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“We consider stockholder return is properly served by balancing present return with optimization of ebook worth and long-term earnings potential by our strategic capital allocation choices,” BXMT chief government Katie Keenan stated in a press release.
The dividend minimize, from 62 cents to 47 cents per share, is predicted to save lots of roughly $100 million yearly, which might be redirected to new loans or different investments.
This transfer follows comparable actions by different industrial actual property mortgage REITs, similar to KKR Actual Property Finance Belief Inc. and Ares Business Actual Property Corp., which decreased their dividends by 42% and 24% respectively earlier this 12 months.
The vast majority of BXMT’s troubled loans are tied to US workplace buildings, which comprise a few quarter of its excellent loans. Workplace values have dropped 37% from their early 2022 peak, in comparison with a 20% decline for all industrial property, in keeping with the Inexperienced Avenue Business Property Value Index.
BXMT reported lowering its web publicity to workplaces by $1.4 billion over the previous two years. Roughly 13% of the workplace portfolio was given a threat score of “3”, primarily related to European properties. About 7% of the portfolio obtained the worst threat score, with BXMT contemplating these loans impaired.
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