Financial Performance - Total revenues for the three months ended March 31, 2025, were $17,002 thousand, a decrease of 9.4% compared to $18,768 thousand for the same period in 2024[14]. - Net interest income fell to $5,603 thousand for Q1 2025, down 50.7% from $11,360 thousand in Q1 2024[14]. - The company reported a net loss of $730 thousand for the three months ended March 31, 2025, compared to a net income of $4,924 thousand for the same period in 2024[17]. - The net loss income per common share for Q1 2025 was $(0.80), compared to a net income per common share of $0.07 for Q1 2024[14]. - For the three months ended March 31, 2025, the company reported a net loss of $730,000 compared to a net income of $4,924,000 for the same period in 2024[25]. Asset and Liability Changes - Total assets decreased to $1,779,946 thousand as of March 31, 2025, down from $1,881,467 thousand at December 31, 2024, representing a decline of approximately 5.4%[9]. - Total liabilities decreased to $1,339,497 thousand as of March 31, 2025, down from $1,431,805 thousand at December 31, 2024, reflecting a reduction of approximately 6.4%[9]. - The company’s total stockholders' equity decreased to $430,099 thousand as of March 31, 2025, from $439,128 thousand at December 31, 2024, a decline of approximately 2.4%[9]. - The allowance for credit losses decreased to $31,130 thousand as of March 31, 2025, from $32,847 thousand at December 31, 2024, indicating an improvement in credit quality[9]. Investment and Loan Activity - Cash provided by investing activities was $117,735,000 for Q1 2025, significantly higher than $54,871,000 in Q1 2024[25]. - The company’s principal fundings of CRE loans were $26,515,000 in Q1 2025, compared to $11,406,000 in Q1 2024[25]. - The Company holds $1.36 billion in whole loans and $19.7 million in mezzanine loans as of March 31, 2025, with total loans held for investment amounting to $1.38 billion[67]. - The Company had unfunded loan commitments of $84,000,000 and $94,000,000 for CRE whole loans at March 31, 2025, and December 31, 2024, respectively, indicating a decrease of approximately 10.6%[70]. Real Estate and Property Investments - The company held investments in seven real estate properties as of March 31, 2025, with three included in investments in real estate and four in properties held for sale[100]. - Total net investments in real estate and properties held for sale amounted to $190,067,000 as of March 31, 2025, compared to $188,783,000 on December 31, 2024, reflecting an increase of 0.68%[103]. - The carrying value of investments in real estate was $77,143,000 as of March 31, 2025, up from $76,608,000 at the end of 2024, representing a growth of 0.70%[103]. Borrowings and Financing - As of March 31, 2025, total outstanding borrowings amounted to $1,271,071,000 with a weighted average borrowing rate of 6.47% and a remaining maturity of 4.7 years[10]. - The Company has a total of $1,541,287,000 in collateral value backing its borrowings as of March 31, 2025[10]. - The average interest rate for mortgages payable was 9.17% with a remaining maturity of 5.7 years as of March 31, 2025[10]. - The total amount at risk under the Company's financing arrangements was $314,573,000 as of March 31, 2025[134]. Stockholder and Shareholder Information - The Company did not pay any common share distributions for the three months ended March 31, 2025, and 2024[181]. - Total unrecognized compensation costs relating to unvested restricted stock was $2.8 million as of March 31, 2025, expected to be recognized over a weighted average period of 2.9 years[175]. - The Company anticipates distributing substantially all of its taxable income to stockholders to avoid corporate federal income taxes on retained income[179]. - The Company recognized stock-based compensation expense of $815,000 for the three months ended March 31, 2025, up from $477,000 in the same period of 2024[169].

