Arbor Realty Trust Reports First Quarter 2025 Results and Declares Dividend of $0.30 per Share

Company Highlights: GAAP net income of $0.16 per diluted common shareDistributable earnings1 of $0.28, or $0.31 per diluted common share, excluding $7.1 million of realized losses from the sale of two real estate owned properties that were previously reservedDeclares cash dividend on common stock of $0.30 per shareClosed on a new $1.15 billion repurchase facility to unwind in full two CLO vehicles; enhancing leverage, reducing pricing and generated ~$80 million of additional liquidityServicing portfolio of ~$33.48 billion, agency loan originations of $605.9 millionStructured loan portfolio of ~$11.49 billion, originations of $747.1 million and runoff of $421.9 millionForeclosed on seven non-performing loans as real estate owned assets totaling $196.7 million UNIONDALE, N.Y., May 02, 2025 (GLOBE NEWSWIRE) -- Arbor Realty Trust, Inc. (NYSE: ABR), today announced financial results for the first quarter ended March 31, 2025. Arbor reported net income for the quarter of $30.4 million, or $0.16 per diluted common share, compared to net income of $57.9 million, or $0.31 per diluted common share for the quarter ended March 31, 2024. Distributable earnings for the quarter was $57.3 million, or $0.28 per diluted common share, compared to $96.7 million, or $0.47 per diluted common share for the quarter ended March 31, 2024. Agency Business Loan Origination Platform Agency Loan Volume (in thousands) Quarter Ended March 31, 2025 December 31, 2024Fannie Mae$357,811 $556,676 Freddie Mac 178,020 675,244 Private Label 44,925 27,650 FHA 16,041 119,050 SFR-Fixed Rate 9,111 — Total Originations$605,908 $1,378,620 Total Loan Sales$730,854 $1,270,048 Total Loan Commitments$645,401 $1,353,527 For the quarter ended March 31, 2025, the Agency Business generated revenues of $62.9 million, compared to $78.7 million for the fourth quarter of 2024. Gain on sales, including fee-based services, net was $12.8 million for the quarter, reflecting a margin of 1.75%, compared to $22.2 million and 1.75% for the fourth quarter of 2024. Income from mortgage servicing rights was $8.1 million for the quarter, reflecting a rate of 1.26% as a percentage of loan commitments, compared to $13.3 million and 0.99% for the fourth quarter of 2024. At March 31, 2025, loans held-for-sale was $314.6 million, with financing associated with these loans totaling $279.4 million. Fee-Based Servicing Portfolio The Company’s fee-based servicing portfolio totaled $33.48 billion at March 31, 2025. Servicing revenue, net was $25.6 million for the quarter and consisted of servicing revenue of $43.4 million, net of amortization of mortgage servicing rights totaling $17.8 million. Fee-Based Servicing Portfolio ($ in thousands) March 31, 2025 December 31, 2024 UPB Wtd. Avg. Fee (bps) Wtd. Avg. Life (years) UPB Wtd. Avg. Fee (bps) Wtd. Avg. Life (years)Fannie Mae$22,683,885 46.2 6.2 $22,730,056 46.4 6.4Freddie Mac 6,123,074 21.4 6.6 6,077,020 21.5 6.8Private Label 2,603,122 18.7 5.3 2,605,980 18.7 5.5FHA 1,519,675 14.0 19.0 1,506,948 14.1 19.2Bridge 278,293 10.4 2.8 278,494 10.4 3.0SFR-Fixed Rate 276,839 20.1 4.1 271,859 20.1 4.4Total$33,484,888 37.5 6.7 $33,470,357 37.8 6.9 Loans sold under the Fannie Mae program contain an obligation to partially guarantee the performance of the loan (“loss-sharing obligations”) and includes $34.7 million for the fair value of the guarantee obligation undertaken at March 31, 2025. The Company recorded a $1.9 million net provision for loss sharing associated with CECL for the first quarter of 2025. At March 31, 2025, the Company’s total CECL allowance for loss-sharing obligations was $50.8 million, representing 0.22% of the Fannie Mae servicing portfolio. Structured Business Portfolio and Investment Activity Structured Portfolio Activity ($ in thousands) Quarter Ended March 31, 2025 December 31, 2024 UPB % UPB % Bridge: Multifamily$367,750 49% $371,250 54%SFR 356,294 48% 273,087 40% 724,044 97% 644,337 94% . Mezzanine/Preferred Equity 4,440 1% 35,592 5%Construction - Multifamily 18,637 2% 4,368 1%Total Originations$747,121 100% $684,297 100% Number of Loans Originated 20 28 Commitments: SFR$162,400 $375,894 Construction - Multifamily 92,000 54,000 Total Commitments$254,400 $429,894 Loan Runoff$421,941 $900,583 Structured Portfolio ($ in thousands) March 31, 2025 December 31, 2024 UPB % UPB % Bridge: Multifamily$8,637,773 