312		(15,802)		85,510
Goodwill	—		119,409		—		140,437		—		259,846		—		259,846
Intangible assets	14,948		—		32,050		69,691		—		116,689		(41,725)		74,964
Derivative assets	126,546		232		371		1,578		—		128,727		—		128,727
Accrued interest receivable	117,918		4,941		14		1,118		7,827		131,818		(158)		131,660
Other assets	126,936		6,952		66,483		34,667		22,453		257,491		(306)		257,185
VIE assets, at fair value	—		—		—		—		—		—		57,993,563		57,993,563
Total Assets	$	19,867,949	$	2,554,490	$	2,560,771	$	1,718,169	$	162,411	$	26,863,790	$	56,235,096	$	83,098,886
Liabilities and Equity
Liabilities:
Accounts payable, accrued expenses and other liabilities	$	152,679	$	24,052	$	10,161	$	48,634	$	37,823	$	273,349	$	65	$	273,414
Related-party payable	—		—		—		—		30,754		30,754		—		30,754
Dividends payable	—		—		—		—		149,991		149,991		—		149,991
Derivative liabilities	11,899		197		—		—		43,041		55,137		—		55,137
Secured financing agreements, net	9,999,749		1,025,145		788,557		584,395		770,965		13,168,811		(21,364)		13,147,447
Collateralized loan obligations and single asset securitization, net	2,951,308		812,843		—		—		—		3,764,151		—		3,764,151
Unsecured senior notes, net	—		—		—		—		2,324,772		2,324,772		—		2,324,772
VIE liabilities, at fair value	—		—		—		—		—		—		56,256,080		56,256,080
Total Liabilities	13,115,635		1,862,237		798,718		633,029		3,357,346		19,766,965		56,234,781		76,001,746
Temporary Equity: Redeemable non-controlling interests	—		—		322,753		—		—		322,753		—		322,753
Permanent Equity:
Starwood Property Trust, Inc. Stockholders’ Equity:
Common stock	—		—		—		—		3,167		3,167		—		3,167
Additional paid-in capital	1,926,108		624,101		(378,128)		(556,122)		4,150,574		5,766,533		—		5,766,533
Treasury stock	—		—		—		—		(138,022)		(138,022)		—		(138,022)
Accumulated other comprehensive income	28,970		—		—		—		—		28,970		—		28,970
Retained earnings (accumulated deficit)	4,797,121		68,152		1,608,794		1,469,935		(7,210,654)		733,348		—		733,348
Total Starwood Property Trust, Inc. Stockholders’ Equity	6,752,199		692,253		1,230,666		913,813		(3,194,935)		6,393,996		—		6,393,996
Non-controlling interests in consolidated subsidiaries	115		—		208,634		171,327		—		380,076		315		380,391
Total Permanent Equity	6,752,314		692,253		1,439,300		1,085,140		(3,194,935)		6,774,072		315		6,774,387
Total Liabilities and Equity	$	19,867,949	$	2,554,490	$	2,560,771	$	1,718,169	$	162,411	$	26,863,790	$	56,235,096	$	83,098,886

The table below presents our consolidated balance sheet as of December 31, 2021 by business segment (amounts in thousands):

	Commercial and Residential Lending Segment		Infrastructure Lending Segment		Property Segment		Investing and Servicing Segment		Corporate		Subtotal		Securitization VIEs		Total
Assets:
Cash and cash equivalents	$	65,064	$	17,011	$	14,136	$	26,700	$	93,861	$	216,772	$	590	$	217,362
Restricted cash	39,853		43,408		954		20,337		—		104,552		—		104,552
Loans held-for-investment, net	13,499,520		2,027,426		—		9,903		—		15,536,849		—		15,536,849
Loans held-for-sale	2,590,005		—		—		286,795		—		2,876,800		—		2,876,800
Investment securities	1,155,452		31,923		—		1,165,395		—		2,352,770		(1,491,786)		860,984
Properties, net	124,503		—		887,553		154,331		—		1,166,387		—		1,166,387
Investments of consolidated affordable housing fund	—		—		1,040,309		—		—		1,040,309		—		1,040,309
Investments in unconsolidated entities	44,938		26,255		—		34,160		—		105,353		(15,256)		90,097
Goodwill	—		119,409		—		140,437		—		259,846		—		259,846
Intangible assets	—		—		34,619		71,064		—		105,683		(42,119)		63,564
Derivative assets	34,265		128		8		391		13,424		48,216		—		48,216
Accrued interest receivable	106,251		3,207		—		947		5,988		116,393		(131)		116,262
Other assets	68,908		14,265		43,420		40,395		21,800		188,788		(162)		188,626
VIE assets, at fair value	—		—		—		—		—		—		61,280,543		61,280,543
Total Assets	$	17,728,759	$	2,283,032	$	2,020,999	$	1,950,855	$	135,073	$	24,118,718	$	59,731,679	$	83,850,397
Liabilities and Equity
Liabilities:
Accounts payable, accrued expenses and other liabilities	$	57,267	$	8,917	$	14,757	$	58,920	$	49,779	$	189,640	$	56	$	189,696
Related-party payable	—		—		—		—		76,371		76,371		—		76,371
Dividends payable	—		—		—		—		147,624		147,624		—		147,624
Derivative liabilities	12,870		260		—		291		—		13,421		—		13,421
Secured financing agreements, net	9,097,985		1,225,548		787,396		714,237		773,244		12,598,410		(21,560)		12,576,850
Collateralized loan obligations and single asset securitization, net	2,210,798		405,318		—		—		—		2,616,116		—		2,616,116
Unsecured senior notes, net	—		—		—		—		1,828,590		1,828,590		—		1,828,590
VIE liabilities, at fair value	—		—		—		—		—		—		59,752,922		59,752,922
Total Liabilities	11,378,920		1,640,043		802,153		773,448		2,875,608		17,470,172		59,731,418		77,201,590
Temporary Equity: Redeemable non-controlling interests	—		—		214,915		—		—		214,915		—		214,915
Permanent Equity:
Starwood Property Trust, Inc. Stockholders’ Equity:
Common stock	—		—		—		—		3,123		3,123		—		3,123
Additional paid-in capital	1,735,397		600,412		(365,922)		(388,196)		4,091,685		5,673,376		—		5,673,376
Treasury stock	—		—		—		—		(138,022)		(138,022)		—		(138,022)
Accumulated other comprehensive income	40,953		—		—		—		—		40,953		—		40,953
Retained earnings (accumulated deficit)	4,573,374		42,577		1,161,334		1,413,142		(6,697,321)		493,106		—		493,106
Total Starwood Property Trust, Inc. Stockholders’ Equity	6,349,724		642,989		795,412		1,024,946		(2,740,535)		6,072,536		—		6,072,536
Non-controlling interests in consolidated subsidiaries	115		—		208,519		152,461		—		361,095		261		361,356
Total Permanent Equity	6,349,839		642,989		1,003,931		1,177,407		(2,740,535)		6,433,631		261		6,433,892
Total Liabilities and Equity	$	17,728,759	$	2,283,032	$	2,020,999	$	1,950,855	$	135,073	$	24,118,718	$	59,731,679	$	83,850,397

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Business and Organization (Details)	6 Months Ended
	Jun. 30, 2022 segment
Organization, Consolidation and Presentation of Financial Statements [Abstract]
Number of reportable business segments	4
Minimum annual REIT taxable income distributable to stockholders (as a percent)	90.00%

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Summary of Significant Accounting Policies (Details)			6 Months Ended
	Nov. 06, 2021 USD ($)	Nov. 05, 2021 USD ($) property unit	Jun. 30, 2022 USD ($)	Jun. 30, 2021 USD ($)
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
REO assets as a percent of consolidated VIE assets			1.00%
Loans as a percent of consolidated VIE assets			99.00%
Permitted reinvestment under static investment in VIEs			$ 0
Number of properties in portfolio investment | property		59
Number of units in portfolio investment | unit		15,057
Contributions from non-controlling interests			$ 21,926,000	$ 5,538,000
Woodstar Fund
New Accounting Pronouncements or Change in Accounting Principle [Line Items]
Percentage of interest sold		20.60%
Contributions from non-controlling interests	$ 214,200,000	$ 216,000,000
Fund term		8 years

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Acquisitions and Divestitures - Narrative (Details) - USD ($) $ in Thousands	3 Months Ended	6 Months Ended
	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Apr. 30, 2019	Mar. 31, 2019
Business Acquisition [Line Items]
Allowance		$ 77,449
Commercial and Residential Lending Segment
Business Acquisition [Line Items]
Loan with related allowance, unpaid principal					$ 20,900
Commercial and Residential Lending Segment | Orlando, Florida
Business Acquisition [Line Items]
Loans with no related allowance				$ 18,500
Commercial and Residential Lending Segment | Montgomery Alabama
Business Acquisition [Line Items]
Loans with related allowance					9,000
Allowance					8,300
Unamortized discount					$ 3,600
Operating properties | Investing and Servicing Segment
Business Acquisition [Line Items]
Proceeds from sale of operating properties	$ 30,900	34,500	$ 30,900
Gain on sale of property		11,700
Operating properties | Commercial and Residential Lending Segment
Business Acquisition [Line Items]
Gain on sale of property	$ 9,700		9,700
Operating properties | Commercial and Residential Lending Segment | Orlando, Florida
Business Acquisition [Line Items]
Proceeds from sale of operating properties		114,800
Gain on sale of property		86,600
Operating properties | Commercial and Residential Lending Segment | Montgomery Alabama
Business Acquisition [Line Items]
Proceeds from sale of operating properties		114,800	31,200
Gain on sale of property		$ 86,600	$ 17,700

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Loans - Held for Investment (Details) - USD ($) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2022	Dec. 31, 2021	Jun. 30, 2021	Dec. 31, 2020
Investments in loans
Carrying Value	$ 20,209,885	$ 18,480,919
Face Amount	20,460,882	18,521,795
Credit loss allowances	(77,449)	(67,270)
Total net loans	20,132,436	18,413,649	$ 13,725,049	$ 12,139,908
Loans held for investment
Investments in loans
Carrying Value	17,973,238	15,604,119
Face Amount	18,092,372	15,706,124
Credit loss allowances	(77,449)	(67,270)
Loans under fair value option
Investments in loans
Carrying Value	2,236,647	2,876,800
Face Amount	2,368,510	2,815,671
Total net loans	2,236,647	2,876,800	961,677	1,052,835
Commercial Portfolio Segment
Investments in loans
Carrying Value	15,634,152
Reclassification to held-for-sale	63,600
Commercial Portfolio Segment | Loans held for investment
Investments in loans
Carrying Value	15,634,152	13,496,798
Face Amount	15,728,190	13,574,079
Credit loss allowances	(56,671)	(46,600)
Total net loans	15,577,481	13,450,198	10,926,557	9,583,949
Infrastructure Portfolio Segment
Investments in loans
Carrying Value	2,283,785
Infrastructure Portfolio Segment | Loans held for investment
Investments in loans
Carrying Value	2,283,785	2,048,096
Face Amount	$ 2,308,602	$ 2,071,912
Weighted Average Life	4 years 1 month 6 days	4 years 3 months 18 days
Credit loss allowances	$ (20,778)	$ (20,670)
Total net loans	$ 2,263,007	$ 2,027,426	1,694,109	1,412,440
Infrastructure Portfolio Segment | Loans held for investment | Weighted-average
Investments in loans
Weighted Average Coupon	6.00%	4.40%
Residential Portfolio Segment
Investments in loans
Weighted Average Life	29 years 3 months 18 days	29 years 4 months 24 days
Reclassification to held-for-sale	$ 300
Residential Portfolio Segment | Loans held for investment
Investments in loans
Total net loans	55,301	$ 59,225	$ 142,706	$ 90,684
RMBS, fair value option | Loans under fair value option
Investments in loans
Carrying Value	2,132,337	2,590,005
Face Amount	$ 2,260,154	$ 2,525,910
RMBS, fair value option | Loans under fair value option | Weighted-average
Investments in loans
Weighted Average Coupon	4.60%	4.20%
CMBS, fair value option | Loans under fair value option
Investments in loans
Carrying Value	$ 104,310	$ 286,795
Face Amount	$ 108,356	$ 289,761
Weighted Average Life	7 years 7 months 6 days	9 years
Before reclassification amount	$ 40,694
CMBS, fair value option | Loans under fair value option | Weighted-average
Investments in loans
Weighted Average Coupon	4.20%	4.00%
First mortgage loan participation | Loans held for investment
Investments in loans
Carrying Value	$ 15,114,160	$ 12,991,099
Face Amount	$ 15,207,825	$ 13,067,524
Weighted Average Life	2 years	1 year 10 months 24 days
First mortgage loan participation | Loans held for investment | Weighted-average
Investments in loans
Weighted Average Coupon	5.50%	4.50%
Subordinated mortgages | Loans held for investment
Investments in loans
Carrying Value	$ 69,413	$ 70,771
Face Amount	$ 70,729	$ 72,371
Weighted Average Life	2 years 3 months 18 days	2 years 9 months 18 days
Subordinated mortgages | Loans held for investment | Weighted-average
Investments in loans
Weighted Average Coupon	11.20%	10.00%
Mezzanine Loans
Investments in loans
Total net loans	$ 1,200,000	$ 1,400,000
Mezzanine Loans | Loans held for investment
Investments in loans
Carrying Value	433,730	417,504
Face Amount	$ 431,475	$ 415,155
Weighted Average Life	1 year 2 months 12 days	1 year 4 months 24 days
Mezzanine Loans | Loans held for investment | Weighted-average
Investments in loans
Weighted Average Coupon	10.30%	9.40%
Other | Loans held for investment
Investments in loans
Carrying Value	$ 16,849	$ 17,424
Face Amount	$ 18,161	$ 19,029
Weighted Average Life	1 year 9 months 18 days	2 years 1 month 6 days
Other | Loans held for investment | Weighted-average
Investments in loans
Weighted Average Coupon	8.20%	8.20%
Residential loans, fair value option | Loans held for investment
Investments in loans
Carrying Value	$ 55,301	$ 59,225
Face Amount	$ 55,580	$ 60,133
Residential loans, fair value option | Loans held for investment | Weighted-average
Investments in loans
Weighted Average Coupon	6.00%	6.00%
Residential loans, fair value option | Residential Portfolio Segment | Loans held for investment
Investments in loans
Carrying Value	$ 55,301

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Loans - Variable Rate Loans Held for Investment (Details) $ in Thousands	Jun. 30, 2022 USD ($)
Variable rate loans held-for-investment
Carrying Value	$ 17,225,303
Weighted-average Spread Above Index	4.00%
Commercial loans
Variable rate loans held-for-investment
Carrying Value	$ 14,941,518
Weighted-average Spread Above Index	4.00%
Infrastructure loans
Variable rate loans held-for-investment
Carrying Value	$ 2,283,785
Weighted-average Spread Above Index	3.90%

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Loans - Ratings (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Investments in loans
Total Amortized Cost Basis	$ 20,209,885	$ 18,480,919
Credit Loss Allowance	77,449
Credit deteriorated
Investments in loans
Total Amortized Cost Basis	38,200
Total loans held-for-investment
Investments in loans
Total Amortized Cost Basis	17,973,238	15,604,119
Total loans held-for-investment | Residential loans, fair value option
Investments in loans
Total Amortized Cost Basis	55,301	59,225
Loans under fair value option
Investments in loans
Total Amortized Cost Basis	2,236,647	2,876,800
Credit Loss Allowance	0
Commercial Portfolio Segment
Investments in loans
2022	2,864,885
2021	7,085,992
2020	996,074
2019	2,475,038
2018	1,154,668
Prior	1,057,495
Revolving Loans Amortized Cost Total	0
Total Amortized Cost Basis	15,634,152
Credit Loss Allowance	56,671
Commercial Portfolio Segment | LTV less than 60%
Investments in loans
2022	446,275
2021	2,613,440
2020	501,609
2019	947,347
2018	384,309
Prior	703,459
Revolving Loans Amortized Cost Total	0
Total Amortized Cost Basis	5,596,439
Credit Loss Allowance	4,287
Commercial Portfolio Segment | LTV 60% - 70%
Investments in loans
2022	2,318,864
2021	4,151,281
2020	246,709
2019	1,104,966
2018	457,469
Prior	68,379
Revolving Loans Amortized Cost Total	0
Total Amortized Cost Basis	8,347,668
Credit Loss Allowance	15,849
Commercial Portfolio Segment | LTV > 70%
Investments in loans
2022	99,746
2021	321,271
2020	247,756
2019	422,725
2018	312,890
Prior	263,883
Revolving Loans Amortized Cost Total	0
Total Amortized Cost Basis	1,668,271
Credit Loss Allowance	31,610
Commercial Portfolio Segment | Credit deteriorated
Investments in loans
2022	0
2021	0
2020	0
2019	0
2018	0
Prior	4,925
Revolving Loans Amortized Cost Total	0
Total Amortized Cost Basis	4,925
Credit Loss Allowance	4,925
Commercial Portfolio Segment | Defeased and other
Investments in loans
2022	0
2021	0
2020	0
2019	0
2018	0
Prior	16,849
Revolving Loans Amortized Cost Total	0
Total Amortized Cost Basis	16,849
Credit Loss Allowance	0
Commercial Portfolio Segment | Total loans held-for-investment
Investments in loans
Total Amortized Cost Basis	15,634,152	13,496,798
Infrastructure Portfolio Segment
Investments in loans
2022	93,913
2021	576,000
2020	149,161
2019	555,424
2018	478,400
Prior	421,560
Revolving Loans Amortized Cost Total	9,327
Total Amortized Cost Basis	2,283,785
Credit Loss Allowance	20,778
Infrastructure Portfolio Segment | Credit deteriorated
Investments in loans
2022	0
2021	0
2020	0
2019	0
2018	0
Prior	33,288
Revolving Loans Amortized Cost Total	0
Total Amortized Cost Basis	33,288
Credit Loss Allowance	10,121
Infrastructure Portfolio Segment | Power
Investments in loans
2022	93,913
2021	229,627
2020	108,491
2019	268,362
2018	393,708
Prior	338,268
Revolving Loans Amortized Cost Total	7,378
Total Amortized Cost Basis	1,439,747
Credit Loss Allowance	5,366
Infrastructure Portfolio Segment | Oil and gas
Investments in loans
2022	0
2021	346,373
2020	40,670
2019	287,062
2018	84,692
Prior	50,004
Revolving Loans Amortized Cost Total	1,949
Total Amortized Cost Basis	810,750
Credit Loss Allowance	5,291
Infrastructure Portfolio Segment | Total loans held-for-investment
Investments in loans
Total Amortized Cost Basis	2,283,785	$ 2,048,096
Residential Portfolio Segment
Investments in loans
Credit Loss Allowance	0
Residential Portfolio Segment | Total loans held-for-investment | Residential loans, fair value option
Investments in loans
Total Amortized Cost Basis	$ 55,301

