What changed in this filing

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Item 1. Financial Statements

2021-08-09 compared with 2021-05-10 · 733 added, 759 removed, 1038 unchanged (59% of the section changed)

Financial Statements.

COLONY CAPITAL, INC.

DigitalBridge Group, Inc.

Consolidated Balance Sheets

(In thousands, except per share data)

March 31, 2021 (Unaudited)

June 30, 2021 (Unaudited)

December 31, 2020

6 unchanged sentences

Loans receivable (at fair value) 52,791 36,798

Equity and debt investments ($ 225,845 and $ 298,568 at fair value, respectively)

Equity investments ($ 177,595 and $ 247,025 at fair value)

820,307 792,996

2 unchanged sentences

1,230,625 1,340,760

Assets held for disposition ($ 3,329,199 and $ 6,652,743 held for sale, respectively)

4,094,657 7,426,268

Other assets ($ 4,280 and $ 99 at fair value, respectively)

Assets held for disposition 6,691,392 11,237,319

Other assets ($ 87 and $ 99 at fair value)

736,624 784,912

3 unchanged sentences

$ 3,877,664 $ 3,930,989

Accrued and other liabilities ($ 38,155 and $ 128,057 at fair value, respectively)

Accrued and other liabilities ($ 1,291 and $ 128,057 at fair value)

854,339 1,034,282

37 unchanged sentences

The accompanying notes are an integral part of the consolidated financial statements.

COLONY CAPITAL, INC.

DigitalBridge Group, Inc.

Consolidated Statements of Operations

(In thousands, except per share data)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2021 2020 2021 2020

Property operating income $ 188,985 $ 42,017 $ 377,987 $ 87,166

Interest income

Fee income ($ 33,679 and $ 25,128 from affiliates, respectively)

1,319 2,102 2,173 3,906

Other income ($ 1,490 and $ 4,182 from affiliates, respectively)

Fee income (from affiliates) 45,157 20,173 74,600 39,251

Other income ($ 908 , $ 2,822 , $ 1,427 and $ 6,053 from affiliates)

1,726 3,581 3,008 7,700

Total revenues

4 unchanged sentences

37,938 20,852 77,718 39,936

Investment and servicing expense

Investment expense 5,871 2,010 12,764 4,739

Transaction-related costs 64 89 1,682 681

5 unchanged sentences

48,199 44,628 126,985 82,684

Compensation expense—carried interest and incentive fee

Compensation expense—incentive fee and carried interest 8,266 — 8,233 —

Administrative expenses

3 unchanged sentences

344,212 147,458 708,339 295,789

Other loss, net ( 8,714 ) ( 9,703 )

Equity method losses ( 18,686 ) ( 11,879 )

Equity method losses—carried interest ( 222 ) —

Other income (loss)

Other gain (loss), net ( 27,041 ) 1,254 ( 36,391 ) ( 1,971 )

Equity method earnings (losses) 51,481 ( 316,516 ) 35,064 ( 326,864 )

Equity method earnings—carried interest 11,169 — 10,947 —

Loss from continuing operations before income taxes

1 unchanged sentence

Income tax benefit 75,239 1,650 98,435 6,883

Loss from continuing operations

( 190,177 ) ( 154,199 )

Income (loss) from continuing operations 3,823 ( 393,197 ) ( 142,516 ) ( 479,718 )

Loss from discontinued operations ( 98,906 ) ( 2,325,796 ) ( 580,166 ) ( 2,643,332 )

7 unchanged sentences

( 14,980 ) ( 225,057 ) ( 42,876 ) ( 264,658 )

Net loss attributable to Colony Capital, Inc.

Net loss attributable to DigitalBridge Group, Inc.

( 122,744 ) ( 2,024,274 ) ( 369,034 ) ( 2,366,433 )

13 unchanged sentences

Dividends declared per common share

$ — $ — $ — $ 0.11

The accompanying notes are an integral part of the consolidated financial statements.

COLONY CAPITAL, INC.

DigitalBridge Group, Inc.

Consolidated Statements of Comprehensive Income (Loss)

(In thousands)

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2021 2020 2021 2020

Net loss $ ( 95,083 ) $ ( 2,718,993 ) $ ( 722,682 ) $ ( 3,123,050 )

7 unchanged sentences

Net investment hedges

Other comprehensive loss ( 60,232 ) ( 63,713 )

( 4,202 ) ( 193 ) ( 84 ) 21,415

Other comprehensive income (loss) ( 19,503 ) 52,841 ( 79,735 ) ( 10,872 )

Comprehensive loss ( 114,586 ) ( 2,666,152 ) ( 802,417 ) ( 3,133,922 )

5 unchanged sentences

The accompanying notes are an integral part of the consolidated financial statements.

COLONY CAPITAL, INC.

DigitalBridge Group, Inc.

Consolidated Statements of Equity

8 unchanged sentences

— ( 127 ) ( 24,622 ) — — ( 24,749 ) — — ( 24,749 )

Equity-based compensation

— 76 12,114 — — 12,190 — 584 12,774

Shares canceled for tax withholdings on vested stock awards

— ( 18 ) ( 5,051 ) — — ( 5,069 ) — — ( 5,069 )

Equity awards issued, net of forfeitures — 76 12,114 — — 12,190 — 584 12,774

Shares canceled for tax withholdings on vested equity awards — ( 18 ) ( 5,051 ) — — ( 5,069 ) — — ( 5,069 )

Contributions from noncontrolling interests

9 unchanged sentences

Balance at March 31, 2020 999,490 4,809 7,532,213 ( 3,806,308 ) 16,222 4,746,426 3,233,910 411,380 8,391,716

— — — ( 2,024,274 ) — ( 2,024,274 ) ( 470,052 ) ( 225,057 ) ( 2,719,383 )

