Ladder Capital Corp
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Our businesses, including balance sheet lending, conduit lending, securities investments, and real estate investments, provide for a stable base of net interest and rental income. We have originated $31.3 billion of commercial real estate loans from our inception in October 2008 through December 31, 2025. During this timeframe, we also acquired $16.0 billion of predominantly investment grade-rated securities secured by first mortgage loans on commercial real estate and $2.2 billion of selected net leased and other real estate assets.
As part of our commercial mortgage lending operations, we originate conduit loans, which are first mortgage loans on stabilized, income producing commercial real estate properties that we intend to make available for sale in commercial mortgage-backed securities (“CMBS”) securitizations. From our inception in October 2008 through December 31, 2025, we originated $17.0 billion of conduit loans, of which $16.9 billion were sold into 75 CMBS securitizations, making us, by volume, one of the largest non-bank contributors of loans to CMBS securitizations in the United States in such period. Our sales of loans into securitizations are generally accounted for as true sales, not financings, and we generally retain no ongoing interest in loans which we securitize unless we are required to do so as issuer pursuant to the risk retention requirements of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, as amended, (the “Dodd-Frank Act”). The securitization of conduit loans enables us to reinvest our equity capital into new loan originations or allocate it to other investments.
We maintain a diversified and flexible financing strategy supporting our investment strategy and overall business operations, including the use of senior unsecured notes, non-recourse, non-mark-to-market Collateralized Loan Obligations (“CLO”) debt issuances and committed term financing from leading financial institutions. Refer to “Our Financing Strategies” and “Liquidity and Capital Resources” for further information.
Ladder was founded in October 2008 and we completed our initial public offering in February 2014. We are led by a disciplined and highly aligned management team. As of December 31, 2025, our management team and directors held interests in our Company comprising over 11% of our total equity. On average, our management team members have over 29 years of experience in the industry. Our management team includes Brian Harris, Chief Executive Officer; Pamela McCormack, President; Paul J. Miceli, Chief Financial Officer; Robert Perelman, Head of Asset Management; and Kelly Porcella, Chief Administrative Officer & General Counsel. Anthony V. Esposito, Chief Accounting Officer, and Stephanie Lin, Assistant Secretary, are additional officers of Ladder.
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Our Businesses
We invest primarily in loans, securities and other interests in U.S. commercial real estate, with a focus on senior secured assets. Our complementary business segments are designed to provide us with the flexibility to opportunistically allocate capital in order to generate attractive risk-adjusted returns under varying market conditions. The following chart summarizes our investment portfolio as of December 31, 2025 ($ in thousands):
(1)CRE equity asset amounts represent undepreciated asset values.
There are a number of factors that influence our operating results. Some of these factors include: (1) our competition; (2) market and economic conditions, including inflation; (3) loan origination and repayment volume; (4) profitability of securitizations; (5) avoidance of credit losses; (6) availability of debt and equity funding and the costs of that funding; (7) the net interest margin on our investments; (8) effectiveness of our hedging and other risk management practices; (9) real estate transaction volumes; (10) occupancy rates; and (11) expense management. Refer to Part II, Item 7 “Management’s Discussion and Analysis of Financial Condition and Results of Operations” under the heading “Results of Operations.”
Loans
Balance Sheet First Mortgage Loans. We originate and invest in balance sheet first mortgage loans secured by commercial real estate properties that are typically undergoing transition, including lease-up, sell-out, and renovation or repositioning. These mortgage loans are structured to fit the needs and business plans of the property owners, and generally have Term SOFR-based floating rates and terms (including extension options) ranging from one to five years. Our loans are directly originated by an internal team that has longstanding and strong relationships with borrowers and mortgage brokers throughout the United States. We follow a rigorous investment process, which begins with an initial due diligence review; continues through a comprehensive legal and underwriting process incorporating multiple internal and external checks and balances; and culminates in approval or disapproval of each prospective investment by our Investment Committee. Balance sheet first mortgage loans in excess of $50.0 million also require the approval of our board of directors’ Risk and Underwriting Committee.
We generally seek to hold our balance sheet first mortgage loans for investment although we also maintain the flexibility to contribute such loans into a CLO or similar structure, sell participation interests or “b-notes” in our mortgage loans or sell such mortgage loans as whole loans. Our balance sheet first mortgage loans may be refinanced by us into a new conduit first mortgage loan upon property stabilization. As of December 31, 2025, we held a portfolio of 73 balance sheet first mortgage loans with an aggregate book value of $2.2 billion. Based on the loan balances and the “as-is” third-party Financial Institutions
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Reform, Recovery and Enforcement Act of 1989 (“FIRREA”) appraised values at origination, the weighted average loan-to-value ratio of this portfolio was 68.8% at December 31, 2025.
Other Commercial Real Estate-Related Loans. We selectively invest in note purchase financings, subordinated debt, mezzanine debt and other structured finance products related to commercial real estate that are generally held for investment. As of December 31, 2025, we held a portfolio of 2 mezzanine loans with an aggregate book value of $7.3 million. Based on the loan balance and the “as-is” third-party FIRREA appraised values at origination, the weighted average loan-to-value ratio of the portfolio was 69.2% at December 31, 2025.
Conduit First Mortgage Loans. We also originate conduit loans, which are first mortgage loans that are secured by cash-flowing commercial real estate and are available for sale to securitizations. These first mortgage loans are typically structured with fixed interest rates and generally have five- to ten-year terms. Conduit first mortgage loans are originated, underwritten, approved and funded using the same comprehensive legal and underwriting approach, process and personnel used to originate our balance sheet first mortgage loans. Conduit first mortgage loans in excess of $50.0 million also require approval of our board of directors’ Risk and Underwriting Committee. We held one conduit loan with an aggregate carrying value of $28.0 million at December 31, 2025.
Although our primary intent is to sell our conduit first mortgage loans to CMBS trusts, we generally seek to maintain the flexibility to keep them on our balance sheet, sell participation interests or “B-notes” in such loans or sell the loans as whole loans. The Company holds these conduit loans in its taxable REIT subsidiary (“TRS”) upon origination. As of December 31, 2025, we held one conduit first mortgage loan that was available for contribution into securitizations. Based on the loan balance and the “as-is” third-party FIRREA appraised values at origination, loan-to-value ratio of the loan was 58.9% at December 31, 2025.
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The following charts set forth our total outstanding balance sheet first mortgage loans, other commercial real estate-related loans, and conduit first mortgage loans as of December 31, 2025, and a breakdown of our loan portfolio by loan size and geographic location and asset type of the underlying real estate by loan balance.
Real Estate
Net Leased Commercial Real Estate Properties. As of December 31, 2025, we owned 149 single tenant net leased properties with an undepreciated book value of $596.2 million. These properties are fully leased on a net basis where the tenant is generally responsible for payment of real estate taxes, property, building and general liability insurance and property and building maintenance expenses. As of December 31, 2025, our net leased properties comprised a total of 3.4 million square feet, 100% leased with an average age since construction of 21.2 years and a weighted average remaining lease term of 6.7 years. Commercial real estate investments in excess of $20.0 million require the approval of our board of directors’ Risk and Underwriting Committee. The majority of the tenants in our net leased properties are necessity-based businesses. During the year ended December 31, 2025, we collected 100% of rent on these properties.
