Market Overview

Arbor Realty Trust Reports Third Quarter 2017 Results and Increases Quarterly Dividend to $0.19 per Share

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Company Highlights:

  • GAAP net income of $0.26 and AFFO of $0.25 per diluted common share1
  • Declares a cash dividend on common stock of $0.19 per share, a 19% increase in our dividend from a year ago and 6% higher than last quarter

Agency Business

  • Segment income of $17.1 million
  • Loan originations of $1.0 billion
  • Servicing portfolio of $15.6 billion at September 30, 2017, up 4% from 2Q17 and 15% year to date

Structured Business

  • Segment income of $6.0 million
  • Closed an eighth collateralized securitization vehicle totaling $365.0 million with improved terms and a 68 basis point decrease in rate from our last securitization
  • Strong portfolio growth of 11% on loan originations of $473.2 million

UNIONDALE, N.Y., Nov. 03, 2017 (GLOBE NEWSWIRE) -- Arbor Realty Trust, Inc. (NYSE:ABR), today announced financial results for the third quarter ended September 30, 2017.  Arbor reported net income for the quarter of $16.4 million, or $0.26 per diluted common share, compared to $10.9 million, or $0.21 per diluted common share for the quarter ended September 30, 2016.  Adjusted funds from operations ("AFFO") for the quarter was $21.0 million, or $0.25 per diluted common share, compared to $15.0 million, or $0.21 per diluted common share for the quarter ended September 30, 2016.1

Agency Business

Loan Origination Platform

Agency Loan Volume  ($ in 000's)
    Quarter Ended
    September 30,
 2017
  June 30,
 2017
Fannie Mae   $ 650,374   $ 669,897
Freddie Mac     328,075     317,490
FHA     18,273     32,878
Total Originations   $ 996,722   $ 1,020,265
         
Total Loan Sales   $ 1,052,073   $ 1,204,353
         
Total Loan Commitments   $ 928,181   $ 1,101,243
         

For the quarter ended September 30, 2017, the Agency Business generated revenues of $49.7 million, compared to $45.7 million for the second quarter of 2017.  Gain on sales, including fee-based services, net was $17.1 million for the quarter, reflecting a margin of 1.63% on loan sales, compared to $18.8 million and 1.56% for the second quarter of 2017. Income from mortgage servicing rights was $18.9 million for the quarter, reflecting a rate of 2.04% as a percentage of loan commitments, compared to $17.3 million and 1.57% for the second quarter of 2017. 

At September 30, 2017, loans held-for-sale was $333.3 million which was primarily comprised of unpaid principal balances totaling $328.5 million, with financing associated with these loans totaling $328.0 million.

Fee-Based Servicing Portfolio

The fee-based servicing portfolio totaled $15.60 billion at September 30, 2017, an increase of 4% from June 30, 2017, primarily as a result of $1.00 billion of new loan originations during the quarter. Servicing revenue, net was $8.5 million for the quarter, and consists of servicing revenue of $20.2 million net of amortization of mortgage servicing rights totaling $11.7 million.

    Fee-Based Servicing Portfolio ($ in 000s)
    As of September 30, 2017   As of June 30, 2017
    UPB Wtd. Avg.
Fee
Wtd. Avg.
Life (in years)
  UPB Wtd. Avg.
Fee
Wtd. Avg.
Life (in years)
Fannie Mae   $ 12,331,135 0.54 % 7.2   $ 12,034,573 0.54 % 7.1
Freddie Mac     2,732,537 0.29 % 10.9     2,458,530 0.26 % 10.9
FHA     537,554 0.17 % 20.0     525,944 0.17 % 20.0
Total   $ 15,601,226 0.48 % 8.3   $ 15,019,047 0.48 % 8.1
                 

Loans sold under the Fannie Mae program contain an obligation to partially guarantee the performance of the loan ("loss-sharing obligations"). At September 30, 2017, the Company's allowance for loss-sharing obligations was $30.2 million which consists of general loss sharing guaranty obligations of $29.5 million, representing 0.24% of the Fannie Mae servicing portfolio, and $0.7 million of loss-sharing obligations on specifically identified loans with losses determined to be probable and estimable.

Financing Activity

The Company closed on a $100.0 million credit facility to finance agency mortgage loans. The facility has an interest rate of 1.35% over LIBOR and matures in one year. 

