Financial Data and Key Metrics Changes - The company reported distributable earnings of $0.34 per share, exceeding the high end of the guidance range [6][18] - A quarterly dividend of $0.35 per share was declared and paid [6][18] - The weighted average risk rating improved to 2.9 from 3.1 in the previous quarter [6][18] - Total debt to equity remained at 1.6 times, with a cash balance of approximately $42 million [19] Business Line Data and Key Metrics Changes - The loan portfolio totaled $691 million in commitments, with 23 first mortgage loans and a weighted average yield of 8.5% [7] - Office exposure decreased to 25% of the portfolio from 27% at year-end [8] - The company closed two new student housing loans totaling approximately $50 million during the quarter [7] Market Data and Key Metrics Changes - The company noted a robust pipeline with increased requests for new acquisitions, indicating improved market conditions [13] - There was a shift in market sentiment with signs of spreads widening due to tariff-related headlines and uncertainties surrounding the Fed's rate path [14] Company Strategy and Development Direction - The company is focused on reducing exposure to office loans while increasing investments in multifamily, student housing, industrial, and necessity-based retail sectors [8] - The management emphasized a disciplined credit selection approach and maintaining strong sponsor relationships to navigate market volatility [11][17] Management's Comments on Operating Environment and Future Outlook - Management acknowledged that a lower rate environment could pressure earnings, particularly as older loans with higher margins are expected to be repaid [20] - The company remains confident in its portfolio's quality and the ability to capitalize on new opportunities despite a cautious outlook [11] Other Important Information - The company has a modest CECL reserve of 130 basis points of total loan commitments, down from 140 basis points [18] - New slides were added to the earnings presentation to illustrate earnings trends and net interest rate spreads [21] Q&A Session Summary Question: Discussions with lenders and market sentiment - Management reported supportive conversations with lenders, maintaining steady borrowing costs despite widening market spreads [24][25] Question: Underwriting approach and credit standards - Management confirmed no modifications to their underwriting approach, emphasizing the importance of maintaining credit standards [27] Question: Credit performance and portfolio growth expectations - Management highlighted strong credit performance due to diligent underwriting and sponsorship, with a robust pipeline for new loans [32][34] Question: Updates on specific loans and maturities - Management provided updates on loan extensions and anticipated repayments, indicating a proactive approach to managing the portfolio [42][45] Question: Dividend evaluation timing - The Board of Trustees evaluates the dividend each quarter, considering overall performance and market conditions [48]