Financial Data and Key Metrics Changes - GAAP net loss allocable to common shares in Q1 2025 was $5,900,000 or $0.80 per share diluted, compared to earnings of $0.48 per share in the previous quarter [11] - Earnings available for distribution (EAD) for Q1 2025 was a loss of $0.86 per share, a decrease of $1.34 from the previous quarter [11][12] - GAAP book value per share decreased to $28.5 on March 31 from $28.87 on December 31 [12] - Available liquidity at March 31 was $87,000,000, comprising $66,000,000 of unrestricted cash and $21,000,000 of projected financing available on unlevered assets [13] Business Line Data and Key Metrics Changes - Loan payoffs during the period were $115,900,000, with a net reduction of the loan portfolio of $109,600,000 [5] - The company closed one new commitment of $15,000,000 and funded existing loan commitments of $12,000,000 [5] - The weighted average spread of the floating rate loans in the $1,400,000,000 commercial real estate loan portfolio is now 3.67% over one month term SOFR rates [6] - The total allowance for credit losses at March 31 was $31,100,000, representing 2.26% of the loan portfolio [11] Market Data and Key Metrics Changes - The number of loans rated four, zero, five decreased from 12 at the end of last year to 11 at the end of this quarter [7] - The company expects to grow the portfolio by $300,000,000 to $500,000,000 by the end of the year, despite loan payoffs [19] Company Strategy and Development Direction - The company aims to optimize portfolio leverage to drive equity returns and is focused on improving credit quality while recycling capital into new investments [9][10] - The investment landscape is described as attractive, with the company actively closing new loans across various asset classes, including multifamily, student housing, self-storage, and retail [14][19] Management's Comments on Operating Environment and Future Outlook - Management indicated that Q1 2025 represents a trough in portfolio size, with expectations of ramping securitization in the second half of the year [14] - The company noted that the pipeline has been stronger than ever, with increased quoting of deals due to market volatility pushing more opportunities their way [26] Other Important Information - The company incurred a non-recurring charge of $1,500,000 related to unamortized debt issuance costs during the quarter [9] - The company sold a $20,600,000 loan at par and took a $700,000 loss on a non-performing hotel property [7][23] Q&A Session Summary Question: Could you talk a little bit about the portfolio and the payoffs that occurred during the quarter? - Management confirmed that the payoffs were expected, with five loan payoffs occurring, including refinancings and asset sales [17] Question: Should we expect more early payments and what are the opportunities for portfolio growth? - Management expects more payoffs throughout the year and anticipates net growth in the portfolio between $300,000,000 and $500,000,000 [19] Question: Can you provide details on the loan sales and the impact on earnings? - One loan was sold at par, while another non-performing hotel property was sold at 94¢ on the dollar, resulting in a $700,000 loss [23] Question: Is the increase in real estate expenses due to seasonality, and should we expect REO sales in 2025? - Management indicated that the increase is primarily due to seasonality and expects to report on asset sales in the upcoming quarters [25] Question: How is the pipeline looking given recent market volatility? - Management reported a stronger pipeline than ever, with increased quoting of deals due to some lenders moving to the sidelines [26]

Financial Data and Key Metrics Changes - GAAP net loss allocable to common shares in Q1 2025 was $5,900,000 or $0.80 per share diluted, compared to earnings of $0.48 per share in the previous quarter [11] - Earnings available for distribution (EAD) for Q1 2025 was a loss of $0.86 per share, a decrease of $0.41 from the previous quarter [12] - GAAP book value per share decreased to $28.5 on March 31 from $28.87 on December 31 [12] - Available liquidity at March 31 was $87,000,000, comprising $66,000,000 of unrestricted cash and $21,000,000 of projected financing available on unlevered assets [13] Business Line Data and Key Metrics Changes - Loan payoffs during the period were $115,900,000, with a net reduction of the loan portfolio of $109,600,000 [5] - The company closed one new commitment of $15,000,000 and funded existing loan commitments of $12,000,000 during the quarter [5] - The weighted average spread of the floating rate loans in the $1,400,000,000 commercial real estate loan portfolio is now 3.67% over one month term SOFR rates [6] - The total allowance for credit losses at March 31 was $31,100,000, representing 2.26% of the loan portfolio [11] Market Data and Key Metrics Changes - The company sold two loans during the period, including a loan for $31,700,000 in proceeds [5] - A $20,600,000 loan was sold at par on an underperforming sub-storage facility in Miami [6] - One loan was sold at 94¢ on the dollar, resulting in a $700,000 loss [24] Company Strategy and Development Direction - The company aims to optimize portfolio leverage to drive equity returns and plans to redeploy capital into attractive commercial real estate loans [8] - The investment landscape is described as attractive, with expectations of net growth in the portfolio between $300,000,000 and $500,000,000 by the end of the year [20] - The company is actively closing new loans and focusing on maintaining strong credit quality in the current portfolio [14] Management's Comments on Operating Environment and Future Outlook - Management indicated that Q1 2025 represents a trough in portfolio size, with expectations to ramp up securitization in the second half of the year [14] - The company expects to see more payoffs throughout the year through refinancings or sales of assets, indicating a healthy portfolio [20] - The pipeline for new loans is reported to be stronger than ever, with increased quoting of deals due to market volatility pushing opportunities their way [27] Other Important Information - The company incurred a non-recurring charge of $1,500,000 related to unamortized debt issuance costs during the quarter [9] - The GAAP debt to equity leverage ratio slightly decreased to 2.9 times at March 31 from 3 times at December 31 [13] Q&A Session Summary Question: Could you talk a little bit about the portfolio and the payoffs that occurred during the quarter? - Management confirmed that the payoffs were expected, with five loan payoffs occurring, primarily through refinancing [18] Question: Should we expect more early payments and what are the opportunities for portfolio growth? - Management expects more payoffs throughout the year and anticipates net growth in the portfolio despite these payoffs, focusing on multifamily and other asset classes [20] Question: Can you provide details on the loan sales and the impact on earnings? - One loan was sold at par, while another was sold at a loss of 94¢ on the dollar due to underperformance [24] Question: Is the increase in real estate expenses due to seasonality? - Management indicated that the increase is primarily due to seasonality, particularly in hotel operations, and expects a turnaround in Q2 [26] Question: How is the pipeline looking given recent market volatility? - The pipeline is reported to be stronger than ever, with many opportunities arising from market volatility [27]