In addition, the Company replaced a $30.0 million letter of credit facility with a $50.0 million letter of credit facility with another institution. The new facility has a three-year term and a fixed interest rate of 2.875%, representing a 12.5 basis point rate decrease from the prior facility.

Structured Business

Portfolio and Investment Activity

Third quarter of 2017:

  • 23 new loan originations totaling $473.2 million, of which 20 were bridge loans for $378.2 million
  • Payoffs and pay downs on 22 loans totaling $270.0 million
  • Portfolio growth of 11% from 2Q17

At September 30, 2017, the loan and investment portfolio's unpaid principal balance, excluding loan loss reserves, was $2.10 billion, with a weighted average current interest pay rate of 6.04%, compared to $1.90 billion and 6.05% at June 30, 2017.  Including certain fees earned and costs associated with the loan and investment portfolio, the weighted average current interest pay rate was 6.84% at September 30, 2017, compared to 6.71% at June 30, 2017.

The average balance of the Company's loan and investment portfolio during the third quarter of 2017, excluding loan loss reserves, was $2.00 billion with a weighted average yield on these assets of 7.34%, compared to $1.80 billion and 6.60% for the second quarter of 2017.  The increase in average yield was primarily due to an increase in income from the acceleration of fees and prepayment fees on early loan payoffs in the third quarter as compared to the second quarter, as well as an increase in one-month LIBOR.

At September 30, 2017, the Company's total loan loss reserves were $83.3 million on six loans with an aggregate carrying value before loan loss reserves of $184.5 million. The Company also had five non-performing loans with a carrying value of $32.6 million, net of related loan loss reserves of $27.9 million.

The Company recorded $1.0 million of income from equity affiliates primarily consisting of $2.2 million of income from distributions received partially offset by a $1.2 million loss from its joint venture investment in a residential mortgage banking business.

Financing Activity

The Company completed its eighth collateralized securitization vehicle ("CLO VIII") totaling $365.0 million of real estate related assets and cash. Investment grade-rated notes totaling $282.9 million were issued, and the Company retained subordinate interests in the issuing vehicle of $82.1 million. The facility has a three-year asset replenishment period and an initial weighted average interest rate of 1.31% over one-month LIBOR, excluding fees and transaction costs, a 68 basis point decrease from the Company's last collateralized securitization vehicle.

The Company completed the unwind of CLO IV, redeeming $219.0 million of outstanding notes which were repaid with proceeds received from the refinancing of CLO IV's outstanding assets within the Company's existing financing facilities including CLO VIII. As a result of this transaction, the Company recognized an expense of $1.1 million from the acceleration of deferred fees.

The balance of debt that finances the Company's loan and investment portfolio at September 30, 2017 was $1.67 billion with a weighted average interest rate including fees of 4.48%, as compared to $1.49 billion and a rate of 4.69% at June 30, 2017. The average balance of debt that finances the Company's loan and investment portfolio for the third quarter of 2017 was $1.62 billion, as compared to $1.46 billion for the second quarter of 2017. The average cost of borrowings for the third quarter was 4.89%, compared to 4.60% for the second quarter of 2017. The increase in average cost was primarily due to the acceleration of fees related to the unwind of CLO IV.

The Company is subject to various financial covenants and restrictions under the terms of its collateralized securitization vehicles and financing facilities. The Company believes it was in compliance with all financial covenants and restrictions as of September 30, 2017 and as of the most recent collateralized securitization vehicle determination dates in October 2017.

Dividends

The Company announced today that its Board of Directors has declared a quarterly cash dividend of $0.19 per share of common stock for the quarter ended September 30, 2017, representing an increase of 19% from a year ago and 6% over the prior quarter dividend of $0.18 per share. The dividend is payable on November 30, 2017 to common stockholders of record on November 15, 2017. The ex-dividend date is November 14, 2017.

The Company also announced today that its Board of Directors has declared cash dividends on the Company's Series A, Series B and Series C cumulative redeemable preferred stock reflecting accrued dividends from September 1, 2017 through November 30, 2017. The dividends are payable on November 30, 2017 to preferred stockholders of record on November 15, 2017. The Company will pay total dividends of $0.515625, $0.484375 and $0.53125 per share on the Series A, Series B and Series C preferred stock, respectively.