75% $8,725,429 76%SFR 2,247,817 20% 1,993,890 18%Other 171,952 1% 173,787 2% 11,057,542 96% 10,893,106 96% Mezzanine/Preferred Equity 405,770 4% 404,401 3%Construction - Multifamily 23,005 <1% 4,367 <1%SFR Permanent 3,076 <1% 3,082 <1%Total Portfolio$11,489,393 100% $11,304,956 100% At March 31, 2025, the loan and investment portfolio’s unpaid principal balance ("UPB"), excluding loan loss reserves, was $11.49 billion, with a weighted average interest rate of 6.94%, compared to $11.30 billion and 6.90% at December 31, 2024. Including certain fees earned and costs associated with the loan and investment portfolio, the weighted average interest rate was 7.85% at March 31, 2025, compared to 7.80% at December 31, 2024. The average balance of the Company’s loan and investment portfolio during the first quarter of 2025, excluding loan loss reserves, was $11.39 billion with a weighted average yield of 8.15%, compared to $11.46 billion and 8.52% for the fourth quarter of 2024. The decrease in yield was primarily due to a decrease in the average SOFR rate in the first quarter of 2025. During the first quarter of 2025, the Company recorded an $8.4 million net provision for loan losses associated with CECL. At March 31, 2025, the Company’s total allowance for loan losses was $240.9 million. The Company had twenty-three non-performing loans with a UPB of $511.1 million, before related loan loss reserves of $35.3 million, compared to twenty-six loans with a UPB of $651.8 million, before loan loss reserves of $23.8 million at December 31, 2024. In addition, at March 31, 2025, the Company had five loans with a total UPB of $142.8 million (before related loan loss reserves of $7.3 million) that were less than 60 days past due classified as non-accrual, compared to nine loans with a total UPB of $167.4 million at December 31, 2024. Interest income on these loans is only being recorded to the extent cash is received. During the first quarter of 2025, the Company modified twenty-one loans with a total UPB of $949.8 million, most of which had borrowers investing additional capital to recapitalize their deals. Nineteen of these loans with a total UPB of $849.4 million, contained interest rates based on pricing over SOFR ranging from 3.10% to 4.25% and were modified to provide temporary rate relief through a pay and accrual feature. At March 31, 2025, these modified loans had a weighted average pay rate of 5.18% and a weighted average accrual rate of 2.56%. In addition, of the total modified loans for the first quarter, $16.5 million were less than 60 days past due and $38.3 million were non-performing at December 31, 2024, and are now current in accordance with their modified terms. Financing Activity The balance of debt that finances the Company’s loan and investment portfolio at March 31, 2025 was $9.49 billion with a weighted average interest rate including fees of 6.82%, as compared to $9.46 billion and a rate of 6.88% at December 31, 2024. The average balance of debt that finances the Company’s loan and investment portfolio for the first quarter of 2025 was $9.42 billion, as compared to $9.67 billion for the fourth quarter of 2024. The average cost of borrowings for the first quarter of 2025 was 6.96%, compared to 7.10% for the fourth quarter of 2024. In March 2025, the Company closed a $1.15 billion repurchase facility and transferred approximately $1.43 billion of assets into this facility, $1.34 billion of which were from two of the Company's existing CLO vehicles that were redeemed in full and at par. The facility is match funded with 80% leverage and pricing of SOFR plus 1.85%, well below the pricing of SOFR plus 2.24% and 77% leverage of the CLOs replaced at the time of redemption. Additionally, this facility is 88% non-recourse to the Company and has a 24-month reinvestment period. As a result of these transactions, the Company created approximately $80 million of additional liquidity and has increased the returns on these assets through enhanced leverage and reduced pricing. Dividend The Company announced today that its Board of Directors has declared a quarterly cash dividend of $0.30 per share of common stock for the quarter ended March 31, 2025. The dividend is payable on May 30, 2025 to common stockholders of record on May 16, 2025. Earnings Conference Call The Company will host a conference call today at 10:00 a.m. Eastern Time. A live webcast and replay of the conference call will