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Loans - Narrative (Details) - USD ($) $ in Thousands	1 Months Ended
	May 31, 2022	Jun. 30, 2022	Dec. 31, 2021
Financing Receivable, Allowance for Credit Loss [Line Items]
Carrying Value		$ 20,209,885	$ 18,480,919
Allowance		77,449
Texas Mezzanine Borrower
Financing Receivable, Allowance for Credit Loss [Line Items]
Net consideration transferred	$ 50,200
Properties	110,800
Lease intangibles	15,400
Net working capital	11,800
Third-party first mortgage debt	$ 87,800
Credit deteriorated
Financing Receivable, Allowance for Credit Loss [Line Items]
Carrying Value		38,200
90 days or greater past due | Non-Credit Deterioration
Financing Receivable, Allowance for Credit Loss [Line Items]
Carrying Value		501,000
Past due loan converted to equity interests		7,300
Commercial Portfolio Segment
Financing Receivable, Allowance for Credit Loss [Line Items]
Carrying Value		15,634,152
Allowance		56,671
Commercial Portfolio Segment | Credit deteriorated
Financing Receivable, Allowance for Credit Loss [Line Items]
Carrying Value		4,925
Allowance		4,925
Commercial Portfolio Segment | 90 days or greater past due | Credit deteriorated
Financing Receivable, Allowance for Credit Loss [Line Items]
Nonaccrual status		33,300
Commercial Portfolio Segment | 90 days or greater past due | Senior Loans | New Jersey | Non-Credit Deterioration
Financing Receivable, Allowance for Credit Loss [Line Items]
Carrying Value		201,200
Commercial Portfolio Segment | 90 days or greater past due | Senior Loans | California | Non-Credit Deterioration
Financing Receivable, Allowance for Credit Loss [Line Items]
Carrying Value		222,500
Commercial Portfolio Segment | 90 days or greater past due | Senior Loans | New York | Non-Credit Deterioration
Financing Receivable, Allowance for Credit Loss [Line Items]
Carrying Value		9,200
Commercial Portfolio Segment | 90 days or greater past due | Leasehold Mortgage Loan | California | Non-Credit Deterioration
Financing Receivable, Allowance for Credit Loss [Line Items]
Nonaccrual status		37,800
Residential Portfolio Segment
Financing Receivable, Allowance for Credit Loss [Line Items]
Allowance		0
Residential Portfolio Segment | 90 days or greater past due | Non-Credit Deterioration
Financing Receivable, Allowance for Credit Loss [Line Items]
Carrying Value		30,300
Infrastructure Portfolio Segment
Financing Receivable, Allowance for Credit Loss [Line Items]
Carrying Value		2,283,785
Allowance		20,778
Infrastructure Portfolio Segment | Credit deteriorated
Financing Receivable, Allowance for Credit Loss [Line Items]
Carrying Value		33,288
Allowance		10,121
Infrastructure Portfolio Segment | Senior Loans | Credit deteriorated
Financing Receivable, Allowance for Credit Loss [Line Items]
Nonaccrual status		$ 4,900

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Loans - Activity in Portfolio (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021	Apr. 30, 2021
Activity in allowance for loan losses
Credit loss allowance at beginning of the period			$ 67,270
Credit loss (reversal) provision, net			10,179	$ (9,862)
Credit loss allowance at the end of the period	$ 77,449		77,449
Activity in loan portfolio
Balance at the beginning of the period			18,413,649	12,139,908
Acquisitions/originations/additional funding			7,499,295	5,369,620
Capitalized Interest			54,803	63,538
Basis of loans sold			(3,967,128)	(1,710,563)
Loan maturities/principal repayments			(1,297,513)	(2,351,252)
Discount accretion/premium amortization			30,869	29,739
Changes in fair value	(113,480)	$ 45,867	(239,263)	36,389
Foreign currency translation gain/(loss), net			(301,946)	1,642
Credit loss reversal (provision), net			(10,179)	9,862
Loan foreclosure and conversion to equity interest				(36,308)
Transfer to/from other asset classifications or between segments			(50,151)	172,474
Balance at the end of the period	20,132,436	13,725,049	20,132,436	13,725,049
Carrying Value	20,209,885		20,209,885		$ 18,480,919
90 days or greater past due | Non-Credit Deterioration
Activity in loan portfolio
Carrying Value	501,000		501,000
Past due loan converted to equity interests	7,300		7,300
Funded commitments
Activity in allowance for loan losses
Credit loss allowance at beginning of the period			67,270
Credit loss (reversal) provision, net			10,179
Credit loss allowance at the end of the period	77,449		77,449
Activity in loan portfolio
Credit loss reversal (provision), net			(10,179)
Unfunded commitments
Activity in allowance for loan losses
Credit loss allowance at beginning of the period			6,837
Credit loss (reversal) provision, net			(1,294)
Credit loss allowance at the end of the period	5,543		5,543
Unfunded commitments	2,603,260		2,603,260
Activity in loan portfolio
Credit loss reversal (provision), net			1,294
Held-to-Maturity Preferred Interests
Activity in allowance for loan losses
Credit loss allowance at beginning of the period			0
Credit loss (reversal) provision, net			248
Credit loss allowance at the end of the period	248		248
Unfunded commitments	12,500		12,500
Activity in loan portfolio
Credit loss reversal (provision), net			(248)
CMBS
Activity in allowance for loan losses
Credit loss allowance at beginning of the period			0
Credit loss (reversal) provision, net			47
Credit loss allowance at the end of the period	47		47
Unfunded commitments	35,976		35,976
Activity in loan portfolio
Credit loss reversal (provision), net			(47)
Total loans held-for-investment
Activity in allowance for loan losses
Credit loss allowance at beginning of the period			67,270
Credit loss allowance at the end of the period	77,449		77,449
Activity in loan portfolio
Carrying Value	17,973,238		17,973,238		15,604,119
Total loans held-for-investment | First mortgage loan participation
Activity in loan portfolio
Carrying Value	15,114,160		15,114,160		12,991,099
Loans under fair value option
Activity in allowance for loan losses
Credit loss (reversal) provision, net			0	0
Activity in loan portfolio
Balance at the beginning of the period			2,876,800	1,052,835
Acquisitions/originations/additional funding			3,607,070	1,367,574
Capitalized Interest			147	0
Basis of loans sold			(3,960,798)	(1,502,588)
Loan maturities/principal repayments			(110,642)	(206,119)
Discount accretion/premium amortization			0	504
Changes in fair value			(239,892)	35,005
Foreign currency translation gain/(loss), net			0	0
Credit loss reversal (provision), net			0	0
Loan foreclosure and conversion to equity interest				0
Transfer to/from other asset classifications or between segments			63,962	214,466
Balance at the end of the period	2,236,647	961,677	2,236,647	961,677
Carrying Value	2,236,647		2,236,647		2,876,800
Commercial Portfolio Segment
Activity in loan portfolio
Carrying Value	15,634,152		15,634,152
Commercial Portfolio Segment | Funded commitments
Activity in allowance for loan losses
Credit loss allowance at beginning of the period			46,600
Credit loss (reversal) provision, net			10,071
Credit loss allowance at the end of the period	56,671		56,671
Activity in loan portfolio
Credit loss reversal (provision), net			(10,071)
Commercial Portfolio Segment | Loans Held-For-Investment
Activity in allowance for loan losses
Credit loss allowance at beginning of the period			6,692
Credit loss (reversal) provision, net			(1,469)
Credit loss allowance at the end of the period	5,223		5,223
Unfunded commitments	2,550,117		2,550,117
Activity in loan portfolio
Credit loss reversal (provision), net			1,469
Commercial Portfolio Segment | Total loans held-for-investment
Activity in allowance for loan losses
Credit loss allowance at beginning of the period			46,600
Credit loss (reversal) provision, net			10,071	(11,381)
Credit loss allowance at the end of the period	56,671		56,671
Activity in loan portfolio
Balance at the beginning of the period			13,450,198	9,583,949
Acquisitions/originations/additional funding			3,510,157	3,713,142
Capitalized Interest			54,414	63,538
Basis of loans sold			(6,330)	(207,975)
Loan maturities/principal repayments			(1,034,439)	(2,025,641)
Discount accretion/premium amortization			26,525	27,067
Changes in fair value			0	0
Foreign currency translation gain/(loss), net			(299,206)	1,987
Credit loss reversal (provision), net			(10,071)	11,381
Loan foreclosure and conversion to equity interest				(36,308)
Transfer to/from other asset classifications or between segments			(113,767)	(204,583)
Balance at the end of the period	15,577,481	10,926,557	15,577,481	10,926,557
Carrying Value	15,634,152		15,634,152		13,496,798
Infrastructure Portfolio Segment
Activity in loan portfolio
Carrying Value	2,283,785		2,283,785
Infrastructure Portfolio Segment | Funded commitments
Activity in allowance for loan losses
Credit loss allowance at beginning of the period			20,670
Credit loss (reversal) provision, net			108
Credit loss allowance at the end of the period	20,778		20,778
Activity in loan portfolio
Credit loss reversal (provision), net			(108)
Infrastructure Portfolio Segment | Loans Held-For-Investment
Activity in allowance for loan losses
Credit loss allowance at beginning of the period			145
Credit loss (reversal) provision, net			(120)
Credit loss allowance at the end of the period	25		25
Unfunded commitments	4,667		4,667
Activity in loan portfolio
Credit loss reversal (provision), net			120
Infrastructure Portfolio Segment | Total loans held-for-investment
Activity in allowance for loan losses
Credit loss allowance at beginning of the period			20,670
Credit loss (reversal) provision, net			108	1,519
Credit loss allowance at the end of the period	20,778		20,778
Activity in loan portfolio
Balance at the beginning of the period			2,027,426	1,412,440
Acquisitions/originations/additional funding			382,068	288,904
Capitalized Interest			242	0
Basis of loans sold			0	0
Loan maturities/principal repayments			(148,225)	(100,624)
Discount accretion/premium amortization			4,344	2,168
Changes in fair value			0	0
Foreign currency translation gain/(loss), net			(2,740)	(345)
Credit loss reversal (provision), net			(108)	(1,519)
Loan foreclosure and conversion to equity interest				0
Transfer to/from other asset classifications or between segments			0	93,085
Balance at the end of the period	2,263,007	1,694,109	2,263,007	1,694,109
Carrying Value	2,283,785		2,283,785		$ 2,048,096
Residential Portfolio Segment | First mortgage loan participation | New York
Activity in loan portfolio
Carrying Value						$ 29,000
Residential Portfolio Segment | 90 days or greater past due | Non-Credit Deterioration
Activity in loan portfolio
Carrying Value	30,300		30,300
Residential Portfolio Segment | Total loans held-for-investment
Activity in allowance for loan losses
Credit loss (reversal) provision, net			0	0
Activity in loan portfolio
Balance at the beginning of the period			59,225	90,684
Acquisitions/originations/additional funding			0	0
Capitalized Interest			0	0
Basis of loans sold			0	0
Loan maturities/principal repayments			(4,207)	(18,868)
Discount accretion/premium amortization			0	0
Changes in fair value			629	1,384
Foreign currency translation gain/(loss), net			0	0
Credit loss reversal (provision), net			0	0
Loan foreclosure and conversion to equity interest				0
Transfer to/from other asset classifications or between segments			(346)	69,506
Balance at the end of the period	$ 55,301	$ 142,706	$ 55,301	$ 142,706

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Investment Securities - Summary of Investment Securities (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Debt Securities, Available-for-sale [Line Items]
Available-for-sale securities	$ 124,439	$ 143,980
HTM debt securities	762,268	691,746
Total investment securities	913,360	860,984
Credit loss allowance	4,505	8,610
VIE eliminations
Debt Securities, Available-for-sale [Line Items]
Equity security	(1,702,532)	(1,491,786)
CMBS
Debt Securities, Available-for-sale [Line Items]
HTM debt securities	571,959	538,506
Credit loss allowance	1,169	3,140
CMBS | Non- Controlling Interests
Debt Securities, Available-for-sale [Line Items]
Equity security	205,300	182,600
Before consolidation of securitization VIEs
Debt Securities, Available-for-sale [Line Items]
HTM debt securities	757,763	683,136
Equity security, fair value	10,193	11,624
Total investment securities	2,615,892	2,352,770
Before consolidation of securitization VIEs | RMBS
Debt Securities, Available-for-sale [Line Items]
Available-for-sale securities	124,439	143,980
Equity security	416,057	250,424
Before consolidation of securitization VIEs | CMBS
Debt Securities, Available-for-sale [Line Items]
Equity security	$ 1,307,440	$ 1,263,606

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Investment Securities - Summary of Purchases and Sales (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Debt Securities, Available-for-sale [Line Items]
Purchases/fundings	$ 67,919	$ 0	$ 86,058	$ 0
Sales	0	0	0	0
Principal collections	7,396	9,353	15,180	68,867
Redemptions		0		0
VIE eliminations
Debt Securities, Available-for-sale [Line Items]
Purchases/fundings	(205,476)	(106,433)	(289,833)	(133,766)
Sales	0	(30,684)	0	(42,288)
Principal collections	(20,739)	(16,089)	(42,753)	(30,570)
Redemptions		(11,976)		(11,976)
Held-to-maturity
Debt Securities, Available-for-sale [Line Items]
Purchases/fundings	67,919	0	86,058	0
Sales	0		0
Principal collections	1,276	879	1,940	52,569
Redemptions		0		0
RMBS | Available-for-sale
Debt Securities, Available-for-sale [Line Items]
Purchases/fundings	0	0	0	0
Sales	0	0	0	0
Principal collections	5,893	7,863	12,788	15,114
Redemptions		0		0
RMBS | Fair value option
Debt Securities, Available-for-sale [Line Items]
Purchases/fundings	141,795	52,351	226,152	79,684
Sales	0	30,684	0	30,684
Principal collections	20,325	14,687	41,929	28,031
Redemptions		11,976		11,976
CMBS | Fair value option
Debt Securities, Available-for-sale [Line Items]
Purchases/fundings	63,681	54,082	63,681	54,082
Sales	0	0	0	11,604
Principal collections	$ 641	2,013	$ 1,276	3,723
Redemptions		$ 0		$ 0

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Investment Securities - Available-for-Sale RMBS (Details) - USD ($) $ in Thousands	3 Months Ended
	Jun. 30, 2022	Dec. 31, 2021
Debt Securities, Available-for-sale [Line Items]
Amortized Cost	$ 95,469	$ 103,027
Credit Loss Allowance	0	0
Net Basis	95,469	103,027
Gross Unrealized Gains	29,278	41,052
Gross Unrealized Losses	(308)	(99)
Net Fair Value Adjustment	28,970	40,953
Fair Value	$ 124,439	$ 143,980
Available-for-sale | One-month LIBOR
Debt Securities, Available-for-sale [Line Items]
Effective variable rate basis	1.787%
RMBS | Available-for-sale | B-
Debt Securities, Available-for-sale [Line Items]
Weighted Average Coupon	2.60%
WAL (Years)	6 years 1 month 6 days

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Investment Securities - Narrative (Details)	3 Months Ended		6 Months Ended		12 Months Ended
	Jun. 30, 2022 USD ($) security	Jun. 30, 2021 USD ($)	Jun. 30, 2022 USD ($) security	Jun. 30, 2021 USD ($)	Dec. 31, 2012 shares	Dec. 31, 2021 USD ($) security
Debt Securities, Available-for-sale [Line Items]
Cost of third party management	$ 200,000	$ 300,000	$ 500,000	$ 600,000
Number of securities with unrealized losses | security	7		7			1
SEREF
Debt Securities, Available-for-sale [Line Items]
Number of shares acquired (in shares) | shares					9,140,000
Equity security, fair value	$ 10,200,000		$ 10,200,000			$ 11,600,000
Ownership percentage			2.00%
VIE eliminations
Debt Securities, Available-for-sale [Line Items]
Fair value of investment securities before consolidation of VIEs eliminated against VIE liabilities	21,000,000		$ 21,000,000
Fair value option
Debt Securities, Available-for-sale [Line Items]
Fair value of mortgage backed securities	1,700,000,000		1,700,000,000
RMBS
Debt Securities, Available-for-sale [Line Items]
Portion of securities with variable rate	$ 109,700,000		$ 109,700,000
RMBS | Available-for-sale
Debt Securities, Available-for-sale [Line Items]
Portion of securities with variable rate (as a percent)	88.00%		88.00%
RMBS | Fair value option
Debt Securities, Available-for-sale [Line Items]
Portion of securities with variable rate	$ 0		$ 0
Unpaid principal balance of investment securities before consolidation of VIEs	326,300,000		326,300,000
Fair value of investment securities before consolidation of VIEs	416,100,000		416,100,000
CMBS | Fair value option
Debt Securities, Available-for-sale [Line Items]
Portion of securities with variable rate	97,100,000		97,100,000
Unpaid principal balance of investment securities before consolidation of VIEs	2,900,000,000		2,900,000,000
Fair value of investment securities before consolidation of VIEs	$ 1,300,000,000		$ 1,300,000,000

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Investment Securities - AFS and Fair Value Option (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Estimated Fair Value
Securities with a loss less than 12 months	$ 4,691	$ 2,478
Securities with a loss greater than 12 months	0	0
Unrealized Losses
Securities with a loss less than 12 months	(308)	(99)
Securities with a loss greater than 12 months	$ 0	$ 0

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Investment Securities - HTM (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2022	Dec. 31, 2021
HTM Securities
Amortized Cost Basis	$ 762,268	$ 691,746
Credit Loss Allowance	(4,505)	(8,610)
Net Carrying Amount	757,763	683,136
Gross Unrealized Holding Gains	927	1,206
Gross Unrealized Holding Losses	(38,049)	(27,478)
Fair Value	720,641	656,864
Activity in credit loss allowance for HTM debt securities
Credit loss allowance at December 31, 2021	8,610
Credit loss (reversal) provision, net	(4,105)
Credit loss allowance at March 31, 2022	4,505
HTM preferred equity interests
Less than one year	405,394
One to three years	52,651
Three to five years	270,288
Thereafter	29,430
Total	757,763
CMBS
HTM Securities
Amortized Cost Basis	571,959	538,506
Credit Loss Allowance	(1,169)	(3,140)
Net Carrying Amount	570,790	535,366
Gross Unrealized Holding Gains	198	195
Gross Unrealized Holding Losses	(31,239)	(25,029)
Fair Value	539,749	510,532
Activity in credit loss allowance for HTM debt securities
Credit loss allowance at December 31, 2021	3,140
Credit loss (reversal) provision, net	(1,971)
Credit loss allowance at March 31, 2022	1,169
HTM preferred equity interests
Less than one year	314,026
One to three years	24,382
Three to five years	232,382
Thereafter	0
Total	570,790
Preferred interests
HTM Securities
Amortized Cost Basis	119,899	118,409
Credit Loss Allowance	(262)	(2,562)
Net Carrying Amount	119,637	115,847
Gross Unrealized Holding Gains	125	450
Gross Unrealized Holding Losses	(5,851)	(2,449)
Fair Value	113,911	113,848
Activity in credit loss allowance for HTM debt securities
Credit loss allowance at December 31, 2021	2,562
Credit loss (reversal) provision, net	(2,300)
Credit loss allowance at March 31, 2022	262
HTM preferred equity interests
Less than one year	91,368
One to three years	28,269
Three to five years	0
Thereafter	0
Total	119,637
Infrastructure bonds
HTM Securities
Amortized Cost Basis	70,410	34,831
Credit Loss Allowance	(3,074)	(2,908)
Net Carrying Amount	67,336	31,923
Gross Unrealized Holding Gains	604	561
Gross Unrealized Holding Losses	(959)	0
Fair Value	66,981	$ 32,484
Activity in credit loss allowance for HTM debt securities
Credit loss allowance at December 31, 2021	2,908
Credit loss (reversal) provision, net	166
Credit loss allowance at March 31, 2022	3,074
HTM preferred equity interests
Less than one year	0
One to three years	0
Three to five years	37,906
Thereafter	29,430
Total	$ 67,336

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Properties - Narrative (Details) ft² in Millions, $ in Millions	1 Months Ended	3 Months Ended	6 Months Ended		12 Months Ended
	Sep. 30, 2017 ft² property	Jun. 30, 2021 USD ($)	Jun. 30, 2022 USD ($) property	Jun. 30, 2021 USD ($)	Dec. 31, 2016 ft² Item
Operating properties | Commercial and Residential Lending Segment
Real Estate Properties [Line Items]
Gain on sale of property		$ 9.7		$ 9.7
Operating properties | Montgomery Alabama | Commercial and Residential Lending Segment
Real Estate Properties [Line Items]
Proceeds from sale of operating properties			$ 114.8	31.2
Gain on sale of property			86.6	17.7
Medical Office Portfolio
Real Estate Properties [Line Items]
Number of acquired properties closed | Item					34
Area of property | ft²					1.9
Total gross properties and lease intangibles			763.4
Debt			595.4
Master Lease Portfolio
Real Estate Properties [Line Items]
Total gross properties and lease intangibles			343.8
Debt			193.2
Number of retail properties acquired | property	16
Number of square feet of properties | ft²	1.9
Term of master lease agreements	24 years 7 months 6 days
Master Lease Portfolio | Minimum | Retail Properties | Geographic Concentration Risk | Utah, Florida, Texas and Minnesota
Real Estate Properties [Line Items]
Concentration risk (as a percent)	50.00%
REIS Equity Portfolio
Real Estate Properties [Line Items]
Total gross properties and lease intangibles			200.9
Debt			$ 144.2
Number of retail properties acquired | property			12
Number of equity interests in unconsolidated commercial real estate properties | property			1
REIS Equity Portfolio | Operating properties
Real Estate Properties [Line Items]
Proceeds from sale of operating properties		30.9	$ 34.5	30.9
Gain on sale of property		$ 9.7	$ 11.7	$ 9.7