Earnings Conference Call

The Company will host a conference call today at 10:00 a.m. Eastern Time. A live webcast of the conference call will be available at www.arbor.com in the investor relations area of the website. Those without web access should access the call telephonically at least ten minutes prior to the conference call. The dial-in numbers are (866) 516-5034 for domestic callers and (678) 509-7613 for international callers. Please use participant passcode 96242464.

After the live webcast, the call will remain available on the Company's website through November 30, 2017.  In addition, a telephonic replay of the call will be available until November 10, 2017. The replay dial-in numbers are (855) 859-2056 for domestic callers and (404) 537-3406 for international callers. Please use passcode 96242464.

About Arbor Realty Trust, Inc.

Arbor Realty Trust, Inc. (NYSE:ABR) is a real estate investment trust and national direct lender specializing in loan origination and servicing for multifamily, seniors housing, healthcare and other diverse commercial real estate assets. Arbor is a Top 10 Fannie Mae DUS® Multifamily Lender by volume and a Top Fannie Mae Small Loan lender, a Freddie Mac Program Plus® Seller/Servicer and the Top Freddie Mac Small Balance Loan Lender, a Fannie Mae and Freddie Mac Seniors Housing Lender, an FHA Multifamily Accelerated Processing (MAP)/LEAN Lender, a HUD-approved LIHTC Lender as well as a CMBS, bridge, mezzanine and preferred equity lender, consistently building on its reputation for service, quality and flexibility. With a fee-based servicing portfolio of over $15 billion, Arbor is a primary commercial loan servicer and special servicer rated by Standard & Poor's with an Above Average rating. Arbor is also on the Standard & Poor's Select Servicer List and is a primary commercial loan servicer and loan level special servicer rated by Fitch Ratings.

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, continued ability to source new investments, changes in interest rates and/or credit spreads, changes in the real estate markets, and other risks detailed in Arbor's Annual Report on Form 10-K for the year ended December 31, 2016 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.

1. Non-GAAP Financial Measures

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 page 12 of this release.

     
 ARBOR REALTY TRUST, INC. AND SUBSIDIARIES     
               
CONSOLIDATED STATEMENTS OF INCOME - (Unaudited)    
                       
      Quarter Ended   Nine Months Ended    
      September 30,   September 30,    
        2017       2016       2017       2016      
                       
Interest income   $ 42,139,576     $ 29,636,227     $ 110,132,866     $ 83,424,190      
Other interest income, net     -       -       -       2,539,274      
Interest expense     23,849,417       16,966,228       63,697,641       42,958,329      
  Net interest income     18,290,159       12,669,999       46,435,225       43,005,135      
                       
Other revenue:                    
Gain on sales, including fee-based services,  net     17,126,106       9,693,822       55,127,004       9,693,822      
Mortgage servicing rights     18,897,239       15,968,067       56,181,638       15,968,067      
Servicing revenue, net     8,520,111       5,885,884       19,922,901       5,885,884      
Property operating income     2,668,055       2,960,940       8,754,518       12,719,027      
Other income, net     777,656       359,546       (929,893 )     663,977      
  Total other revenue     47,989,167       34,868,259       139,056,168       44,930,777      
                       
Other expenses:                    
Employee compensation and benefits     25,194,433       14,216,679       66,860,581       22,856,433      
Selling and administrative     7,606,936       5,903,031       23,135,750       10,277,844      
Acquisition costs     -       6,406,258       -       10,261,902      
Property operating expenses     2,582,745       2,819,004       7,842,571       10,991,823      
Depreciation and amortization     1,829,016       1,808,765       5,541,991       3,129,410      
Impairment loss on real estate owned     -       -       2,700,000       11,200,000      
Provision for loss sharing (net of recoveries)     (2,617,064 )     1,316,862       (405,494 )     1,316,862      
Provision for loan losses (net of recoveries)     2,000,000       (54,000 )     (455,653 )     (24,995 )    
Management fee - related party     -       3,325,000       6,673,260       8,875,000      
  Total other expenses     36,596,066       35,741,599       111,893,006       78,884,279      
                       
