Bridge Investment (US:BRDG)2024-05-11 10:23Financial Data and Key Metrics Changes - The company reported a GAAP net loss of approximately $36.8 million for Q1 2024, with distributable earnings increasing by 27% from the previous quarter [3][4] - Fee-related earnings to the Operating Company increased by 19% from the previous quarter, reaching $33.9 million, while distributable earnings were $32.2 million, up 22% from the last quarter [47][48] - Recurring fund management fees increased by 17% year-over-year and 11% from the previous quarter [20] Business Line Data and Key Metrics Changes - Fee-earning AUM grew at a 29% compound annual growth rate, driven by successful fundraising and the acquisition of Newbury Partners [9] - The company launched a new accredited investor-focused product within its net lease industrial income vertical in Q1 [13] - The Multifamily segment reported unlevered underwritten IRRs that are 30% better than pre-pandemic levels [16] Market Data and Key Metrics Changes - Year-to-date CMBS issuance is nearly triple the volume compared to the same point last year, indicating a more active debt capital market [41] - The company has over $100 billion in dry powder across U.S. value-add and opportunistic equity funds, with expectations for markets to open up quickly [15] - The overall transaction volumes in the commercial real estate market remained muted, but signs of a strengthening environment are emerging [14] Company Strategy and Development Direction - The company is optimistic about its positioning and is raising capital globally while investing in selective, high-performing sectors of alternative assets [11] - The 2024 outlook emphasizes investing in areas where the company has developed distinctive competencies, particularly in real estate [10] - The company is focused on enhancing operating efficiencies and driving lower costs for its limited partners [11] Management's Comments on Operating Environment and Future Outlook - Management believes that 2024 represents an attractive entry point to deploy capital into specialized strategies, with a focus on Multifamily and Logistics [37][42] - The company anticipates that the cost of capital and commercial real estate has peaked, with expectations for a rebound in transaction volumes as the Fed signals rate cuts [41] - Management expressed confidence in the operational trends of its property portfolios, which have exceeded NOI projections by 9.6% [43] Other Important Information - The company has logged over 1,000 meetings and calls with current and prospective investors in Q1, indicating strong engagement in capital raising efforts [12] - The balance sheet remains resilient, with net accrued performance revenues on the balance sheet standing at $320.3 million [22] Q&A Session Summary Question: Can you elaborate on the new product in the wealth channel? - The new product is a different structure aimed at building on the success in the wealth channel, offering another investment alternative for wealth partners [26] Question: How do you size the opportunities across each vertical? - The value of existing assets has improved significantly, inciting interest across various strategies, with hopes for tangible capital commitments [29] Question: What is changing to drive value beyond waiting for a better macro backdrop? - The company is focused on maximizing value in investment vehicles and has started to lean into markets due to attractive resets in valuation [59] Question: Can you elaborate on access to financing markets? - The company believes that markets are poised to be more active, with a tightening of spreads and a significant amount of dry powder ready to enter the market [63] Question: What trends are seen in the Multifamily marketplace? - The company is focused on operational strengths to maintain competitiveness, with rent growth needed across the market [86]