Financial Performance - The company reported a GAAP net loss per share-diluted of $0.80 for 1Q25[12] - The company reported an EAD loss for 1Q25 of $0.86[12] - Book Value per Share at March 31, 2025 was $28.50, down from $28.87 in 4Q24 and up from $27.25 in 1Q24[10, 12] Loan Portfolio - The CRE loan portfolio at par value is $1.4 billion, comprising 48 loans with a weighted average LTV of 81%[12] - 89.5% of the par value of the CRE loan portfolio is current on payments[10, 12] - 77% of the CRE loan portfolio is focused on Multifamily properties[10] - Net CRE loan repayments for 1Q25 totaled $120.7 million[10, 12] Capitalization and Liquidity - Total liquidity at March 31, 2025 was $87.4 million[10, 12] - Total capacity was $2.2 billion, with $948.3 million available at March 31, 2025[12, 13] - Total Capitalization is $1.7 billion, with Stockholders' equity accounting for 26%[17] Real Estate Investments - Net investments in real estate and properties held for sale totaled $177.0 million[13, 32]

Financial Results - ACRES Commercial Realty Corp. reported its operating results for Q1 2025 on April 30, 2025[7] - Specific financial metrics and performance data were included in the press release and earnings presentation[7] Earnings Presentation - The company provided a detailed earnings presentation available on its website[7] Regulatory Compliance - The report is part of the requirements under the Securities Exchange Act of 1934[12] - The Chief Financial Officer, Eldron C. Blackwell, signed the report[14]

Core Viewpoint - ACRES Commercial Realty Corp. has authorized an additional $10 million for its existing share repurchase program to buy back outstanding shares of both common and preferred stock [1] Group 1: Share Repurchase Program - The company intends to repurchase shares through various methods including open market purchases and privately-negotiated transactions, in compliance with federal securities laws [1] - The timing and amount of shares repurchased will be determined by the company's management based on market conditions and other factors [2] Group 2: Company Overview - ACRES Commercial Realty Corp. is a real estate investment trust focused on originating, holding, and managing commercial real estate mortgage loans, and may also hold equity investments in commercial real estate properties [3] - The company is externally managed by ACRES Capital, LLC, which specializes in middle market commercial real estate lending across various property types in top U.S. markets [3]

Group 1 - The article provides profiles of two professionals with extensive backgrounds in nuclear engineering and environmental engineering, highlighting their educational qualifications and career experiences [1] - The first individual has a 41-year career in nuclear engineering, including roles in nuclear facility construction and government contracting, and has been an avid investor for over 40 years [1] - The second individual has a 35-year career focused on commercial nuclear power engineering services and nuclear waste clean-up, emphasizing safety in their work [1]

Company Announcement - ACRES Commercial Realty Corp. will release its first quarter 2025 results on April 30, 2025, after market close [1] - A live conference call is scheduled for May 1, 2025, at 10:00 a.m. Eastern Time [1] Conference Call Details - The conference call can be accessed by dialing 1-800-267-6316 for U.S. domestic or 1-203-518-9783 for international calls, using Conference ID ACRES [2] - A replay of the conference call will be available until May 15, 2025, through the company's website and by phone [2] Company Overview - ACRES Commercial Realty Corp. is a real estate investment trust focused on originating, holding, and managing commercial real estate mortgage loans [3] - The company may also hold equity investments in commercial real estate properties through direct ownership and joint ventures [3] - It is externally managed by ACRES Capital, LLC, which specializes in middle market commercial real estate lending across various property types in top U.S. markets [3]

Core Viewpoint - ACRES Commercial Realty has successfully repurchased its assets in ACRES Commercial Realty 2021-FL1 and ACRES Commercial Realty 2021-FL2, eliminating the existing JP Morgan warehouse facility balance and entering into a new $940 million managed facility with JP Morgan Chase Bank to leverage commercial mortgage loan investments [1][2]. Group 1: Company Actions - The company announced the redemption of the CRE securitizations at par and the execution of a financing arrangement with JP Morgan, which diversifies its capital sources at attractive pricing [2]. - The new $940 million facility will provide term funding with underlying loans and has a two-year reinvestment period [1]. Group 2: Company Profile - ACRES Commercial Realty Corp. is a real estate investment trust focused on originating, holding, and managing commercial real estate mortgage loans, and may also hold equity investments in commercial real estate properties [2]. - The company is externally managed by ACRES Capital, LLC, which specializes in middle market commercial real estate lending across various property types in top U.S. markets [2].