Income before gain on extinguishment of debt, gain on                    
  sale of real estate, income from equity affiliates                    
  and provision for income taxes     29,683,260       11,796,659       73,598,387       9,051,633      
Gain on extinguishment of debt     -       -       7,116,243       -      
Gain on sale of real estate     -       -       -       11,630,687      
Income from equity affiliates     995,312       4,929,375       1,755,145       11,193,918      
Provision for income taxes     (6,708,000 )     (300,000 )     (16,244,000 )     (300,000 )    
                       
Net income     23,970,572       16,426,034       66,225,775       31,576,238      
                       
Preferred stock dividends     1,888,430       1,888,430       5,665,290       5,665,290      
Net income attributable to noncontrolling interest     5,661,184       3,649,432       16,596,415       3,649,432      
Net income attributable to common stockholders   $ 16,420,958     $ 10,888,172     $ 43,964,070     $ 22,261,516      
                       
Basic earnings per common share   $ 0.27     $ 0.21     $ 0.78     $ 0.43      
Diluted earnings per common share   $ 0.26     $ 0.21     $ 0.77     $ 0.43      
                       
                       
Weighted average shares outstanding:                    
  Basic     61,582,796       51,390,467       56,602,504       51,272,795      
  Diluted     83,918,117       70,271,796       78,942,919       51,627,550      
                       
Dividends declared per common share   $ 0.18     $ 0.16     $ 0.53     $ 0.46      
                       

 

 ARBOR REALTY TRUST, INC. AND SUBSIDIARIES   
                 
CONSOLIDATED BALANCE SHEETS  
                 
          September 30,   December 31,  
            2017       2016    
          (Unaudited)      
Assets:            
Cash and cash equivalents   $ 84,751,397     $ 138,645,430    
Restricted cash     137,138,389       29,314,929    
Loans and investments, net     1,997,555,985       1,695,732,351    
Loans held-for-sale, net     333,267,976       673,367,304    
Capitalized mortgage servicing rights, net     247,875,659       227,742,986    
Available-for-sale securities, at fair value     4,707,085       5,403,463    
Securities held to maturity     18,851,089       -    
Investments in equity affiliates     31,330,740       33,948,853    
Real estate owned, net     17,354,720       19,491,805    
Due from related party     12,613,313       1,464,732    
Goodwill and other intangible assets     123,166,816       97,489,884    
Other assets     49,564,693       48,184,509    
Total assets   $ 3,058,177,862     $ 2,970,786,246    
                 
Liabilities and Equity:          
Credit facilities and repurchase agreements     562,326,537       906,636,790    
Collateralized loan obligations     1,066,230,488       728,441,109    
Senior unsecured notes     95,088,379       94,521,566    
Convertible senior notes, net     95,381,121       80,660,038    
Junior subordinated notes to subsidiary trust issuing preferred securities     139,418,416       157,858,555    
Related party financing     50,000,000       50,000,000    
Due to related party     -       6,038,707    
Due to borrowers     69,357,152       81,019,386    
Allowance for loss-sharing obligations     30,158,464       32,407,554    
Other liabilities     104,474,096       86,164,613    
Total liabilities     2,212,434,653       2,223,748,318    
                 
Equity:            
  Arbor Realty Trust, Inc. stockholders' equity:          
    Preferred stock, cumulative, redeemable, $0.01 par value: 100,000,000 shares          
      authorized; special voting preferred shares; 21,230,769 shares issued and          
      outstanding, no shares issued and outstanding, respectively; 8.25% Series A,      
      $38,787,500 aggregate liquidation preference; 1,551,500 shares issued and          
      outstanding; 7.75% Series B, $31,500,000 aggregate liquidation preference;        
      1,260,000 shares issued and outstanding; 8.50% Series C, $22,500,000          
      aggregate liquidation preference; 900,000 shares issued and outstanding     89,508,213       89,508,213    
    Common stock, $0.01 par value: 500,000,000 shares authorized; 61,702,628          
      and 51,401,295 shares issued and outstanding, respectively     617,026       514,013    
    Additional paid-in capital     702,240,622       621,931,995    
    Accumulated deficit     (112,069,714 )     (125,134,403 )  
    Accumulated other comprehensive income     205,761       320,917    
Total Arbor Realty Trust, Inc. stockholders' equity     680,501,908       587,140,735    
                 
Noncontrolling interest     165,241,301       159,897,193    
Total equity     845,743,209       747,037,928    
                 
