ACRES Commercial Realty Corp. reported a net income of $4.3 million for the three months ended June 30, 2025, a decrease from $6.4 million in the same period last year. For the first half of 2025, the company recorded a net income of $3.6 million, down from $11.3 million in the prior year. The decline in profitability was attributed to a significant drop in interest income from commercial real estate (CRE) loans, which fell to $28.5 million from $40.3 million year-over-year. Total revenues for the second quarter increased slightly to $21.9 million, compared to $20.9 million in the previous year, primarily due to a rise in real estate income.
The company’s total assets decreased to $1.8 billion as of June 30, 2025, down from $1.9 billion at the end of 2024. This decline was largely driven by a reduction in net CRE loans, which fell to $1.4 billion from $1.5 billion. The allowance for credit losses also decreased to $30.4 million, reflecting improvements in the credit quality of the loan portfolio. The company reported a reversal of expected credit losses of $2.5 million during the first half of 2025, indicating a positive shift in the risk profile of its loans.
In terms of strategic developments, ACRES Commercial Realty Corp. originated a new $72 million CRE floating-rate whole loan and a $15 million mezzanine loan during the first half of 2025. The company also executed a master repurchase agreement with JPMorgan Chase Bank to finance existing CRE loans and new originations, which has a maximum facility amount of $939.9 million. The company’s financing arrangements included a total of $1.3 billion in borrowings, with a leverage ratio of 3.0 times equity, consistent with the previous period.
Operationally, the company’s portfolio remains concentrated in multifamily properties, which accounted for 75% of its total loan portfolio as of June 30, 2025. The company continues to manage its liquidity actively, holding $42.7 million in cash and cash equivalents. Looking ahead, ACRES Commercial Realty Corp. aims to leverage its net operating loss carryforwards of $32.1 million to enhance its investable base and selectively deploy capital into new loan originations, while navigating the challenges posed by current market conditions, including rising interest rates and economic uncertainties.
About ACRES Commercial Realty Corp.
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