Other comprehensive income

— — — — 28,133 28,133 21,609 3,099 52,841

Redemption of OP Units for class A common stock

— 2 1,421 — — 1,423 — ( 1,423 ) —

Equity awards issued, net of forfeitures — 16 8,946 — — 8,962 296 584 9,842

Shares canceled for tax withholdings on vested equity awards — ( 6 ) ( 1,151 ) — — ( 1,157 ) — — ( 1,157 )

Contributions from noncontrolling interests

— — — — — — 112,721 — 112,721

Distributions to noncontrolling interests

— — — — — — ( 123,495 ) — ( 123,495 )

Preferred stock dividends

— — — ( 18,516 ) — ( 18,516 ) — — ( 18,516 )

Reallocation of equity (Notes 2 and 10)

— — ( 1,232 ) — 12 ( 1,220 ) 1,615 ( 395 ) —

Balance at June 30, 2020 $ 999,490 $ 4,821 $ 7,540,197 $ ( 5,849,098 ) $ 44,367 $ 2,739,777 $ 2,776,604 $ 188,188 $ 5,704,569

The accompanying notes are an integral part of the consolidated financial statements.

COLONY CAPITAL, INC.

DigitalBridge Group, Inc.

Consolidated Statements of Equity (Continued)

7 unchanged sentences

Redemption of OP Units for class A common stock — — 16 — — 16 — ( 16 ) —

Equity-based compensation — 48 16,536 — — 16,584 308 1,308 18,200

Shares canceled for tax withholdings on vested stock awards

— ( 11 ) ( 7,707 ) — — ( 7,718 ) — — ( 7,718 )

Equity awards issued, net of forfeitures — 48 16,536 — — 16,584 308 1,308 18,200

Shares canceled for tax withholdings on vested equity awards — ( 11 ) ( 7,707 ) — — ( 7,718 ) — — ( 7,718 )

Contributions from noncontrolling interests — — — — — — 113,213 — 113,213

4 unchanged sentences

Balance at March 31, 2021 999,490 4,878 7,576,873 ( 6,460,262 ) 101,056 2,222,035 4,003,905 124,397 6,350,337

Net loss — — — ( 122,744 ) — ( 122,744 ) 36,616 ( 14,980 ) ( 101,108 )

Other comprehensive income — — — — ( 15,818 ) ( 15,818 ) 7,805 ( 1,625 ) ( 9,638 )

Shares issued pursuant to settlement liability (Note 13)

— 60 46,982 — — 47,042 — — 47,042

Deconsolidation of investment entities (Note 21)

— — 2,028 — ( 1,482 ) 546 ( 202,887 ) — ( 202,341 )

Redemption of OP Units for class A common stock

— — 1 — — 1 — ( 1 ) —

Equity awards issued, net of forfeitures — 2 10,194 — — 10,196 308 1,067 11,571

Shares canceled for tax withholdings on vested equity awards — ( 13 ) ( 9,166 ) — — ( 9,179 ) — — ( 9,179 )

Contributions from noncontrolling interests — — — — — — 24,540 — 24,540

Distributions to noncontrolling interests — — — — — — ( 33,678 ) — ( 33,678 )

Preferred stock dividends — — — ( 18,516 ) — ( 18,516 ) — — ( 18,516 )

Reallocation of equity (Notes 2 and 10)

— — ( 4,530 ) — ( 81 ) ( 4,611 ) — 4,611 —

Balance at June 30, 2021 $ 999,490 $ 4,927 $ 7,622,382 $ ( 6,601,522 ) $ 83,675 $ 2,108,952 $ 3,836,609 $ 113,469 $ 6,059,030

The accompanying notes are an integral part of the consolidated financial statements.

COLONY CAPITAL, INC.

DigitalBridge Group, Inc.

Consolidated Statements of Cash Flows

(In thousands)

Three Months Ended March 31,

Six Months Ended June 30,

Cash Flows from Operating Activities

7 unchanged sentences

Amortization of deferred financing costs and debt discount and premium, net 51,371 25,627

Equity method losses (gains) 111,519 ( 97,291 )

Equity method losses 18,248 277,732

Distributions of income from equity method investments

5 unchanged sentences

Equity-based compensation

30,961 18,671

Unrealized settlement loss — 3,890

Gain on sales of real estate, net ( 48,718 ) ( 3,013 )

Settlement of forward starting interest rate swap — ( 6,641 )

Deferred income tax benefit ( 34,480 ) ( 9,138 )

Payment of cash collateral on derivative — ( 2,771 )

Deferred income tax (benefit) expense ( 85,458 ) 577

Other loss, net 202,573 182,711

Decrease (increase) in other assets and due from affiliates

( 31,721 ) ( 6,406 )

(Increase) decrease in other assets and due from affiliates ( 57,321 ) 11,381

Increase (decrease) in accrued and other liabilities and due to affiliates ( 20,692 ) ( 54,187 )

1 unchanged sentence

( 3,076 ) ( 3,514 )

Net cash provided by (used in) operating activities ( 23,937 ) ( 59,669 )

Net cash provided by operating activities 104,896 42,312

Cash Flows from Investing Activities

2 unchanged sentences

Return of capital from equity method investments

15,033 122,112

Acquisition of loans receivable and debt securities

2 unchanged sentences

Repayments of loans receivable

363,686 57,991

Acquisition of and additions to real estate, related intangibles and leasing commissions ( 156,944 ) ( 131,967 )

3 unchanged sentences

Investment deposits

( 343 ) ( 6,627 )

Proceeds from sale of non-real estate fixed assets 14,946 —

Net receipts on settlement of derivatives 17,123 27,097

Acquisition of DBH, net of cash acquired, and payment of deferred purchase price (Note 3 )

Other investing activities, net

Net cash (used in) provided by investing activities ( 7,901 ) 166,921

COLONY CAPITAL, INC.