Total liabilities and equity   $ 3,058,177,862     $ 2,970,786,246    
                 

 

 ARBOR REALTY TRUST, INC. AND SUBSIDIARIES   
                 
STATEMENT OF INCOME SEGMENT INFORMATION- (Unaudited)  
                     
                     
      Quarter Ended September 30, 2017  
      Structured   Agency   Other /      
      Business   Business   Eliminations (1)   Consolidated  
                     
Interest income   $ 37,258,633   $ 4,880,943     $ -     $ 42,139,576    
Interest expense     19,912,991     2,974,603       961,823       23,849,417    
  Net interest income     17,345,642     1,906,340       (961,823 )     18,290,159    
                     
Other revenue:                  
Gain on sales, including fee-based services,  net     -     17,126,106       -       17,126,106    
Mortgage servicing rights     -     18,897,239       -       18,897,239    
Servicing revenue     -     20,231,489       -       20,231,489    
Amortization of OMSR     -     (11,711,378 )     -       (11,711,378 )  
Property operating income     2,668,055     -       -       2,668,055    
Other income, net     540,241     237,415       -       777,656    
  Total other revenue     3,208,296     44,780,871       -       47,989,167    
                     
Other expenses:                  
Employee compensation and benefits     5,670,249     19,524,184       -       25,194,433    
Selling and administrative     3,014,038     4,592,898       -       7,606,936    
Property operating expenses     2,582,745     -       -       2,582,745    
Depreciation and amortization     428,562     1,400,454       -       1,829,016    
Provision for loss sharing (net of recoveries)     -     (2,617,064 )     -       (2,617,064 )  
Provision for loan losses (net of recoveries)     2,000,000     -       -       2,000,000    
  Total other expenses     13,695,594     22,900,472       -       36,596,066    
                     
Income before income from equity affiliates and provision                  
  for income taxes     6,858,344     23,786,739       (961,823 )     29,683,260    
Income from equity affiliates     995,312     -       -       995,312    
Provision for income taxes     -     (6,708,000 )     -       (6,708,000 )  
                     
Net income   $ 7,853,656   $ 17,078,739     $ (961,823 )   $ 23,970,572    
                     
Preferred stock dividends     1,888,430     -       -       1,888,430    
Net income attributable to noncontrolling interest     -     -       5,661,184       5,661,184    
Net income attributable to common stockholders   $ 5,965,226   $ 17,078,739     $ (6,623,007 )   $ 16,420,958    
                     
(1) Includes certain corporate expenses not allocated to the two reportable segments, such as financing costs associated with the acquisition of the Agency Business in 2016 as well as income allocated to the noncontrolling interest holder.  
       
                     

 

 ARBOR REALTY TRUST, INC. AND SUBSIDIARIES 
                   
BALANCE SHEET SEGMENT INFORMATION - (Unaudited)
                       
          September 30, 2017
          Structured
Business
  Agency
Business
  Other /
Eliminations (1)
  Consolidated
Assets:                  
Cash and cash equivalents   $ 28,874,347   $ 55,877,050   $ -   $ 84,751,397
Restricted cash     137,126,053     12,336     -     137,138,389
Loans and investments, net     1,997,555,985     -     -     1,997,555,985
Loans held-for-sale, net     -     333,267,976     -     333,267,976
Capitalized mortgage servicing rights, net     -     247,875,659     -     247,875,659
Securities held to maturity     -     18,851,089     -     18,851,089
Investments in equity affiliates     31,330,740     -     -     31,330,740
Goodwill and other intangible assets     12,500,000     110,666,816     -     123,166,816
Other assets     71,864,641     12,375,170     -     84,239,811
Total assets   $ 2,279,251,766   $ 778,926,096   $ -   $ 3,058,177,862
                       
Liabilities:                
Debt obligations     1,630,457,754     327,987,187     50,000,000     2,008,444,941
Allowance for loss-sharing obligations     -     30,158,464     -     30,158,464
Other liabilities     122,924,302     49,852,331     1,054,615     173,831,248
Total liabilities   $ 1,753,382,056   $ 407,997,982   $ 51,054,615   $ 2,212,434,653
                       
(1) Includes debt and accrued interest costs associated with the acquisition of the Agency Business in 2016, not allocated to the two reportable segments.
                 