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Diversified Commercial Real Estate Properties. As of December 31, 2025, we owned 56 diversified commercial real estate properties throughout the U.S with an undepreciated book value of $370.0 million. During the year ended December 31, 2025, we collected 98% of rent on these properties.
The following charts summarize the composition of our real estate investments as of December 31, 2025 ($ in millions):
Securities
We invest in primarily AAA-rated real estate securities, typically front pay securities, with relatively short duration and significant subordination. We invest primarily in CMBS, including CRE CLOs, secured by first mortgage loans on commercial real estate. These investments provide a stable and attractive base of net interest income and help us manage our liquidity and hyper-amortization features included in many of these securities positions help mitigate potential credit losses in the event of adverse market conditions. We have significant in-house expertise in the evaluation and trading of these securities, due in part to our experience in originating and underwriting mortgage loans that comprise assets within CMBS trusts, as well as our experience in structuring CMBS transactions. In the future, we may invest in CMBS securities or other securities that are unrated.
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As of December 31, 2025, the estimated fair value of our portfolio of CMBS investments totaled $2.1 billion in 115 CUSIPs ($18.0 million average investment per CUSIP). Included in the $2.1 billion of CMBS securities are $8.8 million of CMBS securities designated as risk retention securities under the Dodd-Frank Act, which are subject to transfer restrictions over the term of the securitization trust. The following chart summarizes our securities investments by market value, 98.6% of which were rated investment grade by Standard & Poor’s Ratings Group, Moody’s Investors Service, Inc. or Fitch Ratings Inc. as of December 31, 2025:
As of December 31, 2025, our CMBS investments had a weighted average duration of 3.0 years. The commercial real estate collateral underlying our CMBS investment portfolio is located throughout the United States. As of December 31, 2025, by property count and market value, respectively, 58.6% and 63.9% of the collateral underlying our CMBS investment portfolio was distributed throughout the top 25 metropolitan statistical areas (“MSAs”) in the United States, with 4.4% and 11.2%, by property count and market value, respectively, of the collateral located in the New York-Newark-Jersey City MSA, and the concentrations in each of the remaining top 24 MSAs ranging from 0.5% to 6.5% by property count and 0.2% to 6.9% by market value.
AAA-rated CMBS or U.S. Agency securities investments in excess of $106.0 million and all other investment grade CMBS or U.S. Agency securities investments in excess of $51.0 million, each in any single class of any single issuance, require the approval of our board of directors’ Risk and Underwriting Committee. The Risk and Underwriting Committee also must approve any investments in non-rated or sub-investment grade CMBS or U.S. Agency securities in any single class of any single issuance in excess of the lesser of (x) $21.0 million and (y) 10% of the total net asset value of the respective Ladder subsidiary or other entity for which Ladder has authority to make investment decisions.
Other Investments
Unconsolidated Ventures. From time to time we invest in real estate related ventures. As of December 31, 2025, the carrying value of our unconsolidated ventures was $44.5 million.
United States Treasury Securities. From time to time, we invest in short-term and long-term U.S. Treasury securities. Short-term U.S. Treasury securities are classified as cash and cash equivalents on our consolidated balance sheet. As of December 31, 2025, we did not hold any U.S. Treasury securities and as of December 31, 2024, we held $1.1 billion of U.S. Treasury securities classified as cash and cash equivalents on our consolidated balance sheet.
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Investment Process
Origination
Our team of originators is responsible for sourcing and directly originating new commercial first mortgage loans from the brokerage community and directly from real estate owners, operators, developers and investors. The extensive industry experience of our management team and origination team has enabled us to build a strong network of mortgage brokers and direct borrowers throughout the commercial real estate community in the United States.
Credit and Underwriting
Our underwriting and credit process commences upon receipt of a potential borrower’s executed loan application and non-refundable deposit.
Our underwriters conduct a thorough due diligence process for each prospective investment. The team coordinates in-house and third-party due diligence for each prospective loan as part of a checklist-based process that is designed to ensure that each loan receives a systematic evaluation. Elements of the underwriting process generally include:
Cash Flow Analysis. We create an estimated cash flow analysis and underwriting model for each prospective investment. Creation of the cash flow analysis generally draws on an assessment of current and historical data related to the property’s rent roll, operating expenses, net operating income, leasing cost, and capital expenditures. Underwriting evaluates and factors in assumptions regarding current market rents, vacancy rates, operating expenses, tenant improvements, leasing commissions, replacement reserves, renewal probabilities and concession packages based on observable conditions in the subject property’s sub-market at the time of underwriting. The cash flow analysis may also rely upon third-party environmental and engineering reports to estimate the cost to repair or remediate any identified environmental and/or property-level deficiencies. The final underwritten cash flow analysis is used to estimate the property’s overall value and its ability to produce cash flow to service the proposed loan.
Borrower Analysis. Careful attention is also paid to the proposed borrower, including an analysis based on available information of its credit history, financial standing, existing portfolio and sponsor exposure to leverage and contingent liabilities, capacity and capability to manage and lease the collateral, depth of organization, knowledge of the local market, and understanding of the proposed product type. We also generally commission and review a third-party background check of our prospective borrower and sponsor.
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Financial statements
data from SEC XBRL filings. Values are as-reported; restatements supersede originals. Values reported in .
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Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations
The following discussion and analysis of financial condition and results of operations should be read in conjunction with the consolidated financial statements and the related notes of Ladder Capital Corp included within this Quarterly Report and the Annual Report. This Management’s Discussion and Analysis of Financial Condition and Results of Operations contains forward-looking statements. See “Cautionary Statement Regarding Forward-Looking Statements” within this Quarterly Report and “Risk Factors” within the Annual Report for a discussion of the uncertainties, risks and assumptions associated with these statements. Actual results may differ materially from those contained in any forward-looking statements as a result of various factors, including but not limited to, those in “Risk Factors” set forth within the Annual Report.
References to “Ladder,” the “Company,” and “we,” “our” and “us” refer to Ladder Capital Corp, a Delaware corporation incorporated in 2013, and its consolidated subsidiaries.
Supplemental Guarantor Disclosures
In June 2025, we filed a registration statement on Form S-3 with the SEC registering, among other securities, debt securities of LCFH and Ladder Capital Finance Corporation (“Co-Issuer” and, together with LCFH, the “Issuers”), which will be fully and unconditionally guaranteed by us. We own substantially all of our assets and conduct all of our operations through LCFH, and the Co-Issuer is a wholly-owned subsidiary of LCFH. The Issuers are consolidated into our financial statements.
Pursuant to Rule 3-10 of Regulation S-X and Rule 12h-5 of the Exchange Act, subsidiary issuers of obligations guaranteed by their parent company and subsidiary guarantors of securities are not required to provide separate financial statements, provided that the subsidiary obligor is consolidated into such parent company’s consolidated financial statements, such related guarantee is “full and unconditional” and, subject to certain exceptions as set forth below, the alternative disclosure required by Rule 13-01 is provided, which includes narrative disclosure and summarized financial information. Accordingly, separate consolidated financial statements of the Issuers have not been presented.
