Arbor Realty announces $1.1B in Q1 agency loans

The company states: "This unprecedented environment has caused significant disruption and liquidity constraints in many market segments, including the financial services, real estate and credit markets. Many commercial mortgage REITs have suffered from reduced available liquidity and significant margin calls on assets and securities that are financed through short-term repurchase facilities. We have always run our business with a heavy focus on the right side of our balance sheet, particularly in financing a large portion of our loans through non-recourse, non-mark-to-market long-dated CLO vehicles, as well as longer term unsecured debt facilities. That commitment to maintaining a strong balance sheet and careful capital management allows me to report that we currently have approximately $350 million in cash and available liquidity. Our balance sheet portfolio is approximately $4.8 billion as of March 31, 2020 with $3.4 billion of debt financing those assets. Approximately $2.6 billion, or 76% of that debt, is in non-recourse CLOs and approximately $800 million is financed through warehouse and repurchase facilities with eight different banks that we have long standing relationships with. Additionally, the majority of the loans being financed in these bank lines are also rated and CLO eligible... We have created a fully integrated diversified operating platform. As a result, we have been very active in providing liquidity to the multifamily market through our sizable agency business. We originated $1.1 billion in agency loans in the first quarter, which is up from $850 million in originations for the first quarter of 2019, and our agency pipeline is up to $1.6 billion compared to $1.2 billion at the same time last year. In this unprecedented environment, our agency platform offers a premium value as it requires limited capital and generates significant, long-dated, predictable income streams. Just as importantly, it allows us to retain our staff and generates significant annual cash flow. Our $20 billion agency servicing portfolio, which is mostly prepayment protected, generates approximately $90 million a year in recurring cash flow, in addition to the strong gain on sale margins we generate from our deep agency origination platform. In our agency business, we have seen positive trends related to April payments with approximately 2% of our portfolio requesting forbearance. With respect to our outlook for May and June payments, we do think there will be some economic stress, although we also think it will be largely mitigated or offset by enhanced unemployment insurance and other economic stimulus programs the government is offering, including the Paycheck Protection Program, which will assist our borrowers with their payroll costs. In addition, the average debt service coverage ratio in our agency portfolio, based mostly on year-end 2019 financial data, is approximately 1.65, which means that borrowers could withstand, on average, a 20% economic vacancy due to the effects of the virus, before it impairs their ability to meet their debt service."