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Properties - Summary of Properties (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2022	Dec. 31, 2021
Real Estate Properties [Line Items]
Properties, cost	$ 1,417,688	$ 1,347,844
Less: accumulated depreciation	(191,709)	(181,457)
Properties, net	1,225,979	1,166,387
Property Segment
Real Estate Properties [Line Items]
Land and land improvements	175,836	175,810
Buildings and building improvements	851,919	851,274
Furniture & fixtures	$ 288	260
Property Segment | Minimum
Real Estate Properties [Line Items]
Land and land improvements, useful life	0 days
Building and building improvements, useful life	0 days
Furniture & fixtures, useful life	3 years
Property Segment | Maximum
Real Estate Properties [Line Items]
Land and land improvements, useful life	15 years
Building and building improvements, useful life	45 years
Furniture & fixtures, useful life	5 years
Investing and Servicing Segment
Real Estate Properties [Line Items]
Land and land improvements	$ 36,910	41,771
Buildings and building improvements	133,748	149,399
Furniture & fixtures	$ 3,181	3,143
Investing and Servicing Segment | Minimum
Real Estate Properties [Line Items]
Land and land improvements, useful life	0 days
Building and building improvements, useful life	3 years
Furniture & fixtures, useful life	2 years
Investing and Servicing Segment | Maximum
Real Estate Properties [Line Items]
Land and land improvements, useful life	15 years
Building and building improvements, useful life	40 years
Furniture & fixtures, useful life	5 years
Commercial and Residential Lending Segment
Real Estate Properties [Line Items]
Land and land improvements	$ 33,681	9,691
Buildings and building improvements	77,941	12,408
Construction in progress	$ 104,184	$ 104,088
Commercial and Residential Lending Segment | Minimum
Real Estate Properties [Line Items]
Building and building improvements, useful life	0 days
Commercial and Residential Lending Segment | Maximum
Real Estate Properties [Line Items]
Building and building improvements, useful life	24 years

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Investments of Consolidated Affordable Housing Fund - Narrative (Details) - Primary beneficiary $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2022 USD ($) affordable_housing_community affordable_housing_unit	Dec. 31, 2018 affordable_housing_community	Dec. 31, 2017 affordable_housing_community	Dec. 31, 2016 affordable_housing_community	Dec. 31, 2015 affordable_housing_community	Dec. 31, 2021 USD ($)
Investments in and Advances to Affiliates [Line Items]
Investments of consolidated affordable housing fund, at fair value	$ 1,558,850					$ 1,040,309
Woodstar I Portfolio
Investments in and Advances to Affiliates [Line Items]
Number of affordable housing communities in portfolio | affordable_housing_community	32
Number of affordable housing units in portfolio | affordable_housing_unit	8,948
Number of affordable housing communities acquired in portfolio | affordable_housing_community				14	18
Investments of consolidated affordable housing fund, at fair value	$ 1,500,000
Debt fair value	$ 719,200
Woodstar II Portfolio
Investments in and Advances to Affiliates [Line Items]
Number of affordable housing communities in portfolio | affordable_housing_community	27
Number of affordable housing units in portfolio | affordable_housing_unit	6,109
Number of affordable housing communities acquired in portfolio | affordable_housing_community		19	8
Investments of consolidated affordable housing fund, at fair value	$ 1,200,000
Debt fair value	$ 492,500

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Investments of Consolidated Affordable Housing Fund - Summary of Investment Income (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Investments in and Advances to Affiliates [Line Items]
Unrealized change in fair value of investments	$ 294,690		$ 518,541
Primary beneficiary
Investments in and Advances to Affiliates [Line Items]
Distributions from affordable housing fund investments	12,475		22,665
Income from affordable housing fund investments	$ 307,165	$ 0	$ 541,206	$ 0

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Investment in Unconsolidated Entities (Details)	1 Months Ended	3 Months Ended	6 Months Ended
	Mar. 31, 2021 USD ($) entity Item	Jun. 30, 2022 USD ($) Item investment	Jun. 30, 2022 USD ($) Item investment	Dec. 31, 2021 USD ($)
Equity method investments:
Equity method, Carrying value		$ 62,519,000	$ 62,519,000	$ 64,316,000
Other equity investments:
Other equity investments, carrying value		22,991,000	22,991,000	25,781,000
Investment in unconsolidated entities		$ 85,510,000	$ 85,510,000	90,097,000
Number of publicly traded investments | Item		0	0
Carrying value over (under) equity in net assets		$ 0	$ 0
Equity interest in a natural gas power plant
Equity method investments:
Equity method, Participation / Ownership %		10.00%	10.00%
Equity method, Carrying value		$ 26,994,000	$ 26,994,000	26,255,000
Investor entity which owns equity in an online real estate company
Equity method investments:
Equity method, Participation / Ownership %		50.00%	50.00%
Equity method, Carrying value		$ 5,288,000	$ 5,288,000	5,206,000
Equity interest in a residential mortgage originator
Equity method investments:
Equity method, Carrying value		15,920,000	15,920,000	20,327,000
Other equity investments:
Carrying value over (under) equity in net assets		1,600,000	1,600,000
Various
Equity method investments:
Equity method, Carrying value		$ 14,317,000	$ 14,317,000	12,528,000
Other equity investments:
Investment in unconsolidated entities	$ 7,300,000
Number of investor entities | entity	2
Number of shopping malls | Item	2
Equity interest in a servicing and advisory business
Other equity investments:
Cost method, Participation / Ownership %		2.00%	2.00%
Other equity investments, carrying value		$ 12,955,000	$ 12,955,000	12,955,000
Investment funds which own equity in a loan servicer and other real estate assets (3)
Other equity investments:
Other equity investments, carrying value		940,000	940,000	4,194,000
Received a capital distribution		7,300,000	7,300,000
Decrease in equity securities related to proceeds		$ 3,300,000	$ 3,300,000
Number of investments | investment		2	2
Investor entities which own equity interests in two entertainment and retail centers
Other equity investments:
Cost method, Participation / Ownership %		15.00%	15.00%
Other equity investments, carrying value		$ 7,320,000	$ 7,320,000	7,320,000
Various
Other equity investments:
Other equity investments, carrying value		1,776,000	1,776,000	1,312,000
Subordinated Loans | Equity interest in a residential mortgage originator
Equity method investments:
Equity method, Carrying value		$ 4,500,000	$ 4,500,000	$ 4,500,000
Minimum | Various
Equity method investments:
Equity method, Participation / Ownership %		25.00%	25.00%
Minimum | Investment funds which own equity in a loan servicer and other real estate assets (3)
Other equity investments:
Cost method, Participation / Ownership %		4.00%	4.00%
Minimum | Various
Other equity investments:
Cost method, Participation / Ownership %		1.00%	1.00%
Maximum | Various
Equity method investments:
Equity method, Participation / Ownership %		50.00%	50.00%
Maximum | Investment funds which own equity in a loan servicer and other real estate assets (3)
Other equity investments:
Cost method, Participation / Ownership %		6.00%	6.00%
Maximum | Various
Other equity investments:
Cost method, Participation / Ownership %		3.00%	3.00%

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Goodwill and Intangibles - Narrative (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Goodwill [Line Items]
Goodwill	$ 259,846	$ 259,846
Domestic servicing rights, at fair value | Before consolidation of securitization VIEs
Goodwill [Line Items]
Servicing rights intangibles	59,200	58,900
VIE eliminations | Domestic servicing rights, at fair value
Goodwill [Line Items]
Servicing rights intangibles	41,700	42,100
Infrastructure Lending Segment
Goodwill [Line Items]
Goodwill	119,400	119,400
Investing and Servicing Segment
Goodwill [Line Items]
Goodwill	$ 140,400	$ 140,400

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Goodwill and Intangibles - Summary of Intangible Assets (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Goodwill [Line Items]
Gross Carrying Value	$ 145,058	$ 135,238
Accumulated Amortization	(70,094)	(71,674)
Net Carrying Value	74,964	63,564
In-place Lease Intangible Assets
Goodwill [Line Items]
Gross Carrying Value	100,797	94,712
Accumulated Amortization	(60,874)	(62,721)
Net Carrying Value	39,923	31,991
Favorable Lease Intangible Assets
Goodwill [Line Items]
Gross Carrying Value	26,762	23,746
Accumulated Amortization	(9,220)	(8,953)
Net Carrying Value	17,542	14,793
Domestic servicing rights, at fair value
Goodwill [Line Items]
Gross Carrying Value	17,499	16,780
Net Carrying Value	$ 17,499	$ 16,780

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Goodwill and Intangibles - Activity (Details) $ in Thousands	6 Months Ended
	Jun. 30, 2022 USD ($)
Intangible Assets, Net (Excluding Goodwill) [Roll Forward]
Balance as of January 1, 2022	$ 63,564
Acquisition	15,430
Amortization	(4,163)
Impairment	(47)
Sales	(539)
Changes in fair value due to changes in inputs and assumptions	719
Balance as of June 30 2022	74,964
In-place Lease Intangible Assets
Intangible Assets, Net (Excluding Goodwill) [Roll Forward]
Balance as of January 1, 2022	31,991
Acquisition	11,910
Amortization	(3,434)
Impairment	(43)
Sales	(501)
Changes in fair value due to changes in inputs and assumptions	0
Balance as of June 30 2022	39,923
Favorable Lease Intangible Assets
Intangible Assets, Net (Excluding Goodwill) [Roll Forward]
Balance as of January 1, 2022	14,793
Acquisition	3,520
Amortization	(729)
Impairment	(4)
Sales	(38)
Changes in fair value due to changes in inputs and assumptions	0
Balance as of June 30 2022	17,542
Domestic servicing rights, at fair value
Intangible Assets, Net (Excluding Goodwill) [Roll Forward]
Balance as of January 1, 2022	16,780
Acquisition	0
Amortization	0
Impairment	0
Sales	0
Changes in fair value due to changes in inputs and assumptions	719
Balance as of June 30 2022	$ 17,499

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Goodwill and Intangibles - Future Expected Amortization (Details) $ in Thousands	Jun. 30, 2022 USD ($)
Goodwill and Intangible Assets Disclosure [Abstract]
2022 (remainder of)	$ 4,760
2023	8,639
2024	6,941
2025	5,827
2026	4,301
Thereafter	26,997
Total	$ 57,465

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Secured Borrowings - Secured Financing Agreements (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2022	Dec. 31, 2022	Dec. 31, 2021
Secured Borrowings
Available-for-sale securities	$ 124,439		$ 143,980
Secured financing agreements, net	13,147,447		12,576,850
Revolving credit facility
Secured Borrowings
Maximum borrowing capacity	150,000
Equity interests in certain subsidiaries used to secure facilities	5,000,000
Borrowing Base Facility
Secured Borrowings
Maximum Facility Size	650,000
Maximum facility size subject to certain conditions	750,000
Borrowing Base Facility | Forecast
Secured Borrowings
Maximum Facility Size		$ 450,000
Commercial Financing Facilities
Secured Borrowings
Maximum Facility Size	$ 345,000
Property Mortgages - Fixed rate
Secured Borrowings
Maturity period	5 years
Term Loan Facility
Secured Borrowings
Maximum borrowing capacity	$ 784,800
Floor interest rate (as a percent)	0.75%
SOFR | Revolving credit facility
Secured Borrowings
Coupon Rate	2.50%
LIBOR + 2.50% | Term Loan Facility
Secured Borrowings
Pricing margin	2.50%
Maximum borrowing capacity	$ 389,000
LIBOR + 3.25% | Term Loan Facility
Secured Borrowings
Pricing margin	3.25%
Maximum borrowing capacity	$ 395,800
Secured Borrowings
Secured Borrowings
Maximum Facility Size	22,485,661
Long term debt, gross	13,228,043		12,654,420
Unamortized net discount	(13,813)		(13,350)
Unamortized deferred financing costs	(66,783)		(64,220)
Secured financing agreements, net	13,147,447		12,576,850
Secured Borrowings | Asset Pledged as Collateral
Secured Borrowings
Available-for-sale securities	17,192,295
Secured Borrowings | Borrowing Base Facility
Secured Borrowings
Maximum Facility Size	750,000
Long term debt, gross	6,613		213,478
Secured Borrowings | Borrowing Base Facility | Asset Pledged as Collateral
Secured Borrowings
Available-for-sale securities	8,786
Secured Borrowings | Commercial Financing Facilities
Secured Borrowings
Maximum Facility Size	445,005
Long term debt, gross	234,948		167,476
Secured Borrowings | Commercial Financing Facilities | Asset Pledged as Collateral
Secured Borrowings
Available-for-sale securities	299,352
Secured Borrowings | Residential Financing Facility
Secured Borrowings
Maximum Facility Size	500,000
Long term debt, gross	142,418		102,018
Secured Borrowings | Residential Financing Facility | Asset Pledged as Collateral
Secured Borrowings
Available-for-sale securities	489,474
Secured Borrowings | Infrastructure Financing Facilities
Secured Borrowings
Maximum Facility Size	1,750,000
Long term debt, gross	737,326		855,646
Secured Borrowings | Infrastructure Financing Facilities | Asset Pledged as Collateral
Secured Borrowings
Available-for-sale securities	$ 915,824
Secured Borrowings | Property Mortgages - Fixed rate
Secured Borrowings
Coupon Rate	4.48%
Maximum Facility Size	$ 275,993
Long term debt, gross	275,993		272,522
Secured Borrowings | Property Mortgages - Fixed rate | Asset Pledged as Collateral
Secured Borrowings
Available-for-sale securities	384,284
Secured Borrowings | Property Mortgages - Variable rate
Secured Borrowings
Maximum Facility Size	742,650
Long term debt, gross	730,336		712,493
Secured Borrowings | Property Mortgages - Variable rate | Asset Pledged as Collateral
Secured Borrowings
Available-for-sale securities	775,534
Secured Borrowings | Term Loan and Revolver
Secured Borrowings
Maximum Facility Size	934,759
Long term debt, gross	784,759		788,753
Secured Borrowings | Other Secured Financing
Secured Borrowings
Maximum Facility Size	5,398,407
Long term debt, gross	2,912,393		3,112,386
Secured Borrowings | Other Secured Financing | Asset Pledged as Collateral
Secured Borrowings
Available-for-sale securities	2,873,254
Secured Borrowings | First Mortgage and Mezzanine
Secured Borrowings
Long term debt, gross	$ 600,000
Secured Borrowings | LIBOR | First Mortgage and Mezzanine
Secured Borrowings
Coupon Rate	3.34%
Secured Borrowings | LIBOR | First Mortgage and Mezzanine | Weighted-average
Secured Borrowings
Pricing margin	2.07%
Secured Borrowings | SOFR | Borrowing Base Facility
Secured Borrowings
Pricing margin	2.11%
Secured Borrowings | SOFR | Residential Financing Facility
Secured Borrowings
Pricing margin	2.45%
Secured Borrowings | Index | Commercial Financing Facilities
Secured Borrowings
Pricing margin	1.73%
Secured Borrowings | Index | Infrastructure Financing Facilities
Secured Borrowings
Pricing margin	2.04%
Line of Credit | Commercial Financing Facilities
Secured Borrowings
Line of credit capacity if conditions are met	$ 445,000
Commercial Loans
Secured Borrowings
Maximum Facility Size	11,500,000
Secured financing agreements, net	2,900,000
Line of credit capacity if conditions are met	$ 12,400,000
Commercial Loans | Index | Weighted-average
Secured Borrowings
Pricing margin	2.28%
Commercial Loans | Secured Borrowings
Secured Borrowings
Maximum Facility Size	$ 12,407,967
Long term debt, gross	7,828,681		6,556,438
Commercial Loans | Secured Borrowings | Asset Pledged as Collateral
Secured Borrowings
Available-for-sale securities	$ 10,771,843
Commercial Loans | Secured Borrowings | Index
Secured Borrowings
Pricing margin	2.03%
Residential Loans | Secured Borrowings
Secured Borrowings
Maximum Facility Size	$ 2,502,636
Long term debt, gross	1,405,200		1,744,225
Residential Loans | Secured Borrowings | Asset Pledged as Collateral
Secured Borrowings
Available-for-sale securities	$ 1,697,635
Residential Loans | Secured Borrowings | Index
Secured Borrowings
Pricing margin	2.11%
Infrastructure Loans | Secured Borrowings
Secured Borrowings
Maximum Facility Size	$ 650,000
Long term debt, gross	293,673		379,095
Infrastructure Loans | Secured Borrowings | Asset Pledged as Collateral
Secured Borrowings
Available-for-sale securities	$ 350,599
Infrastructure Loans | Secured Borrowings | Index
Secured Borrowings
Pricing margin	2.01%
Conduit Loans | Secured Borrowings
Secured Borrowings
Maximum Facility Size	$ 650,000
Long term debt, gross	30,923		174,130
Conduit Loans | Secured Borrowings | Asset Pledged as Collateral
Secured Borrowings
Available-for-sale securities	$ 40,694
Conduit Loans | Secured Borrowings | Index
Secured Borrowings
Pricing margin	2.28%
CMBS/RMBS
Secured Borrowings
Coupon Rate	3.27%
Secured financing agreements, net	$ 265,700
Amount outstanding on a repurchase facility not subject to margin calls	265,700
Amount outstanding on repurchase facility	$ 43,300
Pro rata share owned by a non-controlling partner in a consolidated joint venture	49.00%
CMBS/RMBS | Certain Facilities
Secured Borrowings
Secured financing agreements, net	$ 332,600
Rolling maturity period	11 months
Maturity period	12 months
CMBS/RMBS | Index | Weighted-average
Secured Borrowings
Coupon Rate	1.94%
CMBS/RMBS | Secured Borrowings
Secured Borrowings
Maximum Facility Size	$ 876,651
Long term debt, gross	757,173		688,146
CMBS/RMBS | Secured Borrowings | Asset Pledged as Collateral
Secured Borrowings
Available-for-sale securities	1,458,270
Total Repurchase Agreements | Secured Borrowings
Secured Borrowings
Maximum Facility Size	17,087,254
Long term debt, gross	10,315,650		$ 9,542,034
Total Repurchase Agreements | Secured Borrowings | Asset Pledged as Collateral
Secured Borrowings
Available-for-sale securities	$ 14,319,041

