Gabriel Poggi

Gabriel Poggi inquired about TRTX's target leverage ratio for 2026 and sought an update on the company's strategy for its remaining REO assets, especially with anticipated increases in transaction volume.

Answer

CEO Doug Bouquard stated that the target leverage ratio is currently 3.5x-3.75x, aiming for a fully invested position. He also mentioned that while REO sales are not the primary growth lever, 2026 is expected to be an attractive year for selling down the remaining REO portfolio, with further progress anticipated.

Gabriel Poggi asked for clarification on the company's target leverage range for 2026, given the current 3x leverage. He also requested an update on the Real Estate Owned (REO) assets, including their status and the company's strategy for these assets as transaction volumes potentially increase.

Answer

Doug Bouquard, CEO, stated that the company is targeting a leverage range of 3.5x to 3.75x, which would bring them close to fully invested. Regarding REO, Mr. Bouquard mentioned the sale of two office assets last year and indicated that 2026 is expected to be an attractive year for continuing to sell down the remaining REO portfolio, aligning with the priority of getting fully invested.

Gabriel Poggi sought more details on new multifamily loan originations, following previous discussions on industrial, and also asked about the company's perspective on its total leverage, currently at approximately 3.9x.

Answer

President Austin Peña expressed enthusiasm for multifamily opportunities, noting 100% performance in their portfolio, structural undersupply, and its highly liquid nature. CFO Marcin Urbaszek stated that leverage is within target ranges, influenced by non-mark-to-market financing, and is actively managed through corporate debt refinancings and cost reductions, reflecting investment opportunities and market financing availability.

Gabriel Poggi asked about Blackstone Mortgage Trust's new origination activity in multifamily and its outlook on total leverage going forward.

Answer

President Austin Peña expressed strong interest in multifamily, citing 100% performing loans, structural undersupply, and its liquid nature. CFO Marcin Urbaszek stated that BXMT's leverage is within its target range, supported by non-mark-to-market financing and proactive debt management. He emphasized that leverage levels are a function of investment opportunities and market financing, and will be maintained within targets.

Gabriel Poggi asked for KKR's broader perspective on global demand for commercial real estate credit and equity, seeking insights into the KKR machine's view on market sentiment and value creation probability for a longer-term outlook.

Answer

CEO Matt Salem, speaking from KKR's perspective, indicated increased allocation to both real estate credit and equity, with sentiment shifting due to real estate's relative stagnation over the past five years. He noted that most equity allocation is in opportunistic and value-add sectors, with early signs of core-plus money returning. Salem observed increasing velocity in the market, with more acquisitions and capital recycling. For real estate credit, he highlighted increased allocations, driven by a tangible relative value discussion and diversification away from corporate credit, expecting continued growth in private funds for this space.

Gabriel Poggi from Raymond James Financial, Inc. asked about the broader KKR perspective on global demand for domestic commercial real estate, both on the credit and equity sides, to understand potential value creation probabilities over a longer term.

Answer

President and COO Patrick Mattson, speaking from the KKR perspective, reported increased allocation to both real estate credit and equity, noting a shift in sentiment. He observed equity demand primarily in opportunistic and value-add sectors, with increasing market velocity and acquisitions. For real estate credit, he highlighted sustained growth in allocations, driven by relative value discussions and diversification away from corporate credit, with significant capital raising by private funds expected to continue.