CIM Group Sells 177,434-Square-Foot Best Buy Plaza Shopping Center in North Dallas Mar 19, 2026 11:02 AM Eastern Daylight Time CIM Group Sells 177,434-Square-Foot Best Buy Plaza Shopping Center in North Dallas Share DALLAS--(BUSINESS WIRE)--CIM Group announced today that it has sold Best Buy Plaza, an approximately 177,434-square-foot retail shopping center located at 9358 N. Central Expressway in North Dallas. CIM is a community-focused real estate and infrastructure owner, operator, lender and developer. ...

Investment Portfolio - As of December 31, 2025, approximately 65% of the investment portfolio was allocated to residential mortgage loans, 23% to Agency MBS, and 5% to Non-Agency RMBS, a significant shift from 88%, 4%, and 8% respectively in 2024[333]. - The company gained exposure to a $6.5 billion pool of Fannie Mae MSRs, acquiring it for $38 million, which serves as a natural book value hedge against interest rate fluctuations[352]. - The company plans to grow its Agency RMBS and MSR portfolios to enhance portfolio diversity and stability of dividends[396]. - The fixed-rate percentage of the portfolio was 86.5% as of December 31, 2025, slightly down from 87.9% in 2024[495]. - Loans held for investment constituted 69.8% of the portfolio as of December 31, 2025, compared to 88.0% in 2024[495]. HomeXpress Acquisition - The company completed the HomeXpress Acquisition on October 1, 2025, which is expected to enhance diversification of earnings sources and provide direct exposure to the growing residential consumer Non-QM and investor business purpose mortgage loan origination market[336][337]. - The acquisition of HomeXpress was completed for a total consideration of $272 million, including cash and stock issuance[376]. - HomeXpress originated 2,516 mortgage loans totaling approximately $1.0 billion in principal balance during Q4 2025, with an average loan balance of $412,000[379]. - HomeXpress reported net income of $8 million for Q4 2025, with operating income of approximately $11 million, representing 111 basis points of loan origination volume[383]. - The HomeXpress acquisition is expected to enhance loan origination volumes and overall returns to shareholders[397]. Financial Performance - Net income available to common shareholders for the year ended December 31, 2025, was $144 million, or $1.76 per share, up from $90 million, or $1.12 per share in 2024[409]. - Interest income increased by $60 million, or 7.9%, to $821 million for the year ended December 31, 2025, driven by Agency RMBS purchases[410]. - Interest expense rose by $59 million, or 11.8%, to $555 million for the year ended December 31, 2025, primarily due to higher borrowings for Agency RMBS financing[411]. - The company reported a return on average equity of 8.91% for the year ended December 31, 2025, up from 6.72% in 2024 and 4.87% in 2023[488]. - The company recorded net unrealized gains on financial instruments at fair value of $82 million in 2025, compared to $11 million in 2024[457]. Capital and Financing - The company raised over $187 million in capital for new investments through the redemption of securities in seven outstanding securitizations and sponsoring two new securitizations[360]. - In September 2025, the company issued $120 million of 8.875% unsecured senior notes, receiving approximately $116 million in proceeds after fees[374]. - The weighted average cost of debt on securities sold in the new securitizations was 5.8%, with a reduction in financing costs by 17 basis points from previous securitizations[360]. - The company incurred transaction expenses of $17 million related to the HomeXpress acquisition in 2025, compared to $7 million for the Palisades acquisition in 2024[466]. - The company had $7.4 billion of securities or cash pledged against secured financing agreements obligations as of December 31, 2025, compared to $4.1 billion in 2024[525]. Economic Indicators - The average 30-year fixed mortgage rate declined from 6.85% at the beginning of 2025 to 6.15% at year-end, a decrease of approximately 70 basis points[347]. - The unemployment rate increased to 4.4% at year-end 2025, while real GDP increased at an annualized rate of 3.8% in Q2 and 4.4% in Q3[343]. - The year-over-year national home price appreciation ended below consumer wage growth, indicating a step toward easing affordability challenges in the housing market[349]. Risk Management - The company entered into an interest rate cap with a notional amount of $1.0 billion, paying $7 million for a strike rate of 3.95%[438]. - The ratio of interest-earning assets to interest-bearing liabilities was 1.14 for the year ended December 31, 2025, down from 1.18 in 2024[424]. - The company actively manages 20 counterparties for secured financing agreements, with a total exposure of $6,038,336 thousand as of December 31, 2025[527]. - The haircut for secured financing agreements at fair value was 7.5% as of December 31, 2025[521]. - The company expects to enter into new secured financing agreements at maturity, but faces risks related to market conditions and interest rates[526].

