Rithm Property Trust Reports $92.2 Million Net Loss for Fiscal Year 2024

Rithm Property Trust Inc., formerly known as Great Ajax Corp., reported a net loss attributable to common stockholders of $92.2 million for the fiscal year ending December 31, 2024, compared to a loss of $49.3 million in the previous year. The company's total revenue for 2024 was a net loss of $55.5 million, significantly down from a loss of $17.1 million in 2023. The decline in financial performance was primarily driven by a substantial mark-to-market loss of $54.5 million on mortgage loans held for sale, alongside a decrease in interest income, which fell to $52.9 million from $72.3 million in the prior year.

The company underwent significant strategic changes during the year, including a shift in its investment focus from residential mortgage loans to commercial real estate assets. This transition was formalized through a Strategic Transaction completed on June 11, 2024, which involved the sale of $14 million of common stock to Rithm Capital Corp. at a price of $4.87 per share. Additionally, Rithm became the new external manager of the company, replacing Thetis Asset Management LLC. The company also terminated its management contract with the former manager, resulting in the issuance of approximately 3.2 million shares of common stock and a cash payment of $0.6 million.

Operationally, Rithm Property Trust's total mortgage-related assets decreased to $902.4 million as of December 31, 2024, down from $1.2 billion in 2023. The company reported a significant reduction in its portfolio of mortgage loans held for investment, which fell to $396.1 million from $864.6 million the previous year. The company also reported a decrease in its employee headcount, as it does not maintain direct employees but relies on its external manager for operational functions. As of the end of 2024, the company had 240 common stockholders of record.

Looking ahead, Rithm Property Trust anticipates continued challenges in the commercial real estate market, particularly due to high interest rates and inflationary pressures. The company plans to focus on originating and acquiring loans and securities collateralized by commercial real estate assets, including senior loans and mezzanine loans. The management believes that the strategic shift will create opportunities for attractive risk-adjusted returns, although it acknowledges the potential for ongoing losses from its residential mortgage holdings. The company is committed to maintaining its REIT status, which requires distributing at least 90% of its taxable income to shareholders, and it will continue to evaluate its dividend policy in light of market conditions.