                       


ARBOR REALTY TRUST, INC. AND SUBSIDIARIES  
                 
Supplemental Schedule of Non-GAAP Financial Measures -  
Funds from Operations ("FFO") and Adjusted Funds from Operations ("AFFO")  
(Unaudited)  
                 
  Quarter Ended     Nine Months Ended    
  September 30,   September 30,    
    2017       2016       2017       2016    
                                 
                                 
Net income attributable to common stockholders $ 16,420,958     $ 10,888,172     $ 43,964,070     $ 22,261,516    
                                 
Adjustments:                                
Gain on sale of real estate   -       -       -       (11,630,687)    
Net income attributable to noncontrolling interest   5,661,184       3,649,432       16,596,415       3,649,432    
Impairment loss on real estate owned   -       -       2,700,000       11,200,000    
Depreciation - real estate owned   172,657       443,684       591,755       1,764,329    
Depreciation - investments in equity affiliates   101,447       93,588       304,341       280,764    
                                 
Funds from operations  (1) $ 22,356,246     $ 15,074,876     $ 64,156,581     $ 27,525,354    
                                 
Adjustments:                                
Income from mortgage servicing rights   (18,897,239)       (15,968,067)       (56,181,638)       (15,968,067)    
Impairment loss on real estate owned   -       -       (2,700,000)       (11,200,000)    
Deferred tax (benefit) provision   (922,000)       -       15,000       -    
Amortization and write-offs of MSRs   15,927,329       7,586,524       46,140,491       7,586,524    
Depreciation and amortization   1,882,543       1,365,081       5,623,203       1,365,081    
Net (gain) loss on changes in fair value of derivatives   (237,415)       (248,510)       2,311,740       (248,510)    
Gain on sale of real estate   -       -       -       11,630,687    
Stock-based compensation   847,128       777,080       3,833,361       2,940,174    
Acquisition costs   -       6,406,258       -       10,261,902    
                                 
Adjusted funds from operations  (1) $ 20,956,592     $ 14,993,242     $ 63,198,738     $ 33,893,145    
                                 
Diluted FFO per share  (1) $ 0.27     $ 0.21     $ 0.81     $ 0.48    
                                 
Diluted AFFO per share  (1) $ 0.25     $ 0.21     $ 0.80     $ 0.59    
                                 
Diluted weighted average shares outstanding  (1)   83,918,117       70,271,796       78,942,919       57,748,830    
                                 
(1) Amounts are attributable to common stockholders and OP Unit holder. 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.    
   
                 
The Company is presenting FFO and AFFO because management believes they are important supplemental measures of the Company's operating performance in that they are frequently used by analysts, investors and other parties in the evaluation of REITs.  The National Association of Real Estate Investment Trusts, or NAREIT, defines FFO as net income (loss) attributable to common stockholders (computed in accordance with GAAP), excluding gains (losses) from sales of depreciated real properties, plus impairments of depreciated real properties and real estate related depreciation and amortization, and after adjustments for unconsolidated ventures.  
   
The Company defines AFFO as funds from operations adjusted for accounting items such as non-cash stock-based compensation expense, income from mortgage servicing rights ("MSRs"), changes in fair value of certain derivatives that temporarily flow through earnings, amortization and write-offs of MSRs, deferred tax (benefit) provision and the amortization of the convertible senior notes conversion option. The Company also adds back one-time charges such as acquisition costs and impairment losses on real estate and gains (losses) on sales of real estate. The Company is generally not in the business of operating real estate property and has obtained real estate by foreclosure or through partial or full settlement of mortgage debt related to the Company's loans to maximize the value of the collateral and minimize the Company's exposure.  Therefore, the Company deems such impairment and gains (losses) on real estate as an extension of the asset management of its loans, thus a recovery of principal or additional loss on the Company's initial investment.  
   
FFO and AFFO are not intended to be an indication of the Company's cash flow 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 FFO and AFFO may be different from the calculations used by other companies and, therefore, comparability may be limited.  

 

Contacts:
Arbor Realty Trust, Inc.
Paul Elenio, Chief Financial Officer 
516-506-4422
pelenio@arbor.com

Media:
Bonnie Habyan, EVP of Marketing
516-506-4615
bhabyan@arbor.com

Investors:
The Ruth Group
Lee Roth
646-536-7012
lroth@theruthgroup.com

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