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

Company Highlights:

  • GAAP net income of $0.12 per diluted common share
  • Distributable earnings1 of $0.25, or $0.30 per diluted common share, excluding $10.5 million of realized losses from the sale of two real estate owned properties
  • Declares cash dividend on common stock of $0.30 per share
  • Significant improvements to the right side of our balance sheet:
    • Closed our first build-to-rent collateralized securitization vehicle totaling $801.9 million with improved terms over our warehouse lines
    • In July 2025, issued $500.0 million of 7.875% senior unsecured notes due 2030 to repay $287.5 million of convertible senior notes and add ~$200 million of liquidity
  • Servicing portfolio of ~$33.76 billion, agency loan originations of $857.1 million
  • Structured loan portfolio of ~$11.61 billion, originations of $716.5 million and runoff of $519.7 million
  • Foreclosed on six loans totaling $188.2 million and sold four real estate owned properties totaling $114.5 million

UNIONDALE, N.Y., Aug. 01, 2025 (GLOBE NEWSWIRE) -- Arbor Realty Trust, Inc. (NYSE: ABR), today announced financial results for the second quarter ended June 30, 2025. Arbor reported net income for the quarter of $24.0 million, or $0.12 per diluted common share, compared to net income of $47.4 million, or $0.25 per diluted common share for the quarter ended June 30, 2024. Distributable earnings for the quarter was $52.1 million, or $0.25 per diluted common share, compared to $91.6 million, or $0.45 per diluted common share for the quarter ended June 30, 2024.

Agency Business

Loan Origination Platform

  Agency Loan Volume (in thousands)
  Quarter Ended
  June 30, 2025   March 31, 2025
Fannie Mae $ 683,206   $ 357,811
Freddie Mac   150,339     178,020
Private Label       44,925
FHA       16,041
SFR-Fixed Rate   23,552     9,111
Total Originations $ 857,097   $ 605,908
       
Total Loan Sales $ 807,020   $ 730,854
       
Total Loan Commitments $ 852,766   $ 645,401
           

For the quarter ended June 30, 2025, the Agency Business generated revenues of $64.5 million, compared to $62.9 million for the first quarter of 2025. Gain on sales, including fee-based services, net was $13.7 million for the quarter, reflecting a margin of 1.69%, compared to $12.8 million and 1.75% for the first quarter of 2025. Income from mortgage servicing rights was $10.9 million for the quarter, reflecting a rate of 1.28% as a percentage of loan commitments, compared to $8.1 million and 1.26% for the first quarter of 2025.

At June 30, 2025, loans held-for-sale was $361.4 million, with financing associated with these loans totaling $329.5 million.

Fee-Based Servicing Portfolio

The Company’s fee-based servicing portfolio totaled $33.76 billion at June 30, 2025. Servicing revenue, net was $27.4 million for the quarter and consisted of servicing revenue of $45.2 million, net of amortization of mortgage servicing rights totaling $17.8 million.

  Fee-Based Servicing Portfolio ($ in thousands)
  June 30, 2025   March 31, 2025
  UPB   Wtd. Avg.
Fee (bps)
  Wtd. Avg.
Life (years)
  UPB   Wtd. Avg.
Fee (bps)
  Wtd. Avg.
Life (years)
Fannie Mae $ 22,999,772   45.8   5.9   $ 22,683,885   46.2   6.2
Freddie Mac   6,100,091   21.3   6.5     6,123,074   21.4   6.6
Private Label   2,599,971   18.7   5.0     2,603,122   18.7   5.3
FHA   1,497,551   14.0   19.9     1,519,675   14.0   19.0
SFR-Fixed Rate   287,065   20.0   4.2     276,839   20.1   4.1
Bridge   278,116   10.4   2.6     278,293   10.4   2.8
Total $ 33,762,566   37.4   6.5   $ 33,484,888   37.5   6.7
                           

Loans sold under the Fannie Mae program contain an obligation to partially guarantee the performance of the loan (“loss-sharing obligations”) and includes $35.0 million for the fair value of the guarantee obligation undertaken at June 30, 2025. The Company recorded a $4.0 million net provision for loss sharing associated with CECL for the second quarter of 2025. At June 30, 2025, the Company’s total CECL allowance for loss-sharing obligations was $54.8 million, representing 0.24% of the Fannie Mae servicing portfolio.