Net cash provided by investing activities 408,596 114,565

DigitalBridge Group, Inc.

Consolidated Statements of Cash Flows (Continued)

(In thousands)

Three Months Ended March 31,

Six Months Ended June 30,

Cash Flows from Financing Activities

2 unchanged sentences

Repurchase of common stock — ( 24,749 )

Repayment of convertible senior notes ( 31,502 ) —

Repayment of senior notes ( 31,502 ) —

Borrowings from corporate credit facility 45,000 600,000

Repayment of borrowings from corporate credit facility — ( 200,000 )

Borrowings from secured debt 698,135 8,922

4 unchanged sentences

Redemption of preferred stock — ( 402,855 )

Shares canceled for tax withholdings on vested stock awards ( 7,718 ) ( 5,069 )

Net cash provided by financing activities 99,171 4,882

Shares canceled for tax withholdings on vested equity awards ( 16,897 ) ( 6,226 )

Net cash used in financing activities ( 308,682 ) ( 329,490 )

Effect of exchange rates on cash, cash equivalents and restricted cash 6,305 ( 2,468 )

Net increase in cash, cash equivalents and restricted cash 71,383 108,484

Net increase (decrease) in cash, cash equivalents and restricted cash 211,115 ( 175,081 )

Cash, cash equivalents and restricted cash, beginning of period 963,008 1,424,698

1 unchanged sentence

Reconciliation of cash, cash equivalents and restricted cash to consolidated balance sheets

Three Months Ended March 31,

Six Months Ended June 30,

Beginning of the period

9 unchanged sentences

The accompanying notes are an integral part of the consolidated financial statements.

COLONY CAPITAL, INC.

DigitalBridge Group, Inc.

Notes to Consolidated Financial Statements

March 31, 2021

Colony Capital, Inc.

(together with its consolidated subsidiaries, the "Company") is a leading global investment firm with a focus on identifying and capitalizing on key secular trends in digital real estate.

June 30, 2021

Business and Organization

DigitalBridge Group, Inc.

or DBRG (together with its consolidated subsidiaries, the "Company") is a leading global investment firm with a focus on identifying and capitalizing on key secular trends in digital infrastructure.

The Company is currently the only global real estate investment trust ("REIT") that owns, manages, and/or operates across all major infrastructure components of the digital ecosystem including data centers, cell towers, fiber networks and small cells .

At March 31, 2021, the Company has $ 46 billion of total assets under management, including both third party capital and the Company's balance sheet, and $ 18 billion of fee earning equity under management.

The Company conducts all of its activities and holds substantially all of its assets and liabilities through its operating subsidiary, Colony Capital Operating Company, LLC (the "Operating Company" or the "OP") .

At March 31, 2021, the Company owned 90 % of the OP , as its sole managing member.

Effective June 22, 2021, the Company changed its name to DigitalBridge Group, Inc.

(formerly Colony Capital, Inc.) and trades under the ticker symbol, DBRG, signifying the Company's transformation to digital infrastructure.

At June 30, 2021, the Company has $ 48 billion of total assets under management, including both third party capital and the Company's balance sheet, and $ 20 billion of fee earning equity under management.

The Company conducts all of its activities and holds substantially all of its assets and liabilities through its operating subsidiary, DigitalBridge Operating Company, LLC (the "Operating Company" or the "OP") .

At June 30, 2021, the Company owned 90.5 % of the OP , as its sole managing member.

The remaining 9.5 % is owned primarily by certain current and former employees of the Company as noncontrolling interests.

4 unchanged sentences

Accordingly, in the second quarter of 2020, the Company determined to accelerate its previously announced shift to a digitally-focused strategy in order to better position the Company for growth, which requires a rotation of the Company's traditional non-digital assets into digital-focused investments.

During the first quarter of 2021, the Company successfully exited its hotel business, and continues its process of actively monetizing a substantial majority of its other equity and debt ("OED") investments and its non-digital investment management ("Other IM") business, both of which reside in the Other segment.

The disposition of the Company’s hotel business and the continued efforts to monetize the Company’s OED investments and Other IM business represent strategic shifts in the Company's business that are expected to have a significant effect on the Company’s operations and financial results, and accordingly, have met the criteria as discontinued operations.

In 2021, having successfully exited its hotel business, the Company is continuing the process of monetizing the remainder of its non-digital businesses to complete its digital transformation.

This includes the Company's Wellness Infrastructure segment, and a substantial majority of the Company's other equity and debt ("OED") investments and its non-digital investment management ("Other IM") business, both of which reside in the Other segment.

The completed and pending dispositions of the Company’s hotel business, OED investments and Other IM business, and Wellness Infrastructure segment represent strategic shifts in the Company's business that are expected to have a significant effect on the Company’s operations and financial results, and accordingly, have met the criteria as discontinued operations.

For all current and prior periods presented, the related assets and liabilities, to the extent they have not been disposed at the respective balance sheet dates, are presented as assets and liabilities held for disposition on the consolidated balance sheets (Note 11) and the related operating results are presented as loss from discontinued operations on the consolidated statements of operations (Note 12).

Accelerating the Monetization of OED and Other IM

Having successfully exited its hotel business in the first quarter of 2021, the Company is continuing its efforts to accelerate the monetization of a substantial majority of its OED investments and Other IM business.

These assets consist of non-digital real estate, real estate-related equity and debt investments, and management of the Company's private real estate credit funds and Colony Credit Real Estate, Inc.

In consideration of a potential monetization and consequently, classification of the assets as held for disposition, the Company reassessed the carrying value of these assets based upon estimated recoverable values.

As a result, the Company recognized an aggregate write-down in asset values of $ 420.3 million, of which $ 121.2 million was attributable to the OP, recorded within impairment loss, equity method loss and other loss in discontinued operations (Note 7).

