Richard Jay Mack: Thank you, Anne, and thank you all for joining us this morning for CMTG's fourth quarter earnings call. CMTG made a meaningful amount of progress last year, executing on several critical path items. In 2025, we accomplished the priorities we established at the start of the year, including resolving watch list loans, enhancing liquidity, and further deleveraging the portfolio. One year ago, we established a $2,000,000,000 total resolution target for 2025, and I am pleased to report that we ...

Financial Data and Key Metrics Changes - For Q4 2025, the company reported a GAAP net loss of $1.56 per share and a distributable loss of $0.71 per share, with distributable earnings prior to realized gains and losses at $0.02 per share [10] - The held for investment loan portfolio decreased to $3.7 billion at December 31, down from $4.3 billion at September 30 and $6.1 billion at year-end 2024 [10][11] - The total CECL reserve on loans receivable held for investment increased from $308 million (6.8% of UPB) at September 30 to $443 million (10.9% of UPB) at year-end [20] Business Line Data and Key Metrics Changes - Office exposure decreased from $859 million to $589 million, and land exposure decreased from $489 million to $187 million [11] - The company resolved 11 watch list loans with an aggregate UPB of $1.3 billion, exceeding the $2 billion resolution target for 2025 by achieving $2.5 billion in total resolutions [4][15] Market Data and Key Metrics Changes - The company observed encouraging indicators in property market fundamentals, including a reduction in new supply, tightening credit spreads, and improving financing costs for new originations [8] - Increased demand for industrial space and significant investments in areas such as artificial intelligence and domestic manufacturing were noted, which are expected to support job growth and incremental demand for real estate over time [8] Company Strategy and Development Direction - The company aims to continue resolving watch list loans, deleveraging the balance sheet, and reducing capital costs over time, with a focus on asset management and decisive execution in 2026 [7][9] - The goal is to position the company to evaluate new lending opportunities towards the end of 2026 and lay the groundwork for portfolio growth in subsequent years [9] Management's Comments on Operating Environment and Future Outlook - Management remains optimistic but cautious about the macroeconomic backdrop, anticipating a gradual improvement in the real estate market rather than an overnight recovery [7] - The company is focused on cleaning up its book to make it more transparent and easier to understand, which is expected to help the market evaluate the business properly [28] Other Important Information - The company retired the Term Loan B, which had a balance of $718 million, and replaced it with a new $500 million senior secured loan from HPS, extending the maturity of corporate debt to 2030 [5][24] - The company generated significant liquidity, with $153 million in liquidity reported, representing a $51 million increase compared to the prior year-end [25] Q&A Session Summary Question: Opportunities to create shareholder value outside of resolving the portfolio - Management emphasized the need to clean up the book for better market evaluation before considering other opportunities [28] Question: Expectations for net interest income (NII) in Q1 2026 - Management indicated that NII is likely to continue to compress as loans are resolved and the portfolio transitions [30] Question: Percentage of reserves that could translate into losses over the next 12 months - Management stated that they believe they are appropriately reserved, but new information could change expectations [32][33] Question: Liquidity levels in 2026 - Management expressed confidence in liquidity levels, which are above minimum requirements, and indicated plans for capital allocation options [45] Question: Changes in expectations for the pace of sales from the REO portfolio - Management noted a more constructive environment for resolving assets but emphasized the need for a balanced approach [48] Question: NOI within the REO portfolio - Management described a mixed performance in NOI across REO assets, with some generating positive NOI and others being more challenged [54]

Claros Mortgage Trust (NYSE:CMTG) Q4 2025 Earnings call February 19, 2026 10:00 AM ET Company ParticipantsAnh Huynh - VP of Investor RelationsChris Muller - DirectorJohn Nicodemus - Managing DirectorMike McGillis - President and CFOPriyanka Garg - EVPRichard Mack - CEORick Shane - Managing DirectorOperatorHello, and welcome to the Claros Mortgage Trust fourth quarter 2025 earnings conference call. My name is Becky, and I will be your conference facilitator today. All participants will be in a listen-only mo ...