Structured Business

Portfolio and Investment Activity

  Structured Portfolio Activity ($ in thousands)
  Quarter Ended
  June 30, 2025   March 31, 2025
  UPB   %   UPB   %
Bridge:              
Multifamily $ 103,300   14 %   $ 367,750   49 %
SFR   530,986   74 %     356,294   48 %
    634,286   88 %     724,044   97 %
          .    
Mezzanine/Preferred Equity   6,999   1 %     4,440   1 %
Construction - Multifamily   75,259   11 %     18,637   2 %
Total Originations $ 716,544   100 %   $ 747,121   100 %
               
Number of Loans Originated   19         20    
               
Commitments:              
SFR $ 232,384       $ 162,400    
Construction - Multifamily   173,000         92,000    
Total Commitments $ 405,384       $ 254,400    
               
Loan Runoff $ 519,709       $ 421,941    


  Structured Portfolio ($ in thousands)
  June 30, 2025   March 31, 2025
  UPB   %   UPB   %
Bridge:              
Multifamily $ 8,404,597   72 %   $ 8,637,773   75 %
SFR   2,531,841   22 %     2,247,817   20 %
Other   169,025   2 %     171,952   1 %
    11,105,463   96 %     11,057,542   96 %
               
Mezzanine/Preferred Equity   400,634   3 %     405,770   4 %
Construction - Multifamily   100,070   1 %     23,005   <1 %
SFR Permanent   3,068   <1 %     3,076   <1 %
Total Portfolio $ 11,609,235   100 %   $ 11,489,393   100 %
                       

At June 30, 2025, the loan and investment portfolio’s unpaid principal balance ("UPB"), excluding loan loss reserves, was $11.61 billion, with a weighted average interest rate of 7.03%, compared to $11.49 billion and 6.94% at March 31, 2025. Including certain fees earned and costs associated with the loan and investment portfolio, the weighted average interest rate was 7.86% at June 30, 2025, compared to 7.85% at March 31, 2025.

The average balance of the Company’s loan and investment portfolio during the second quarter of 2025, excluding loan loss reserves, was $11.53 billion with a weighted average yield of 7.95%, compared to $11.39 billion and 8.15% for the first quarter of 2025. The decrease in yield was primarily due to non-performing and foreclosed on loans in the second quarter of 2025.

During the second quarter of 2025, the Company recorded a $16.1 million net provision for loan losses associated with CECL. At June 30, 2025, the Company’s total allowance for loan losses was $243.3 million. The Company had nineteen non-performing loans with a UPB of $471.8 million, before related loan loss reserves of $36.4 million, compared to twenty-three loans with a UPB of $511.1 million, before loan loss reserves of $35.3 million at March 31, 2025.

In addition, at June 30, 2025, the Company had three loans with a total UPB of $56.9 million that were less than 60 days past due classified as non-accrual, compared to five loans with a total UPB of $142.8 million (before related loan loss reserves of $7.3 million) at March 31, 2025. Interest income on these loans is only being recorded to the extent cash is received.

During the second quarter of 2025, the Company modified eight loans to borrowers experiencing financial difficulty with a total UPB of $251.9 million, primarily all of which had borrowers investing additional capital to recapitalize their deals. Six of these loans with a total UPB of $144.9 million, contained interest rates based on pricing over SOFR ranging from 3.25% to 4.50% and were modified to provide temporary rate relief through a pay and accrual feature. At June 30, 2025, these modified loans had a weighted average pay rate of 5.50% and a weighted average accrual rate of 2.78%. In addition, of the total modified loans for the second quarter, $47.7 million were less than 60 days past due and $11.2 million were non-performing at March 31, 2025, and are now current in accordance with their modified terms.