In April 2021, the Company and CLNC agreed to terminate the management agreement for a one-time termination fee of $102.3 million in cash.

The transaction closed on April 30, 2021, resulting in the internalization of CLNC's management and operating functions (the "CLNC Internalization"), with certain employees previously dedicated wholly or substantially to CLNC becoming employees of CLNC.

In connection with the CLNC Internalization, CLNC's board of directors ceased to include Company-affiliated directors on CLNC's board of directors upon expiration of their terms in May 2021.

The Company also entered into a new stockholders agreement, pursuant to which the Company agreed, for so long as the Company owns at least 10% of CLNC's outstanding common shares, to vote in CLNC director elections as recommended by CLNC’s board of directors at any stockholders' meeting that occurs prior to CLNC's 2023 annual

stockholders' meeting.

In addition, the Company is subject to customary standstill restrictions, including an obligation not to initiate or make stockholder proposals, nominate directors or participate in proxy solicitations, until the beginning of the advance notice window for CLNC's 2023 annual meeting.

The Company currently holds a 36.1% equity ownership in CLNC and is prohibited from acquiring additional CLNC shares.

Accelerating the Monetization of Wellness Infrastructure and Other Segments

In the second quarter of 2021, the Company started the process to dispose of its Wellness Infrastructure business along with other non-core assets, all of which are held by its subsidiary, NRF Holdco, LLC ("NRF Holdco").

The Wellness Infrastructure business is composed of senior housing, skilled nursing facilities, medical office buildings, and hospitals.

Other assets and obligations held by NRF Holdco include primarily:

(i) the Company's equity interest in and management of its sponsored non-traded REIT, NorthStar Healthcare Income, Inc.

(NorthStar Healthcare"), debt securities collateralized largely by certain debt and preferred equity within the capital structure of the Wellness Infrastructure portfolio, limited partner interests in private equity real estate funds;

and (ii) the 5.375% exchangeable senior notes, trust preferred securities and corresponding junior subordinated debt, all of which were issued by NRF Holdco who acts as guarantor.

In June 2021, the Company entered into a definitive agreement with a third party to sell a substantial majority of its OED investments and Other IM business, composed of the Company's interests in various non-digital real estate, real estate-related equity and debt investments, and the Company's general partner interests and management rights with respect to these assets.

The aggregate sales price is approximately $535 million, subject to customary adjustments, including adjustments if consents with respect to certain assets cannot be obtained.

Consummation of the sale is subject to customary closing conditions, including regulatory approvals and third party consents, but no financing conditions.

During the six months ended June 30, 2021, taking into consideration the agreed upon sales price and/or estimated recoverable values for the OED, Other IM and Wellness Infrastructure assets that are classified as held for disposition, the Company wrote down the carrying value of these assets by $ 537.8 million in aggregate, of which $ 276.5 million was attributable to the OP, recorded within impairment loss, equity method loss and other loss in discontinued operations, as discussed further in Note 11.

Internalization of BrightSpire Capital, Inc.

In early April 2021, the Company and BRSP (formerly Colony Credit Real Estate, Inc.

or CLNC) agreed to terminate the BRSP management agreement for a one-time termination payment of $102.3 million in cash.

The transaction closed on April 30, 2021, resulting in the internalization of BRSP's management and operating functions (the "BRSP Internalization"), with certain of the Company's employees previously dedicated wholly or substantially to BRSP becoming employees of BRSP.

In connection with the BRSP Internalization, BRSP's board of directors ceased to include Company-affiliated directors upon the expiration of such directors' terms in May 2021.

The Company also entered into a stockholders agreement with BRSP, pursuant to which the Company agreed, for so long as the Company owns at least 10% of BRSP's outstanding common shares, to vote in BRSP director elections as recommended by BRSP’s board of directors at any stockholders' meeting that occurs prior to BRSP's 2023 annual stockholders' meeting.

Except as aforementioned, the Company may vote its shares in its sole discretion in any votes of BRSP’s stockholders.

The Company currently holds a 36.1% equity ownership and is prohibited from acquiring additional BRSP shares.

Exit of the Hotel Business

In March 2021, the Company completed the previously announced exit of its hotel business, which represents a key milestone in the Company’s digital transformation.

In March 2021, the Company completed the sale of its hotel business.

Pursuant to an agreement entered into with a third party in September 2020 (as amended in October 2020, February 2021 and March 2021), the Company sold five of the six hotel portfolios in its Hospitality segment and its 55.6% interest in a portfolio of limited service hotels that was acquired through a consensual foreclosure in July 2017 (the "THL Hotel Portfolio") in its Other segment, composed of 197 hotel properties in aggregate.

The remaining portfolio in the Hospitality segment is in receivership and the remaining interests in the THL Hotel Portfolio will continue to be held by investment vehicles currently managed by the Company.

The remaining portfolio in the Hospitality segment is in receivership and currently under contract for sale by the lender, while the remaining interests in the THL Hotel Portfolio continue to be held by investment vehicles managed by the Company.

Two of the hotel portfolios that were sold in the Hospitality segment were held through joint ventures in which the Company held a 90% and a 97.5% interest, respectively.

11 unchanged sentences

All significant intercompany accounts and transactions have been eliminated.

The portions of equity, net income and other comprehensive income of consolidated subsidiaries that are not attributable to the parent are presented separately as amounts attributable to noncontrolling interests in the consolidated financial statements.

The portions of equity, net income and other comprehensive income of consolidated subsidiaries that are not attributable to the parent are presented

separately as amounts attributable to noncontrolling interests in the consolidated financial statements.

A substantial portion of noncontrolling interests represents interests held by private investment funds or other investment vehicles managed by the Company and which invest alongside the Company, and membership interests in OP primarily held by certain employees of the Company.

