KKR Real Estate Finance Trust Inc. (KREF) reported a net loss attributable to common stockholders of $69.9 million, or ($1.05) per diluted share, for the year ended December 31, 2025. This compares to a net income of $13.1 million, or $0.19 per diluted share, for the year ended December 31, 2024. The company's distributable earnings for 2025 were $26.3 million, or $0.39 per diluted share. KREF declared dividends of $1.00 per share of common stock for both 2025 and 2024.
The company's financial performance was impacted by several factors. Interest income decreased to $435.6 million in 2025 from $564.6 million in 2024, a 23% decline. Interest expense also decreased, falling to $323.0 million from $412.9 million, a 22% decrease. The provision for credit losses, net, increased significantly to $119.4 million in 2025 from $80.6 million in 2024. KREF also took title to multifamily properties in West Hollywood, CA and Raleigh, NC through deed-in-lieu of foreclosures, resulting in net realized losses of $34.8 million.
Operationally, KREF originated and funded $1.1 billion in new floating-rate loans during 2025, including two European loans, with a weighted average loan-to-value (LTV) of 68% and a coupon of 2.8% over the applicable benchmark. Loan repayments totaled $1.5 billion for the year. As of December 31, 2025, the company's investment portfolio totaled $5.9 billion, with a weighted average unlevered all-in yield of 7.3%. The company also sold certain real estate owned assets, including a parking garage in Philadelphia, PA and a retail/redevelopment parcel in Portland, OR, for a combined gain of $1.2 million.
KREF actively managed its financing arrangements during the year. The company refinanced and upsized its secured term loan from $339.5 million to $650.0 million, reducing the spread from S+3.50% to S+2.50% and extending the maturity to March 2032. The borrowing capacity of the corporate revolving credit facility was increased by $90.0 million to $700.0 million, with the maturity date extended to 2030. KREF also entered into three term lending agreements totaling $650.0 million and a new £300.0 million term credit agreement to finance European originations. As a result, non-mark-to-market financing represented 74% of KREF's secured financing as of December 31, 2025, totaling $3.5 billion. The company's total leverage ratio was 3.9-to-1 as of December 31, 2025. KREF also repurchased 4,629,824 shares at an average price per share of $9.35 for a total of $43.3 million.
About KKR Real Estate Finance Trust Inc.
KKR Real Estate Finance Trust Inc. is a real estate finance company specializing in originating and acquiring transitional senior loans secured by institutional-quality commercial real estate in top markets. It also invests in mezzanine loans, preferred equity, and real estate securities. Managed by an affiliate of KKR, the company focuses on debt-oriented investments, leveraging global relationships and capital markets expertise to generate attractive risk-adjusted returns primarily through dividends.
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