Furthermore, as permitted under Rule 13-01(a)(4) of Regulation S-X, summarized financial information for the Issuers has been excluded because the combined assets, liabilities and results of operations of the Issuers and us are not materially different than the corresponding amounts in our consolidated financial statements incorporated by reference herein, and because management believes such summarized financial information would not be material for investors.
Overview
Ladder Capital is an investment grade-rated, internally-managed real estate investment trust (“REIT”) that is a leader in commercial real estate finance. We originate and invest in a diverse portfolio of commercial real estate and real estate-related assets, focusing on senior secured assets. Our investment activities include: (i) our primary business of originating senior first mortgage fixed and floating rate loans collateralized by commercial real estate with flexible loan structures; (ii) owning and operating commercial real estate, including net leased commercial properties; and (iii) investing in investment grade securities secured by first mortgage loans on commercial real estate. We believe that our in-house origination platform, ability to flexibly allocate capital among complementary product lines, credit-centric underwriting approach, access to diversified financing sources, and experienced management team position us well to deliver attractive returns on equity to our shareholders through economic and credit cycles.
Our businesses, including balance sheet lending, conduit lending, securities investments, and real estate investments, provide for a stable base of net interest and rental income. We have originated $31.9 billion of commercial real estate loans from our inception in October 2008 through March 31, 2026. During this timeframe, we also acquired $16.3 billion of predominantly investment grade-rated securities secured by first mortgage loans on commercial real estate and $2.2 billion of selected net leased and other real estate assets.
As part of our commercial mortgage lending operations, we originate conduit loans, which are first mortgage loans on stabilized, income producing commercial real estate properties that we intend to make available for sale in commercial mortgage-backed securities (“CMBS”) securitizations. From our inception in October 2008 through March 31, 2026, we originated $17.0 billion of conduit loans, of which $16.9 billion were sold into 75 CMBS securitizations. Our sales of loans into securitizations are generally accounted for as true sales, not financings, and we generally retain no ongoing interest in loans which we securitize unless we are required to do so as issuer pursuant to the risk retention requirements of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, as amended, (the “Dodd-Frank Act”). The securitization of conduit loans enables us to reinvest our equity capital into new loan originations or allocate it to other investments.
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We maintain a diversified and flexible financing strategy supporting our investment strategy and overall business operations, including the use of senior unsecured notes and our unsecured revolving credit facility. Refer to “Our Financing Strategies” and “Liquidity and Capital Resources” for further information.
Ladder was founded in October 2008 and we completed our initial public offering in February 2014. We are led by a disciplined and highly aligned management team. As of March 31, 2026, our management team and directors held interests in our Company comprising over 12% of our total equity. On average, our management team members have over 29 years of experience in the industry. Our management team includes Brian Harris, Chief Executive Officer; Pamela McCormack, President; Paul J. Miceli, Chief Financial Officer; Robert Perelman, Head of Asset Management; and Kelly Porcella, Chief Administrative Officer & General Counsel. Anthony V. Esposito, Chief Accounting Officer, and Stephanie Lin, Assistant Secretary, are additional officers of Ladder.
Our Businesses
We invest primarily in loans, securities and other interests in U.S. commercial real estate, with a focus on senior secured assets. Our complementary business segments are designed to provide us with the flexibility to opportunistically allocate capital in order to generate attractive risk-adjusted returns under varying market conditions. The following chart summarizes our investment portfolio as of March 31, 2026 ($ in thousands):
(1)CRE equity asset amounts represent undepreciated asset values.
There are a number of factors that influence our operating results. Some of these factors include: (1) our competition; (2) market and economic conditions, including inflation; (3) loan origination and repayment volume; (4) profitability of securitizations; (5) avoidance of credit losses; (6) availability of debt and equity funding and the costs of that funding; (7) the net interest margin on our investments; (8) effectiveness of our hedging and other risk management practices; (9) real estate transaction volumes; (10) occupancy rates; and (11) expense management. Refer to the heading “Results of Operations.”
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Loans
Balance Sheet First Mortgage Loans. We originate and invest in balance sheet first mortgage loans secured by commercial real estate properties that are typically undergoing transition, including lease-up, sell-out, and renovation or repositioning. These mortgage loans are structured to fit the needs and business plans of the property owners, and generally have Term SOFR-based floating rates and terms (including extension options) ranging from one to five years. Our loans are directly originated by an internal team that has longstanding and strong relationships with borrowers and mortgage brokers throughout the United States. We follow a rigorous investment process, which begins with an initial due diligence review; continues through a comprehensive legal and underwriting process incorporating multiple internal and external checks and balances; and culminates in approval or disapproval of each prospective investment by our Investment Committee. Balance sheet first mortgage loans in excess of $50.0 million also require the approval of our board of directors’ Risk and Underwriting Committee.
We generally seek to hold our balance sheet first mortgage loans for investment although we also maintain the flexibility to contribute such loans into a CLO or similar structure, sell participation interests or “b-notes” in our mortgage loans or sell such mortgage loans as whole loans. Our balance sheet first mortgage loans may be refinanced by us into a new conduit first mortgage loan upon property stabilization. As of March 31, 2026, we held a portfolio of 84 balance sheet first mortgage loans with an aggregate book value of $2.6 billion. Based on the loan balances and the “as-is” third-party Financial Institutions Reform, Recovery and Enforcement Act of 1989 (“FIRREA”) appraised values at origination, the weighted average loan-to-value ratio of this portfolio was 67.8% at March 31, 2026.
Other Commercial Real Estate-Related Loans. We selectively invest in note purchase financings, subordinated debt, mezzanine debt and other structured finance products related to commercial real estate that are generally held for investment.
Conduit First Mortgage Loans. We also originate conduit loans, which are first mortgage loans that are secured by cash-flowing commercial real estate and are available for sale to securitizations. These first mortgage loans are typically structured with fixed interest rates and generally have five- to ten-year terms. Conduit first mortgage loans are originated, underwritten, approved and funded using the same comprehensive legal and underwriting approach, process and personnel used to originate our balance sheet first mortgage loans. Conduit first mortgage loans in excess of $50.0 million also require approval of our board of directors’ Risk and Underwriting Committee. We held one conduit loan with an aggregate carrying value of $27.6 million at March 31, 2026.
Although our primary intent is to sell our conduit first mortgage loans to CMBS trusts, we generally seek to maintain the flexibility to keep them on our balance sheet, sell participation interests or “B-notes” in such loans or sell the loans as whole loans. The Company holds these conduit loans in its taxable REIT subsidiary (“TRS”) upon origination. As of March 31, 2026, we held one conduit first mortgage loan that was available for contribution into securitizations. Based on the loan balance and the “as-is” third-party FIRREA appraised value at origination, the loan-to-value ratio of the loan was 58.9% at March 31, 2026.
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The following charts set forth our total outstanding balance sheet first mortgage loans, other commercial real estate-related loans, and conduit first mortgage loans as of March 31, 2026, and a breakdown of our loan portfolio by loan size and geographic location and asset type of the underlying real estate by loan balance.