7 unchanged sentences

(ii) whose equity holders lack the characteristics of a controlling financial interest;

or (iii) is established with non-substantive voting rights.

and/or (iii) is established with non-substantive voting rights.

A VIE is consolidated by its primary beneficiary, which is defined as the party who has a controlling financial interest in the VIE through (a) power to direct the activities of the VIE that most significantly affect the VIE’s economic performance, and (b) obligation to absorb losses or right to receive benefits of the VIE that could be significant to the VIE.

The Company also considers interests held by its

related parties, including de facto agents.

The Company also considers interests held by its related parties, including de facto agents.

The Company assesses whether it is a member of a related party group that collectively meets the power and benefits criteria and, if so, whether the Company is most closely associated with the VIE.

18 unchanged sentences

Allocation of net income or loss to redeemable noncontrolling interests is based upon their ownership percentage during the period.

The carrying amount of redeemable noncontrolling interests is adjusted to its redemption value at the end of each reporting period to an amount not less than its initial carrying value, except for amounts contingently redeemable which will be adjusted to redemption value only when redemption is probable.

The carrying amount of

redeemable noncontrolling interests is adjusted to its redemption value at the end of each reporting period to an amount not less than its initial carrying value, except for amounts contingently redeemable which will be adjusted to redemption value only when redemption is probable.

Such adjustments will be recognized in additional paid-in capital.

7 unchanged sentences

Definition of a Business —The Company evaluates each purchase transaction to determine whether the acquired assets meet the definition of a business.

If substantially all of the fair value of gross assets acquired is concentrated in a single identifiable asset or a group of similar identifiable assets, then the set of transferred assets and activities is not a

If not, for an acquisition to be considered a business, it would have to include an input and a substantive process that together significantly contribute to the ability to create outputs (i.e., there is a continuation of revenue before and after the transaction).

A substantive process is not ancillary or minor, cannot be replaced without significant costs, effort or delay or is otherwise considered unique or scarce.

To qualify as a business without outputs, the acquired assets would require an organized workforce with the necessary skills, knowledge and experience that performs a substantive process.

To qualify as a business without outputs, the acquired assets would require an organized workforce with the necessary skills, knowledge and experience to perform a substantive process.

Asset Acquisitions —For acquisitions that are not deemed to be businesses, the assets acquired are recognized based on their cost to the Company as the acquirer and no gain or loss is recognized.

11 unchanged sentences

If the disposition of a component, being an operating or reportable segment, business unit, subsidiary or asset group, represents a strategic shift that has or will have a major effect on the Company’s operations and financial results, the operating profits or losses of the component when classified as held for sale, and the gain or loss upon disposition of the component, are presented as discontinued operations in the statements of operations.

A business or asset group acquired in connection with a purchase business combination that meets the criteria to be accounted for as held for sale at the date of acquisition is reported as discontinued operations, regardless of whether it meets the strategic shift criteria.

The accelerated monetization of a substantial majority of the Company’s OED investments and Other IM business in the Other segment that is in progress as of March 2021;

the disposition of the hotel business, composed of the Hospitality segment and the THL Hotel Portfolio in the Other segment in March 2021;

and the disposition of the bulk industrial portfolio in December 2020, all represent strategic shifts that have or will have major effects on the Company’s operations and financial results, and have met the criteria as discontinued operations as of March 2021, September 2020, and June 2019, respectively.

A business or asset group acquired in connection with a business combination that meets the criteria to be accounted for as held for sale at the date of acquisition is reported as discontinued operations, regardless of whether it meets the strategic shift criterion.

The accelerated monetization of the Wellness Infrastructure segment that is in progress as of June 2021;

pending disposition of a substantial majority of the OED investments and Other IM business in the Other segment;

disposition of the hotel business, composed of the Hospitality segment and the THL Hotel Portfolio in the Other segment in March 2021;

and disposition of the bulk industrial portfolio in December 2020, all represent strategic shifts that have or are expected to have major effects on the Company’s operations and financial results, and have met the criteria as discontinued operations as of June 2021, March 2021, September 2020, and June 2019, respectively.

Accordingly, for all prior periods presented, the related assets and liabilities are presented as assets and liabilities held for disposition on the consolidated balance sheets (Note 11) and the related operating results are presented as income (loss) from discontinued operations on the consolidated statements of operations (Note 12).

Discontinued operations in prior periods include investments in the Other segment that were disposed or otherwise resolved in those periods.

Discontinued operations in prior periods include investments in the respective segments that have been disposed or otherwise resolved in those periods.

Reclassifications

6 unchanged sentences

Credit Losses , the Company recorded a $ 5.1 million increase to accumulated deficit, composed of:

(i) an $ 8.4 million increase to accumulated deficit, representing the Company's share of the cumulative effect adjustment of adopting the lifetime current expected credit loss model by its equity method investee, CLNC;

partially offset by (ii) a $ 3.3 million

decrease to accumulated deficit, reflecting the cumulative effect adjustment of the Company's election of the fair value option for all of its then outstanding loans receivable.

partially offset by (ii) a $ 3.3 million decrease to accumulated deficit, reflecting the cumulative effect adjustment of the Company's election of the fair value option for all of its then outstanding loans receivable.

Accounting Standards Adopted in 2021

6 unchanged sentences

Transition is generally prospective, other than the provision related to outside basis difference which is on a modified retrospective basis with cumulative effect adjusted to retained earnings at the beginning of the period adopted, and franchise tax provision which is on either full or modified retrospective.

The Company adopted ASU No.

2019-12 on January 1, 2021, with no resulting effect upon adoption.

The Company adopted the new guidance on January 1, 2021, with no resulting effect upon adoption.

Accounting for Certain Equity Investments

9 unchanged sentences

Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity .

The ASU (1) simplifies an issuer’s accounting for convertible instruments as a single unit of account;

The ASU (1) simplifies an issuer’s accounting for convertible

instruments as a single unit of account;

(2) allows more contracts on an entity’s own equity to qualify for equity classification and more embedded derivatives meeting the derivative scope exception;

13 unchanged sentences

Adoption of the new standard may be made either on a full retrospective approach or a modified retrospective approach, with cumulative effect adjustment recorded to beginning retained earnings.

The Company early adopted the new standard on January 1, 2021 using a modified retrospective approach, with no resulting effect upon adoption.

The Company early adopted the new guidance on January 1, 2021 using a modified retrospective approach, with no resulting effect upon adoption.

Asset Acquisitions

7 unchanged sentences

Additionally, the Company and its co-investors have committed to acquire the future build-out of expansion capacity within the Vantage SDC portfolio, including lease-up of the expanded capacity and existing inventory, the costs of which will be borne by the previous owners of Vantage SDC, for estimated payments of approximately $ 240 million.

It is anticipated that all, if not most, of the payments will be funded by Vantage SDC from borrowings under its credit facilities and/or cash from operations.

Pursuant to this arrangement, Vantage SDC entered into a lease with a tenant related to a portion of the expansion capacity in the first quarter of 2021, which triggered a payment of $ 14.8 million to the previous owners of Vantage SDC.

The payment was treated as an asset acquisition, which consideration was allocated to data center infrastructure and in-place lease acquired, and as additional consideration for land and building on a relative fair value basis based upon the valuation of the initial acquisition.

It is anticipated that most, if not all, of the payments will be funded by Vantage SDC from borrowings under its credit facilities and/or cash from operations.

Pursuant to this arrangement, Vantage SDC entered into two tenant leases related to a portion of the expansion capacity during the six months ended June 30, 2021, which triggered aggregate payments of $ 73.6 million to the previous owners of Vantage SDC.

These payments were treated as asset acquisitions, which consideration was allocated to data center infrastructure and in-place lease acquired, and as additional consideration for land and building.

zColo Colocation Data Centers

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("Zayo"), composed of 39 data centers in the U.S.

and U.K., for approximately $ 1.2 billion through a combination of debt and equity financing, including $ 0.5 billion of third party co-invest capital raised by the Company.

and the U.K., for approximately $ 1.2 billion through a combination of debt and equity financing, including $ 0.5 billion of third party co-invest capital raised by the Company.

The Company's balance sheet investment is $ 145 million ($ 188 million at the time of closing), which maintained the Company's 20 % equity interest in DataBank.

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The following table summarizes the consideration and allocation to assets acquired, liabilities assumed and noncontrolling interests at acquisition.

Consideration for asset acquisitions incorporates capitalized transaction costs, which includes incentive payments to employees for successful closing of the acquisitions.

Consideration for asset acquisitions incorporates capitalized transaction costs, which may include incentive payments to employees for successful closing of the acquisitions.

Asset Acquisitions

(In thousands) zColo France Vantage SDC zColo US and UK

(In thousands) Vantage SDC Expansion Capacity zColo France Vantage SDC zColo US and UK

Assets acquired and liabilities assumed

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and (iv) contracted price net of estimated selling costs for real estate held for sale.

Useful lives of real estate acquired ranges from 30 to 50 years for buildings and improvements, 7 to 21 years for site improvements, 12 to 19 years for data center infrastructure, and 1 to 5 years for furniture, fixtures and equipment.

Useful lives of real estate acquired range from 30 to 50 years for buildings and improvements, 7 to 21 years for site improvements, 12 to 19 years for data center infrastructure, and 1 to 5 years for furniture, fixtures and equipment.

• Lease-related intangibles for real estate acquisitions were composed of the following:

• In-place leases reflect the value of rental income forgone if the properties were acquired vacant, and the leasing commissions, legal and marketing costs that would have been incurred to lease up the properties, with remaining lease terms ranging between 3 and 15 years.

• In-place leases reflect the value of rental income forgone if the properties had been acquired vacant, and the leasing commissions, legal and marketing costs that would have been incurred to lease up the properties, with remaining lease terms ranging between 3 and 15 years.

• Above- and below-market leases represent the rent differential for the remaining lease term between contractual rents of acquired leases and market rents at the time of acquisition, discounted at rates between 6 % and 8 %, with remaining lease terms ranging between 2 and 15 years.

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Other Real Estate Asset Acquisitions

The following table summarizes the Company's other real estate asset acquisitions in 2020 in addition to those discussed above:

($ in thousands) Purchase Price Allocation (1)

Acquisition Date Property Type and Location Number of Properties Purchase

Land Buildings and Improvements Lease-Related Intangible Assets Lease ROU and Other Assets Debt Intangible, Lease and Other Liabilities

Various Hotel—France (2)

9 $ 37,916 $ 5,243 $ 34,038 $ — $ 43,503 $ ( 2,245 ) $ ( 42,623 )

Various Easements—Various in U.S.

— 2,586 2,586 — — — — —

October Office—U.K.

and Ireland (4)

5 32,975 57,222 67,113 5,383 33,054 ( 124,981 ) ( 4,816 )

December Land—U.S — 5,116 5,116 — — — — —

$ 78,593 $ 70,167 $ 101,151 $ 5,383 $ 76,557 $ ( 127,226 ) $ ( 47,439 )

(1) Purchase price includes capitalized transaction costs.

Dollar amounts of purchase price and allocation to assets acquired and liabilities assumed are translated using foreign exchange rates as of the respective dates of acquisition, where applicable.

(2) Bids for hotels under receivership were accepted by the French courts in prior years, with the transactions closing in 2020.

Amounts include acquisition of hotel operations pursuant to operating leases on real estate owned by third parties.