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Secured Borrowings - Narrative (Details)	1 Months Ended					3 Months Ended		6 Months Ended
	Jun. 30, 2022 USD ($) extension	Mar. 31, 2022 USD ($)	Feb. 28, 2022 USD ($)	Jan. 31, 2022 USD ($)	Jul. 31, 2021 USD ($) hotel	Jun. 30, 2022 USD ($)	Jun. 30, 2021 USD ($)	Jun. 30, 2022 USD ($)	Jun. 30, 2021 USD ($)	Dec. 31, 2021 USD ($)	May 31, 2021 USD ($)	Apr. 30, 2021 USD ($)	Aug. 31, 2019 USD ($)
Secured Borrowings
Principal amount of notes purchased by third-party investors					$ 210,100,000
RMBS
Secured Borrowings
Securitizations of loans					$ 230,000,000
Number of hotels | hotel					41
Residential Loan Credit Facility
Secured Borrowings
Maximum borrowing capacity		$ 500,000,000	$ 250,000,000
Initial maturity extension		18 months
Extension term		3 years
STWD 2022-FL3
Secured Borrowings
Face Amount			1,000,000,000
Principal amount of notes purchased by third-party investors			842,500,000
Long term debt, gross			82,500,000
Liquidation preference			$ 75,000,000
CLO contribution period			2 years
Additional contribution to CLO								$ 0
STWD 2021-FL2
Secured Borrowings
Face Amount											$ 1,300,000,000
Principal amount of notes purchased by third-party investors											1,100,000,000
Long term debt, gross											70,100,000
Liquidation preference											$ 127,500,000
Additional contribution to CLO								123,700,000
STWD 2019-FL1
Secured Borrowings
Face Amount													$ 1,100,000,000
Principal amount of notes purchased by third-party investors													936,400,000
Long term debt, gross													86,600,000
Liquidation preference													$ 77,000,000
Repayments of debt								106,200,000
STWD 2021-SIF2
Secured Borrowings
Additional contribution to CLO								86,200,000
STWD 2021-SIF1
Secured Borrowings
Face Amount				$ 500,000,000								$ 500,000,000
Principal amount of notes purchased by third-party investors				410,000,000								410,000,000
Liquidation preference				$ 90,000,000								$ 90,000,000
CLO contribution period				3 years
Additional contribution to CLO								57,700,000
CLOs and SASB
Secured Borrowings
Amortization of deferred financing costs						$ 2,700,000	$ 1,400,000	5,100,000	$ 2,000,000
Incurred debt issuance costs								37,900,000
Deferred financing costs, net of amortization	$ 23,700,000					23,700,000		23,700,000		$ 17,700,000
Morgan Stanley Bank, N.A.
Secured Borrowings
Amount at risk	719,900,000					719,900,000		$ 719,900,000
Weighted average extended maturities								3 years 10 months 24 days
Line of Credit | Infrastructure Credit Facility
Secured Borrowings
Maximum borrowing capacity	$ 500,000,000					$ 500,000,000		$ 500,000,000
Extension term	1 year
Maturity period	3 years
Number of extensions | extension	2
Line of Credit | Commercial Loans Repurchase Facilities
Secured Borrowings
Increase in borrowing capacity, new facilities								1,400,000,000
Increase in borrowing capacity, existing facilities								$ 924,700,000
Repurchase Agreements
Secured Borrowings
Percentage of repurchase agreements for which margin calls are limited to collateral specific credit marks	70.00%					70.00%		70.00%
Percentage of repurchase agreements containing margin call provisions for general capital market activity	30.00%					30.00%		30.00%
Percentage of repurchase agreements containing margin call provisions that pertain to loans held-for-sale	12.00%					12.00%		12.00%
Secured Borrowings
Secured Borrowings
Amortization of deferred financing costs						$ 9,200,000	$ 8,900,000	$ 18,800,000	$ 18,400,000
Long term debt, gross	$ 13,228,043,000					$ 13,228,043,000		$ 13,228,043,000		$ 12,654,420,000

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Secured Borrowings - Collateralized Loan Obligations (Details) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2022 USD ($) Item	Dec. 31, 2021 USD ($) Item	Feb. 28, 2022 USD ($)	Jan. 31, 2022 USD ($)	May 31, 2021 USD ($)	Apr. 30, 2021 USD ($)	Aug. 31, 2019 USD ($)
Summary of CLO
Carrying Value	$ 3,764,151	$ 2,616,116
Collateral assets
Summary of CLO
Face Amount	4,490,087	3,086,319
Carrying Value	4,536,916	3,120,444
Financing
Summary of CLO
Face Amount	3,780,115	2,633,841
Carrying Value	$ 3,764,151	$ 2,616,116
STWD 2022-FL3
Summary of CLO
Face Amount			$ 1,000,000
STWD 2022-FL3 | Collateral assets
Summary of CLO
Count | Item	24
Face Amount	$ 1,000,000
Carrying Value	$ 1,010,536
STWD 2022-FL3 | Financing
Summary of CLO
Count | Item	1
Face Amount	$ 842,500
Carrying Value	$ 843,681
STWD 2022-FL3 | Index | Collateral assets
Summary of CLO
Weighted Average Spread	3.58%
STWD 2022-FL3 | SOFR | Financing
Summary of CLO
Weighted Average Spread	1.91%
STWD 2021-HTS | Collateral assets
Summary of CLO
Count | Item	1	1
Face Amount	$ 230,000	$ 230,000
Carrying Value	$ 230,713	$ 230,587
STWD 2021-HTS | Financing
Summary of CLO
Count | Item	1	1
Face Amount	$ 210,091	$ 210,091
Carrying Value	$ 208,509	$ 208,057
STWD 2021-HTS | LIBOR | Collateral assets
Summary of CLO
Weighted Average Spread	3.85%	4.12%
STWD 2021-HTS | LIBOR | Financing
Summary of CLO
Weighted Average Spread	2.69%	2.48%
STWD 2021-FL2
Summary of CLO
Face Amount					$ 1,300,000
Percent of outstanding loan	7.00%
Debt, weighted average interest rate	7.44%
STWD 2021-FL2 | Collateral assets
Summary of CLO
Count | Item	24	25
Face Amount	$ 1,275,275	$ 1,272,133
Carrying Value	$ 1,281,127	$ 1,279,678
STWD 2021-FL2 | Financing
Summary of CLO
Count | Item	1	1
Face Amount	$ 1,077,375	$ 1,077,375
Carrying Value	$ 1,071,047	$ 1,069,691
STWD 2021-FL2 | Index | Collateral assets
Summary of CLO
Weighted Average Spread	4.09%
STWD 2021-FL2 | LIBOR | Collateral assets
Summary of CLO
Weighted Average Spread		4.22%
STWD 2021-FL2 | LIBOR | Financing
Summary of CLO
Weighted Average Spread	1.78%	1.78%
STWD 2019-FL1
Summary of CLO
Face Amount							$ 1,100,000
STWD 2019-FL1 | Collateral assets
Summary of CLO
Count | Item	18	24
Face Amount	$ 993,774	$ 1,092,887
Carrying Value	$ 996,268	$ 1,103,513
STWD 2019-FL1 | Financing
Summary of CLO
Count | Item	1	1
Face Amount	$ 830,149	$ 936,375
Carrying Value	$ 828,071	$ 933,049
STWD 2019-FL1 | LIBOR | Collateral assets
Summary of CLO
Weighted Average Spread	3.82%	4.19%
STWD 2019-FL1 | SOFR | Financing
Summary of CLO
Weighted Average Spread	1.65%	1.63%
STWD 2021-SIF2
Summary of CLO
Percent of outstanding loan	5.00%
Debt, weighted average interest rate	7.75%
STWD 2021-SIF2 | Collateral assets
Summary of CLO
Count | Item	32
Face Amount	$ 494,789
Carrying Value	$ 510,807
STWD 2021-SIF2 | Financing
Summary of CLO
Count | Item	1
Face Amount	$ 410,000
Carrying Value	$ 406,807
STWD 2021-SIF2 | LIBOR | Collateral assets
Summary of CLO
Weighted Average Spread	3.71%
STWD 2021-SIF2 | SOFR | Financing
Summary of CLO
Weighted Average Spread	2.11%
STWD 2021-SIF1
Summary of CLO
Face Amount				$ 500,000		$ 500,000
Percent of outstanding loan	3.00%
Debt, weighted average interest rate	5.95%
STWD 2021-SIF1 | Collateral assets
Summary of CLO
Count | Item	31	31
Face Amount	$ 496,249	$ 491,299
Carrying Value	$ 507,465	$ 506,666
STWD 2021-SIF1 | Financing
Summary of CLO
Count | Item	1	1
Face Amount	$ 410,000	$ 410,000
Carrying Value	$ 406,036	$ 405,319
STWD 2021-SIF1 | Index | Collateral assets
Summary of CLO
Weighted Average Spread	3.87%
STWD 2021-SIF1 | LIBOR | Collateral assets
Summary of CLO
Weighted Average Spread		3.91%
STWD 2021-SIF1 | LIBOR | Financing
Summary of CLO
Weighted Average Spread	2.15%	2.15%

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Secured Borrowings - Principal Repayments (Details) $ in Thousands	Jun. 30, 2022 USD ($)
CLOs and SASB
Repayment of secured financings
2022 (remainder of)	$ 143,428
2023	652,016
2024	434,434
2025	678,448
2026	1,732,148
Thereafter	139,641
Total	3,780,115
Secured Borrowings
Repayment of secured financings
2022 (remainder of)	426,648
2023	3,508,667
2024	1,767,885
2025	3,667,178
2026	4,503,647
Thereafter	3,134,133
Total	17,008,158
Repurchase Agreements
Repayment of secured financings
2022 (remainder of)	258,961
2023	2,120,093
2024	1,097,580
2025	2,742,149
2026	1,797,262
Thereafter	2,299,605
Total	10,315,650
Other Secured Financing
Repayment of secured financings
2022 (remainder of)	24,259
2023	736,558
2024	235,871
2025	246,581
2026	974,237
Thereafter	694,887
Total	$ 2,912,393

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Unsecured Senior Notes - Summary of Unsecured Financing Agreements (Details) - USD ($) $ in Thousands	6 Months Ended
	Jun. 30, 2022	Jan. 25, 2022	Dec. 31, 2021	Mar. 29, 2017
Unsecured Senior Notes
Total carrying amount	$ 2,324,772		$ 1,828,590
Unsecured Senior Notes
Unsecured Senior Notes
Long term debt, gross	2,350,000		1,850,000
Unamortized deferred financing costs	(14,030)		(10,765)
Convertible Senior Notes
Unsecured Senior Notes
Unamortized discount	(351)		(578)
Senior Notes
Unsecured Senior Notes
Unamortized discount	$ (10,847)		(10,067)
2023 Senior Notes
Unsecured Senior Notes
Coupon Rate	5.50%
Effective Rate	5.71%
Remaining Period of Amortization	1 year 3 months 18 days
Long term debt, gross	$ 300,000		300,000
2023 Convertible Notes
Unsecured Senior Notes
Coupon Rate	4.38%			4.375%
Effective Rate	4.57%
Remaining Period of Amortization	9 months 18 days
Long term debt, gross	$ 250,000		250,000
2024 Senior Notes
Unsecured Senior Notes
Coupon Rate	3.75%
Effective Rate	3.94%
Remaining Period of Amortization	2 years 6 months
Long term debt, gross	$ 400,000		400,000
2025 Senior Notes
Unsecured Senior Notes
Coupon Rate	4.75%
Effective Rate	5.04%
Remaining Period of Amortization	2 years 8 months 12 days
Long term debt, gross	$ 500,000		500,000
2026 Senior Notes
Unsecured Senior Notes
Coupon Rate	3.63%
Effective Rate	3.77%
Remaining Period of Amortization	4 years
Long term debt, gross	$ 400,000		400,000
2027 Senior Notes
Unsecured Senior Notes
Coupon Rate	4.375%	4.375%
Effective Rate	4.49%
Remaining Period of Amortization	4 years 7 months 6 days
Long term debt, gross	$ 500,000		$ 0
LIBOR | 2025 Senior Notes
Unsecured Senior Notes
Long term debt, gross	$ 470,000
Pricing margin	2.53%
SOFR | 2027 Senior Notes
Unsecured Senior Notes
Pricing margin	2.95%

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Unsecured Senior Notes - Narrative (Details)		3 Months Ended		6 Months Ended
	Jan. 25, 2022 USD ($)	Jun. 30, 2022 USD ($) $ / shares	Jun. 30, 2021 USD ($)	Jun. 30, 2022 USD ($) Item $ / shares	Jun. 30, 2021 USD ($)	Mar. 29, 2017 USD ($)
Unsecured Senior Notes
Interest expense		$ 152,618,000	$ 109,653,000	$ 279,069,000	$ 213,027,000
Closing share price (in dollars per share) | $ / shares		$ 20.89		$ 20.89
Minimum | Conversion upon satisfaction of closing market price condition
Unsecured Senior Notes
Period of average closing market price of common stock as a basis for debt conversion				10 days
Convertible Senior Notes
Unsecured Senior Notes
Interest expense		$ 2,900,000	$ 2,900,000	$ 5,800,000	$ 5,800,000
Minimum number of conditions to be satisfied for conversion of debt | Item				1
Convertible Senior Notes | Conversion upon satisfaction of closing market price condition
Unsecured Senior Notes
Minimum trading period as a basis for debt conversion				20 days
Consecutive trading period as a basis for debt conversion				30 days
Convertible Senior Notes | Conversion upon satisfaction of trading price condition
Unsecured Senior Notes
Consecutive trading period as a basis for debt conversion				5 days
Convertible Senior Notes | Minimum | Conversion upon satisfaction of closing market price condition
Unsecured Senior Notes
Percentage of per share value of distributions that exceeds the market price of the entity's common stock as a basis for debt conversion				10.00%
Convertible Senior Notes | Maximum | Conversion upon satisfaction of trading price condition
Unsecured Senior Notes
Percentage of conversion price and last reported sales price as a basis for debt conversion				98.00%
2027 Senior Notes
Unsecured Senior Notes
Face Amount	$ 500,000,000
Coupon Rate	4.375%	4.375%		4.375%
2027 Senior Notes | Redemption period one
Unsecured Senior Notes
Redemption percentage	100.00%
2027 Senior Notes | Redemption period two
Unsecured Senior Notes
Redemption percentage	100.00%
2027 Senior Notes | Redemption period three
Unsecured Senior Notes
Redemption percentage	40.00%
2023 Convertible Notes
Unsecured Senior Notes
Face Amount						$ 250,000,000
Coupon Rate		4.38%		4.38%		4.375%
Amount by which if-converted value of the Notes are less than principal amount				$ 48,400,000
Conversion price (in dollars per share) | $ / shares		$ 25.91		$ 25.91
If-converted value		$ 201,600,000		$ 201,600,000
Convertible notes carrying value		249,500,000		249,500,000
Convertible notes fair value		$ 246,300,000		$ 246,300,000
2023 Convertible Notes | Convertible Notes and Senior Notes | Minimum | Conversion upon satisfaction of closing market price condition
Unsecured Senior Notes
Percentage of conversion price as a basis for debt conversion				110.00%

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Unsecured Senior Notes - Convertible Notes (Details)	6 Months Ended
	Jun. 30, 2022 USD ($) $ / shares
Unsecured Senior Notes
Principal amount of notes, basis for conversion | $	$ 1,000
Closing share price (in dollars per share)	$ 20.89
2023 Convertible Notes
Unsecured Senior Notes
Conversion Rate	38.5959
Conversion price (in dollars per share)	$ 25.91

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Loan Securitization/Sale Activities - Summary of Loans (Details) - USD ($) $ in Thousands	1 Months Ended		3 Months Ended		6 Months Ended
	Jun. 30, 2022	Feb. 28, 2022	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Investing and Servicing Segment | Commercial Loans
Loan Transfer Activities
Face Amount			$ 658,447	$ 304,604	$ 1,005,889	$ 389,641
Proceeds			649,730	321,377	991,797	411,087
Investing and Servicing Segment | Residential Loans
Loan Transfer Activities
Face Amount			827,871	564,429	1,905,829	947,978
Proceeds			813,175	583,877	1,913,459	973,675
Commercial and Residential Lending Segment | Commercial Loans
Loan Transfers Accounted for as Sales
Face amount			6,980	232,670	6,980	232,670
Proceeds			6,469	229,490	6,469	229,490
Commercial and Residential Lending Segment | Residential Loans
Loan Transfers Accounted for as Sales
Face amount			220,101	383	1,055,861	89,801
Proceeds			219,426	398	1,055,542	92,817
Commercial and Residential Lending Segment | Residential Loans | Agency-Eligible Residential Loan
Loan Transfers Accounted for as Sales
Face amount		$ 745,000
Estimate of disposition strategy on loans	$ 32,700		32,700		32,700
Face amount	$ 729,100
Financing term	120 days
First Mortgage Loans
Loan Transfers Accounted for as Sales
Face amount			7,000	210,100	7,000	210,100
Proceeds from sale of mortgage loans			$ 6,500	208,000	$ 6,500	208,000
Whole Loan Interest
Loan Transfers Accounted for as Sales
Face amount				22,600		22,600
Proceeds from sale of mortgage loans				$ 21,500		$ 21,500

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Loan Securitization/Sale Activities - Narrative (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Commercial and Residential Lending Segment
Loan Transfer Activities
Net gains (losses) on the sale of loan qualifying for sales treatment	$ 0.1	$ (1.0)	$ 0.1	$ (1.0)
Infrastructure Lending Segment
Loan Transfer Activities
Loans held-for-sale face amount	$ 0.0	2.5	$ 0.0	2.5
Proceeds		$ 2.5		$ 2.5

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Derivatives and Hedging Activity - Designated and Non-Designated Hedges (Details) € in Thousands, £ in Thousands, SFr in Thousands, $ in Thousands, $ in Thousands	Jun. 30, 2022 EUR (€) contract	Jun. 30, 2022 GBP (£) contract	Jun. 30, 2022 AUD ($) contract	Jun. 30, 2022 CHF (SFr) contract	Jun. 30, 2022 USD ($) contract
Derivatives
Number of Contracts	596	596	596	596	596
Foreign exchange contracts | EUR | Long
Derivatives
Number of Contracts	20	20	20	20	20
Aggregate Notional Amount | €	€ 43,684
Foreign exchange contracts | EUR | Short
Derivatives
Number of Contracts	225	225	225	225	225
Aggregate Notional Amount | €	€ 616,996
Foreign exchange contracts | GBP | Long
Derivatives
Number of Contracts	8	8	8	8	8
Aggregate Notional Amount | £		£ 9,772
Foreign exchange contracts | GBP | Short
Derivatives
Number of Contracts	196	196	196	196	196
Aggregate Notional Amount | £		£ 575,781
Foreign exchange contracts | AUD | Long
Derivatives
Number of Contracts	5	5	5	5	5
Aggregate Notional Amount | $			$ 8,915
Foreign exchange contracts | AUD | Short
Derivatives
Number of Contracts	93	93	93	93	93
Aggregate Notional Amount | $			$ 640,709
Foreign exchange contracts | Switzerland, Francs | Long
Derivatives
Number of Contracts	1	1	1	1	1
Aggregate Notional Amount | SFr				SFr 29,400
Foreign exchange contracts | Switzerland, Francs | Short
Derivatives
Number of Contracts	1	1	1	1	1
Aggregate Notional Amount | SFr				SFr 38,449
Interest rate swaps – Paying fixed rates | USD
Derivatives
Number of Contracts	32	32	32	32	32
Aggregate Notional Amount | $					$ 3,061,834
Interest rate swaps – Receiving fixed rates | USD
Derivatives
Number of Contracts	2	2	2	2	2
Aggregate Notional Amount | $					$ 970,000
Interest rate caps | GBP
Derivatives
Number of Contracts	1	1	1	1	1
Aggregate Notional Amount | £		£ 61,000
Interest rate caps | USD
Derivatives
Number of Contracts	5	5	5	5	5
Aggregate Notional Amount | $					$ 633,900
Credit instruments | USD
Derivatives
Number of Contracts	3	3	3	3	3
Aggregate Notional Amount | $					$ 49,000
Interest rate swap guarantees | USD
Derivatives
Number of Contracts	4	4	4	4	4
Aggregate Notional Amount | $					$ 271,363

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Derivatives and Hedging Activity - Fair Value (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Fair value of derivative instruments
Fair Value of Derivatives in an Asset Position	$ 128,727	$ 48,216
Fair Value of Derivatives in a Liability Position	55,137	13,421
Interest rate contracts
Fair value of derivative instruments
Fair Value of Derivatives in an Asset Position	7,487	17,728
Fair Value of Derivatives in a Liability Position	49,642	16
Interest rate swap guarantees
Fair value of derivative instruments
Fair Value of Derivatives in an Asset Position	0	0
Fair Value of Derivatives in a Liability Position	0	260
Foreign exchange contracts
Fair value of derivative instruments
Fair Value of Derivatives in an Asset Position	120,637	30,478
Fair Value of Derivatives in a Liability Position	5,495	12,870
Credit instruments
Fair value of derivative instruments
Fair Value of Derivatives in an Asset Position	603	10
Fair Value of Derivatives in a Liability Position	$ 0	$ 275

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Derivatives and Hedging Activity - Effect on Financial Statements (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Derivatives
Gain (loss) on derivative financial instruments, net	$ 128,583	$ (10,009)	$ 255,851	$ 23,980
Interest rate contracts
Derivatives
Gain (loss) on derivative financial instruments, net	37,257	(7,344)	140,190	12,814
Interest rate swap guarantees
Derivatives
Gain (loss) on derivative financial instruments, net	100	145	259	496
Foreign exchange contracts
Derivatives
Gain (loss) on derivative financial instruments, net	90,543	(2,540)	114,685	11,061
Credit instruments
Derivatives
Gain (loss) on derivative financial instruments, net	$ 683	$ (270)	$ 717	$ (391)