Real Estate
Net Leased Commercial Real Estate Properties. As of March 31, 2026, we owned 149 single tenant net leased properties with an undepreciated book value of $596.1 million. These properties are fully leased on a net basis where the tenant is generally responsible for payment of real estate taxes, property, building and general liability insurance and property and building maintenance expenses. As of March 31, 2026, our net leased properties comprised a total of 3.4 million square feet, 100% leased with an average age since construction of 13.1 years and a weighted average remaining lease term of 3.8 years. Commercial real estate investments in excess of $20.0 million require the approval of our board of directors’ Risk and Underwriting Committee. The majority of the tenants in our net leased properties are necessity-based businesses. During the three months ended March 31, 2026, we collected 100% of rent on these properties.
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Diversified Commercial Real Estate Properties. As of March 31, 2026, we owned 61 diversified commercial real estate properties throughout the U.S with an undepreciated book value of $451.3 million. During the three months ended March 31, 2026, we collected 96% of rent on these properties.
The following charts summarize the composition of our real estate investments as of March 31, 2026 ($ in millions):
Securities
We invest in primarily AAA-rated real estate securities, typically front pay securities, with relatively short duration and significant subordination. We invest primarily in CMBS, including CRE CLOs, secured by first mortgage loans on commercial real estate. These investments provide a stable and attractive base of net interest income and help us manage our liquidity and hyper-amortization features included in many of these securities positions help mitigate potential credit losses in the event of adverse market conditions. We have significant in-house expertise in the evaluation and trading of these securities, due in part to our experience in originating and underwriting mortgage loans that comprise assets within CMBS trusts, as well as our experience in structuring CMBS transactions. In the future, we may invest in CMBS securities or other securities that are unrated.
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As of March 31, 2026, the estimated fair value of our portfolio of CMBS investments totaled $2.1 billion in 118 CUSIPs ($17.4 million average investment per CUSIP). Included in the $2.1 billion of CMBS securities are $8.8 million of CMBS securities designated as risk retention securities under the Dodd-Frank Act, which are subject to transfer restrictions over the term of the securitization trust. The following chart summarizes our securities investments by market value, 98.7% of which were rated investment grade by Standard & Poor’s Ratings Group, Moody’s Investors Service, Inc. or Fitch Ratings Inc. as of March 31, 2026:
As of March 31, 2026, our CMBS investments had a weighted average duration of 3.0 years. The commercial real estate collateral underlying our CMBS investment portfolio is located throughout the United States. As of March 31, 2026, by property count and market value, respectively, 59.7% and 65.9% of the collateral underlying our CMBS investment portfolio was distributed throughout the top 25 metropolitan statistical areas (“MSAs”) in the United States, with 4.9% and 11.2%, by property count and market value, respectively, of the collateral located in the New York-Newark-Jersey City MSA, and the concentrations in each of the remaining top 24 MSAs ranging from 0.6% to 6.3% by property count and 0.1% to 6.7% by market value.
AAA-rated CMBS or U.S. Agency securities investments in excess of $106.0 million and all other investment grade CMBS or U.S. Agency securities investments in excess of $51.0 million, each in any single class of any single issuance, require the approval of our board of directors’ Risk and Underwriting Committee. The Risk and Underwriting Committee also must approve any investments in non-rated or sub-investment grade CMBS or U.S. Agency securities in any single class of any single issuance in excess of the lesser of (x) $21.0 million and (y) 10% of the total net asset value of the respective Ladder subsidiary or other entity for which Ladder has authority to make investment decisions.
Other Investments
Unconsolidated Ventures. From time to time we invest in real estate related ventures. As of March 31, 2026, the carrying value of our unconsolidated ventures was $44.2 million.
Our Financing Strategies
Our financing strategies are critical to the success and growth of our business. We manage our financing to complement our asset composition and to diversify our exposure across multiple capital markets and counterparties. In addition to cash flow from operations, we fund our operations and investment strategy through a diverse array of funding sources, including:
•Senior unsecured notes
•Unsecured revolving credit facilities
•Unsecured term loan facility
•Secured loan and securities repurchase financing
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•Non-recourse mortgage debt
•Loan sales and securitizations
•Unencumbered assets available for financing
•CLO transactions
•Equity
From time to time, we may add financing counterparties that we believe will complement our business, although the agreements governing our indebtedness may limit our ability and the ability of our present and future subsidiaries to incur additional indebtedness. Our amended and restated charter and by-laws do not impose any threshold limits on our ability to use leverage. Refer to our discussion below and “Management’s Discussion and Analysis of Financial Condition and Results of Operations." under the heading “Liquidity and Capital Resources” and Note 6, Debt Obligations, Net, to our consolidated financial statements included elsewhere in this Quarterly Report, for additional information about our financing arrangements.
Senior Unsecured Notes
As of March 31, 2026, we had $2.2 billion of senior unsecured notes outstanding. These unsecured financings were comprised of $599.5 million in aggregate principal amount of 4.25% senior notes due 2027 (the “2027 Notes”), $633.9 million in aggregate principal amount of 4.75% senior notes due 2029 (the “2029 Notes”), $500.0 million in aggregate principal amount of 5.50% senior notes due 2030 (the “2030 Notes”) and $500.0 million in aggregate principal amount of 7.00% senior notes due 2031 (the “2031 Notes,” collectively with the 2027 Notes, the 2029 Notes, and the 2030 Notes, the “Notes”). The Company currently guarantees the obligations under the Notes and the indenture.
Due in large part to devoting such a large portion of our capital structure to equity and unsecured corporate bond debt, we maintain a $4.2 billion pool of unencumbered assets, comprised primarily of first mortgage loans and unrestricted cash as of March 31, 2026.
Unsecured Revolving Credit Facilities
Our Unsecured Revolving Credit Facility is available on a revolving basis to finance our working capital needs and for general corporate purposes. On February 20, 2026, the Company increased the aggregate maximum borrowing amount of the Unsecured Revolving Credit Facility to $1.25 billion. Borrowings under the Unsecured Revolving Credit Facility bear interest at a rate equal to term SOFR plus a margin of 125 basis points as of March 31, 2026. The margin for borrowings is subject to adjustment based on the Company's credit rating and may range between 77.5 and 170 basis points. As of March 31, 2026, we had $492.0 million in outstanding borrowings on the Unsecured Revolving Credit Facility.
Effective May 27, 2025, the date on which we received investment grade ratings from Moody’s and Fitch, the Unsecured Revolving Credit Facility was automatically amended, the pledge of the shares of (or other ownership or equity interest in) certain subsidiaries was terminated, and each guarantor (other than Ladder Capital Corp and any subsidiary that is a trigger guarantor) was released and discharged from all obligations as a guarantor and/or pledgor.
In September 2025, the Company entered into an unsecured Money Market Borrowing Arrangement to provide short-term financing up to $100 million. The arrangement has a five-year term. No borrowing on this facility is permitted over a quarter end date, and as such, no balance was utilized under this arrangement as of March 31, 2026.