be available at www.arbor.com in the investor relations section of the Company’s website, or you can access the call telephonically at least ten minutes prior to the conference call. The dial-in numbers are (800) 579-2543 for domestic callers and (785) 424-1789 for international callers. Please use participant passcode ABRQ125 when prompted by the operator. A telephonic replay of the call will be available until May 9, 2025. The replay dial-in numbers are (800) 934-2127 for domestic callers and (402) 220-1139 for international callers. About Arbor Realty Trust, Inc. Arbor Realty Trust, Inc. (NYSE: ABR) is a nationwide real estate investment trust and direct lender, providing loan origination and servicing for multifamily, single-family rental (SFR) portfolios, and other diverse commercial real estate assets. Headquartered in New York, Arbor manages a multibillion-dollar servicing portfolio, specializing in government-sponsored enterprise products. Arbor is a leading Fannie Mae DUS® lender and Freddie Mac Optigo® Seller/Servicer, and an approved FHA Multifamily Accelerated Processing (MAP) lender. Arbor’s product platform also includes bridge, CMBS, mezzanine and preferred equity loans. Rated by Standard and Poor’s and Fitch Ratings, Arbor is committed to building on its reputation for service, quality, and customized solutions with an unparalleled dedication to providing our clients excellence over the entire life of a loan. Safe Harbor Statement Certain items in this press release may constitute forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations and beliefs and are subject to a number of trends and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Arbor can give no assurance that its expectations will be attained. Factors that could cause actual results to differ materially from Arbor’s expectations include, but are not limited to, changes in economic conditions generally, and the real estate markets specifically, continued ability to source new investments, changes in interest rates and/or credit spreads, and other risks detailed in Arbor’s Annual Report on Form 10-K for the year ended December 31, 2024 and its other reports filed with the SEC. Such forward-looking statements speak only as of the date of this press release. Arbor expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in Arbor’s expectations with regard thereto or change in events, conditions, or circumstances on which any such statement is based. Notes During the quarterly earnings conference call, the Company may discuss non-GAAP financial measures as defined by SEC Regulation G. In addition, the Company has used non-GAAP financial measures in this press release. A supplemental schedule of non-GAAP financial measures and the comparable GAAP financial measure can be found on the last two pages of this release. ARBOR REALTY TRUST, INC. AND SUBSIDIARIESConsolidated Statements of Income - (Unaudited)($ in thousands—except share and per share data) Quarter Ended March 31, 2025 2024 Interest income$240,693 $321,292 Interest expense 165,251 217,676 Net interest income 75,442 103,616 Other revenue: Gain on sales, including fee-based services, net 12,781 16,666 Mortgage servicing rights 8,131 10,199 Servicing revenue, net 25,603 31,526 Property operating income 4,387 1,570 Gain (loss) on derivative instruments, net 3,400 (5,257)Other income, net 4,419 2,333 Total other revenue 58,721 57,037 Other expenses: Employee compensation and benefits 46,036 47,694 Selling and administrative 16,312 13,933 Property operating expenses 3,474 1,678 Depreciation and amortization 3,744 2,571 Provision for loss sharing (net of recoveries) 1,786 273 Provision for credit losses (net of recoveries) 9,075 19,118 Total other expenses 80,427 85,267 Income before extinguishment of debt, loss on real estate, (loss) income from equity affiliates and income taxes 53,736 75,386 Loss on extinguishment of debt (2,319) — Loss on real estate (2,810) — (Loss) income from equity affiliates (1,634) 1,418 Provision for income taxes (3,591) (3,592)Net income 43,382 73,212 Preferred stock dividends 10,342 10,342 Net income attributable to noncontrolling interest 2,602 4,997 Net income attributable to common stockholders$30,438 $57,873 Basic earnings per common share$0.16 $0.31 Diluted earnings per common share$0.16 $0.31 Weighted average shares outstanding: Basic 190,060,776 188,710,390 Diluted 206,862,320 222,926,076 Dividends declared per