Core Viewpoint - Chimera Investment Corporation (CIM) is a real estate investment trust (REIT) focusing on residential mortgage loans and related assets, aiming to deliver attractive risk-adjusted returns through dividends and capital appreciation [1] Financial Performance - On February 11, 2026, CIM reported earnings per share (EPS) of $0.53, surpassing the estimated $0.50, indicating strong profitability [2][6] - CIM's revenue for the same period was $66.18 million, which fell short of the expected $80.74 million, highlighting a revenue generation gap [2][6] - For Q4 2025, CIM reported a GAAP net income of $7 million, translating to $0.08 per diluted common share, with a GAAP book value per common share of $19.70 as of December 31, 2025 [3] Financial Ratios - CIM has a price-to-earnings (P/E) ratio of approximately 4.62, suggesting a low valuation relative to earnings [4][6] - The price-to-sales ratio is about 3.74, and the enterprise value to sales ratio is around 2.78, indicating the market's valuation of the company's sales [4] - The enterprise value to operating cash flow ratio is negative at -8.43, suggesting potential challenges in cash flow generation [5] - Despite cash flow concerns, CIM's earnings yield is approximately 21.63%, indicating a strong return on investment relative to its share price [5]

Core Insights - Chimera Investment executed a strategic plan in 2025 to diversify its portfolio, strengthen liquidity, and expand fee-based income, transitioning towards a "hybrid REIT" model with diversified income sources [2][3][5] Portfolio and Financial Performance - The company increased third-party assets under management to $26 billion from $22 billion and repositioned its portfolio by reducing loan concentration and increasing Agency exposure [1][5] - By the end of 2025, the GAAP portfolio composition shifted to 61% loans, 16% Agency securities, 10% non-Agency securities, 11% lending activities, and 1% mortgage servicing rights [1] - Chimera reported a GAAP net income of $7 million, or $0.08 per share, for Q4 2025, and a full-year GAAP net income of $144 million, or $1.72 per share [9] - Earnings available for distribution were $45 million, or $0.53 per share, in Q4 and $141 million, or $1.68 per share, for the full year [10] Acquisition and Operational Metrics - The acquisition of HomeXpress Mortgage contributed to strong origination results, with the platform funding a record $1.04 billion in Q4 2025 and achieving a GAAP cost to originate of 201 basis points [4][18] - HomeXpress's full-year originations reached $3.4 billion, with an annualized EBITDA return on equity of 16.2% [4][18] Dividend and Capital Allocation - The board declared a Q1 2026 dividend of $0.45 per share, a 22% increase from the previous quarter, and expects to maintain this level throughout 2026 [6][7] - Total leverage was reported at 5.1-to-1, with liquidity ending the year at $528 million, down from $752 million at the end of Q3 [11] Market Outlook and Growth Projections - Management anticipates 20% to 25% growth in non-QM and business-purpose loans in 2026 compared to 2025, projecting non-QM origination volume of approximately $110 billion to $130 billion [22]