Term Loan Facility
On February 20, 2026, the Company entered into an amendment to its existing Unsecured Revolving Credit Facility agreement, which, among other things, established a new unsecured delayed draw term loan facility (the “Term Loan Facility”) that permits borrowings of up to $275.0 million. The amended credit agreement permits additional issuances of term loans of up to an aggregate of $500.0 million under a new accordion feature for term loan facilities. Borrowings under the Term Loan Facility bear interest at a rate equal to term SOFR plus a margin of 140 basis points as of March 31, 2026. The margin for borrowings is subject to adjustment based on the Company's credit rating. The Term Loan Facility has a draw period through February 20, 2027 and a fully extended maturity date of February 20, 2030. As of March 31, 2026, the Company had no outstanding borrowings on the Term Loan Facility.
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Committed Loan Financing Facilities
We are a party to multiple committed loan repurchase agreement facilities, totaling $576.0 million of credit capacity. As of March 31, 2026, we had no borrowings outstanding. Assets pledged as collateral under these facilities are generally limited to first lien whole mortgage loans, mezzanine loans and certain interests in such first mortgage and mezzanine loans.
We have the option to extend some of our existing facilities subject to a number of customary conditions. The lenders have sole discretion to include collateral in these facilities and to determine the market value of the collateral. In certain cases, the lenders may require additional collateral, a full or partial repayment of the facilities (margin call), or a reduction in undrawn availability under the facilities. Typically, the lender establishes a maximum percentage of the collateral asset’s market value that can be borrowed. We often borrow at a lower percentage of the collateral asset’s value than the maximum, leaving us with excess borrowing capacity that can be drawn upon at a later date and/or applied against future margin calls so that they can be satisfied on a cashless basis.
Securities Repurchase Financing
We are a party to master repurchase agreements with several counterparties to finance our investments in securities. As of March 31, 2026, the Company had $934.9 million of securities repurchase debt outstanding. The securities that serve as collateral for these borrowings are typically highly liquid AAA-rated CMBS with relatively short duration and significant subordination. The lenders have sole discretion to determine the market value of the collateral on a daily basis, and, if the estimated market value of the collateral declines, the lenders have the right to require additional collateral. If the estimated market value of the collateral subsequently increases, we have the right to call back excess collateral.
Mortgage Loan Financing
We typically finance our real estate investments with long-term, non-recourse mortgage financing. These mortgage loans have carrying amounts of $384.2 million, net of unamortized premiums of $2.9 million as of March 31, 2026, representing proceeds received upon financing greater than the contractual amounts due under these agreements. The premiums are being amortized over the remaining life of the respective debt instruments using the effective interest method. We recorded $0.2 million of premium amortization, which decreased interest expense for the three months ended March 31, 2026. During the three months ended March 31, 2026, we executed no new term debt agreements.
Hedging Strategies
We may enter into interest rate and credit spread derivative contracts to mitigate our exposure to changes in interest rates and credit spreads. We generally seek to hedge the interest rate risk on the financing of assets that have a duration longer than five years, including newly-originated conduit first mortgage loans and securities if long enough in duration. We monitor our asset profile and our hedge positions to manage our interest rate and credit spread exposures, and we seek to match fund our assets according to the liquidity characteristics and expected holding periods of our assets.
Financial Covenants
We generally seek to maintain a debt-to-equity ratio of approximately 3.0:1.0 or below. We expect this ratio to fluctuate during the course of a fiscal year due to the normal course of business. This ratio may also fluctuate as a result of our conduit lending operations, in which we generally securitize our inventory of conduit loans at intervals, and also because of changes in our asset mix, due in part to such securitizations. We generally seek to match fund our assets according to their liquidity characteristics and expected hold period. We believe that the defensive positioning of our predominantly senior secured assets and our financing strategy has allowed us to maintain financial flexibility to capitalize on an attractive range of market opportunities as they have arisen.
We and our subsidiaries may incur substantial additional debt in the future. However, we are subject to certain restrictions on our ability to incur additional debt in the indentures governing the Notes and our other debt agreements. Under the indenture for the 2030 Notes (the “2030 Indenture”), we may not incur certain types of indebtedness unless our leverage ratio (as defined in the 2030 Indenture) is less than or equal to 3.50:1.00 and our fixed charge coverage ratio is more than or equal to 1.25:1.00. We are also required to maintain unencumbered assets in excess of 120% of our aggregate unsecured indebtedness.
Our borrowings under certain financing agreements are subject to financial covenants as defined in such agreements, including minimum net worth requirements, minimum liquidity levels, maximum leverage ratios, minimum fixed charge coverage or
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interest coverage ratios. These restrictions, which would permit us to incur substantial additional debt, are subject to significant qualifications and exceptions.
Further, certain of our financing arrangements and loans on our real property are secured by our assets, including the assets of certain subsidiaries. From time to time, certain of these financing arrangements and loans may prohibit certain of our subsidiaries from paying dividends to us, from making distributions on such subsidiary’s capital stock, from repaying to us any loans or advances to such subsidiary from us or from transferring any of such subsidiary’s property or other assets to us or other of our subsidiaries.
We were in compliance in all material respects with the covenants under our financing arrangements as described in this Quarterly Report as of March 31, 2026.
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Results of Operations
A discussion regarding our results of operations for the three months ended March 31, 2026 compared to the three months ended December 31, 2025 is presented below.
Three months ended March 31, 2026 compared to the three months ended December 31, 2025
The following table sets forth information regarding our consolidated results of operations ($ in thousands):
| Three Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||
| March 31, 2026 | December 31, 2025 | Difference | ||||||||||||||||||||||||||||||||||||||||||||
| Net interest income | ||||||||||||||||||||||||||||||||||||||||||||||
| Interest income | $ | 74,221 | $ | 68,065 | $ | 6,156 | ||||||||||||||||||||||||||||||||||||||||
| Interest expense | 51,204 | 45,737 | 5,467 | |||||||||||||||||||||||||||||||||||||||||||
| Net interest income (expense) | 23,017 | 22,328 | 689 | |||||||||||||||||||||||||||||||||||||||||||
| Provision for (release of) loan loss reserves, net | (28) | (3) | (25) | |||||||||||||||||||||||||||||||||||||||||||
| Net interest income (expense) after provision for (release of) loan loss reserves | 23,045 | 22,331 | 714 | |||||||||||||||||||||||||||||||||||||||||||
| Other income (loss) | ||||||||||||||||||||||||||||||||||||||||||||||
| Real estate operating income | 27,291 | 25,094 | 2,197 | |||||||||||||||||||||||||||||||||||||||||||
| Net result from mortgage loan receivables held for sale | 73 | 16 | 57 | |||||||||||||||||||||||||||||||||||||||||||
| Fee and other income | 1,405 | 3,043 | (1,638) | |||||||||||||||||||||||||||||||||||||||||||
| Net result from derivative transactions | 350 | (34) | 384 | |||||||||||||||||||||||||||||||||||||||||||
| Earnings (loss) from investment in unconsolidated ventures | (256) | 18 | (274) | |||||||||||||||||||||||||||||||||||||||||||
| Total other income (loss) | 28,863 | 28,137 | 726 | |||||||||||||||||||||||||||||||||||||||||||
| Costs and expenses | ||||||||||||||||||||||||||||||||||||||||||||||
| Compensation and employee benefits | 22,324 | 10,861 | 11,463 | |||||||||||||||||||||||||||||||||||||||||||
| Operating expenses | 5,094 | 4,867 | 227 | |||||||||||||||||||||||||||||||||||||||||||
| Real estate operating expenses | 11,258 | 10,019 | 1,239 | |||||||||||||||||||||||||||||||||||||||||||
| Investment related expenses | 1,156 | 825 | 331 | |||||||||||||||||||||||||||||||||||||||||||
| Depreciation and amortization | 8,907 | 8,378 | 529 | |||||||||||||||||||||||||||||||||||||||||||
| Total costs and expenses | 48,739 | 34,950 | 13,789 | |||||||||||||||||||||||||||||||||||||||||||
| Income (loss) before taxes | 3,169 | 15,518 | (12,349) | |||||||||||||||||||||||||||||||||||||||||||
| Income tax expense (benefit) | 566 | (343) | 909 | |||||||||||||||||||||||||||||||||||||||||||
| Net income (loss) | $ | 2,603 | $ | 15,861 | $ | (13,258) | ||||||||||||||||||||||||||||||||||||||||
Investment Overview
Activity for the three months ended March 31, 2026 included fundings of $567.8 million and paydowns of $91.1 million and the sale of $13.0 million of a conduit loan, which contributed to a $388.6 million increase in commercial mortgage loans. Activity for the three months ended March 31, 2026 included securities purchases of $274.9 million, amortization and paydowns of $124.7 million and sales of $162.0 million, which contributed to a net decrease in our securities portfolio of $14.6 million. Activity for three months ended March 31, 2026 included $79.7 million of real estate acquired via foreclosure.