common share$0.43 $0.43 ARBOR REALTY TRUST, INC. AND SUBSIDIARIESConsolidated Balance Sheets($ in thousands—except share and per share data) March 31, 2025(Unaudited) December 31, 2024Assets: Cash and cash equivalents$308,842 $503,803 Restricted cash 40,563 156,376 Loans and investments, net (allowance for credit losses of $240,937 and $238,967) 11,215,625 11,033,997 Loans held-for-sale, net 314,635 435,759 Capitalized mortgage servicing rights, net 357,220 368,678 Securities held-to-maturity, net (allowance for credit losses of $10,767 and $10,846) 158,658 157,154 Investments in equity affiliates 77,095 76,312 Real estate owned, net 302,158 176,543 Due from related party 9,605 12,792 Goodwill and other intangible assets 87,727 88,119 Other assets 495,221 481,448 Total assets$13,367,349 $13,490,981 Liabilities and Equity: Credit and repurchase facilities$4,780,753 $3,559,490 Securitized debt 3,286,395 4,622,489 Senior unsecured notes 1,237,160 1,236,147 Convertible senior unsecured notes 286,555 285,853 Junior subordinated notes to subsidiary trust issuing preferred securities 144,890 144,686 Mortgage notes payable — real estate owned 123,851 74,897 Due to related party 1,458 4,474 Due to borrowers 52,062 47,627 Allowance for loss-sharing obligations 85,515 83,150 Other liabilities 239,251 280,198 Total liabilities 10,237,890 10,339,011 Equity: Arbor Realty Trust, Inc. stockholders' equity: Preferred stock, cumulative, redeemable, $0.01 par value: 100,000,000 shares authorized, shares issued and outstanding by period: 633,682 633,684 Special voting preferred shares - 16,173,761 shares 6.375% Series D - 9,200,000 shares 6.25% Series E - 5,750,000 shares 6.25% Series F - 11,342,000 shares Common stock, $0.01 par value: 500,000,000 shares authorized - 192,161,707 and 189,259,435 shares issued and outstanding 1,922 1,893 Additional paid-in capital 2,410,499 2,375,469 (Accumulated deficit) retained earnings (38,600) 13,039 Total Arbor Realty Trust, Inc. stockholders' equity 3,007,503 3,024,085 Noncontrolling interest 121,956 127,885 Total equity 3,129,459 3,151,970 Total liabilities and equity$13,367,349 $13,490,981 ARBOR REALTY TRUST, INC. AND SUBSIDIARIESStatement of Income Segment Information - (Unaudited)(in thousands) Quarter Ended March 31, 2025 StructuredBusiness AgencyBusiness Other (1) ConsolidatedInterest income$230,087 $10,606 $— $240,693 Interest expense 161,579 3,672 — 165,251 Net interest income 68,508 6,934 — 75,442 Other revenue: Gain on sales, including fee-based services, net — 12,781 — 12,781 Mortgage servicing rights — 8,131 — 8,131 Servicing revenue — 43,361 — 43,361 Amortization of MSRs — (17,758) — (17,758)Property operating income 4,387 — — 4,387 Gain on derivative instruments, net — 3,400 — 3,400 Other income, net 2,078 2,341 — 4,419 Total other revenue 6,465 52,256 — 58,721 Other expenses: Employee compensation and benefits 18,157 27,879 — 46,036 Selling and administrative 8,932 7,380 — 16,312 Property operating expenses 3,474 — — 3,474 Depreciation and amortization 3,352 392 — 3,744 Provision for loss sharing — 1,786 — 1,786 Provision for credit losses (net of recoveries) 9,154 (79) — 9,075 Total other expenses 43,069 37,358 — 80,427 Income before extinguishment of debt, loss on real estate, loss from equity affiliates and income taxes 31,904 21,832 — 53,736 Loss on extinguishment of debt (2,319) — — (2,319)Loss on real estate (2,810) — — (2,810)Loss from equity affiliates (1,634) — — (1,634)Benefit from (provision for) income taxes 639 (4,230) — (3,591)Net income 25,780 17,602 — 43,382 Preferred stock dividends 10,342 — — 10,342 Net income attributable to noncontrolling interest — — 2,602 2,602 Net income attributable to common stockholders$15,438 $17,602 $(2,602) $30,438 (1) Includes income allocated to the noncontrolling interest holders not allocated to the two reportable segments. ARBOR REALTY TRUST, INC. AND SUBSIDIARIESBalance Sheet Segment Information - (Unaudited)(in thousands) March 31, 2025 Structured Business Agency Business ConsolidatedAssets: Cash and cash equivalents$55,328 $253,514 $308,842 Restricted cash 15,943 24,620 40,563 Loans and investments, net 11,215,625 — 11,215,625 Loans held-for-sale, net — 314,635 314,635 Capitalized mortgage servicing rights, net — 357,220 357,220 Securities held-to-maturity, net — 158,658 158,658 Investments in equity affiliates 77,095 — 77,095 Real estate owned, net 302,158 — 302,158 Goodwill and other intangible