(3) Transferred to the Company's new sponsored fund, Digital Colony Partners II, LP, or DCP II, in December 2020.

(4) The Company acquired a controlling equity interest in a borrower upon default of an acquisition, development and construction ("ADC") loan, which was previously accounted for as an equity method investment.

This resulted in the acquisition of the borrower's real estate assets and assumption of its underlying mortgage debt, some of which is in default.

Other real estate acquisitions include the following.

Some of the acquired real estate has since been disposed, and all of the remaining assets and associated liabilities were classified as held for disposition in 2021.

• Hotel properties in France that are under receivership, for which the Company's bid was accepted by the French courts in 2019.

The acquisitions closed throughout 2020 and 2021 for total purchase price of $ 37.9 million and $ 38.8 million, respectively, including $ 2.2 million and $ 3.4 million of assumed debt, respectively.

This includes the acquisition of hotel operations pursuant to operating leases on hotels owned by third parties.

• Office properties in the U.K.

and Ireland in 2020, valued at approximately $ 33.0 million, including the assumption of approximately $ 125.0 million of debt.

The Company had acquired a controlling equity interest in a borrower upon the borrower's default of an acquisition, development and construction ("ADC") loan, which was previously accounted for as an equity method investment.

This resulted in the Company's acquisition of the borrower's real estate assets and assumption of its underlying mortgage debt, some of which is in default.

The following table summarizes the Company's real estate held for investment.

Real estate held for disposition is presented in Note 11.

(In thousands) March 31, 2021 December 31, 2020

(In thousands) June 30, 2021 December 31, 2020

Land $ 168,645 $ 168,145

Buildings and improvements 1,061,868 966,839

Tenant improvements 82,320 80,598

Data center infrastructure 3,458,998 3,396,854

Furniture, fixtures and equipment 71,404 74,327

Construction in progress 53,321 38,210

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Real estate assets, net $ 4,491,287 $ 4,451,864

Real Estate Sales

Results from sales of real estate, including discontinued operations (Note 14), are as follows:

Three Months Ended March 31,

(In thousands) 2021 2020

Proceeds from sales of real estate $ 64,808 $ 126,741

Gain on sale of real estate 45,750 7,932

Depreciation and Impairment

The following table summarizes real estate depreciation and impairment.

Three Months Ended March 31,

(In thousands) 2021 2020

Depreciation of real estate held for investment $ 95,611 $ 47,919

Impairment of real estate and related asset group (1)

Continuing operations

Held for disposition 14,466 204

Held for investment 766 48,328

Discontinued operations

Held for disposition 104,528 7,372

Held for investment (2)

(1) Includes impairment of real estate intangibles of $ 63,000 and $ 7.0 million in the three months ended March 31, 2021 and 2020, respectively, and impairment of ground lease ROU of $ 6.1 million and $ 13.0 million in the three months ended March 31, 2021 and 2020, respectively.

(2) Represents impairment recorded in 2020 on properties in the Hospitality and Other segments prior to their reclassification as held for disposition and discontinued operations.

Impairment of Real Estate Held for Disposition

Real estate held for disposition is carried at the lower of amortized cost or fair value less estimated selling costs.

Real estate held for disposition that has been written down and carried at fair value totaled $ 82.7 million and $ 897.9 million relating to continuing and discontinued operations, respectively, at March 31, 2021 and $ 1.0 billion relating to discontinued operations at December 31, 2020, generally representing Level 3 fair value.

Real estate held for disposition that was written down in 2021 and in 2020 was valued using either estimated recoverable value, sales price, broker opinions of value, or third-party appraisals, in certain cases, adjusted as deemed appropriate by management to account for the inherent risk associated with specific properties.

Impairment on real estate held for disposition in 2020 also factored in the economic effects of COVID-19 on real estate values.

Fair value of real estate held for disposition was generally reduced for estimated selling costs, where applicable, ranging from 1 % to 3 %.

Impairment of Real Estate Held for Investment

Real estate held for investment that was written down to fair value during the three months ended March 31, 2021 had carrying values of $ 1.1 million relating to continuing operations, and for the year ended December 31, 2020, carrying values of $ 1.3 billion and $ 2.4 billion relating to continuing and discontinued operations, respectively, at the time of impairment, representing Level 3 fair value.

Real estate carrying values at December 31, 2020 included properties in the Hospitality and Other segments that were impaired in 2020 prior to being classified as held for sale and discontinued operations.

Impairment in 2021 relates to the Wellness Infrastructure segment and was based upon an appraised value of a net leased skilled nursing facility that may be repurposed or sold.

Impairment in 2020 was attributed primarily to shortened hold period assumptions, particularly in the hotel and wellness infrastructure portfolios, driven by the Company's accelerated digital transformation in the second quarter of 2020, and/or to a lesser extent, decline in property operating performance, in part from the economic effects of COVID-19.

The Company compared the real estate carrying values to the undiscounted future net cash flows expected to be generated by these properties over their expected hold periods.

For properties for which undiscounted expected net cash flows over their respective hold periods fell short of carrying values, the Company expects that the carrying value of these properties would likely not be recoverable.

Fair value of impaired real estate held for investment in 2020 was estimated based upon:

(i) third party appraisals, (ii) broker opinions of value with discounts applied based upon management judgment, (iii) income capitalization approach, using net operating income for each property and applying capitalization rates between 10.0 % and 12.0 %;

or (iv) discounted cash flow analyses with terminal values determined using terminal capitalization rates between 7.3 % and 11.3 %, and discount rates between 8.5 % and 9.5 %.

The Company considered the risk characteristics of the properties and adjusted the capitalization rates and/or discount rates as applicable.

Impairment was measured as the excess of carrying value over fair value for each of these properties.