Activity for the three months ended December 31, 2025 included fundings of $406.3 million and paydowns of $106.9 million, which contributed to a $301.8 million increase of commercial mortgage loans. Activity for the three months ended December 31, 2025 included securities purchases of $412.6 million, amortization and paydowns of $169.3 million and sales of $95.1 million, which contributed to a net increase in our securities portfolio of $147.7 million.
Net Interest Income
The $6.2 million increase in interest income was primarily attributable to net originations within our loan portfolio, partially offset by a decrease in interest earned from CMBS securities due to a net decrease in the portfolio as a result of amortization and sales activity. There was a $0.1 billion increase in average securities investments from $2.0 billion for the three months
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ended December 31, 2025 to $2.1 billion for the three months ended March 31, 2026. There was a $0.5 billion increase in average loan investments from $2.0 billion for the three months ended December 31, 2025 to $2.5 billion for the three months ended March 31, 2026.
The $5.5 million increase in interest expense was primarily attributable to an increase in usage of our Unsecured Corporate Revolver and securities repurchase facilities.
The increase in net interest income before provision for loan losses of $0.7 million is primarily driven by increased income on loans, partially offset by a net increase in borrowings.
As of March 31, 2026 and December 31, 2025, the weighted average yield on our mortgage loan receivables was 8.0% and 7.7%, respectively. As of March 31, 2026 and December 31, 2025, we did not have any borrowings against our mortgage loan receivables.
As of March 31, 2026 and December 31, 2025, the weighted average yield on our securities was 5.3%. As of March 31, 2026 and December 31, 2025, the weighted average interest rate on borrowings against our securities was 4.2% and 4.3%, respectively. As of March 31, 2026, we had outstanding borrowings secured by our securities equal to 45.1% of the carrying value of our securities, compared to 30.0% as of December 31, 2025.
Our real estate portfolio is comprised of non-interest bearing assets; however, interest incurred on mortgage financing collateralized by such real estate is included in interest expense. As of March 31, 2026 and December 31, 2025, the weighted average interest rate on mortgage borrowings against our real estate was 5.9%. As of March 31, 2026, we had outstanding borrowings secured by our real estate equal to 49.5% of the carrying value of our real estate, compared to 55.2% as of December 31, 2025.
Real Estate Operating Income
The increase of $2.2 million in real estate operating income during the three months ended March 31, 2026 compared to the three months ended December 31, 2025 was primarily attributable to an increase in operations at our properties and the acquisition of real estate that occurred during the quarter, for which there was not a full quarter of operating income during the three months ended December 31, 2025. Refer to Note 5, Real Estate and Related Lease Intangibles, Net, for further details.
Net Result from Mortgage Loan Receivables Held for Sale
Net result from mortgage loan receivables held for sale includes unrealized losses on loans held for sale related to lower of cost or market adjustments and realized gains and losses from the sale of loans. During the three months ended March 31, 2026, we recorded $0.4 million of realized gains on the sale of one conduit loan and $0.4 million of unrealized losses on loans related to lower of cost or market adjustments on our conduit loans. During the three months ended December 31, 2025, we recorded $16 thousand related to lower of cost or market adjustments on our conduit loans. Income from sales of loans, net is subject to market conditions impacting timing, size and pricing and as such may vary significantly quarter to quarter.
Fee and Other Income
We generate fee income on the loans we originate and in which we invest and also include unrealized and realized gains and losses on securities within fee and other income. The $1.6 million decrease in fee and other income was primarily due to an increase in unrealized losses on securities for the three months ended March 31, 2026 as compared to the three months ended December 31, 2025.
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Net Result from Derivative Transactions
The total net result from derivative transactions is comprised of hedging interest expense, realized gains/losses related to hedge terminations and unrealized gains/losses related to changes in the fair value of asset hedges. Net result from derivative transactions of $0.3 million was comprised of a realized gain of $0.2 million and an unrealized gain of $0.1 million for the three months ended March 31, 2026. Net result from derivative transactions of $34 thousand was comprised of a realized loss of $8 thousand and an unrealized loss of $26 thousand for the three months ended December 31, 2025. The hedge positions primarily relate to fixed rate conduit loans and securities investments. The derivative positions that generated these results were a combination of five and ten year U.S. treasury rate futures that we employed in an effort to hedge the interest rate risk primarily on the financing of our fixed rate assets and the net interest income we earn against the impact of changes in interest rates. The gain during the three months ended March 31, 2026 was primarily related to movement in interest rates during the three months ended March 31, 2026.
Operating Expenses
Operating expenses are primarily comprised of professional fees, and lease, technology and administrative expenses. The increase of $0.2 million during the three months ended March 31, 2026 compared to the three months ended December 31, 2025 was primarily related to an increase in administrative expenses and professional fees.
Real Estate Operating Expenses
The increase of $1.2 million in real estate operating expenses during the three months ended March 31, 2026 compared to the three months ended December 31, 2025 was primarily attributable to an increase in operations at our properties and the acquisition of real estate. Refer to Note 5, Real Estate and Related Lease Intangibles, Net, for further details.
Income Tax (Benefit) Expense
Most of our consolidated income tax provision relates to business units held in our TRSs. The increase in expense during the three months ended March 31, 2026 compared to the three months ended December 31, 2025 is primarily a result of changes in our income in our TRSs.
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Results of Operations
A discussion regarding our results of operations for the three months ended March 31, 2026 compared to the three months ended March 31, 2025 is presented below.
