NEW YORK–(BUSINESS WIRING) – BrightSpire Capital, Inc. (NYSE: BRSP) (“BrightSpire Capital” or “The Company”), formerly Colony Credit Real Estate, Inc. (NYSE: CLNC), one of the largest publicly traded commercial real estate companies. (CRE) credit card companies REIT, today announced that they have reached an agreement to sell most of their historic development and / or non-accrual assets to Fortress Investment Group LLC (“Fortress”), a leading diversified global investment manager, for gross revenues of US $ 223 million (“Sale of a co-investment portfolio”). Revenue is largely in line with the Company’s gross GAAP and the undervalued carrying amount of the underlying assets as at 31 March 2021.
The sale of a co-investment portfolio permits 5 (of 6) inherited co-investment assets held jointly with Colony Capital, Inc. (now known as DigitalBridge Group, Inc. (NYSE: DBRG)). On June 7, 2021, Colony Capital announced the sale of its portfolio with Fortress, which included its joint venture stake in those five core investments. The sale of the co-investment portfolio is driven by the deal between Colony Capital and Fortress and will close at the same time, which is expected in the fourth quarter of 2021 and will result in Fortress gaining 100% control and ownership of such investments.
The sale of a co-investment portfolio contributes to the achievement of the main objectives of the company, including:
- Withdrawal from several assets with historical development and / or assets not accrued for accrual – The sale of the co-investment portfolio includes (i) four co-investments eligible for 5 Investment Preferred Financing, which includes development loans in Dublin, Ireland and two other mixed-use and single-family development loans in the United States, and (ii) the residual equity interest of the Austin, Texas hotel loan (Loan 64 in the Company Loans Table), each of which is detailed in the Company’s report for the quarter ended March 31, 2021;
- Simplify your portfolio – Reduces the likelihood of major development investments, including two in markets outside the United States;
- Preservation of book value – $ 223 million in gross revenues, settlement largely in line with GAAP total assets as of March 31, 2021; as well as
- Reduce leverage – Proceeds from the sale of a co-investment portfolio, earmarked to disburse the “5 Investment Preferred Funding”, COVID-19 related funding secured in June 2020 for balance sheet protection purposes.
“We look forward to continuing to work with the Fortress team to complete this transaction, which is another step towards simplifying our business by rebalancing our portfolio and reducing the impact of certain investment profiles that are no longer central to our strategy. We remain focused on delivering ongoing and predictable earnings primarily by raising senior mortgages, ”said Andy Witt, chief operating officer of BrightSpire Capital.
“This is another clear win-win deal following our June agreement to become the general partner and manager of a range of CDCF Colony Capital funds. We are thrilled to acquire these assets, which combine perfectly with our expertise in managing complexity across a wide range of asset classes and geographic regions, and provide BrightSpire Capital with a “one stop solution” to accelerate the achievement of their strategic goals. ” said Fortress managing director Noah Shore.
The sale of a co-investment portfolio is subject to certain adjustments to the purchase price (including for contributions, distributions and currency adjustments during the exercise period), normal closing conditions and third party consent.
About BrightSpire Capital, Inc.
BrightSpire Capital, Inc. (NYSE: BRSP), formerly Colony Credit Real Estate, Inc. (NYSE: CLNY), is one of the largest publicly traded REITs for commercial real estate (CRE), focused on creating, acquiring, financing and managing a diversified portfolio consisting primarily of CRE debt and net leased real estate, predominantly in the United States. CRE’s debt investments mainly consist of the first mortgage loans, which we expect will be the main investment strategy. BrightSpire Capital is organized as a Maryland corporation and is taxed as a REIT for US federal income tax purposes. For more information about the Company, its management and business, please refer to www.brightspire.com…
Forward-looking statements warning
This press release may contain forward-looking statements in accordance with federal securities laws. Forward-looking statements refer to expectations, beliefs, projections, plans and strategies for the future, expected events or trends, and similar statements regarding matters that are not historical facts. In some cases, you may identify forward-looking statements using forward-looking terminology such as may, will, should, expects, intends, plans, expects, believes, estimates , “Predicts” or “potentially” or denies these words and phrases or similar words or phrases that are predictions or indicate future events or trends and that do not relate exclusively to historical issues. Forward-looking statements involve known and unknown risks, uncertainties, assumptions and unforeseen circumstances, many of which are beyond our control, and could cause actual results to differ materially from those expressed in any forward-looking statements. Factors that could cause actual results to differ materially from BrightSpire Capital’s expectations include, without limitation, that the conditions for the completion of the sale of the co-investment portfolio may not be met or the approvals required for the transaction may not be obtained at the latest. expected timeline, expected schedule or in general; the effect of timing, other conditions or adjustments on the ability to maintain carrying amount; the timing or ability of the Company to pay priority financing for 5 investments after the sale of the portfolio of co-investments and the net impact on the Company’s carrying amount of such events (including the extent of the purchase price adjustment); the ability to simplify the portfolio and / or achieve efficiency gains and achieve the expected strategic and financial benefits from internalization; and uncertainty about the ongoing impact of the novel coronavirus (COVID-19). The above list of factors is not exhaustive. Additional information on these and other factors can be found in Part I, Clause 1A of the Company’s 10-K Annual Report for the fiscal year ended December 31, 2020, as well as other BrightSpire Capital documents to the United States Securities Fund. Commission. Moreover, each of the factors mentioned above is likely to also be directly or indirectly affected by the continued exposure to COVID-19, and investors are encouraged to interpret virtually all such statements and risks as being heightened by the continued exposure to the coronavirus. COVID-19. More information about these and other factors can be found in BrightSpire Capital’s reports, which are filed with the Securities and Exchange Commission from time to time.
BrightSpire Capital warns its investors not to rely unduly on any forward-looking statements. Forward-looking statements are valid only as of the date of this press release. BrightSpire Capital is under no obligation to update any of these forward-looking statements after the date of this press release or to reconcile prior statements with actual results or revised expectations, and BrightSpire Capital has no intention of doing so.