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Offsetting Assets and Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Derivative assets
Gross Amounts Recognized	$ 128,727	$ 48,216
Gross Amounts Offset in the Statement of Financial Position	0	0
Net Amounts Presented in the Statement of Financial Position	128,727	48,216
Derivative Assets, Gross Amounts Not Offset in the Statements of Condition, Financial Instruments	52,137	12,870
Derivative Assets, Gross Amounts Not Offset in the Statements of Condition, Cash Collateral Received/Pledged	0	21,290
Total net derivative assets	76,590	14,056
Derivative liabilities
Gross Amounts Recognized	55,137	13,421
Gross Amounts Offset in the Statement of Financial Position	0	0
Net Amounts Presented in the Statement of Financial Position	55,137	13,421
Derivative Liabilities, Gross Amounts Not Offset in the Statements of Condition, Financial Instruments	52,137	12,870
Derivative Liabilities, Gross Amounts Not Offset in the Statements of Condition, Cash Collateral Received/Pledged	3,000	291
Total net derivative liabilities	0	260
Repurchase agreements
Gross Amounts Recognized	10,315,650	9,542,034
Gross Amounts Offset in the Statement of Financial Position	0	0
Net Amounts Presented in the Statement of Financial Position	10,315,650	9,542,034
Repurchase Agreements, Gross Amounts Not Offset in the Statements of Condition, Financial Instruments	10,315,650	9,542,034
Repurchase Agreements, Gross Amounts Not Offset in the Statements of Condition, Cash Collateral Received/Pledged	0	0
Total net repurchase agreements	0	0
Offsetting Derivative Liability, Securities Sold under Agreements to Repurchase, Securities Loaned [Abstract]
Gross Amounts Recognized	10,370,787	9,555,455
Gross Amounts Offset in the Statement of Financial Position	0	0
Net Amounts Presented in the Statement of Financial Position	10,370,787	9,555,455
Liabilities, Gross Amounts Not Offset in the Statements of Condition, Financial Instruments	10,367,787	9,554,904
Liabilities, Gross Amounts Not Offset in the Statements of Condition, Cash Collateral Received/Pledged	3,000	291
Total net liabilities	$ 0	$ 260

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Variable Interest Entities - Narrative (Details)	6 Months Ended
	Jun. 30, 2022 USD ($) loan collateralized_loan_obligation	Mar. 31, 2022 USD ($)	Dec. 31, 2021 USD ($)	Jun. 30, 2021 USD ($)	Mar. 31, 2021 USD ($)	Dec. 31, 2020 USD ($)
Variable interest entities
Number of CLOs | collateralized_loan_obligation	5
Number of SASBs | loan	1
Assets	$ 83,098,886,000		$ 83,850,397,000
Liabilities	76,001,746,000		77,201,590,000
Temporary equity	322,753,000	$ 261,685,000	214,915,000	$ 0	$ 0	$ 0
Investments in unconsolidated entities	$ 85,510,000		$ 90,097,000
CMBS JV
Variable interest entities
Ownership percentage	51.00%
Primary beneficiary
Variable interest entities
Assets	$ 75,600,000
Liabilities	32,300,000
Primary beneficiary | CMBS Venture Holdings
Variable interest entities
Assets	367,200,000
Liabilities	89,100,000
Primary beneficiary | SPT Dolphin
Variable interest entities
Assets	1,600,000,000
Liabilities	0
Primary beneficiary | Woodstar Feeder Fund, L.P.
Variable interest entities
Assets	400,000,000
Liabilities	0
Temporary equity	300,000,000
Not primary beneficiary
Variable interest entities
Maximum risk of loss related to VIEs, on fair value basis	21,000,000
Not primary beneficiary | Measurement Period Adjustments
Variable interest entities
Investments in unconsolidated entities	16,900,000
Not primary beneficiary | Securitization SPEs
Variable interest entities
Long term debt, gross	$ 4,800,000,000

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Variable Interest Entities - Assets and Liabilities of Consolidated CLO (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Assets:
Cash and cash equivalents	$ 272,174	$ 217,362
Carrying Value	20,209,885	18,480,919
Investment securities	913,360	860,984
Accrued interest receivable	131,660	116,262
Other assets	257,185	188,626
Total Assets	83,098,886	83,850,397
Liabilities
Accounts payable, accrued expenses and other liabilities	273,414	189,696
Collateralized loan obligations and single asset securitization, net	3,764,151	2,616,116
Total Liabilities	76,001,746	77,201,590
Loans held for investment
Assets:
Carrying Value	17,973,238	15,604,119
Primary beneficiary
Assets:
Total Assets	75,600
Liabilities
Total Liabilities	32,300
CLOs and SASB | Primary beneficiary
Assets:
Cash and cash equivalents	28,169	15,297
Investment securities	37,427	11,426
Accrued interest receivable	12,424	8,936
Other assets	461	11,213
Total Assets	4,536,916	3,120,444
Liabilities
Accounts payable, accrued expenses and other liabilities	10,813	3,335
Collateralized loan obligations and single asset securitization, net	3,764,151	2,616,116
Total Liabilities	3,774,964	2,619,451
CLOs and SASB | Primary beneficiary | Loans held for investment
Assets:
Carrying Value	$ 4,458,435	$ 3,073,572

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Related-Party Transactions - Management Agreement (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021	Dec. 31, 2021
Related-Party Transactions
Granted (in shares)			784,893
2022 Manager Equity Plan
Related-Party Transactions
Granted (in shares)			0
S P T Management L L C
Related-Party Transactions
Management fee expense	$ 21.6	$ 19.2	$ 43.1	$ 38.3
Base management fee payable	21.6		21.6		$ 20.3
Accrued incentive fee	5.2	5.0	34.2	18.2
Unpaid incentive fee	5.2		5.2		51.2
Executive compensation expense	1.9	$ 1.6	3.6	$ 3.1
Unpaid reimbursable compensation	$ 4.0		$ 4.0		$ 4.9
S P T Management L L C | Restricted Stock Awards
Related-Party Transactions
Granted (in shares)	0	0	200,972	981,951
Grant date values			$ 4.8	$ 19.6
Share-based expense	$ 2.3	$ 2.2	$ 5.0	$ 4.5
S P T Management L L C | Restricted Stock Awards | 2022 Manager Equity Plan
Related-Party Transactions
Award vesting period			3 years

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Related-Party Transactions - Manager Equity Plan (Details) - USD ($) $ in Millions	1 Months Ended			3 Months Ended		6 Months Ended
	Nov. 30, 2020	Sep. 30, 2019	Apr. 30, 2018	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Related-Party Transactions
Granted (in shares)						784,893
2022 Manager Equity Plan
Related-Party Transactions
Granted (in shares)						0
Restricted stock units | 2022 Manager Equity Plan
Related-Party Transactions
Granted (in shares)	1,800,000	1,200,000	775,000
Share-based expense				$ 4.5	$ 4.5	$ 9.0	$ 10.4

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Related-Party Transactions - Investments in Loans and Securities (Details) $ in Thousands	1 Months Ended	3 Months Ended	6 Months Ended
	Mar. 31, 2022 USD ($) Item	Jun. 30, 2022 USD ($)	Jun. 30, 2022 USD ($)	Jun. 30, 2021 USD ($)
Related-Party Transactions
Acquisitions/originations/additional funding			$ 7,499,295	$ 5,369,620
First mortgage loan participation
Related-Party Transactions
Repayments of mortgage loans on real estate	$ 99,000
Affiliated Entity | Development and Recapitalization of Luxury Rental Cabins
Related-Party Transactions
Loans payable		$ 92,700	92,700
Loan number of extension options | Item	3
Loan extension term	1 year
Affiliated Entity | Development and Recapitalization of Luxury Rental Cabins | Loans Payable
Related-Party Transactions
Face Amount	$ 200,000
Maturity period	24 months
Affiliated Entity | Development and Recapitalization of Luxury Rental Cabins | SOFR
Related-Party Transactions
Loans payable, basis spread	6.50%
Residential Mortgage Originator | Affiliated Entity
Related-Party Transactions
Proceeds from sale of receivables		0	4,400
Residential Mortgage Originator | Affiliated Entity | Residential Loans
Related-Party Transactions
Acquisitions/originations/additional funding		332,900	956,800
Loan purchase commitment		$ 130,100	$ 130,100

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Related-Party Transactions - Lease Arrangements (Details) - Office Lease Agreement with Affiliate of Chairman and CEO - Affiliates of Chairman and CEO ft² in Thousands, $ in Millions	1 Months Ended	3 Months Ended	6 Months Ended
	Mar. 31, 2020 ft² $ / sqft	Jun. 30, 2022 USD ($)	Jun. 30, 2022 USD ($)	Apr. 30, 2020 USD ($)
Related-Party Transactions
Area of office space | ft²	65
Term of master lease agreements	15 years
Annual base rent (in usd per sq ft) | $ / sqft	52.00
Percent increase in base rent	3.00%
Security deposit				$ 1.9
Rent payments		$ 0.0	$ 1.8

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Related-Party Transactions - Other Related-Party Arrangements (Details) - USD ($) $ in Millions	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Highmark Residential
Related-Party Transactions
Payments to related party	$ 1.3	$ 0.7	$ 2.7	$ 1.5

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Stockholders' Equity and Non-Controlling Interests - Declared Dividends (Details) - $ / shares			3 Months Ended		6 Months Ended
	Jun. 15, 2022	Mar. 14, 2022	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Stockholders' Equity Note [Abstract]
Dividends declared per common share (in dollars per share)	$ 0.48	$ 0.48	$ 0.48	$ 0.48	$ 0.96	$ 0.96

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Stockholders' Equity and Non-Controlling Interests - Narrative (Details) $ / shares in Units, $ in Thousands			1 Months Ended	3 Months Ended		6 Months Ended		12 Months Ended
	Nov. 06, 2021 USD ($)	Nov. 05, 2021 USD ($)	Apr. 30, 2022 USD ($) shares	Jun. 30, 2022 USD ($) $ / shares shares	Jun. 30, 2021 USD ($) shares	Jun. 30, 2022 USD ($) extension $ / shares shares	Jun. 30, 2021 USD ($) shares	Dec. 31, 2021 USD ($)	Dec. 31, 2018 shares	May 31, 2022 USD ($)
Equity Incentive Plans
Authorized value of stock under ATM agreement										$ 500,000
Number of shares issued (in shares) | shares							0
Commission costs under ATM agreement						$ 756	$ 22
Contributions from non-controlling interests						21,926	5,538
Net income				$ 62,783		110,503
Net income attributable to non-controlling interests				$ 69,418	$ 10,074	$ 129,133	21,222
ATM Agreement
Equity Incentive Plans
Number of shares issued (in shares) | shares				1,415,564	0	1,415,564
Proceeds from ATM Agreement				$ 33,300		$ 33,300
Sale of stock average price (in dollars per share) | $ / shares				$ 23.54		$ 23.54
Commission costs under ATM agreement				$ 700		$ 700
Employee Stock
Equity Incentive Plans
Purchase price of fair market value			85.00%
Maximum purchase value per calendar year			$ 25
Number of shares of authorized for issuance (in shares) | shares			2,000,000
Number of shares issued for future grants (in shares) | shares						0
Woodstar Fund
Equity Incentive Plans
Percentage of interest sold		20.60%
Contributions from non-controlling interests	$ 214,200	$ 216,000
Initial term						8 years
Number of extension options | extension						2
Extension term						1 year
CMBS JV
Equity Incentive Plans
Non-controlling interest				$ 153,000		$ 153,000		$ 131,900
CMBS JV | Joint Venture Partner
Equity Incentive Plans
Ownership percentage				49.00%		49.00%
CMBS JV
Equity Incentive Plans
Ownership percentage				51.00%		51.00%
Class A Units
Equity Incentive Plans
Number of units outstanding (in shares) | shares				9,800,000		9,800,000
Woodstar II Portfolio | Class A Units
Equity Incentive Plans
Net income attributable to non-controlling interests				$ 4,700	$ 4,900	$ 9,400	10,000
Woodstar II Portfolio | Class A Units | CMBS JV
Equity Incentive Plans
Net income attributable to non-controlling interests				$ 1,300	$ 4,700	$ 4,900	$ 10,100
Subsidiaries | Woodstar II Portfolio
Equity Incentive Plans
Conversion of stock ratio						1
Subsidiaries | Woodstar II Portfolio | Class A Units
Equity Incentive Plans
Shares issued (in shares) | shares									10,200,000
Right to receive additional shares (in shares) | shares						1,900,000			1,900,000
Subsidiaries | Woodstar II Portfolio | Class A Units | Non- Controlling Interests
Equity Incentive Plans
Redemption of units						$ 208,500		$ 208,500
Starwood Property Trust, Inc. Equity Plan and Manager Equity Plan
Equity Incentive Plans
Number of shares of authorized for issuance (in shares) | shares			18,700,000
Number of shares available for future grants (in shares) | shares				18,700,000		18,700,000

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Stockholders' Equity and Non-Controlling Interests - Equity Incentive Plans (Details) - USD ($) $ in Thousands	1 Months Ended			6 Months Ended
	Nov. 30, 2020	Sep. 30, 2019	Apr. 30, 2018	Jun. 30, 2022
Equity Incentive Plans
Granted (in shares)				784,893
2022 Manager Equity Plan
Equity Incentive Plans
Granted (in shares)				0
Restricted stock units | 2022 Manager Equity Plan
Equity Incentive Plans
Granted (in shares)	1,800,000	1,200,000	775,000
Awards granted, fair value	$ 30,078	$ 29,484	$ 16,329
Award vesting period	3 years		3 years
Restricted stock units | 2022 Manager Equity Plan | Vested immediately on the grant date
Equity Incentive Plans
Granted (in shares)		218,898
Restricted stock units | 2022 Manager Equity Plan | Remaining vesting
Equity Incentive Plans
Award vesting period		3 years

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Stockholders' Equity and Non-Controlling Interests - Non-Vested Shares (Details)	6 Months Ended
	Jun. 30, 2022 $ / shares shares
Non-Vested Shares and Share Equivalents activity
Balance at the beginning of the period (in shares)	3,702,007
Granted (in shares)	784,893
Vested (in shares)	(1,064,420)
Forfeited (in shares)	(10,809)
Balance at the end of the period (in shares)	3,411,671
Weighted Average Grant Date Fair Value (per share)
Balance at the beginning of period (in dollars per share) | $ / shares	$ 18.90
Granted (in dollars per share) | $ / shares	23.81
Vested (in dollars per share) | $ / shares	18.11
Forfeited (in dollars per share) | $ / shares	23.17
Balance at the end of period (in dollars per share) | $ / shares	$ 20.26
2022 Equity Plan
Non-Vested Shares and Share Equivalents activity
Balance at the beginning of the period (in shares)	2,406,730
Granted (in shares)	784,893
Vested (in shares)	(600,902)
Forfeited (in shares)	(10,809)
Balance at the end of the period (in shares)	2,579,912
2022 Manager Equity Plan
Non-Vested Shares and Share Equivalents activity
Balance at the beginning of the period (in shares)	1,295,277
Granted (in shares)	0
Vested (in shares)	(463,518)
Forfeited (in shares)	0
Balance at the end of the period (in shares)	831,759

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Earnings per Share (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Basic Earnings
Income attributable to STWD common stockholders	$ 212,287	$ 116,310	$ 536,886	$ 227,688
Less: Income attributable to participating shares not already deducted as non-controlling interests	(3,990)	(1,791)	(12,811)	(3,716)
Basic earnings	208,297	114,519	524,075	223,972
Diluted Earnings
Income attributable to STWD common stockholders	212,287	116,310	536,886	227,688
Less: Income attributable to participating shares not already deducted as non-controlling interests	(3,990)	(1,791)	(12,811)	(3,716)
Add: Undistributed earnings to participating shares	2,584	0	9,879	0
Less: Undistributed earnings reallocated to participating shares	(2,506)	0	(9,579)	0
Diluted earnings	$ 211,290	$ 117,419	$ 530,193	$ 229,788
Number of Shares:
Basic - Average shares outstanding (in shares)	305,035	284,710	303,995	284,018
Effect of dilutive securities - Contingently issuable shares (in shares)	120	95	120	95
Effect of dilutive securities - Unvested non-participating shares (in shares)	158	117	144	46
Diluted - Average shares outstanding (in shares)	314,962	294,571	313,908	293,808
Earnings Per Share Attributable to STWD Common Stockholders:
Basic (in dollars per share)	$ 0.68	$ 0.40	$ 1.72	$ 0.79
Diluted (in dollars per share)	$ 0.67	$ 0.40	$ 1.69	$ 0.78
Convertible Senior Notes
Diluted Earnings
Add: Interest expense on Convertible Notes	$ 2,915	$ 2,900	$ 5,818	$ 5,816
Number of Shares:
Effect of dilutive securities - Convertible Notes (in shares)	9,649	9,649	9,649	9,649

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Earnings per Share - Dilutive and Antidilutive securities (Details) - shares shares in Millions	6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021
Class A Units
Antidilutive securities and effect of dilutive securities
Number of anti-dilutive common shares excluded from the calculation of diluted income per share (in shares)	9.8	10.2
Restricted stock
Antidilutive securities and effect of dilutive securities
Number of anti-dilutive common shares excluded from the calculation of diluted income per share (in shares)	12.7	14.0

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Accumulated Other Comprehensive Income - Changes in AOCI (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Changes in AOCI by component
Beginning balance	$ 6,647,968	$ 4,854,785	$ 6,433,892	$ 4,862,576
OCI before reclassifications	(6,699)	(344)	(11,983)	(2,747)
Amounts reclassified from AOCI	0	0	0	64
Net period OCI	(6,699)	(344)	(11,983)	(2,683)
Ending balance	6,774,387	4,851,700	6,774,387	4,851,700
Cumulative Unrealized Gain (Loss) on Available-for- Sale Securities
Changes in AOCI by component
Beginning balance	35,669	41,654	40,953	44,057
OCI before reclassifications	(6,699)	(344)	(11,983)	(2,747)
Amounts reclassified from AOCI	0	0	0	0
Net period OCI	(6,699)	(344)	(11,983)	(2,747)
Ending balance	28,970	41,310	28,970	41,310
Foreign Currency Translation
Changes in AOCI by component
Beginning balance	0	0	0	(64)
OCI before reclassifications	0	0	0	0
Amounts reclassified from AOCI	0	0	0	64
Net period OCI	0	0	0	64
Ending balance	0	0	0	0
Accumulated Other Comprehensive Income
Changes in AOCI by component
Beginning balance	35,669	41,654	40,953	43,993
Ending balance	$ 28,970	$ 41,310	$ 28,970	$ 41,310

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Fair Value - Narrative (Details)	Nov. 05, 2021
Woodstar Fund
Assets and liabilities measured at fair value
Term including extensions	10 years