Financing Activity

The balance of debt that finances the Company’s loan and investment portfolio at June 30, 2025 was $9.61 billion with a weighted average interest rate including fees of 6.88%, as compared to $9.49 billion and a rate of 6.82% at March 31, 2025.

The average balance of debt that finances the Company’s loan and investment portfolio for the second quarter of 2025 was $9.52 billion, as compared to $9.42 billion for the first quarter of 2025. The average cost of borrowings for the second quarter of 2025 was 6.99%, compared to 6.96% for the first quarter of 2025.

In May 2025, the Company completed its first build-to-rent collateralized securitization vehicle totaling $801.9 million, of which $682.6 million consisted of investment grade notes, with the Company retaining subordinate interests in the vehicle of $119.3 million and $41.0 million of the investment grade notes. The vehicle included $50 million in ramp-up capacity for acquiring additional loans within 180 days of closing, a two-year replenishment period and a $200 million senior revolving note to support construction advances and future reinvestment during the replenishment period. The investment grade-rated notes placed with investors had an initial weighted average spread of 2.48% over SOFR, excluding fees and transaction costs.

In July 2025, the Company issued $500.0 million of its 7.875% senior unsecured notes due July 2030 through a private offering. The Company is using the net proceeds of this offering to pay down debt and for general corporate purposes.

Dividend

The Company announced today that its Board of Directors has declared a quarterly cash dividend of $0.30 per share of common stock for the quarter ended June 30, 2025. The dividend is payable on August 29, 2025 to common stockholders of record on August 15, 2025.

Earnings Conference Call

The Company will host a conference call today at 10:00 a.m. Eastern Time. A live webcast and replay of the conference call will be available at www.arbor.com in the investor relations section of the Company’s website, or you can access the call telephonically at least ten minutes prior to the conference call. The dial-in numbers are (800) 343-4136 for domestic callers and (203) 518-9843 for international callers. Please use participant passcode ABRQ225 when prompted by the operator.

A telephonic replay of the call will be available until August 8, 2025. The replay dial-in numbers are (800) 839-8531 for domestic callers and (402) 220-6074 for international callers.

About Arbor Realty Trust, Inc.

Arbor Realty Trust, Inc. (NYSE: ABR) is a nationwide real estate investment trust and direct lender, providing loan origination and servicing for multifamily, single-family rental (SFR) portfolios, and other diverse commercial real estate assets. Headquartered in New York, Arbor manages a multibillion-dollar servicing portfolio, specializing in government-sponsored enterprise products. Arbor is a leading Fannie Mae DUS® lender and Freddie Mac Optigo® Seller/Servicer, and an approved FHA Multifamily Accelerated Processing (MAP) lender. Arbor’s product platform also includes bridge, CMBS, mezzanine and preferred equity loans. Rated by Standard and Poor’s and Fitch Ratings, Arbor is committed to building on its reputation for service, quality, and customized solutions with an unparalleled dedication to providing our clients excellence over the entire life of a loan.

Safe Harbor Statement

Certain items in this press release may constitute forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995. These statements are based on management’s current expectations and beliefs and are subject to a number of trends and uncertainties that could cause actual results to differ materially from those described in the forward-looking statements. Arbor can give no assurance that its expectations will be attained. Factors that could cause actual results to differ materially from Arbor’s expectations include, but are not limited to, changes in economic conditions generally, and the real estate markets specifically, continued ability to source new investments, changes in interest rates and/or credit spreads, and other risks detailed in Arbor’s Annual Report on Form 10-K for the year ended December 31, 2024 and its other reports filed with the SEC. Such forward-looking statements speak only as of the date of this press release. Arbor expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward-looking statements contained herein to reflect any change in Arbor’s expectations with regard thereto or change in events, conditions, or circumstances on which any such statement is based.

Notes

  1. During the quarterly earnings conference call, the Company may discuss non-GAAP financial measures as defined by SEC Regulation G. In addition, the Company has used non-GAAP financial measures in this press release. A supplemental schedule of non-GAAP financial measures and the comparable GAAP financial measure can be found on the last two pages of this release.

