5. Investments in Real Estate-Related Securities

The following table details the Company’s investments in CMBS as of June 30, 2017 ($ in thousands):

Number of Investments		Credit Rating⁽¹⁾	Collateral	Weighted Average Coupon⁽²⁾	Face Amount		Cost Basis		Fair Value
	4	BBB	Office, Industrial, Hospitality	L+2.15%	$	114,659	$	114,659	$	115,307
	5	BB	Office, Hospitality, Multifamily	L+3.29%		150,899		150,942		151,800
	3	B	Office, Multifamily	L+3.79%		24,313		24,313		24,442
	12				$	289,871	$	289,914	$	291,549

(1)

BBB represents credit ratings of BBB+, BBB, and BBB-, BB represents credit ratings of BB+, BB, and BB-, and B represents credit ratings of B+, B, and B-.

(2)

The term “L” refers to the three-month U.S. dollar-denominated London Interbank Offer Rate. As of June 30, 2017, three-month U.S. dollar-denominated LIBOR was equal to 1.3%.

As of June 30, 2017, the Company’s investments in real estate-related securities included five CMBS with a total cost basis of $122.3 million collateralized by properties owned by Blackstone-advised investment vehicles and three CMBS with a total cost basis of $63.5 million collateralized by a loan originated by a Blackstone-advised investment vehicle. Such CMBS were purchased in fully or over-subscribed offerings. Each investment in such CMBS by Blackstone and its affiliates (including the Company) represented no more than a 49% participation in any individual tranche. The Company acquired its minority participation interests from third-party investment banks on market terms negotiated by the majority third-party investors. Blackstone and its affiliates (including the Company) will forgo all non-economic rights (including voting rights) in such CMBS as long as the Blackstone-advised investment vehicles either own the properties collateralizing, or have an interest in a different part of the capital structure related to such CMBS. For both the three and six months ended June 30, 2017, the Company recorded interest income of $1.2 million related to its investments in such CMBS.

As described in Note 2, the Company classifies its investments in real estate-related securities as trading and records these investment in real estate related securities at fair value on its consolidated balance sheets. During the three and six months ended June 30, 2017, the Company recorded an unrealized gain of $900 thousand and $1.6 million, respectively, as a component of income from real estate-related securities on its consolidated statements of operations. During the three and six months ended June 30, 2017, one of the Company’s CMBS investments was repaid and the Company recorded a realized loss of $177 thousand as a component of income from real estate-related securities on its consolidated statements of operations. The Company did not sell any securities during the three and six months ended June 30, 2017.