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Fair Value - Financial Assets and Liabilities (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Financial Assets:
Available-for-sale securities	$ 124,439	$ 143,980
Domestic servicing rights	17,499	16,780
Derivative assets	128,727	48,216
Assets	83,098,886	83,850,397
Liabilities, Fair Value Disclosure [Abstract]
Derivative liabilities	55,137	13,421
Liabilities	76,001,746	77,201,590
Fair value measurements on recurring basis
Financial Assets:
Equity security, fair value	10,193	11,624
Derivative assets	128,727	48,216
Total Assets	62,082,568	65,499,721
Liabilities, Fair Value Disclosure [Abstract]
Derivative liabilities	55,137	13,421
Total Liabilities	56,311,217	59,766,343
Fair value measurements on recurring basis | Loans under fair value option
Financial Assets:
Loans under fair value option	2,228,332	2,936,025
Fair value measurements on recurring basis | RMBS
Financial Assets:
Available-for-sale securities	124,439	143,980
Fair value measurements on recurring basis | CMBS
Financial Assets:
Available-for-sale securities	20,965	22,244
Fair value measurements on recurring basis | Woodstar Fund investments
Financial Assets:
Investments	1,558,850	1,040,309
Fair value measurements on recurring basis | Domestic servicing rights, at fair value
Financial Assets:
Domestic servicing rights	17,499	16,780
Fair value measurements on recurring basis | Level I
Financial Assets:
Equity security, fair value	10,193	11,624
Derivative assets	0	0
Total Assets	10,193	11,624
Liabilities, Fair Value Disclosure [Abstract]
Derivative liabilities	0	0
Total Liabilities	0	0
Fair value measurements on recurring basis | Level I | Loans under fair value option
Financial Assets:
Loans under fair value option	0	0
Fair value measurements on recurring basis | Level I | RMBS
Financial Assets:
Available-for-sale securities	0	0
Fair value measurements on recurring basis | Level I | CMBS
Financial Assets:
Available-for-sale securities	0	0
Fair value measurements on recurring basis | Level I | Woodstar Fund investments
Financial Assets:
Investments	0	0
Fair value measurements on recurring basis | Level I | Domestic servicing rights, at fair value
Financial Assets:
Domestic servicing rights	0	0
Fair value measurements on recurring basis | Level II
Financial Assets:
Equity security, fair value	0	0
Derivative assets	128,727	48,216
Total Assets	159,558	48,216
Liabilities, Fair Value Disclosure [Abstract]
Derivative liabilities	55,137	13,421
Total Liabilities	50,330,583	54,986,122
Fair value measurements on recurring basis | Level II | Loans under fair value option
Financial Assets:
Loans under fair value option	30,831	0
Fair value measurements on recurring basis | Level II | RMBS
Financial Assets:
Available-for-sale securities	0	0
Fair value measurements on recurring basis | Level II | CMBS
Financial Assets:
Available-for-sale securities	0	0
Fair value measurements on recurring basis | Level II | Woodstar Fund investments
Financial Assets:
Investments	0	0
Fair value measurements on recurring basis | Level II | Domestic servicing rights, at fair value
Financial Assets:
Domestic servicing rights	0	0
Fair value measurements on recurring basis | Level III
Financial Assets:
Equity security, fair value	0	0
Derivative assets	0	0
Total Assets	61,912,817	65,439,881
Liabilities, Fair Value Disclosure [Abstract]
Derivative liabilities	0	0
Total Liabilities	5,980,634	4,780,221
Fair value measurements on recurring basis | Level III | Loans under fair value option
Financial Assets:
Loans under fair value option	2,197,501	2,936,025
Fair value measurements on recurring basis | Level III | RMBS
Financial Assets:
Available-for-sale securities	124,439	143,980
Fair value measurements on recurring basis | Level III | CMBS
Financial Assets:
Available-for-sale securities	20,965	22,244
Fair value measurements on recurring basis | Level III | Woodstar Fund investments
Financial Assets:
Investments	1,558,850	1,040,309
Fair value measurements on recurring basis | Level III | Domestic servicing rights, at fair value
Financial Assets:
Domestic servicing rights	17,499	16,780
Primary beneficiary
Financial Assets:
Investments	1,558,850	1,040,309
Assets	75,600
Liabilities, Fair Value Disclosure [Abstract]
Liabilities	32,300
Primary beneficiary | Fair value measurements on recurring basis | VIE assets
Financial Assets:
Assets	57,993,563	61,280,543
Primary beneficiary | Fair value measurements on recurring basis | VIE liabilities
Liabilities, Fair Value Disclosure [Abstract]
Liabilities	56,256,080	59,752,922
Primary beneficiary | Fair value measurements on recurring basis | Level I | VIE assets
Financial Assets:
Assets	0	0
Primary beneficiary | Fair value measurements on recurring basis | Level I | VIE liabilities
Liabilities, Fair Value Disclosure [Abstract]
Liabilities	0	0
Primary beneficiary | Fair value measurements on recurring basis | Level II | VIE assets
Financial Assets:
Assets	0	0
Primary beneficiary | Fair value measurements on recurring basis | Level II | VIE liabilities
Liabilities, Fair Value Disclosure [Abstract]
Liabilities	50,275,446	54,972,701
Primary beneficiary | Fair value measurements on recurring basis | Level III | VIE assets
Financial Assets:
Assets	57,993,563	61,280,543
Primary beneficiary | Fair value measurements on recurring basis | Level III | VIE liabilities
Liabilities, Fair Value Disclosure [Abstract]
Liabilities	$ 5,980,634	$ 4,780,221

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Fair Value - Level III (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Total realized and unrealized gains (losses):
Net accretion			$ 7,010	$ 6,773
Level III
Changes in financial assets classified as Level III
Balance at the beginning of the period	$ 56,089,565	$ 61,095,418	60,659,660	63,441,439
Total realized and unrealized gains (losses):
Change in fair value / gain on sale	(2,394,200)	(1,036,966)	(5,717,431)	(3,245,778)
Net accretion	2,625	2,610	5,230	5,216
Included in OCI	(6,699)	(344)	(11,983)	(2,747)
Purchases / Originations	1,340,371	992,304	3,607,070	1,367,574
Sales	(1,309,220)	(905,653)	(3,587,687)	(1,477,580)
Issuances				(11,604)
Cash repayments / receipts	(62,951)	(60,132)	(128,914)	(122,164)
Transfers into Level III	(426,183)	(2,431,880)	(629,970)	(2,841,147)
Transfers out of Level III	232,008	114,769	(86,493)	263,544
Transfers within Level III		0		0
Consolidation of VIEs	2,466,867	1,842,673	2,551,224	2,236,046
Deconsolidation of VIEs			(728,523)
Balance at the end of the period	55,932,183	59,612,799	55,932,183	59,612,799
Amount of Unrealized Gains (Losses) Attributable to Assets Still Held [Abstract]
Included in earnings	(2,386,791)	(1,249,423)	(5,641,352)	(3,446,523)
Included in OCI	(6,375)	(344)	(11,577)	(2,747)
Level III | Loans under fair value option
Changes in financial assets classified as Level III
Balance at the beginning of the period	2,367,022	763,773	2,936,025	1,022,979
Total realized and unrealized gains (losses):
Change in fair value / gain on sale	(113,480)	45,867	(239,263)	36,389
Net accretion	0	0	0	0
Included in OCI	0	0	0	0
Purchases / Originations	1,340,371	992,304	3,607,070	1,367,574
Sales	(1,309,220)	(905,653)	(3,587,687)	(1,477,580)
Issuances				0
Cash repayments / receipts	(56,415)	(50,257)	(114,849)	(103,328)
Transfers into Level III	54	0	147	0
Transfers out of Level III	(30,831)	(250,687)	(403,942)	(250,687)
Transfers within Level III		172,474		172,474
Consolidation of VIEs	0	0	0	0
Deconsolidation of VIEs			0
Balance at the end of the period	2,197,501	767,821	2,197,501	767,821
Amount of Unrealized Gains (Losses) Attributable to Assets Still Held [Abstract]
Included in earnings	(108,411)	3,274	(168,610)	2,902
Included in OCI	0	0	0	0
Level III | RMBS
Changes in financial assets classified as Level III
Balance at the beginning of the period	134,406	160,301	143,980	167,349
Total realized and unrealized gains (losses):
Change in fair value / gain on sale	0	0	0	0
Net accretion	2,625	2,610	5,230	5,216
Included in OCI	(6,699)	(344)	(11,983)	(2,747)
Purchases / Originations	0	0	0	0
Sales	0	0	0	0
Issuances				0
Cash repayments / receipts	(5,893)	(7,863)	(12,788)	(15,114)
Transfers into Level III	0	0	0	0
Transfers out of Level III	0	0	0	0
Transfers within Level III		0		0
Consolidation of VIEs	0	0	0	0
Deconsolidation of VIEs			0
Balance at the end of the period	124,439	154,704	124,439	154,704
Amount of Unrealized Gains (Losses) Attributable to Assets Still Held [Abstract]
Included in earnings	2,340	2,610	4,896	5,216
Included in OCI	(6,375)	(344)	(11,577)	(2,747)
Level III | CMBS
Changes in financial assets classified as Level III
Balance at the beginning of the period	21,858	19,256	22,244	19,457
Total realized and unrealized gains (losses):
Change in fair value / gain on sale	(665)	320	(1,357)	692
Net accretion	0	0	0	0
Included in OCI	0	0	0	0
Purchases / Originations	0	0	0	0
Sales	0	0	0	0
Issuances				0
Cash repayments / receipts	(228)	(611)	(452)	(1,184)
Transfers into Level III	0	0	0	0
Transfers out of Level III	0	0	0	0
Transfers within Level III		0		0
Consolidation of VIEs	0	0	0	0
Deconsolidation of VIEs			530
Balance at the end of the period	20,965	18,965	20,965	18,965
Amount of Unrealized Gains (Losses) Attributable to Assets Still Held [Abstract]
Included in earnings	(665)	320	(827)	692
Included in OCI	0	0	0	0
Level III | Woodstar Fund investments
Changes in financial assets classified as Level III
Balance at the beginning of the period	1,264,160	0	1,040,309	0
Total realized and unrealized gains (losses):
Change in fair value / gain on sale	294,690	0	518,541	0
Net accretion	0	0	0	0
Included in OCI	0	0	0	0
Purchases / Originations	0	0	0	0
Sales	0	0	0	0
Issuances				0
Cash repayments / receipts	0	0	0	0
Transfers into Level III	0	0	0	0
Transfers out of Level III	0	0	0	0
Transfers within Level III				0
Consolidation of VIEs	0	0	0	0
Deconsolidation of VIEs			0
Balance at the end of the period	1,558,850	0	1,558,850	0
Amount of Unrealized Gains (Losses) Attributable to Assets Still Held [Abstract]
Included in earnings	294,690	0	518,541	0
Included in OCI	0	0	0	0
Level III | Domestic servicing rights, at fair value
Changes in financial assets classified as Level III
Balance at the beginning of the period	17,864	12,406	16,780	13,202
Total realized and unrealized gains (losses):
Change in fair value / gain on sale	(365)	1,299	719	503
Net accretion	0	0	0	0
Included in OCI	0	0	0	0
Purchases / Originations	0	0	0	0
Sales	0	0	0	0
Issuances				0
Cash repayments / receipts	0	0	0	0
Transfers into Level III	0	0	0	0
Transfers out of Level III	0	0	0	0
Transfers within Level III				0
Consolidation of VIEs	0	0	0	0
Deconsolidation of VIEs			0
Balance at the end of the period	17,499	13,705	17,499	13,705
Amount of Unrealized Gains (Losses) Attributable to Assets Still Held [Abstract]
Included in earnings	(365)	1,299	719	503
Included in OCI	0	0	0	0
Level III | VIE assets
Changes in financial assets classified as Level III
Balance at the beginning of the period	57,763,543	62,367,110	61,280,543	64,238,328
Total realized and unrealized gains (losses):
Change in fair value / gain on sale	(3,021,691)	(1,085,746)	(6,918,293)	(3,350,337)
Net accretion	0	0	0	0
Included in OCI	0	0	0	0
Purchases / Originations	0	0	0	0
Sales	0	0	0	0
Issuances				0
Cash repayments / receipts	0	0	0	0
Transfers into Level III	0	0	0	0
Transfers out of Level III	0	0	0	0
Transfers within Level III		(172,474)		(172,474)
Consolidation of VIEs	3,251,711	2,384,906	4,361,325	2,778,279
Deconsolidation of VIEs			(730,012)
Balance at the end of the period	57,993,563	63,493,796	57,993,563	63,493,796
Amount of Unrealized Gains (Losses) Attributable to Assets Still Held [Abstract]
Included in earnings	(3,021,691)	(1,258,220)	(6,918,293)	(3,522,811)
Included in OCI	0	0	0	0
Level III | VIE liabilities
Changes in financial assets classified as Level III
Balance at the beginning of the period	(5,479,288)	(2,227,428)	(4,780,221)	(2,019,876)
Total realized and unrealized gains (losses):
Change in fair value / gain on sale	447,311	1,294	922,222	66,975
Net accretion	0	0	0	0
Included in OCI	0	0	0	0
Purchases / Originations	0	0	0	0
Sales	0	0	0	0
Issuances				(11,604)
Cash repayments / receipts	(415)	(1,401)	(825)	(2,538)
Transfers into Level III	(426,237)	(2,431,880)	(630,117)	(2,841,147)
Transfers out of Level III	262,839	365,456	317,449	514,231
Transfers within Level III		0		0
Consolidation of VIEs	(784,844)	(542,233)	(1,810,101)	(542,233)
Deconsolidation of VIEs			959
Balance at the end of the period	(5,980,634)	(4,836,192)	(5,980,634)	(4,836,192)
Amount of Unrealized Gains (Losses) Attributable to Assets Still Held [Abstract]
Included in earnings	447,311	1,294	922,222	66,975
Included in OCI	$ 0	$ 0	$ 0	$ 0

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Fair Value - Financial Instruments Not Carried at Fair Value (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Financial assets not carried at fair value:
HTM debt securities	$ 762,268	$ 691,746
Financial liabilities not carried at fair value:
Unsecured senior notes	2,324,772	1,828,590
Carrying Value
Financial assets not carried at fair value:
Loans	17,904,104	15,477,624
HTM debt securities	757,763	683,136
Financial liabilities not carried at fair value:
Secured financing agreements, CLOs and SASB	16,911,598	15,192,966
Unsecured senior notes	2,324,772	1,828,590
Fair Value
Financial assets not carried at fair value:
Loans	17,684,507	15,526,235
HTM debt securities	720,641	656,864
Financial liabilities not carried at fair value:
Secured financing agreements, CLOs and SASB	16,751,875	15,266,440
Unsecured senior notes	$ 2,149,983	$ 1,893,065

XML

Fair Value - Significant Unobservable Inputs (Details) $ in Thousands	6 Months Ended	12 Months Ended
	Jun. 30, 2022 USD ($) score	Dec. 31, 2021 USD ($) score
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities	$ 124,439	$ 143,980
Domestic servicing rights	17,499	16,780
Assets	83,098,886	83,850,397
Liabilities	76,001,746	77,201,590
Fair value measurements on recurring basis | Loans under fair value option
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Loans under fair value option	2,228,332	2,936,025
Fair value measurements on recurring basis | RMBS
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities	124,439	143,980
Fair value measurements on recurring basis | CMBS
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities	20,965	22,244
Fair value measurements on recurring basis | Woodstar Fund investments
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Investments	1,558,850	1,040,309
Fair value measurements on recurring basis | Domestic servicing rights, at fair value
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Domestic servicing rights	17,499	16,780
Fair value measurements on recurring basis | Level III | Loans under fair value option
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Loans under fair value option	$ 2,197,501	$ 2,936,025
Fair value measurements on recurring basis | Level III | Loans under fair value option | Minimum
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Loans held-for-sale, duration	5 years 9 months 18 days	6 years 3 months 18 days
Fair value measurements on recurring basis | Level III | Loans under fair value option | Minimum | Debt yield
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Loans held-for-sale, measurement input	0.028	0.026
Fair value measurements on recurring basis | Level III | Loans under fair value option | Minimum | FICO score
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Loans held-for-sale, measurement input | score	584	582
Fair value measurements on recurring basis | Level III | Loans under fair value option | Minimum | LTV
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Loans held-for-sale, measurement input	0.05	0.01
Fair value measurements on recurring basis | Level III | Loans under fair value option | Minimum | Purchase price
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Loans held-for-sale, measurement input	0.800	0.800
Fair value measurements on recurring basis | Level III | Loans under fair value option | Maximum
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Loans held-for-sale, duration	40 years	39 years 10 months 24 days
Fair value measurements on recurring basis | Level III | Loans under fair value option | Maximum | Debt yield
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Loans held-for-sale, measurement input	0.092	0.092
Fair value measurements on recurring basis | Level III | Loans under fair value option | Maximum | FICO score
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Loans held-for-sale, measurement input | score	900	829
Fair value measurements on recurring basis | Level III | Loans under fair value option | Maximum | LTV
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Loans held-for-sale, measurement input	0.94	0.94
Fair value measurements on recurring basis | Level III | Loans under fair value option | Maximum | Purchase price
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Loans held-for-sale, measurement input	1.086	1.086
Fair value measurements on recurring basis | Level III | Loans under fair value option | Weighted-average
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Loans held-for-sale, duration	29 years 2 months 12 days	27 years 4 months 24 days
Fair value measurements on recurring basis | Level III | Loans under fair value option | Weighted-average | Debt yield
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Loans held-for-sale, measurement input	0.046	0.042
Fair value measurements on recurring basis | Level III | Loans under fair value option | Weighted-average | FICO score
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Loans held-for-sale, measurement input | score	745	748
Fair value measurements on recurring basis | Level III | Loans under fair value option | Weighted-average | LTV
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Loans held-for-sale, measurement input	0.68	0.66
Fair value measurements on recurring basis | Level III | Loans under fair value option | Weighted-average | Purchase price
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Loans held-for-sale, measurement input	1.018	1.023
Fair value measurements on recurring basis | Level III | RMBS
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities	$ 124,439	$ 143,980
Loss severity for specified percentage of portfolio (as a percent)	6.00%	18.00%
Fair value measurements on recurring basis | Level III | RMBS | Minimum
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Loss severity for specified percentage of portfolio (as a percent)	45.00%	45.00%
Fair value measurements on recurring basis | Level III | RMBS | Minimum | Constant prepayment rate
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.034	0.048
Fair value measurements on recurring basis | Level III | RMBS | Minimum | Constant default rate
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.009	0.008
Fair value measurements on recurring basis | Level III | RMBS | Minimum | Loss severity
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0	0
Fair value measurements on recurring basis | Level III | RMBS | Minimum | Delinquency rate
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.06	0.104
Fair value measurements on recurring basis | Level III | RMBS | Minimum | Servicer advances
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.25	0.19
Fair value measurements on recurring basis | Level III | RMBS | Minimum | Annual coupon deterioration
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0	0
Fair value measurements on recurring basis | Level III | RMBS | Minimum | Putback amount per projected total collateral loss
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0	0
Fair value measurements on recurring basis | Level III | RMBS | Maximum
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Loss severity for specified percentage of portfolio (as a percent)	80.00%	80.00%
Fair value measurements on recurring basis | Level III | RMBS | Maximum | Constant prepayment rate
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.146	0.192
Fair value measurements on recurring basis | Level III | RMBS | Maximum | Constant default rate
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.047	0.060
Fair value measurements on recurring basis | Level III | RMBS | Maximum | Loss severity
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.76	0.86
Fair value measurements on recurring basis | Level III | RMBS | Maximum | Delinquency rate
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.30	0.35
Fair value measurements on recurring basis | Level III | RMBS | Maximum | Servicer advances
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.79	0.83
Fair value measurements on recurring basis | Level III | RMBS | Maximum | Annual coupon deterioration
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.025	0.017
Fair value measurements on recurring basis | Level III | RMBS | Maximum | Putback amount per projected total collateral loss
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.08	0.08
Fair value measurements on recurring basis | Level III | RMBS | Weighted-average | Constant prepayment rate
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.066	0.099
Fair value measurements on recurring basis | Level III | RMBS | Weighted-average | Constant default rate
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.020	0.021
Fair value measurements on recurring basis | Level III | RMBS | Weighted-average | Loss severity
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.16	0.26
Fair value measurements on recurring basis | Level III | RMBS | Weighted-average | Delinquency rate
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.15	0.19
Fair value measurements on recurring basis | Level III | RMBS | Weighted-average | Servicer advances
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.53	0.52
Fair value measurements on recurring basis | Level III | RMBS | Weighted-average | Annual coupon deterioration
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.001	0.001
Fair value measurements on recurring basis | Level III | RMBS | Weighted-average | Putback amount per projected total collateral loss
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.005	0.005
Fair value measurements on recurring basis | Level III | CMBS
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities	$ 20,965	$ 22,244
Fair value measurements on recurring basis | Level III | CMBS | Minimum
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale debt securities, term	0 years	0 days
Fair value measurements on recurring basis | Level III | CMBS | Minimum | Debt yield
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0	0
Fair value measurements on recurring basis | Level III | CMBS | Maximum
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale debt securities, term	8 years 2 months 12 days	7 years 2 months 12 days
Fair value measurements on recurring basis | Level III | CMBS | Maximum | Debt yield
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.673	6.136
Fair value measurements on recurring basis | Level III | CMBS | Weighted-average
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale debt securities, term	3 years 1 month 6 days	5 years 2 months 12 days
Fair value measurements on recurring basis | Level III | CMBS | Weighted-average | Debt yield
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.089	0.093
Fair value measurements on recurring basis | Level III | Woodstar Fund investments
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Investments	$ 1,558,850	$ 1,040,309
Fair value measurements on recurring basis | Level III | Woodstar Fund investments | Direct capitalization rate
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.042
Fair value measurements on recurring basis | Level III | Woodstar Fund investments | Minimum | Discount rate - properties
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input		0.058
Fair value measurements on recurring basis | Level III | Woodstar Fund investments | Minimum | Discount rate - debt
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.047	0.026
Fair value measurements on recurring basis | Level III | Woodstar Fund investments | Minimum | Terminal capitalization rate
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input		0.048
Fair value measurements on recurring basis | Level III | Woodstar Fund investments | Minimum | Direct capitalization rate
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input		0.041
Fair value measurements on recurring basis | Level III | Woodstar Fund investments | Maximum | Discount rate - properties
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input		0.063
Fair value measurements on recurring basis | Level III | Woodstar Fund investments | Maximum | Discount rate - debt
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.050	0.033
Fair value measurements on recurring basis | Level III | Woodstar Fund investments | Maximum | Terminal capitalization rate
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input		0.053
Fair value measurements on recurring basis | Level III | Woodstar Fund investments | Maximum | Direct capitalization rate
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input		0.042
Fair value measurements on recurring basis | Level III | Woodstar Fund investments | Weighted-average | Discount rate - properties
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input		0.060
Fair value measurements on recurring basis | Level III | Woodstar Fund investments | Weighted-average | Discount rate - debt
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.048	0.029
Fair value measurements on recurring basis | Level III | Woodstar Fund investments | Weighted-average | Terminal capitalization rate
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input		0.049
Fair value measurements on recurring basis | Level III | Woodstar Fund investments | Weighted-average | Direct capitalization rate
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Available-for-sale securities, measurement input	0.042	0.042
Fair value measurements on recurring basis | Level III | Domestic servicing rights, at fair value
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Domestic servicing rights	$ 17,499	$ 16,780
Fair value measurements on recurring basis | Level III | Domestic servicing rights, at fair value | Debt yield
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Servicing asset, measurement input	0.0750	0.0730
Fair value measurements on recurring basis | Level III | Domestic servicing rights, at fair value | Discount rate
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Servicing asset, measurement input	0.15	0.15
Fair value measurements on recurring basis | Level III | Domestic servicing rights, at fair value | Weighted-average | Debt yield
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Servicing asset, measurement input	0.0750	0.0730
Fair value measurements on recurring basis | Level III | Domestic servicing rights, at fair value | Weighted-average | Discount rate
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Servicing asset, measurement input	0.15	0.15
Fair value measurements on recurring basis | Level III | VIE assets | Minimum
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
VIE duration (in years)	0 years	0 days
Fair value measurements on recurring basis | Level III | VIE assets | Minimum | Debt yield
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
VIE assets, measurement input	0	0
Fair value measurements on recurring basis | Level III | VIE assets | Maximum
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
VIE duration (in years)	11 years 3 months 18 days	11 years
Fair value measurements on recurring basis | Level III | VIE assets | Maximum | Debt yield
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
VIE assets, measurement input	2.531	6.153
Fair value measurements on recurring basis | Level III | VIE assets | Weighted-average
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
VIE duration (in years)	3 years 2 months 12 days	3 years 2 months 12 days
Fair value measurements on recurring basis | Level III | VIE assets | Weighted-average | Debt yield
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
VIE assets, measurement input	0.132	0.130
Fair value measurements on recurring basis | Level III | VIE liabilities | Minimum
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
VIE duration (in years)	0 years	0 days
Fair value measurements on recurring basis | Level III | VIE liabilities | Minimum | Debt yield
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
VIE liabilities, measurement input	0	0
Fair value measurements on recurring basis | Level III | VIE liabilities | Maximum
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
VIE duration (in years)	11 years 3 months 18 days	11 years
Fair value measurements on recurring basis | Level III | VIE liabilities | Maximum | Debt yield
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
VIE liabilities, measurement input	2.531	6.153
Fair value measurements on recurring basis | Level III | VIE liabilities | Weighted-average
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
VIE duration (in years)	2 years 2 months 12 days	2 years 3 months 18 days
Fair value measurements on recurring basis | Level III | VIE liabilities | Weighted-average | Debt yield
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
VIE liabilities, measurement input	0.084	0.064
Primary beneficiary
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Investments	$ 1,558,850	$ 1,040,309
Assets	75,600
Liabilities	32,300
Primary beneficiary | Fair value measurements on recurring basis | VIE assets
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Assets	57,993,563	61,280,543
Primary beneficiary | Fair value measurements on recurring basis | VIE liabilities
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Liabilities	56,256,080	59,752,922
Primary beneficiary | Fair value measurements on recurring basis | Level III | VIE assets
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Assets	57,993,563	61,280,543
Primary beneficiary | Fair value measurements on recurring basis | Level III | VIE liabilities
Quantitative information for Level 3 Fair Value Measurements for assets and liabilities measured at fair value on recurring basis
Liabilities	$ 5,980,634	$ 4,780,221