Financial Data and Key Metrics Changes - For Q4 2025, the company reported a GAAP net loss of $1.56 per share and a distributable loss of $0.71 per share, with distributable earnings prior to realized gains and losses at $0.02 per share [10] - The held for investment loan portfolio decreased to $3.7 billion at December 31, down from $4.3 billion at September 30 and $6.1 billion at year-end 2024 [10] - The total CECL reserve on loans receivable held for investment increased from $308 million, or 6.8% of UPB at September 30, to $443 million, or 10.9% of UPB at year-end [19] Business Line Data and Key Metrics Changes - Office exposure decreased from $859 million to $589 million, and land exposure decreased from $489 million to $187 million [11] - The company resolved 11 watch list loans, representing an aggregate UPB of $1.3 billion, exceeding the $2 billion resolution target for 2025 by achieving $2.5 billion in total resolutions [4][14] Market Data and Key Metrics Changes - The company observed encouraging indicators in the property market, including a reduction in new supply, tightening credit spreads, and improving financing costs for new originations [7] - Increased demand for industrial space and significant investments in areas such as artificial intelligence and domestic manufacturing were noted as positive trends for the real estate market [8] Company Strategy and Development Direction - The company aims to position itself to evaluate new lending opportunities towards the end of 2026 while focusing on asset management and resolving watch list loans [9] - The financing agreement with HPS extends the maturity of corporate debt to 2030, providing flexibility to execute the business plan [6][22] Management's Comments on Operating Environment and Future Outlook - Management remains optimistic but cautious about the macroeconomic backdrop, anticipating a gradual improvement in the real estate market rather than an overnight recovery [6] - The company is focused on cleaning up its portfolio to enhance transparency and facilitate better market evaluation [27] Other Important Information - The company retired the Term Loan B, which had a balance of $718 million, and replaced it with a new $500 million senior secured loan from HPS [5][22] - The company generated significant liquidity, increasing its liquidity position to $153 million, despite significant deleveraging [24] Q&A Session Summary Question: Opportunities to create shareholder value outside of resolving the portfolio - Management emphasized the need to clean up the book for better market evaluation before exploring other value creation opportunities [27] Question: Expectations for net interest income (NII) in Q1 2026 - Management indicated that NII is likely to remain lower in the first and second quarters due to ongoing portfolio transitions and resolutions [29][30] Question: Percentage of reserves that could translate into losses over the next 12 months - Management stated that they believe they are appropriately reserved based on past resolutions and current market conditions, but acknowledged the dynamic nature of the environment [32][33] Question: Liquidity levels in 2026 - Management expressed confidence in their liquidity position, indicating a significant cushion over minimum requirements and plans for further deleveraging [45] Question: Changes in expectations for the pace of sales from the REO portfolio - Management noted a more constructive environment for resolving assets but cautioned that transaction volumes are still lower than anticipated [48]

February 18, 2026 The properties above are not representative of all transactions. The information provided herein is as of December 31, 2025, unless otherwise noted. Fourth Quarter 2025 Earnings Supplement Claros Mortgage Trust, Inc. (CMTG) Fourth Quarter 2025 Highlights | |  | GAAP net loss of $219.2 million, or $1.56 per share; distributable loss of $101.7 million, or $0.71 per share; and distributable earnings prior | | --- | --- | --- | | | | to realized gains and losses of $2.9 million, or $0.02 per ...

NEW YORK--(BUSINESS WIRE)--Claros Mortgage Trust, Inc. (NYSE: CMTG) (the "Company†or "CMTG†) today reported its financial results for the quarter and year ended December 31, 2025. The Company reported GAAP net loss of $219.2 million and $489.1 million, or $1.56 per share and $3.49 per share, for the quarter and year ended December 31, 2025, respectively. Distributable Loss (a non-GAAP financial measure defined below) was $101.7 million and $269.0 million, or $0.71 per share and $1.88 per share. ...