Financial Data and Key Metrics Changes - GAAP net income for Q4 2025 was $7 million or $0.08 per share, while full-year net income was $144 million or $1.72 per share [10] - GAAP book value at the end of Q4 was $19.70 per share, with an economic return on GAAP book value of -0.9% for Q4 and +7.4% for the full year [11] - Earnings available for distribution (EAD) for Q4 was $45 million or $0.53 per share, and for the full year, it was $141 million or $1.68 per share [11] Business Line Data and Key Metrics Changes - The investment portfolio segment reported economic net interest income of $65 million for Q4, with a yield on average interest-earning assets of 5.9% and a net interest spread of 1.4% [12] - HomeXpress funded $1 billion in production during Q4 with a gain-on-sale premium of 358 basis points, and its EBITDA was $11 million for the quarter [13] Market Data and Key Metrics Changes - The company ended the year with $528 million in total cash and unencumbered assets, down from $752 million at the end of Q3 [14] - Agency swap OAS tightened by approximately 22 basis points in Q4, while generic non-QM AAAs firmed by 5 basis points [20] Company Strategy and Development Direction - The company aims to build a hybrid REIT focused on diversification, liquidity, and fee-based income, with a clear plan to grow Agency RMBS and acquire MSRs [5][9] - The acquisition of HomeXpress is expected to enhance capabilities and reach, contributing to a diversified residential platform [6][9] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for 2026, focusing on unlocking capital and redeploying into earnings-accretive investments [24] - The company anticipates strong demand for non-QM loans and related securitized products, projecting significant growth in the market [25] Other Important Information - Compensation, general, and administrative expenses increased by $22 million year-over-year due to staffing costs related to acquisitions [16] - The company generated over $600 million of capital through portfolio and capital markets activity, supporting its portfolio realignment [18] Q&A Session Summary Question: Update on HomeXpress volume and gain on sale - Management noted typical seasonal reduction in volume but expects a strong first quarter compared to last year, with good gain on sale premiums [32][33] Question: Context for dividend increase - The company balanced dividend size with the need to retain capital for growth, ensuring sufficient EAD coverage [40][41] Question: Originating second liens and non-QM volume outlook - Currently not originating second mortgages but sees significant growth potential in non-QM loans, projecting a 20%-25% market growth in 2026 [46][48] Question: Change in book value and securitized debt - The decline in book value is attributed to faster increases in the value of securitized debt compared to loan values, but this does not affect economic risk [49][50] Question: Credit enhancement levels in securitization trusts - Management does not expect a material decline in credit enhancement levels, viewing securitization as an economic consideration [53][54]

Financial Data and Key Metrics Changes - GAAP net income for Q4 2025 was $7 million or $0.08 per share, while for the full year it was $144 million or $1.72 per share [10] - GAAP book value at the end of Q4 was $19.70 per share, with an economic return on GAAP book value of -0.9% for the quarter and +7.4% for the full year [11] - Earnings available for distribution (EAD) for Q4 was $45 million or $0.53 per share, and for the full year, it was $141 million or $1.68 per share [11] Business Line Data and Key Metrics Changes - The investment portfolio segment reported economic net interest income of $65 million in Q4, with a yield on average interest-earning assets of 5.9% and a net interest spread of 1.4% [12] - Home Express funded $1 billion in production in Q4 with a gain-on-sale premium of 358 basis points, and its EBITDA was $11 million for the quarter [13] Market Data and Key Metrics Changes - The company ended the year with $528 million in total cash and unencumbered assets, down from $752 million at the end of Q3 [14] - Agency swap OAS tightened by approximately 22 basis points in Q4, while generic non-QM AAAs firmed by 5 basis points [20] Company Strategy and Development Direction - The company aims to build a hybrid REIT focused on diversification, liquidity, and fee-based income, with a clear plan to grow Agency RMBS and acquire MSRs [5][9] - The acquisition of Home Express is expected to enhance capabilities and reach, contributing to a diversified residential platform [6][10] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for 2026, focusing on unlocking capital and redeploying into earnings-accretive investments [24] - The company anticipates strong demand for non-QM loans and related securitized products, projecting significant growth in the non-QM market [25][48] Other Important Information - Compensation, general, and administrative expenses increased by $22 million year-over-year due to staffing costs related to acquisitions [16] - The company generated over $600 million of capital through portfolio and capital markets activity, supporting its portfolio realignment [18][19] Q&A Session Summary Question: Update on HomeXpress volume and gain on sale - Management noted typical seasonal reduction in volume post-holidays but remains optimistic about Q1 2026 performance compared to last year [33] Question: Relative value between adding more agencies versus securitizations - Management emphasized the importance of portfolio construction and maintaining a balance between agency and credit components [35] Question: Context for dividend increase - The company aims to balance dividend payouts with sufficient EAD coverage to support growth in operating aspects of the business [40] Question: Non-QM volume outlook for 2026 - Management anticipates significant growth in the non-QM market, projecting origination volumes to increase by 20%-25% [46][48] Question: Change in book value and securitized debt - Management explained that while loan values increased, the faster increase in securitized debt value led to a reduction in reported book value [49][50]