Three months ended March 31, 2026 compared to the three months ended March 31, 2025
The following table sets forth information regarding our consolidated results of operations ($ in thousands):
| Three Months Ended March 31, | |||||||||||||||||
| 2026 | 2025 | Difference | |||||||||||||||
| Net interest income | |||||||||||||||||
| Interest income | $ | 74,221 | $ | 64,326 | $ | 9,895 | |||||||||||
| Interest expense | 51,204 | 43,997 | 7,207 | ||||||||||||||
| Net interest income (expense) | 23,017 | 20,329 | 2,688 | ||||||||||||||
| Provision for (release of) loan loss reserves, net | (28) | (81) | 53 | ||||||||||||||
| Net interest income (expense) after provision for (release of) loan loss reserves | 23,045 | 20,410 | 2,635 | ||||||||||||||
| Other income (loss) | |||||||||||||||||
| Real estate operating income | 27,291 | 21,773 | 5,518 | ||||||||||||||
| Net result from mortgage loan receivables held for sale | 73 | 162 | (89) | ||||||||||||||
| Gain (loss) on real estate, net | — | 3,807 | (3,807) | ||||||||||||||
| Fee and other income | 1,405 | 5,285 | (3,880) | ||||||||||||||
| Net result from derivative transactions | 350 | 323 | 27 | ||||||||||||||
| Earnings (loss) from investment in unconsolidated ventures | (256) | (732) | 476 | ||||||||||||||
| Gain on extinguishment of debt | — | 256 | (256) | ||||||||||||||
| Total other income (loss) | 28,863 | 30,874 | (2,011) | ||||||||||||||
| Costs and expenses | |||||||||||||||||
| Compensation and employee benefits | 22,324 | 18,761 | 3,563 | ||||||||||||||
| Operating expenses | 5,094 | 4,516 | 578 | ||||||||||||||
| Real estate operating expenses | 11,258 | 8,766 | 2,492 | ||||||||||||||
| Investment related expenses | 1,156 | 1,188 | (32) | ||||||||||||||
| Depreciation and amortization | 8,907 | 7,336 | 1,571 | ||||||||||||||
| Total costs and expenses | 48,739 | 40,567 | 8,172 | ||||||||||||||
| Income (loss) before taxes | 3,169 | 10,717 | (7,548) | ||||||||||||||
| Income tax expense (benefit) | 566 | (838) | 1,404 | ||||||||||||||
| Net income (loss) | $ | 2,603 | $ | 11,555 | $ | (8,952) | |||||||||||
Investment Overview
Activity for the three months ended March 31, 2026 included fundings of $567.8 million, paydowns of $91.1 million, and the sale of $13.0 million of a conduit loan, which contributed to a $388.6 million increase in commercial mortgage loans. Activity for the three months ended March 31, 2026 included securities purchases of $274.9 million, amortization and paydowns of $124.7 million and sales of $162.0 million, which contributed to a net decrease in our securities portfolio of $14.6 million. Activity for the three months ended March 31, 2026 included $79.7 million of real estate acquired via foreclosure.
Activity for the three months ended March 31, 2025 included fundings of $316.4 million and paydowns of $181.9 million, which contributed to a $137.6 million increase in commercial mortgage loans. Activity for the three months ended March 31, 2025 included securities purchases of $521.8 million, amortization and paydowns of $85.2 million and sales of $39.9 million, which contributed to a net increase in our securities portfolio of $395.5 million. In addition, we purchased $1.4 billion of short-term U.S. Treasury securities during the three months ended March 31, 2025, of which $1.8 billion matured during the three months ended March 31, 2025.
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Net Interest Income
The $9.9 million increase in interest income was primarily attributable to net originations within our loan portfolio and an increase in interest earned from CMBS securities due to net purchases, partially offset by lower interest income on short‑term U.S. Treasury securities, resulting from the sale and maturity of the full portfolio. There was a $0.9 billion increase in average loan investments from $1.6 billion for the three months ended March 31, 2025 to $2.5 billion for the three months ended March 31, 2026. There was a $0.8 billion increase in average securities investments from $1.3 billion for the three months ended March 31, 2025 to $2.1 billion for the three months ended March 31, 2026.
The $7.2 million increase in interest expense is primarily related to an increase in borrowings on our securities repurchase facilities and our Unsecured Corporate Revolver, and the issuance of our 2030 Notes, partially offset by the redemption of all outstanding obligations of LCCM 2021-FL2 and LCCM 2021-FL3, lower outstanding balances on our loan repurchase facilities and the payoff of mortgage loan debt.
As of March 31, 2026, the weighted average yield on our mortgage loan receivables was 8.0%, compared to 8.6% as of March 31, 2025. As of March 31, 2026, we did not have any borrowings against our mortgage loan receivables. As of March 31, 2025, the weighted average interest rate on borrowings against our mortgage loan receivables was 6.3%. As of March 31, 2025, we had outstanding borrowings secured by our mortgage loan receivables equal to 19.9% of the carrying value of our mortgage loan receivables.
As of March 31, 2026, the weighted average yield on our securities was 5.3%, compared to 5.7% as of March 31, 2025. As of March 31, 2026, the weighted average interest rate on borrowings against our securities was 4.2%. As of March 31, 2025, we did not have any borrowings against our securities. As of March 31, 2026, we had outstanding borrowings secured by our securities equal to 45.1% of the carrying value of our real estate securities.
Our real estate is comprised of non-interest bearing assets; however, interest incurred on mortgage financing collateralized by such real estate is included in interest expense. As of March 31, 2026, the weighted average interest rate on mortgage borrowings against our real estate assets was 5.9%, compared to 6.1% as of March 31, 2025. As of March 31, 2026, we had outstanding borrowings secured by our real estate equal to 49.5% of the carrying value of our real estate, compared to 65.0% as of March 31, 2025.
Real Estate Operating Income
The increase of $5.5 million in real estate operating income was primarily attributable to real estate foreclosures that occurred subsequent to March 31, 2025 through March 31, 2026, partially offset by sales that occurred during the same period. Refer to Note 5, Real Estate and Related Lease Intangibles, Net, for further details.
Net Result from Mortgage Loan Receivables Held for Sale
Net result from mortgage loan receivables held for sale includes unrealized losses on loans held for sale related to lower of cost or market adjustments and realized gains and losses from the sale of loans. During the three months ended March 31, 2026, we recorded $0.4 million of realized gains on the sale of one conduit loan and $0.4 million of unrealized losses on loans related to lower of cost or market adjustments on our conduit loans. During the three months ended March 31, 2025, we recorded $162 thousand of unrealized gains on loans related to lower of cost or market adjustments on our conduit loans. Income from sales of loans, net is subject to market conditions impacting timing, size and pricing and as such may vary significantly quarter to quarter.
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Gain (Loss) on Real Estate, net
The decrease of $3.8 million of gain on real estate, net during the three months ended March 31, 2026 compared to the three months ended March 31, 2025 was the result of no property sales during the three months ended March 31, 2026 compared to one property sale for a gain of $3.8 million during the three months ended March 31, 2025. Refer to Note 5, Real Estate and Related Lease Intangibles, Net, for further detail.
Fee and Other Income
We generate fee income on the loans we originate and in which we invest and also include unrealized and realized gains and losses on securities within fee and other income. The $3.9 million decrease was primarily driven by unrealized losses on securities and lower payoffs during the three months ended March 31, 2026 as compared to the three months ended March 31, 2025.