Financial Performance - For Q4 2025, Claros Mortgage Trust, Inc. reported a GAAP net loss of $219.2 million, or $1.56 per share, and a full-year net loss of $489.1 million, or $3.49 per share[1] - Distributable Loss for Q4 2025 was $101.7 million, or $0.71 per share, and for the full year, it was $269.0 million, or $1.88 per share[1] Loan Portfolio and Reserves - The company resolved five loans totaling $483.9 million of UPB in Q4 2025, including two full repayments of $216.2 million[2] - As of December 31, 2025, the loan portfolio was valued at $3.7 billion with a weighted average yield of 6.2%[2] - CECL reserves stood at $443.1 million, or $3.09 per share, representing approximately 10.9% of UPB[2] - Watchlist loans decreased to $1.5 billion, reflecting a 45% net decline from the prior year-end[9] Liquidity and Financing - Total liquidity at year-end was $185 million, including $173 million in cash[2] - Net financings outstanding decreased by $1.7 billion during the year, including $580 million of deleveraging payments[2] Asset Sales - The company executed sales of signage and remaining office floors for a gross sales price of $24.1 million[2] Book Value - The book value per share was reported at $10.69[2]

Financial Capacity and Debt - As of December 31, 2025, the company had a total capacity of $4.2 billion under repurchase agreements and term participation facilities, with $2.2 billion outstanding[47]. - The company had an unpaid principal balance of $235.0 million related to its real estate owned hotel portfolio and a secured term loan with an unpaid principal balance of $556.2 million[49]. - The net debt-to-equity ratio was 1.9x and the Total Leverage Ratio was 2.5x as of December 31, 2025, with expectations for the Total Leverage Ratio to range from 2.0x to 3.0x going forward[51]. - The company had $830.0 million of non-consolidated senior interests as of December 31, 2025, which are not reflected on the balance sheet[48]. - As of December 31, 2025, the company has not received any margin calls under its repurchase agreements, indicating stable financing conditions[487]. Investment Strategy and Risk Management - The company’s investment strategy emphasizes prudent risk management, primarily originating senior loans with conservative loan-to-value ratios to mitigate credit losses[482]. - The asset management team rigorously monitors investments, focusing on both quantitative and qualitative analyses to manage risks effectively[55]. - The company conducts comprehensive credit analysis and rigorous monitoring of borrowers to manage risks associated with loan repayments and tenant rent payments[491]. - Prepayment risk is managed by structuring loans with spread maintenance and minimum income levels to protect against early repayments[493]. Interest Rate and Market Risks - The company’s interest rate risk is influenced by the U.S. Federal Reserve's actions, with benchmark interest rates increasing by 5.25% by the end of 2023, impacting interest expenses and borrower debt servicing capabilities[480]. - The company expects that rising interest rates will generally increase net interest income, while declining rates may decrease it[481]. - Elevated interest rates may lead to an increase in borrowers requesting loan extensions, potentially impacting the company's liquidity and operational results[494]. - Real estate market values are subject to volatility due to various factors, including interest rates and economic conditions, which could lead to losses for the company[498]. Competition and Capital Raising - The company faces competition from various financial entities, which may limit its ability to originate or acquire attractive risk-adjusted investments[57]. - The company is exposed to risks related to equity and debt capital markets, which may impact its ability to raise capital through common stock or debt instruments[486]. - The company finances its operations through various means, including senior interests and secured term loans, but may face challenges due to market volatility and regulatory changes[488]. Counterparty and Currency Risks - Counterparty risks exist due to reliance on financial institutions for cash and financing, which the company mitigates by working with high credit-quality institutions[489]. - The company currently holds no foreign currency-denominated assets or liabilities, but may do so in the future, exposing it to currency risk[496].

Core Viewpoint - Claros Mortgage Trust, Inc. (CMTG) is set to release its fourth quarter and full-year fiscal 2025 financial results on February 18, 2026, after the market closes [1] Financial Results Announcement - The financial results will be disclosed after the closing of trading on the New York Stock Exchange on February 18, 2026 [1] - A conference call to discuss these results is scheduled for February 19, 2026, at 10:00 a.m. ET [1] - Participants can access the conference call by dialing 1-833-470-1428 and referencing Claros Mortgage Trust [1]

Core Viewpoint - Claros Mortgage Trust, Inc. has successfully closed a $500 million secured term loan credit facility, indicating strong financial backing and strategic funding for future operations [1] Group 1: Loan Details - The term loan credit facility is secured and has a duration of four years [1] - It features an annual variable interest rate of SOFR plus 675 basis points [1] - The loan may be prepaid at any time, subject to certain conditions [1] Group 2: Use of Proceeds - Net proceeds from the loan closing, along with cash on hand, were utilized for unspecified purposes [1]