Financial Data and Key Metrics Changes - GAAP net income for Q4 2025 was $7 million or $0.08 per share, while for the full year it was $144 million or $1.72 per share [11] - GAAP book value at the end of Q4 was $19.70 per share, with an economic return on GAAP book value of -0.9% for the quarter and +7.4% for the full year [12] - Earnings available for distribution (EAD) for Q4 was $45 million or $0.53 per share, and for the full year, it was $141 million or $1.68 per share [12] Business Line Data and Key Metrics Changes - The investment portfolio segment reported an economic net interest income of $65 million for Q4, with a yield on average interest-earning assets of 5.9% and a net interest spread of 1.4% [13] - Home Express funded $1 billion in production during Q4 with a gain-on-sale premium of 358 basis points, and its EBITDA was $11 million for the quarter [13][27] - The company ended the year with a total leverage of 5.1-to-1, compared to the REIT average of 2.4-to-1 [13] Market Data and Key Metrics Changes - Agency swap OAS tightened by approximately 22 basis points in Q4, while generic non-QM AAAs firmed by 5 basis points [19] - Treasury yields had a tightening bias, with the two-year, ten-year Treasury spread ending the year at 69 basis points, approximately 37 wider than at the beginning of the year [20] - Mortgage rates decreased by approximately 70 basis points for the year, ending at 6.15% [20] Company Strategy and Development Direction - The company aims to build a diversified residential platform capable of generating long-term value, focusing on portfolio diversification, liquidity expansion, and fee-based income growth [10] - The acquisition of Home Express is a key part of the strategy to enhance capabilities and reach within the residential mortgage market [6][10] - The company is committed to maintaining a long-term orientation while adapting to market conditions and evolving its operational capabilities [7][10] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism about the first quarter of 2026, expecting strong revenue and gain on sale premiums despite typical seasonal reductions in volume [33] - The company anticipates continued growth in the non-QM and business purpose loan markets, projecting a market growth of 20%-25% in 2026 [46] - Management emphasized the importance of capital allocation and the balance between dividend payouts and reinvestment for growth [39] Other Important Information - The company raised approximately $120 million in unsecured debt, with the majority of funding for transformation coming from its own portfolio [6] - Compensation, general, and administrative expenses increased by $22 million year-over-year, primarily due to staffing costs related to acquisitions [16] - The company is focused on managing capital at risk and evaluating cash flow generating capital rather than short-term valuation movements [50] Q&A Session Summary Question: Update on Home Express volume and gain on sale - Management noted a typical seasonal reduction in volume but expressed optimism for Q1 2026, expecting good revenue compared to the previous year [33] Question: Relative value between adding more agencies versus securitizations - Management highlighted the importance of portfolio construction and maintaining a balance between agency and credit components, with a focus on MSR allocation [34][35] Question: Context of dividend increase - Management explained that the dividend increase was sized to ensure sufficient EAD coverage while allowing for growth in operating aspects of the business [39] Question: Originating second liens and non-QM volume outlook - Management confirmed they are not currently originating second mortgages but anticipate significant growth in the non-QM market in 2026 [46] Question: Change in book value and securitized debt - Management clarified that the reduction in book value was due to the faster increase in the value of securitized debt compared to loan values, emphasizing the focus on managing capital at risk [49][50]

Disclaimer This presentation includes "forward-looking statements" within the meaning of the safe harbor provisions of the United States Private Securities Litigation Reform Act of 1995,. Actual results may differ from expectations, estimates and projections and, consequently, readers should not rely on these forward-looking statements as predictions of future events. Words such as "goal," "expect," "target," "assume," "estimate," "project," "budget," "forecast," "anticipate," "intend," "plan," "may," "woul ...