assets 12,500 75,227 87,727 Other assets and due from related party 249,904 254,922 504,826 Total assets$11,928,553 $1,438,796 $13,367,349 Liabilities: Debt obligations$9,580,201 $279,403 $9,859,604 Allowance for loss-sharing obligations — 85,515 85,515 Other liabilities and due to related parties 206,181 86,590 292,771 Total liabilities$9,786,382 $451,508 $10,237,890 ARBOR REALTY TRUST, INC. AND SUBSIDIARIESReconciliation of Distributable Earnings to GAAP Net Income - (Unaudited)($ in thousands—except share and per share data) Quarter Ended March 31, 2025 2024 Net income attributable to common stockholders$30,438 $57,873 Adjustments: Net income attributable to noncontrolling interest 2,602 4,997 Income from mortgage servicing rights (8,131) (10,199)Deferred tax benefit (137) (3,952)Amortization and write-offs of MSRs 20,864 18,418 Depreciation and amortization 4,568 3,193 Loss on extinguishment of debt 2,319 — Provision for credit losses, net 756 14,804 (Gain) loss on derivative instruments, net (4,697) 5,523 Loss on real estate 2,810 — Stock-based compensation 5,935 6,020 Distributable earnings (1)$57,327 $96,677 Diluted distributable earnings per share (1)$0.28 $0.47 Diluted weighted average shares outstanding (1) (2) 206,862,320 205,511,529 (1) Amounts are attributable to common stockholders and OP Unit holders. The OP Units are redeemable for cash, or at the Company's option for shares of the Company's common stock on a one-for-one basis. (2) The diluted weighted average shares outstanding exclude the potential shares issuable upon conversion and settlement of the Company's convertible senior notes principal balance. The Company is presenting distributable earnings because management believes it is an important supplemental measure of the Company's operating performance and is useful to investors, analysts and other parties in the evaluation of REITs and their ability to provide dividends to stockholders. Dividends are one of the principal reasons investors invest in REITs. To maintain REIT status, REITs are required to distribute at least 90% of their REIT-taxable income. The Company considers distributable earnings in determining its quarterly dividend and believes that, over time, distributable earnings is a useful indicator of the Company's dividends per share. The Company defines distributable earnings as net income (loss) attributable to common stockholders computed in accordance with GAAP, adjusted for accounting items such as depreciation and amortization (adjusted for unconsolidated joint ventures), non-cash stock-based compensation expense, income from MSRs, amortization and write-offs of MSRs, gains/losses on derivative instruments primarily associated with Private Label loans not yet sold and securitized, changes in fair value of GSE-related derivatives that temporarily flow through earnings, deferred tax provision (benefit), CECL provisions for credit losses (adjusted for realized losses as described below) and gains/losses on the receipt of real estate from the settlement of loans (prior to the sale of the real estate). The Company also adds back one-time charges such as acquisition costs and one-time gains/losses on the early extinguishment of debt and redemption of preferred stock. The Company reduces distributable earnings for realized losses in the period management determines that a loan is deemed nonrecoverable in whole or in part. Loans are deemed nonrecoverable upon the earlier of: (1) when the loan receivable is settled (i.e., when the loan is repaid, or in the case of foreclosure, when the underlying asset is sold); or (2) when management determines that it is nearly certain that all amounts due will not be collected. The realized loss amount is equal to the difference between the cash received, or expected to be received, and the book value of the asset. Distributable earnings is not intended to be an indication of the Company's cash flows from operating activities (determined in accordance with GAAP) or a measure of its liquidity, nor is it entirely indicative of funding the Company's cash needs, including its ability to make cash distributions. The Company's calculation of distributable earnings may be different from the calculations used by other companies and, therefore, comparability may be limited.

Arbor Realty Trust Reports First Quarter 2025 Results and Declares Dividend of $0.30 per Share

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