Contact: Arbor Realty Trust, Inc.
Investor Relations
516-506-4200
InvestorRelations@arbor.com


 
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
Consolidated Statements of Income - (Unaudited)
($ in thousands—except share and per share data)
 
  Quarter Ended June 30,   Six Months Ended June 30,
    2025       2024       2025       2024  
Interest income $ 240,303     $ 297,188     $ 480,997     $ 618,480  
Interest expense   171,578       209,227       336,829       426,903  
Net interest income   68,725       87,961       144,168       191,577  
Other revenue:              
Gain on sales, including fee-based services, net   13,658       17,448       26,439       34,114  
Mortgage servicing rights   10,930       14,534       19,061       24,733  
Servicing revenue, net   27,437       29,910       53,040       61,436  
Property operating income   5,452       1,444       9,839       3,014  
Gain (loss) on derivative instruments, net   219       (275 )     3,619       (5,533 )
Other income, net   3,989       2,081       8,407       4,414  
Total other revenue   61,685       65,142       120,405       122,178  
Other expenses:              
Employee compensation and benefits   41,181       42,836       87,217       90,529  
Selling and administrative   14,859       12,823       31,171       26,756  
Property operating expenses   6,802       1,584       10,276       3,262  
Depreciation and amortization   5,848       2,423       9,592       4,994  
Provision for loss sharing (net of recoveries)   4,215       4,333       6,002       4,607  
Provision for credit losses (net of recoveries)   19,004       29,564       28,079       48,682  
Total other expenses   91,909       93,563       172,337       178,830  
Income before extinguishment of debt, (loss) gain on real estate, income from equity affiliates and income taxes   38,501       59,540       92,236       134,925  
Loss on extinguishment of debt         (412 )     (2,319 )     (412 )
(Loss) gain on real estate   (1,448 )     3,813       (4,258 )     3,813  
Income from equity affiliates   2,654       2,793       1,020       4,211  
Provision for income taxes   (3,398 )     (3,901 )     (6,989 )     (7,493 )
Net income   36,309       61,833       79,690       135,044  
Preferred stock dividends   10,342       10,342       20,684       20,684  
Net income attributable to noncontrolling interest   2,015       4,094       4,617       9,090  
Net income attributable to common stockholders $ 23,952     $ 47,397     $ 54,389     $ 105,270  
               
Basic earnings per common share $ 0.12     $ 0.25     $ 0.28     $ 0.56  
Diluted earnings per common share $ 0.12     $ 0.25     $ 0.28     $ 0.56  
               
Weighted average shares outstanding:              
Basic   192,236,206       188,655,801       191,154,501       188,683,095  
Diluted   209,003,002       205,487,711       207,938,574       205,499,619  
               
Dividends declared per common share $ 0.30     $ 0.43     $ 0.73     $ 0.86  


 
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
Consolidated Balance Sheets
($ in thousands—except share and per share data)
 
  June 30, 2025    
  (Unaudited)   December 31, 2024
Assets:      
Cash and cash equivalents $ 255,742     $ 503,803
Restricted cash   90,944       156,376
Loans and investments, net (allowance for credit losses of $243,278 and $238,967)   11,333,023       11,033,997
Loans held-for-sale, net   361,447       435,759
Capitalized mortgage servicing rights, net   348,326       368,678
Securities held-to-maturity, net (allowance for credit losses of $13,659 and $10,846)   156,920       157,154
Investments in equity affiliates   71,796       76,312
Real estate owned, net   365,186       176,543
Due from related party   16,773       12,792
Goodwill and other intangible assets   87,336       88,119
Other assets   475,546       481,448
Total assets $ 13,563,039     $ 13,490,981
       
Liabilities and Equity:      
Credit and repurchase facilities $ 4,721,622     $ 3,559,490
Securitized debt   3,510,865       4,622,489
Senior unsecured notes   1,238,174       1,236,147
Convertible senior unsecured notes   287,258       285,853
Junior subordinated notes to subsidiary trust issuing preferred securities   145,085       144,686
Mortgage notes payable — real estate owned   184,618       74,897
Due to related party   3,396       4,474
Due to borrowers   36,780       47,627
Allowance for loss-sharing obligations   89,757       83,150
Other liabilities   251,621       280,198
Total liabilities   10,469,176       10,339,011
       