Loss from Investment in Unconsolidated Ventures
Loss from our investment in unconsolidated ventures totaled $0.3 million and $0.7 million for the three months ended March 31, 2026 and 2025, respectively. The increase in income from investment in unconsolidated ventures is primarily attributable to an increase in property operations.
Compensation and Employee Benefits
Compensation and employee benefits are comprised primarily of salaries, bonuses, stock-based compensation and other employee benefits. The increase of $3.6 million in compensation expense is primarily due to an increase in equity based compensation for the three months ended March 31, 2026 as compared to the three months ended March 31, 2025.
Operating Expenses
Operating expenses are primarily comprised of professional fees, and lease, technology and administrative expenses. The increase of $0.6 million during the three months ended March 31, 2026 compared to the three months ended March 31, 2025 was primarily related to an increase in professional fees, information technology expenses and administrative expenses.
Real Estate Operating Expenses
The increase of $2.5 million in real estate operating expenses was primarily attributable to real estate sales that occurred subsequent to March 31, 2025 through March 31, 2026. Refer to Note 5, Real Estate and Related Lease Intangibles, Net, for further details.
Depreciation and Amortization
The increase of $1.6 million in depreciation and amortization was primarily attributable to real estate foreclosures that occurred subsequent to March 31, 2025 through March 31, 2026, partially offset by sales that occurred during the same period. Refer to Note 5, Real Estate and Related Lease Intangibles, Net, for further details.
Income Tax (Benefit) Expense
Most of our consolidated income tax provision relates to business units held in our TRSs. The increase in expense during the three months ended March 31, 2026 compared to the three months ended March 31, 2025 is primarily a result of changes in our income in our TRSs.
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Liquidity and Capital Resources
The management of our liquidity and capital diversity and allocation strategies is critical to the success and growth of our business. We manage our sources of liquidity to complement our asset composition and to diversify our exposure across multiple capital markets and counterparties.
We require substantial amounts of capital to support our business. The management team, in consultation with our board of directors, establishes our overall liquidity and capital allocation strategies. A key objective of those strategies is to support the execution of our business strategy while maintaining sufficient ongoing liquidity throughout the business cycle to service our financial obligations as they become due. When making funding and capital allocation decisions, members of our senior management consider: business performance; the availability of, and costs and benefits associated with, different funding sources; current and expected capital markets and general economic conditions; our asset composition and capital structure; and our targeted liquidity profile and risks relating to our funding needs.
To ensure that Ladder can effectively address the funding needs of the Company on a timely basis, we maintain a diverse array of liquidity sources including: (1) cash and cash equivalents; (2) cash generated from operations; (3) proceeds from debt financing; (4) principal repayments on investments including mortgage loans and securities; (5) proceeds from securitizations and sales of loans; (6) proceeds from the sale of securities; (7) proceeds from the sale of real estate; and (8) proceeds from the issuance of equity capital. We use these funding sources to meet our obligations on a timely basis and have the ability to use our significant unencumbered asset base to further finance our business.
Our primary uses of liquidity are for: (1) the funding of loan, real estate-related and securities investments; (2) the repayment of short-term and long-term borrowings and related interest; (3) the funding of our operating expenses; and (4) distributions to our equity investors to comply with the REIT distribution requirements. We require short-term liquidity to fund loans that we originate and hold on our consolidated balance sheet pending sale, including through whole loan sale, participation, or securitization. We generally require longer-term funding to finance the loans and real estate-related investments that we hold for investment. We have historically used the aforementioned funding sources to meet the operating and investment needs as they have arisen and have been able to do so by applying a rigorous approach to long and short-term cash and debt forecasting.
In addition, as a REIT, we are also required to make sufficient dividend payments to our shareholders in amounts at least sufficient to maintain our REIT status. Under IRS guidance, we may elect to pay a portion of our dividends in stock, subject to a cash/stock election by our shareholders, to optimize our level of capital retention. Accordingly, our cash requirement to pay dividends to maintain REIT status could be substantially reduced at the discretion of the board of directors.
Our principal debt financing sources include: (1) long-term senior unsecured notes in the form of corporate bonds; (2) an Unsecured Revolving Credit Facility; (3) a Term Loan Facility (4) committed and uncommitted secured funding provided by banks and other lenders; (5) long term non-recourse mortgage financing; and (6) CLO issuances.
In the future, we may also use other sources of financing to fund the acquisition of our assets, including credit facilities, warehouse facilities, repurchase facilities and other secured and unsecured forms of borrowing. These financings may be collateralized or non-collateralized, may involve one or more lenders and may accrue interest at either fixed or floating rates. We may also seek to raise further equity capital or issue debt securities in order to fund our future investments.
Refer to “Financial Covenants” and “Our Financing Strategies” for further disclosure of our diverse financing sources and, for a summary of our financial obligations, refer to the Contractual Obligations table below. All of our existing financial obligations due within the following year can be extended for one or more additional years at our discretion, refinanced or repaid at maturity or are incurred in the normal course of business (i.e., interest payments/loan funding obligations).
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Cash Flows
We held cash and cash equivalents of $33.1 million and restricted cash of $18.5 million as of March 31, 2026. We held cash and cash equivalents of $38.0 million and restricted cash of $14.9 million as of December 31, 2025.
The following table provides a breakdown of the net change in our cash, cash equivalents, and restricted cash ($ in thousands):
Recent insider activity
| Date | Insider | Role | Action | Shares | Price | Value |
|---|---|---|---|---|---|---|
| 2026-06-02 | Perelman Robert | Head of Asset Management | Sell | -17,505 | $10.25 | -$179,426 |
| 2026-05-29 | Perelman Robert | Head of Asset Management | Sell | -17,495 | $10.26 | -$179,499 |
Source: SEC Form 4 filings.
Next expected filings
- ~2026-07-27 10-Q expected by 2026-08-08 (in 1 day)
- ~2026-10-26 10-Q expected by 2026-11-07 (in 92 days)
- ~2027-02-08 10-K expected by 2027-02-12 (in 197 days)
- ~2027-04-26 10-Q expected by 2027-05-08 (in 274 days)
Predicted from historical filing cadence; not an SEC commitment.
Recent SEC filings
- 2026-07-23 8-K Earnings Release; Financial Statements and Exhibits
- 2026-04-27 10-Q Quarterly Report
- 2026-04-23 8-K Earnings Release; Financial Statements and Exhibits
- 2026-04-21 DEF 14A Proxy Statement
- 2026-02-09 10-K Annual Report
- 2026-02-05 8-K Earnings Release; Financial Statements and Exhibits
- 2025-10-27 10-Q Quarterly Report
- 2025-10-23 8-K Earnings Release; Financial Statements and Exhibits
- 2025-07-28 10-Q Quarterly Report
- 2025-07-24 8-K Earnings Release; Financial Statements and Exhibits
- 2025-07-03 8-K Material Agreement Entered; Material Financial Obligation; Other Events; Financial Statements and Exhibits
- 2025-04-28 10-Q Quarterly Report
- 2025-04-24 8-K Earnings Release; Financial Statements and Exhibits
- 2025-02-10 10-K Annual Report
- 2025-02-06 8-K Earnings Release; Financial Statements and Exhibits