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Income Taxes - Narrative (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Dec. 31, 2021
Income Taxes
Assets	$ 83,098,886	$ 83,850,397
Investing and Servicing Segment | TRS entities
Income Taxes
Assets	$ 2,500,000	$ 3,200,000

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Income Taxes - Reconciliation of Tax Rate (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Reconciliation of statutory tax to effective tax
Federal statutory tax rate	$ 59,622	$ 25,836	$ 139,813	$ 52,035
REIT and other non-taxable income	(58,233)	(24,018)	(137,431)	(48,519)
State income taxes	456	597	782	1,155
Federal benefit of state tax deduction	(95)	(126)	(164)	(243)
Intra-entity transfers	0	(6,037)	(3,868)	(6,052)
Other	456	395	624	501
Effective tax rate	$ 2,206	$ (3,353)	$ (244)	$ (1,123)
Reconciliation of statutory tax rate to effective tax rate
Federal statutory tax rate	21.00%	21.00%	21.00%	21.00%
REIT and other non-taxable income	(20.60%)	(19.50%)	(20.60%)	(19.60%)
State income taxes	0.20%	0.50%	0.10%	0.50%
Federal benefit of state tax deduction	0.00%	(0.10%)	0.00%	(0.10%)
Intra-entity transfers	0.00%	(4.90%)	(0.60%)	(2.40%)
Other	0.20%	0.30%	0.10%	0.10%
Effective tax rate	0.80%	(2.70%)	0.00%	(0.50%)

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Commitments and Contingencies - Narrative (Details) $ in Thousands	1 Months Ended		3 Months Ended		6 Months Ended
	Jun. 30, 2022 USD ($) contract	Feb. 28, 2022 USD ($)	Jun. 30, 2022 USD ($) contract	Jun. 30, 2021 USD ($)	Jun. 30, 2022 USD ($) contract	Jun. 30, 2021 USD ($)
Commitments and Contingencies
Number of Contracts | contract	596		596		596
Interest rate swap guarantees | USD
Commitments and Contingencies
Number of Contracts | contract	4		4		4
Commercial and Residential Lending Segment | Residential Loans
Commitments and Contingencies
Face amount of assets transferred			$ 220,101	$ 383	$ 1,055,861	$ 89,801
Commercial and Residential Lending Segment | Agency-Eligible Residential Loan | Residential Loans
Commitments and Contingencies
Face amount of assets transferred		$ 745,000
Estimate of disposition strategy on loans	$ 32,700		32,700		32,700
Face amount	$ 729,100
Financing term	120 days
Commitments | Commercial and Residential Lending Segment
Commitments and Contingencies
Value of loans with future funding commitments	$ 2,900,000		2,900,000		2,900,000
Value of loans with future funding commitments expected to fund	2,600,000		2,600,000		2,600,000
Outstanding	130,100		130,100		130,100
Commitments | Infrastructure Lending Segment
Commitments and Contingencies
Value of loans with future funding commitments	141,700		141,700		141,700
Outstanding	112,200		112,200		112,200
Revolvers and letters of credit | Infrastructure Lending Segment
Commitments and Contingencies
Value of loans with future funding commitments	137,000		137,000		137,000
Outstanding	10,800		10,800		10,800
Delayed draw term loans | Infrastructure Lending Segment
Commitments and Contingencies
Value of loans with future funding commitments	$ 4,700		$ 4,700		$ 4,700

XML

Segment Data - Results of Operations (Details) - USD ($) $ in Thousands	3 Months Ended		6 Months Ended
	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Revenues:
Interest income from loans	$ 261,150	$ 189,272	$ 494,769	$ 379,847
Interest income from investment securities	15,306	10,648	29,289	22,258
Servicing fees	12,553	10,864	22,545	19,266
Rental income	31,524	77,119	63,104	153,457
Other revenues	5,053	2,964	9,871	3,269
Total revenues	325,586	290,867	619,578	578,097
Costs and expenses:
Management fees	31,624	29,250	86,919	67,986
Interest expense	152,618	109,653	279,069	213,027
General and administrative	45,005	45,265	89,326	83,901
Acquisition and investment pursuit costs	517	407	939	592
Costs of rental operations	10,598	30,731	19,888	59,476
Depreciation and amortization	12,240	22,477	23,887	44,951
Credit loss provision (reversal), net	8,438	(11,844)	4,780	(11,800)
Other expense	1,258	0	1,313	685
Total costs and expenses	262,298	225,939	506,121	458,818
Other income (loss):
Change in net assets related to consolidated VIEs	8,373	12,509	35,122	52,254
Change in fair value of servicing rights	(365)	1,299	719	503
Change in fair value of investment securities, net	(1,245)	1,508	(1,600)	1,202
Change in fair value of mortgage loans, net	(113,480)	45,867	(239,263)	36,389
Earnings (loss) from unconsolidated entities	3,865	2,226	2,955	3,960
(Loss) gain on sale of investments and other assets, net	138	8,731	98,606	26,424
Gain (loss) on derivative financial instruments, net	128,583	(10,009)	255,851	23,980
Foreign currency (loss) gain, net	(78,602)	2,627	(105,883)	(9,054)
Loss on extinguishment of debt	0	(1,182)	(823)	(1,698)
Other (loss) income, net	(33,809)	(5,473)	(34,572)	(5,452)
Total other income	220,623	58,103	552,318	128,508
Income before income taxes	283,911	123,031	665,775	247,787
Income tax (provision) benefit	(2,206)	3,353	244	1,123
Net income	281,705	126,384	666,019	248,910
Net income attributable to non-controlling interests	(69,418)	(10,074)	(129,133)	(21,222)
Net income attributable to Starwood Property Trust, Inc.	212,287	116,310	536,886	227,688
Primary beneficiary
Other income (loss):
Income from affordable housing fund investments	307,165	0	541,206	0
Operating Segments and Corporate
Revenues:
Interest income from loans	261,150	189,272	494,769	379,847
Interest income from investment securities	44,754	43,413	93,726	83,302
Servicing fees	15,758	16,475	29,965	29,055
Rental income	31,524	77,119	63,104	153,457
Other revenues	5,056	2,964	9,880	3,269
Total revenues	358,242	329,243	691,444	648,930
Costs and expenses:
Management fees	31,624	29,240	86,919	67,965
Interest expense	152,834	109,873	279,499	213,438
General and administrative	44,907	45,180	89,147	83,729
Acquisition and investment pursuit costs	517	407	939	592
Costs of rental operations	10,598	30,731	19,888	59,476
Depreciation and amortization	12,240	22,477	23,887	44,951
Credit loss provision (reversal), net	8,438	(11,844)	4,780	(11,800)
Other expense	1,258	0	1,313	685
Total costs and expenses	262,416	226,064	506,372	459,036
Other income (loss):
Change in net assets related to consolidated VIEs	0	0	0	0
Change in fair value of servicing rights	543	460	326	1,205
Change in fair value of investment securities, net	(27,462)	(21,987)	(38,858)	(16,867)
Change in fair value of mortgage loans, net	(113,480)	45,867	(239,263)	36,389
Earnings (loss) from unconsolidated entities	4,928	1,419	4,084	3,507
(Loss) gain on sale of investments and other assets, net	138	8,731	98,606	26,424
Gain (loss) on derivative financial instruments, net	128,583	(10,009)	255,851	23,980
Foreign currency (loss) gain, net	(78,602)	2,627	(105,883)	(9,054)
Loss on extinguishment of debt		(1,182)	(823)	(1,698)
Other (loss) income, net	(33,809)	(5,473)	(34,597)	(5,452)
Total other income	188,004	20,453	480,649	58,434
Income before income taxes	283,830	123,632	665,721	248,328
Income tax (provision) benefit	(2,206)	3,353	244	1,123
Net income	281,624	126,985	665,965	249,451
Net income attributable to non-controlling interests	(69,337)	(10,675)	(129,079)	(21,763)
Net income attributable to Starwood Property Trust, Inc.	212,287	116,310	536,886	227,688
Operating Segments and Corporate | Primary beneficiary
Other income (loss):
Income from affordable housing fund investments	307,165		541,206
Operating segment | Commercial and Residential Lending Segment
Revenues:
Interest income from loans	227,555	165,697	430,025	336,290
Interest income from investment securities	22,591	17,190	43,427	35,575
Servicing fees	142	110	278	234
Rental income	1,044	1,419	2,730	2,758
Other revenues	61	74	113	164
Total revenues	251,393	184,490	476,573	375,021
Costs and expenses:
Management fees	254	300	531	615
Interest expense	88,226	48,356	156,828	92,651
General and administrative	11,845	10,411	23,447	21,744
Acquisition and investment pursuit costs	738	179	1,237	364
Costs of rental operations	1,826	433	2,345	910
Depreciation and amortization	1,183	311	1,477	618
Credit loss provision (reversal), net	7,925	(12,447)	4,626	(12,976)
Other expense	1,251	0	1,251	31
Total costs and expenses	113,248	47,543	191,742	103,957
Other income (loss):
Change in net assets related to consolidated VIEs	0	0	0	0
Change in fair value of servicing rights	0	0	0	0
Change in fair value of investment securities, net	(19,312)	(9,402)	(21,417)	(11,452)
Change in fair value of mortgage loans, net	(121,356)	12,329	(237,584)	1,615
Earnings (loss) from unconsolidated entities	2,786	1,996	1,446	3,749
(Loss) gain on sale of investments and other assets, net	138	(1,019)	86,748	16,674
Gain (loss) on derivative financial instruments, net	127,140	(4,945)	245,535	21,196
Foreign currency (loss) gain, net	(78,331)	2,715	(105,585)	(8,879)
Loss on extinguishment of debt		(221)	(206)	(289)
Other (loss) income, net	(33,809)	(5,504)	(34,597)	(5,504)
Total other income	(122,744)	(4,051)	(65,660)	17,110
Income before income taxes	15,401	132,896	219,171	288,174
Income tax (provision) benefit	(557)	8,043	4,583	6,538
Net income	14,844	140,939	223,754	294,712
Net income attributable to non-controlling interests	(4)	(4)	(7)	(7)
Net income attributable to Starwood Property Trust, Inc.	14,840	140,935	223,747	294,705
Operating segment | Commercial and Residential Lending Segment | Primary beneficiary
Other income (loss):
Income from affordable housing fund investments	0		0
Operating segment | Infrastructure Lending Segment
Revenues:
Interest income from loans	30,096	21,171	57,079	39,979
Interest income from investment securities	1,173	555	1,920	1,119
Servicing fees	0	0	0	0
Rental income	0	0	0	0
Other revenues	90	69	158	162
Total revenues	31,359	21,795	59,157	41,260
Costs and expenses:
Management fees	0	0	0	0
Interest expense	15,001	9,694	26,931	18,535
General and administrative	3,631	3,532	7,142	6,974
Acquisition and investment pursuit costs	0	249	1	249
Costs of rental operations	0	0	0	0
Depreciation and amortization	104	100	209	200
Credit loss provision (reversal), net	513	603	154	1,176
Other expense	0	0	0	0
Total costs and expenses	19,249	14,178	34,437	27,134
Other income (loss):
Change in net assets related to consolidated VIEs	0	0	0	0
Change in fair value of servicing rights	0	0	0	0
Change in fair value of investment securities, net	0	0	0	0
Change in fair value of mortgage loans, net	0	0	0	0
Earnings (loss) from unconsolidated entities	394	(70)	739	(324)
(Loss) gain on sale of investments and other assets, net	0	27	0	27
Gain (loss) on derivative financial instruments, net	265	112	897	796
Foreign currency (loss) gain, net	(289)	(62)	(317)	(111)
Loss on extinguishment of debt		(939)	(469)	(1,246)
Other (loss) income, net	0	2	0	23
Total other income	370	(930)	850	(835)
Income before income taxes	12,480	6,687	25,570	13,291
Income tax (provision) benefit	1	(58)	5	(150)
Net income	12,481	6,629	25,575	13,141
Net income attributable to non-controlling interests	0	0	0	0
Net income attributable to Starwood Property Trust, Inc.	12,481	6,629	25,575	13,141
Operating segment | Infrastructure Lending Segment | Primary beneficiary
Other income (loss):
Income from affordable housing fund investments	0		0
Operating segment | Property Segment
Revenues:
Interest income from loans	0	0	0	0
Interest income from investment securities	0	0	0	0
Servicing fees	0	0	0	0
Rental income	22,628	65,410	44,993	130,514
Other revenues	48	44	98	84
Total revenues	22,676	65,454	45,091	130,598
Costs and expenses:
Management fees	0	0	0	0
Interest expense	7,074	16,863	13,155	32,695
General and administrative	975	1,028	2,031	2,051
Acquisition and investment pursuit costs	2	0	7	0
Costs of rental operations	5,216	25,922	10,217	49,882
Depreciation and amortization	8,179	17,901	16,398	36,001
Credit loss provision (reversal), net	0	0	0	0
Other expense	0	0	55	583
Total costs and expenses	21,446	61,714	41,863	121,212
Other income (loss):
Change in net assets related to consolidated VIEs	0	0	0	0
Change in fair value of servicing rights	0	0	0	0
Change in fair value of investment securities, net	0	0	0	0
Change in fair value of mortgage loans, net	0	0	0	0
Earnings (loss) from unconsolidated entities	0	0	0	0
(Loss) gain on sale of investments and other assets, net	0	0	0	0
Gain (loss) on derivative financial instruments, net	5,354	(372)	22,900	4,352
Foreign currency (loss) gain, net	18	(25)	19	0
Loss on extinguishment of debt		0	0	(141)
Other (loss) income, net	0	0	0	0
Total other income	312,537	(397)	564,125	4,211
Income before income taxes	313,767	3,343	567,353	13,597
Income tax (provision) benefit	0	0	0	0
Net income	313,767	3,343	567,353	13,597
Net income attributable to non-controlling interests	(67,482)	(4,914)	(119,893)	(9,991)
Net income attributable to Starwood Property Trust, Inc.	246,285	(1,571)	447,460	3,606
Operating segment | Property Segment | Primary beneficiary
Other income (loss):
Income from affordable housing fund investments	307,165		541,206
Operating segment | Investing and Servicing Segment
Revenues:
Interest income from loans	3,499	2,404	7,665	3,578
Interest income from investment securities	20,990	25,668	48,379	46,608
Servicing fees	15,616	16,365	29,687	28,821
Rental income	7,852	10,290	15,381	20,185
Other revenues	4,854	2,777	9,508	2,859
Total revenues	52,811	57,504	110,620	102,051
Costs and expenses:
Management fees	0	224	0	446
Interest expense	6,391	5,789	12,601	11,238
General and administrative	23,114	25,720	46,557	44,160
Acquisition and investment pursuit costs	(223)	(21)	(306)	(21)
Costs of rental operations	3,556	4,376	7,326	8,684
Depreciation and amortization	2,774	4,165	5,803	8,132
Credit loss provision (reversal), net	0	0	0	0
Other expense	7	0	7	71
Total costs and expenses	35,619	40,253	71,988	72,710
Other income (loss):
Change in net assets related to consolidated VIEs	0	0	0	0
Change in fair value of servicing rights	543	460	326	1,205
Change in fair value of investment securities, net	(8,150)	(12,585)	(17,441)	(5,415)
Change in fair value of mortgage loans, net	7,876	33,538	(1,679)	34,774
Earnings (loss) from unconsolidated entities	1,748	(507)	1,899	82
(Loss) gain on sale of investments and other assets, net	0	9,723	11,858	9,723
Gain (loss) on derivative financial instruments, net	9,007	(5,731)	36,870	3,552
Foreign currency (loss) gain, net	0	(1)	0	(64)
Loss on extinguishment of debt		(22)	(148)	(22)
Other (loss) income, net	0	29	0	29
Total other income	11,024	24,904	31,685	43,864
Income before income taxes	28,216	42,155	70,317	73,205
Income tax (provision) benefit	(1,650)	(4,632)	(4,344)	(5,265)
Net income	26,566	37,523	65,973	67,940
Net income attributable to non-controlling interests	(1,851)	(5,757)	(9,179)	(11,765)
Net income attributable to Starwood Property Trust, Inc.	24,715	31,766	56,794	56,175
Operating segment | Investing and Servicing Segment | Primary beneficiary
Other income (loss):
Income from affordable housing fund investments	0		0
Corporate
Revenues:
Interest income from loans	0	0	0	0
Interest income from investment securities	0	0	0	0
Servicing fees	0	0	0	0
Rental income	0	0	0	0
Other revenues	3	0	3	0
Total revenues	3	0	3	0
Costs and expenses:
Management fees	31,370	28,716	86,388	66,904
Interest expense	36,142	29,171	69,984	58,319
General and administrative	5,342	4,489	9,970	8,800
Acquisition and investment pursuit costs	0	0	0	0
Costs of rental operations	0	0	0	0
Depreciation and amortization	0	0	0	0
Credit loss provision (reversal), net	0	0	0	0
Other expense	0	0	0	0
Total costs and expenses	72,854	62,376	166,342	134,023
Other income (loss):
Change in net assets related to consolidated VIEs	0	0	0	0
Change in fair value of servicing rights	0	0	0	0
Change in fair value of investment securities, net	0	0	0	0
Change in fair value of mortgage loans, net	0	0	0	0
Earnings (loss) from unconsolidated entities	0	0	0	0
(Loss) gain on sale of investments and other assets, net	0	0	0	0
Gain (loss) on derivative financial instruments, net	(13,183)	927	(50,351)	(5,916)
Foreign currency (loss) gain, net	0	0	0	0
Loss on extinguishment of debt		0	0	0
Other (loss) income, net	0	0	0	0
Total other income	(13,183)	927	(50,351)	(5,916)
Income before income taxes	(86,034)	(61,449)	(216,690)	(139,939)
Income tax (provision) benefit	0	0	0	0
Net income	(86,034)	(61,449)	(216,690)	(139,939)
Net income attributable to non-controlling interests	0	0	0	0
Net income attributable to Starwood Property Trust, Inc.	(86,034)	(61,449)	(216,690)	(139,939)
Corporate | Primary beneficiary
Other income (loss):
Income from affordable housing fund investments	0		0
Securitization VIEs
Revenues:
Interest income from loans	0	0	0	0
Interest income from investment securities	(29,448)	(32,765)	(64,437)	(61,044)
Servicing fees	(3,205)	(5,611)	(7,420)	(9,789)
Rental income	0	0	0	0
Other revenues	(3)	0	(9)	0
Total revenues	(32,656)	(38,376)	(71,866)	(70,833)
Costs and expenses:
Management fees	0	10	0	21
Interest expense	(216)	(220)	(430)	(411)
General and administrative	98	85	179	172
Acquisition and investment pursuit costs	0	0	0	0
Costs of rental operations	0	0	0	0
Depreciation and amortization	0	0	0	0
Credit loss provision (reversal), net	0	0	0	0
Other expense	0	0	0	0
Total costs and expenses	(118)	(125)	(251)	(218)
Other income (loss):
Change in net assets related to consolidated VIEs	8,373	12,509	35,122	52,254
Change in fair value of servicing rights	(908)	839	393	(702)
Change in fair value of investment securities, net	26,217	23,495	37,258	18,069
Change in fair value of mortgage loans, net	0	0	0	0
Earnings (loss) from unconsolidated entities	(1,063)	807	(1,129)	453
(Loss) gain on sale of investments and other assets, net	0	0	0	0
Gain (loss) on derivative financial instruments, net	0	0	0	0
Foreign currency (loss) gain, net	0	0	0	0
Loss on extinguishment of debt		0	0	0
Other (loss) income, net	0	0	25	0
Total other income	32,619	37,650	71,669	70,074
Income before income taxes	81	(601)	54	(541)
Income tax (provision) benefit	0	0	0	0
Net income	81	(601)	54	(541)
Net income attributable to non-controlling interests	(81)	601	(54)	541
Net income attributable to Starwood Property Trust, Inc.	0	$ 0	0	$ 0
Securitization VIEs | Primary beneficiary
Other income (loss):
Income from affordable housing fund investments	$ 0		$ 0