Financial Performance - GAAP net income for Q4 2025 was $7 million, or $0.08 per diluted common share, with earnings available for distribution of $45 million, or $0.53 per adjusted diluted common share[5]. - For the full year 2025, GAAP net income reached $144 million, or $1.72 per diluted common share, with earnings available for distribution totaling $141 million, or $1.68 per adjusted diluted common share[5]. - The economic return for Q4 2025 was (0.9)%, while the economic return for the full year 2025 was 7.4%[5]. - Comprehensive income available to common shareholders for the year ended December 31, 2025, was $131.31 million, compared to $64.11 million in 2024[18]. - GAAP net income available to common stockholders for Q4 2025 was $6,501,000, compared to a loss of $21,997,000 in Q3 2025[25]. - Earnings available for distribution for Q4 2025 was $45,161,000, an increase from $30,255,000 in Q3 2025[25]. Asset and Liability Management - Total assets increased to $15.81 billion as of December 31, 2025, compared to $13.12 billion as of December 31, 2024[12]. - Cash and cash equivalents rose significantly to $278.58 million from $83.99 million year-over-year[12]. - Total liabilities increased to $13.24 billion as of December 31, 2025, compared to $10.59 billion as of December 31, 2024[12]. - Loans held for investment at fair value decreased to $9.80 billion from $11.20 billion year-over-year[12]. - Non-Agency RMBS at fair value decreased to $817.28 million from $1.06 billion year-over-year[12]. Income and Expense Analysis - Net interest income for the year ended December 31, 2025, was $266.42 million, slightly up from $264.68 million in 2024[14]. - Interest income for the Investment Portfolio segment in 2025 was $808,384,000, while interest expense was $545,245,000, resulting in net interest income of $263,139,000[30]. - The company reported a total other income of $120,304,000 for the year ended December 31, 2025, which includes gains on origination and sale of loans[30]. - The increase in provision for credit losses for Q4 2025 was $5,322,000, reflecting ongoing risk management efforts[29]. - The company incurred transaction expenses of $625,000 in Q4 2025, down from $9,931,000 in Q3 2025[25]. Segment Performance - The Investment Portfolio segment generated net interest income of $62,898,000 for Q4 2025, while the Residential Origination segment contributed $3,280,000[29]. - The company has restructured its reportable segments into Investment Portfolio and Residential Origination following the HomeXpress acquisition[27]. Market and Economic Conditions - The weighted average yield on interest-bearing liabilities decreased to 5.02% in 2025 from 6.48% in 2024, indicating a reduction in borrowing costs[34]. - Economic net interest income for the Investment Portfolio Segment was reported at $800,192 thousand for the year ended December 31, 2025, compared to $753,598 thousand in 2024, representing a year-over-year increase of 6.2%[39]. - The total principal value of secured financing agreements increased significantly to $6,038,336 thousand in 2025 from $2,842,160 thousand in 2024, reflecting a strategic expansion in financing activities[34]. - The fixed-rate percentage of the portfolio was 86.5% as of December 31, 2025, slightly down from 87.9% in 2024, indicating a minor shift towards adjustable-rate instruments[35]. - The company faces risks from changes in inflation, interest rates, and mortgage prepayment rates that could impact performance[56]. Equity and Capital Management - Tangible common equity as of December 31, 2025, was $1,433,106, down from $1,600,962 in the previous quarter[48]. - Total stockholders' equity available to common stockholders was $1,642,694 as of December 31, 2025[48]. - The GAAP leverage ratio increased to 5.1:1 at the end of 2025, up from 4.0:1 in 2024, indicating a higher level of debt relative to equity[36]. Strategic Focus and Risks - Chimera Investment Corporation emphasizes the importance of managing credit risk related to investments and compliance with the Dodd-Frank Act[56]. - The company highlights the need for favorable funding terms and access to capital markets to achieve optimal leverage levels[56]. - Chimera's ability to integrate and realize benefits from acquisitions, such as HomeXpress, is crucial for future growth[56]. - Maintaining relationships with clients and independent mortgage brokers is essential for operational success[56]. - The company is focused on executing its business and investment strategy effectively to enhance profitability[56]. - Chimera acknowledges the potential impact of cybersecurity threats on its information technology systems[56]. - The volatility of market price and trading volume of shares poses a risk to shareholder distributions[56]. - Chimera's classification as a real estate investment trust is vital for U.S. federal income tax purposes[56].

Financial Performance - Chimera Investment Corporation reported a GAAP net income of $7 million, equating to $0.08 per diluted common share for the fourth quarter ended December 31, 2025 [1] - Earnings available for distribution amounted to $45 million, or $0.53 per adjusted diluted common share [1] - The GAAP book value was reported at $19.70 per common share as of December 31, 2025 [1]