Equity:      
Arbor Realty Trust, Inc. stockholders' equity:      
Preferred stock, cumulative, redeemable, $0.01 par value: 100,000,000 shares authorized, shares issued and outstanding by period:   633,682       633,684
Special voting preferred shares - 16,173,761 and 16,293,589 shares      
6.375% Series D - 9,200,000 shares      
6.25% Series E - 5,750,000 shares      
6.25% Series F - 11,342,000 shares      
Common stock, $0.01 par value: 500,000,000 shares authorized - 192,301,414 and 189,259,435 shares issued and outstanding   1,922       1,893
Additional paid-in capital   2,411,661       2,375,469
(Accumulated deficit) retained earnings   (72,521 )     13,039
Total Arbor Realty Trust, Inc. stockholders' equity   2,974,744       3,024,085
Noncontrolling interest   119,119       127,885
Total equity   3,093,863       3,151,970
Total liabilities and equity $ 13,563,039     $ 13,490,981


 
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
Statement of Income Segment Information - (Unaudited)
(in thousands)
 
  Quarter Ended June 30, 2025
  Structured
Business
  Agency
Business
  Other (1)   Consolidated
Interest income $ 229,980     $ 10,323     $     $ 240,303  
Interest expense   165,858       5,720             171,578  
Net interest income   64,122       4,603             68,725  
Other revenue:              
Gain on sales, including fee-based services, net         13,658             13,658  
Mortgage servicing rights         10,930             10,930  
Servicing revenue         45,204             45,204  
Amortization of MSRs         (17,767 )           (17,767 )
Property operating income   5,452                   5,452  
Gain on derivative instruments, net         219             219  
Other income, net   2,105       1,884             3,989  
Total other revenue   7,557       54,128             61,685  
Other expenses:              
Employee compensation and benefits   16,018       25,163             41,181  
Selling and administrative   7,590       7,269             14,859  
Property operating expenses   6,802                   6,802  
Depreciation and amortization   5,456       392             5,848  
Provision for loss sharing         4,215             4,215  
Provision for credit losses (net of recoveries)   16,112       2,892             19,004  
Total other expenses   51,978       39,931             91,909  
Income before loss on real estate, income from equity affiliates and income taxes   19,701       18,800             38,501  
Loss on real estate   (1,448 )                 (1,448 )
Income from equity affiliates   2,654                   2,654  
Provision for income taxes   (1,277 )     (2,121 )           (3,398 )
Net income   19,630       16,679             36,309  
Preferred stock dividends   10,342                   10,342  
Net income attributable to noncontrolling interest               2,015       2,015  
Net income attributable to common stockholders $ 9,288     $ 16,679     $ (2,015 )   $ 23,952  
                               

(1)  Includes income allocated to the noncontrolling interest holders not allocated to the two reportable segments.

 
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
Balance Sheet Segment Information - (Unaudited)
(in thousands)
 
  June 30, 2025
  Structured Business   Agency Business   Consolidated
Assets:          
Cash and cash equivalents $ 65,771   $ 189,971   $ 255,742
Restricted cash   63,713     27,231     90,944
Loans and investments, net   11,333,023         11,333,023
Loans held-for-sale, net       361,447     361,447
Capitalized mortgage servicing rights, net       348,326     348,326
Securities held-to-maturity, net       156,920     156,920
Investments in equity affiliates   71,796         71,796
Real estate owned, net   365,186         365,186
Goodwill and other intangible assets   12,500     74,836     87,336
Other assets and due from related party   411,439     80,880     492,319
Total assets $ 12,323,428   $ 1,239,611   $ 13,563,039
           