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Segment Data - Balance Sheet (Details) - USD ($) $ in Thousands	Jun. 30, 2022	Mar. 31, 2022	Dec. 31, 2021	Jun. 30, 2021	Mar. 31, 2021	Dec. 31, 2020
Assets:
Cash and cash equivalents	$ 272,174		$ 217,362
Restricted cash	64,632		104,552
Loans held-for-investment, net	17,895,789		15,536,849
Loans held-for-sale	2,236,647		2,876,800
Investment securities	913,360		860,984
Properties, net	1,225,979		1,166,387
Investments in unconsolidated entities	85,510		90,097
Goodwill	259,846		259,846
Intangible assets	74,964		63,564
Derivative assets	128,727		48,216
Accrued interest receivable	131,660		116,262
Other assets	257,185		188,626
VIE assets, at fair value	57,993,563		61,280,543
Total Assets	83,098,886		83,850,397
Liabilities:
Accounts payable, accrued expenses and other liabilities	273,414		189,696
Related-party payable	30,754		76,371
Dividends payable	149,991		147,624
Derivative liabilities	55,137		13,421
Secured financing agreements, net	13,147,447		12,576,850
Collateralized loan obligations and single asset securitization, net	3,764,151		2,616,116
Unsecured senior notes, net	2,324,772		1,828,590
VIE liabilities, at fair value	56,256,080		59,752,922
Total Liabilities	76,001,746		77,201,590
Temporary Equity: Redeemable non-controlling interests	322,753		214,915
Starwood Property Trust, Inc. Stockholders’ Equity:
Common stock	3,167		3,123
Additional paid-in capital	5,766,533		5,673,376
Treasury stock	(138,022)		(138,022)
Accumulated other comprehensive income	28,970		40,953
Retained earnings (accumulated deficit)	733,348		493,106
Total Starwood Property Trust, Inc. Stockholders’ Equity	6,393,996		6,072,536
Non-controlling interests in consolidated subsidiaries	380,391		361,356
Total Permanent Equity	6,774,387	$ 6,647,968	6,433,892	$ 4,851,700	$ 4,854,785	$ 4,862,576
Total Liabilities and Equity	83,098,886		83,850,397
Primary beneficiary
Assets:
Investments of consolidated affordable housing fund, at fair value	1,558,850		1,040,309
Total Assets	75,600
Liabilities:
Total Liabilities	32,300
Infrastructure Lending Segment
Assets:
Goodwill	119,400		119,400
Investing and Servicing Segment
Assets:
Goodwill	140,400		140,400
Operating Segments and Corporate
Assets:
Cash and cash equivalents	270,118		216,772
Restricted cash	64,632		104,552
Loans held-for-investment, net	17,895,789		15,536,849
Loans held-for-sale	2,236,647		2,876,800
Investment securities	2,615,892		2,352,770
Properties, net	1,225,979		1,166,387
Investments in unconsolidated entities	101,312		105,353
Goodwill	259,846		259,846
Intangible assets	116,689		105,683
Derivative assets	128,727		48,216
Accrued interest receivable	131,818		116,393
Other assets	257,491		188,788
VIE assets, at fair value	0		0
Total Assets	26,863,790		24,118,718
Liabilities:
Accounts payable, accrued expenses and other liabilities	273,349		189,640
Related-party payable	30,754		76,371
Dividends payable	149,991		147,624
Derivative liabilities	55,137		13,421
Secured financing agreements, net	13,168,811		12,598,410
Collateralized loan obligations and single asset securitization, net	3,764,151		2,616,116
Unsecured senior notes, net	2,324,772		1,828,590
VIE liabilities, at fair value	0		0
Total Liabilities	19,766,965		17,470,172
Temporary Equity: Redeemable non-controlling interests	322,753		214,915
Starwood Property Trust, Inc. Stockholders’ Equity:
Common stock	3,167		3,123
Additional paid-in capital	5,766,533		5,673,376
Treasury stock	(138,022)		(138,022)
Accumulated other comprehensive income	28,970		40,953
Retained earnings (accumulated deficit)	733,348		493,106
Total Starwood Property Trust, Inc. Stockholders’ Equity	6,393,996		6,072,536
Non-controlling interests in consolidated subsidiaries	380,076		361,095
Total Permanent Equity	6,774,072		6,433,631
Total Liabilities and Equity	26,863,790		24,118,718
Operating Segments and Corporate | Primary beneficiary
Assets:
Investments of consolidated affordable housing fund, at fair value	1,558,850		1,040,309
Operating segment | Commercial and Residential Lending Segment
Assets:
Cash and cash equivalents	67,812		65,064
Restricted cash	2,889		39,853
Loans held-for-investment, net	15,623,041		13,499,520
Loans held-for-sale	2,195,953		2,590,005
Investment securities	1,338,195		1,155,452
Properties, net	215,099		124,503
Investments in unconsolidated entities	38,612		44,938
Goodwill	0		0
Intangible assets	14,948		0
Derivative assets	126,546		34,265
Accrued interest receivable	117,918		106,251
Other assets	126,936		68,908
VIE assets, at fair value	0		0
Total Assets	19,867,949		17,728,759
Liabilities:
Accounts payable, accrued expenses and other liabilities	152,679		57,267
Related-party payable	0		0
Dividends payable	0		0
Derivative liabilities	11,899		12,870
Secured financing agreements, net	9,999,749		9,097,985
Collateralized loan obligations and single asset securitization, net	2,951,308		2,210,798
Unsecured senior notes, net	0		0
VIE liabilities, at fair value	0		0
Total Liabilities	13,115,635		11,378,920
Temporary Equity: Redeemable non-controlling interests	0		0
Starwood Property Trust, Inc. Stockholders’ Equity:
Common stock	0		0
Additional paid-in capital	1,926,108		1,735,397
Treasury stock	0		0
Accumulated other comprehensive income	28,970		40,953
Retained earnings (accumulated deficit)	4,797,121		4,573,374
Total Starwood Property Trust, Inc. Stockholders’ Equity	6,752,199		6,349,724
Non-controlling interests in consolidated subsidiaries	115		115
Total Permanent Equity	6,752,314		6,349,839
Total Liabilities and Equity	19,867,949		17,728,759
Operating segment | Commercial and Residential Lending Segment | Primary beneficiary
Assets:
Investments of consolidated affordable housing fund, at fair value	0		0
Operating segment | Infrastructure Lending Segment
Assets:
Cash and cash equivalents	26,325		17,011
Restricted cash	38,835		43,408
Loans held-for-investment, net	2,263,006		2,027,426
Loans held-for-sale	0		0
Investment securities	67,336		31,923
Properties, net	0		0
Investments in unconsolidated entities	27,454		26,255
Goodwill	119,409		119,409
Intangible assets	0		0
Derivative assets	232		128
Accrued interest receivable	4,941		3,207
Other assets	6,952		14,265
VIE assets, at fair value	0		0
Total Assets	2,554,490		2,283,032
Liabilities:
Accounts payable, accrued expenses and other liabilities	24,052		8,917
Related-party payable	0		0
Dividends payable	0		0
Derivative liabilities	197		260
Secured financing agreements, net	1,025,145		1,225,548
Collateralized loan obligations and single asset securitization, net	812,843		405,318
Unsecured senior notes, net	0		0
VIE liabilities, at fair value	0		0
Total Liabilities	1,862,237		1,640,043
Temporary Equity: Redeemable non-controlling interests	0		0
Starwood Property Trust, Inc. Stockholders’ Equity:
Common stock	0		0
Additional paid-in capital	624,101		600,412
Treasury stock	0		0
Accumulated other comprehensive income	0		0
Retained earnings (accumulated deficit)	68,152		42,577
Total Starwood Property Trust, Inc. Stockholders’ Equity	692,253		642,989
Non-controlling interests in consolidated subsidiaries	0		0
Total Permanent Equity	692,253		642,989
Total Liabilities and Equity	2,554,490		2,283,032
Operating segment | Infrastructure Lending Segment | Primary beneficiary
Assets:
Investments of consolidated affordable housing fund, at fair value	0		0
Operating segment | Property Segment
Assets:
Cash and cash equivalents	27,926		14,136
Restricted cash	958		954
Loans held-for-investment, net	0		0
Loans held-for-sale	0		0
Investment securities	0		0
Properties, net	874,119		887,553
Investments in unconsolidated entities	0		0
Goodwill	0		0
Intangible assets	32,050		34,619
Derivative assets	371		8
Accrued interest receivable	14		0
Other assets	66,483		43,420
VIE assets, at fair value	0		0
Total Assets	2,560,771		2,020,999
Liabilities:
Accounts payable, accrued expenses and other liabilities	10,161		14,757
Related-party payable	0		0
Dividends payable	0		0
Derivative liabilities	0		0
Secured financing agreements, net	788,557		787,396
Collateralized loan obligations and single asset securitization, net	0		0
Unsecured senior notes, net	0		0
VIE liabilities, at fair value	0		0
Total Liabilities	798,718		802,153
Temporary Equity: Redeemable non-controlling interests	322,753		214,915
Starwood Property Trust, Inc. Stockholders’ Equity:
Common stock	0		0
Additional paid-in capital	(378,128)		(365,922)
Treasury stock	0		0
Accumulated other comprehensive income	0		0
Retained earnings (accumulated deficit)	1,608,794		1,161,334
Total Starwood Property Trust, Inc. Stockholders’ Equity	1,230,666		795,412
Non-controlling interests in consolidated subsidiaries	208,634		208,519
Total Permanent Equity	1,439,300		1,003,931
Total Liabilities and Equity	2,560,771		2,020,999
Operating segment | Property Segment | Primary beneficiary
Assets:
Investments of consolidated affordable housing fund, at fair value	1,558,850		1,040,309
Operating segment | Investing and Servicing Segment
Assets:
Cash and cash equivalents	27,863		26,700
Restricted cash	10,011		20,337
Loans held-for-investment, net	9,742		9,903
Loans held-for-sale	40,694		286,795
Investment securities	1,210,361		1,165,395
Properties, net	136,761		154,331
Investments in unconsolidated entities	35,246		34,160
Goodwill	140,437		140,437
Intangible assets	69,691		71,064
Derivative assets	1,578		391
Accrued interest receivable	1,118		947
Other assets	34,667		40,395
VIE assets, at fair value	0		0
Total Assets	1,718,169		1,950,855
Liabilities:
Accounts payable, accrued expenses and other liabilities	48,634		58,920
Related-party payable	0		0
Dividends payable	0		0
Derivative liabilities	0		291
Secured financing agreements, net	584,395		714,237
Collateralized loan obligations and single asset securitization, net	0		0
Unsecured senior notes, net	0		0
VIE liabilities, at fair value	0		0
Total Liabilities	633,029		773,448
Temporary Equity: Redeemable non-controlling interests	0		0
Starwood Property Trust, Inc. Stockholders’ Equity:
Common stock	0		0
Additional paid-in capital	(556,122)		(388,196)
Treasury stock	0		0
Accumulated other comprehensive income	0		0
Retained earnings (accumulated deficit)	1,469,935		1,413,142
Total Starwood Property Trust, Inc. Stockholders’ Equity	913,813		1,024,946
Non-controlling interests in consolidated subsidiaries	171,327		152,461
Total Permanent Equity	1,085,140		1,177,407
Total Liabilities and Equity	1,718,169		1,950,855
Operating segment | Investing and Servicing Segment | Primary beneficiary
Assets:
Investments of consolidated affordable housing fund, at fair value	0		0
Corporate
Assets:
Cash and cash equivalents	120,192		93,861
Restricted cash	11,939		0
Loans held-for-investment, net	0		0
Loans held-for-sale	0		0
Investment securities	0		0
Properties, net	0		0
Investments in unconsolidated entities	0		0
Goodwill	0		0
Intangible assets	0		0
Derivative assets	0		13,424
Accrued interest receivable	7,827		5,988
Other assets	22,453		21,800
VIE assets, at fair value	0		0
Total Assets	162,411		135,073
Liabilities:
Accounts payable, accrued expenses and other liabilities	37,823		49,779
Related-party payable	30,754		76,371
Dividends payable	149,991		147,624
Derivative liabilities	43,041		0
Secured financing agreements, net	770,965		773,244
Collateralized loan obligations and single asset securitization, net	0		0
Unsecured senior notes, net	2,324,772		1,828,590
VIE liabilities, at fair value	0		0
Total Liabilities	3,357,346		2,875,608
Temporary Equity: Redeemable non-controlling interests	0		0
Starwood Property Trust, Inc. Stockholders’ Equity:
Common stock	3,167		3,123
Additional paid-in capital	4,150,574		4,091,685
Treasury stock	(138,022)		(138,022)
Accumulated other comprehensive income	0		0
Retained earnings (accumulated deficit)	(7,210,654)		(6,697,321)
Total Starwood Property Trust, Inc. Stockholders’ Equity	(3,194,935)		(2,740,535)
Non-controlling interests in consolidated subsidiaries	0		0
Total Permanent Equity	(3,194,935)		(2,740,535)
Total Liabilities and Equity	162,411		135,073
Corporate | Primary beneficiary
Assets:
Investments of consolidated affordable housing fund, at fair value	0		0
Securitization VIEs
Assets:
Cash and cash equivalents	2,056		590
Restricted cash	0		0
Loans held-for-investment, net	0		0
Loans held-for-sale	0		0
Investment securities	(1,702,532)		(1,491,786)
Properties, net	0		0
Investments in unconsolidated entities	(15,802)		(15,256)
Goodwill	0		0
Intangible assets	(41,725)		(42,119)
Derivative assets	0		0
Accrued interest receivable	(158)		(131)
Other assets	(306)		(162)
VIE assets, at fair value	57,993,563		61,280,543
Total Assets	56,235,096		59,731,679
Liabilities:
Accounts payable, accrued expenses and other liabilities	65		56
Related-party payable	0		0
Dividends payable	0		0
Derivative liabilities	0		0
Secured financing agreements, net	(21,364)		(21,560)
Collateralized loan obligations and single asset securitization, net	0		0
Unsecured senior notes, net	0		0
VIE liabilities, at fair value	56,256,080		59,752,922
Total Liabilities	56,234,781		59,731,418
Temporary Equity: Redeemable non-controlling interests	0		0
Starwood Property Trust, Inc. Stockholders’ Equity:
Common stock	0		0
Additional paid-in capital	0		0
Treasury stock	0		0
Accumulated other comprehensive income	0		0
Retained earnings (accumulated deficit)	0		0
Total Starwood Property Trust, Inc. Stockholders’ Equity	0		0
Non-controlling interests in consolidated subsidiaries	315		261
Total Permanent Equity	315		261
Total Liabilities and Equity	56,235,096		59,731,679
Securitization VIEs | Primary beneficiary
Assets:
Investments of consolidated affordable housing fund, at fair value	$ 0		$ 0

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Subsequent Events - Narrative (Details) - First Mortgage Loans - USD ($) $ in Millions	1 Months Ended	3 Months Ended		6 Months Ended
	Jul. 31, 2022	Jun. 30, 2022	Jun. 30, 2021	Jun. 30, 2022	Jun. 30, 2021
Subsequent Events
Face amount of assets transferred		$ 7.0	$ 210.1	$ 7.0	$ 210.1
Subsequent Event
Subsequent Events
Face amount of assets transferred	$ 63.6

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Label	Element	Value
Accounting Standards Update [Extensible Enumeration]	us-gaap_AccountingStandardsUpdateExtensibleList	Accounting Standards Update 2020-06 [Member]