Loan Portfolio - As of December 31, 2024, the company's CRE loan portfolio at par comprised $1.5 billion of CRE whole loans with a weighted average spread of 3.73% over the one-month benchmark interest rates[17]. - The company selectively originated one CRE loan with a total commitment of $47.9 million during the year ended December 31, 2024[17]. - The total CRE loan portfolio at carrying value was $1.5 billion as of December 31, 2024[46]. - The weighted average floor of the company's CRE loan portfolio is 0.97%[17]. - At December 31, 2024, 74.7% of the par value of the CRE loan portfolio had interest rate caps or funded debt service reserves in place[30]. - The company targets transitional floating-rate CRE loans between $10.0 million and $100.0 million[17]. Investment Portfolio - At December 31, 2024, the company managed $1.9 billion of assets, including $1.1 billion financed and held in variable interest entities[19]. - The total investment portfolio amounted to $1.7 billion, with CRE whole loans representing 87.41% of the portfolio[33]. - The carrying value of investments in real estate was $304.026 million, including $201.125 million in properties held for sale[49]. - At December 31, 2024, the company held three investments in real estate acquired through direct equity investments and four from lending activities[48]. Financial Performance and Risks - The company has $32.1 million of net operating loss carryforwards and $121.9 million of net capital loss carryforwards, set to expire on December 31, 2025[35]. - Current economic conditions may limit the company's ability to obtain necessary capital and financing for growth, potentially affecting profitability and stock price[78]. - The company has financed a significant portion of its portfolio through leverage, which may reduce returns on investments and cash available for distribution[82]. - A prolonged economic slowdown could impair investments and harm operations, particularly if real estate values decline[79]. - The company may incur losses on repurchase transactions if counterparties default or if the value of underlying assets declines[88]. - The current expected credit losses model may require an increase in the allowance for credit losses, adversely affecting financial condition[77]. Management and Governance - The Management Agreement's current contract term ends on July 31, 2025, with automatic one-year renewals unless terminated[58]. - The Company has no direct employees; all management and support personnel are provided by its Manager under the Management Agreement[70]. - The management fee structure may incentivize the manager to recommend strategies that increase equity, potentially at the expense of optimizing returns for stockholders[137]. - Termination of the management agreement without cause is difficult and costly, requiring a two-thirds vote from independent directors or a majority vote from common stockholders[142]. Regulatory Compliance - The Company operates to be excluded from regulation under the Investment Company Act, ensuring that at least 55% of ACRES RF's assets consist of Qualifying Interests[63]. - ACRES RF must maintain that less than 40% of the value of its total assets consists of "investment securities" to comply with the Investment Company Act[65]. - The company relies on exclusions from registration as an investment company, which could be jeopardized by changes in asset composition or regulatory requirements[158][159]. - To maintain REIT status, the company must distribute at least 90% of its REIT taxable income, and failure to do so could result in corporate income tax and a 4% nondeductible excise tax[174]. Market and Economic Conditions - Increased interest rates could lead to reduced investment values, lower earnings, and decreased ability to pay distributions, particularly affecting CRE-related loans[108]. - Inflationary pressures in the U.S. economy, driven by heightened consumer demand and supply chain imbalances, could compromise property performance and mortgage loan performance[109]. - The transition to alternative reference rates may adversely affect the value of loans and investments, impacting results of operations and cash flows[111]. Cybersecurity and Operational Risks - The company has a robust cybersecurity risk management strategy overseen by its Manager, ACRES Capital Corp[192]. - Cybersecurity risks have not materially affected the company's business strategy or financial condition[195]. - The company relies heavily on information systems, and failures or cybersecurity incidents could disrupt operations and negatively impact stock price[103]. Shareholder and Stock Information - The company has 7,456,150 shares of common stock outstanding as of March 13, 2025, held by 180 holders of record[208]. - The Series D Cumulative Redeemable Preferred Stock has a dividend rate of 7.875% and is listed on the NYSE under the symbol "ACRPrD"[212]. - Dividends on the Series D Preferred Stock have been declared and paid through January 2025, with no dividends currently in arrears[212]. - The company has not established a minimum distribution payment level and may use uninvested offering proceeds or borrowed funds for future distributions[157].