Liabilities:          
Debt obligations $ 9,758,138   $ 329,484   $ 10,087,622
Allowance for loss-sharing obligations       89,757     89,757
Other liabilities and due to related parties   219,877     71,920     291,797
Total liabilities $ 9,978,015   $ 491,161   $ 10,469,176


 
ARBOR REALTY TRUST, INC. AND SUBSIDIARIES
Reconciliation of Distributable Earnings to GAAP Net Income - (Unaudited)
($ in thousands—except share and per share data)
 
  Quarter Ended June 30,   Six Months Ended June 30,
    2025       2024       2025       2024  
Net income attributable to common stockholders $ 23,952     $ 47,397     $ 54,389     $ 105,270  
Adjustments:              
Net income attributable to noncontrolling interest   2,015       4,094       4,617       9,090  
Income from mortgage servicing rights   (10,930 )     (14,534 )     (19,061 )     (24,733 )
Deferred tax benefit   (1,603 )     (2,944 )     (1,741 )     (6,896 )
Amortization and write-offs of MSRs   19,825       19,518       40,689       37,936  
Depreciation and amortization   6,582       3,044       11,149       6,239  
Loss on extinguishment of debt         412       2,319       412  
Provision for credit losses, net   8,435       31,457       9,192       46,260  
(Gain) loss on derivative instruments, net   (674 )     371       (5,371 )     5,894  
Loss on real estate   1,857             4,667        
Stock-based compensation   2,610       2,750       8,545       8,772  
Distributable earnings (1) $ 52,069     $ 91,565     $ 109,394     $ 188,244  
               
Diluted distributable earnings per share (1) $ 0.25     $ 0.45     $ 0.53     $ 0.92  
               
Diluted weighted average shares outstanding (1) (2)   209,003,002       205,487,711       207,938,574       205,499,619  
                               

(1)  Amounts are attributable to common stockholders and OP Unit holders. The OP Units are redeemable for cash, or at the Company's option for shares of the Company's common stock on a one-for-one basis.

(2)  The diluted weighted average shares outstanding exclude the potential shares issuable upon conversion and settlement of the Company's convertible senior notes principal balance.

The Company is presenting distributable earnings because management believes it is an important supplemental measure of the Company's operating performance and is useful to investors, analysts and other parties in the evaluation of REITs and their ability to provide dividends to stockholders. Dividends are one of the principal reasons investors invest in REITs. To maintain REIT status, REITs are required to distribute at least 90% of their REIT-taxable income. The Company considers distributable earnings in determining its quarterly dividend and believes that, over time, distributable earnings is a useful indicator of the Company's dividends per share.

The Company defines distributable earnings as net income (loss) attributable to common stockholders computed in accordance with GAAP, adjusted for accounting items such as depreciation and amortization (adjusted for unconsolidated joint ventures), non-cash stock-based compensation expense, income from MSRs, amortization and write-offs of MSRs, gains/losses on derivative instruments primarily associated with Private Label loans not yet sold and securitized, changes in fair value of GSE-related derivatives that temporarily flow through earnings, deferred tax provision (benefit), CECL provisions for credit losses (adjusted for realized losses as described below) and gains/losses on the receipt of real estate from the settlement of loans (prior to the sale of the real estate). The Company also adds back one-time charges such as acquisition costs and one-time gains/losses on the early extinguishment of debt and redemption of preferred stock.

The Company reduces distributable earnings for realized losses in the period management determines that a loan is deemed nonrecoverable in whole or in part. Loans are deemed nonrecoverable upon the earlier of: (1) when the loan receivable is settled (i.e., when the loan is repaid, or in the case of foreclosure, when the underlying asset is sold); or (2) when management determines that it is nearly certain that all amounts due will not be collected. The realized loss amount is equal to the difference between the cash received, or expected to be received, and the book value of the asset.

Distributable earnings is not intended to be an indication of the Company's cash flows from operating activities (determined in accordance with GAAP) or a measure of its liquidity, nor is it entirely indicative of funding the Company's cash needs, including its ability to make cash distributions. The Company's calculation of distributable earnings may be different from the calculations used by other companies and, therefore, comparability may be limited.


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