Release Date: August 01, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Q: How does the capital raising with the perpetual Series B align with the funding of life sciences investments, and what is the plan for redeploying capital from large repayments? A: Matthew Mcgraner, Executive Vice President and Chief Investment Officer, explained that the capital raising through Series B is aligning well with the life sciences investment funding, with approximately $15 million raised monthly matching the drawdowns. The company is also reviewing capital market options to re-lever the balance sheet and match new investments with opportunities, while the Series B helps in redeploying capital efficiently.
Q: Can you discuss the shift in the portfolio strategy and where you see the most attractive risk-adjusted returns? A: Matthew Mcgraner noted a strategic shift towards the life sciences sector due to a retrenchment of lenders and growth opportunities. The company is capitalizing on financing market inefficiencies, particularly in life sciences, where they can fund projects at favorable terms. In multifamily, liquidity is high, and spreads have narrowed, indicating a focus on sectors with less competition.
Q: What are you observing in terms of multifamily deal flow and agency behavior? A: Matthew Mcgraner highlighted that multifamily deal flow remains muted due to negative leverage and high cap rates. Agencies are not being overly conservative but are limited by the lack of product. Paul Richards added that new originations are more focused on shorter-term fixed rates, and treasury rate movements could influence future deal flow.
Q: How does the NXRT refinancing impact the weighted average cost of capital, and what are the expectations for rate moderation? A: Matthew Mcgraner explained that the NXRT refinancing is accretive due to existing swaps, keeping borrowing costs low. The flexibility of floating rates allows for strategic refinancing without penalties. The agencies are working closely with select sponsors to provide tailored solutions.
Q: Is there an update on the book value per share post-quarter, and how does it compare with quarter-end values? A: Matthew Mcgraner mentioned a recent uptick in book value due to treasury rate movements and mark-to-market improvements in CMBS. Additionally, the storage portfolio is expected to accrete value with upcoming refinancing, contributing to a positive outlook for book value.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
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