THE FREMF TRUSTS

3 Months Ended

Mar. 31, 2019

Organization, Consolidation and Presentation of Financial Statements [Abstract]

The Company previously elected the fair value option on the assets and liabilities of the FREMF 2011-K13 Trust and the FREMF 2012-KF01 Trust, which required that changes in valuations of the trusts be reflected in the Company’s statements of operations. The Company’s net investment in the trusts was limited to the Multi-Family MBS comprised of first loss PO securities and IO securities acquired by the Company in 2014 with an aggregate net carrying value of $0 at March 31, 2019 and $4,762,149 at December 31, 2018. The Company sold the underlying Multi-Family MBS of the FREMF 2011-K13 trust effective May 18, 2018 and on January 25, 2019, the FREMF 2012-KF01 trust was paid-in full. As of March 31, 2019 the Company no longer held any FREMF Trusts.

The condensed consolidated balance sheets of the FREMF trusts at December 31, 2018 are set out below:



Balance Sheets	December 31, 2018
Assets
Multi-family mortgage loans held in securitization trusts	$	—
Receivables	24,357,335
Total assets	$	24,357,335
Liabilities and Equity
Multi-family securitized debt obligations	$	19,231,331
Payables	363,855
Total liabilities	$	19,595,186
Equity	4,762,149
Total liabilities and equity	$	24,357,335

As of December 31, 2018, all of the loans within the FREMF 2012-KF01 trust had been paid-in full. Accordingly, the assets of the trust consisted of the non-distributed cash proceeds of the loan redemptions.

The condensed consolidated statements of operations of the FREMF trusts for the three months ended March 31, 2019 and March 31, 2018 are as follows:



Statements of Operations	Three Months Ended March 31, 2019		Three Months Ended March 31, 2018
Interest income	$	78,361	$	13,227,188
Interest expense	—		12,526,295
Net interest income	$	78,361	$	700,893
General and administrative fees	—		(623,254		)
Unrealized gain (loss) on multi-family loans held in securitization trusts	694,339		(1,355,774		)
Net income (loss)	$	772,700	$	(1,278,135	)

During the three months ended March 31, 2019, the consolidated trust incurred realized losses of $709,439.