As assessment of real estate impairment is subjective and judgmental, actual results may differ if changes occur in the assumptions used and/or in market conditions and accordingly, negative changes to these variables would result in further impairment charge in the future.

Real Estate Depreciation

Depreciation of real estate held for investment was $ 74.3 million and $ 16.0 million for the three months ended June 30, 2021 and 2020, respectively, and $ 141.5 million and $ 29.3 million for the six months ended June 30, 2021 and 2020, respectively.

Property Operating Income

Components of property operating income are as follows, excluding amounts related to discontinued operations (Note 12).

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

(In thousands) 2021 2020 2021 2020

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$ 188,985 $ 42,017 $ 377,987 $ 87,166

For the three months ended March 31, 2021, property operating income from a single tenant accounted for approximately 11 % of the Company's total revenues, excluding discontinued operations.

The Company's share of property operating income from the tenant is approximately 13 %, net of amounts attributable to noncontrolling interests in investment entities.

There was no similar tenant concentration in the three months ended March 31, 2020.

Equity and Debt Investments

The Company's equity investments and debt securities, excluding investments held for disposition (Note 7), are represented by the following:

(In thousands) March 31, 2021 December 31, 2020

For the six months ended June 30, 2021, property operating income from a single tenant accounted for approximately 17 % of the Company's total revenues from continuing operations, or approximately 8.5 % based upon the Company's share of total revenues from continuing operations, net of amounts attributable to noncontrolling interests in investment entities.

There was no similar tenant concentration in the six months ended June 30, 2020.

Equity Investments

The Company's equity investments, excluding investments held for disposition (Note 11), are represented by the following:

(In thousands) June 30, 2021 December 31, 2020

Equity method investments

CLNC $ 352,822 $ 385,193

$ 365,764 $ 356,772

Other investment ventures 14,343 16,160

Private funds 175,364 173,039

Company-sponsored private funds 253,664 173,039

Investments under fair value option — 28,540

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Other equity investments

Marketable equity securities 129,103 218,485

Non-traded REIT and private funds 27,828 20,495

Total equity investments 743,100 848,127

Debt Securities

N-Star CDO bonds, available for sale 34,719 28,576

Equity and debt investments $ 777,819 $ 876,703

Equity Investments

The Company's equity investments represent noncontrolling equity interests in various entities, including equity method investments for which the Company has elected the fair value option.

Equity Method Investments

The Company owns a 36.1 % interest in CLNC, accounted for under the equity method, as it exercises significant influence over CLNC's operating and financial policies through a combination of its ownership interest, and prior to May 2021, its role as the external manager and its representation on CLNC's board of directors.

Other equity method investments, excluding investments held for disposition, are composed primarily of interests in the Company's sponsored digital investment vehicles, and certain investments accounted for under the fair value option (Note 10).

The liabilities of the equity method investment entities may only be settled using the assets of these entities and there is no recourse to the general credit of the Company for the obligations of these investment entities.

The Company is not required to provide financial or other support in excess of its capital commitments and its exposure is limited to its investment balance.

Other-Than-Temporary Impairment ("OTTI") —The Company evaluates its equity method investments for OTTI at each reporting period.

The Company determined there was no OTTI in the three months ended March 31, 2021.

In the second quarter of 2020, the Company had determined that its investment in CLNC was other-than-temporarily impaired and recorded an impairment charge, included in equity method losses, of $ 274.7 million, measured as the excess of carrying value of its investment in CLNC over market value of $ 336.5 million based upon CLNC's closing stock price of $ 7.02 per share on June 30, 2020.

At March 31, 2021, the fair value of the Company's investment in CLNC, based upon its closing stock price of $ 8.52 per share, was in excess of its carrying value.

Basis Difference —The impairment charges recorded by the Company on its investment in CLNC resulted in a basis difference between the Company's carrying value of its investment in CLNC and the Company's proportionate share of CLNC's book value of equity.

The impairment charge was applied to the Company's investment in CLNC as a whole and was not determined based on an impairment assessment of individual assets held by CLNC.

In order to address the basis difference, the impairment charge was generally allocated on a relative fair value basis across CLNC's various investments.

Accordingly, for any future write-downs taken by CLNC on these investments, the Company's share thereof is applied to reduce the basis difference and is not recorded as an equity method loss until such time the basis difference associated with the respective investments has been fully eliminated.

For the three months ended March 31, 2021 and 2020, the Company reduced its share of net loss of CLNC by $ 24.6 million and $ 19.2 million, respectively, representing the basis difference allocated to investments that were resolved or impaired by CLNC during these periods.

The remaining basis difference at March 31, 2021 was $ 252.9 million.

Other Equity Investments

Other equity investments consist of the following:

Marketable Equity Securities —These are publicly traded equity securities held by private open-end funds consolidated by the Company and prior to January 2021, equity investment in a third party mutual fund (Note 10).

The equity securities of the consolidated funds comprise listed stocks primarily in the U.S.

and to a lesser extent, in Europe, and predominantly in the digital real estate and telecommunication sectors.

Non-Traded REIT and Private Funds —These represent interests in a Company-sponsored non-traded REIT, NorthStar Healthcare Income, Inc.

("NorthStar Healthcare"), and a private fund, for which the Company elected the net asset value ("NAV") practical expedient (Note 10), and an investment in a Company-managed sub-account of a third party private fund.

Marketable securities 177,595 218,485

Other 8,941 —

$ 820,307 $ 792,996

(1) Excludes approximately 461,000 shares and 3.1 million units in BRSP that are held by NRF Holdco and included in assets held for disposition (Note 11), of the Company's aggregate holdings of 48 million shares and units in BRSP.

The Company's equity investments represent noncontrolling equity interests in various entities, primarily BRSP, interests in the Company's sponsored digital investment vehicles, and marketable securities held largely by private open-end digital funds sponsored and consolidated by the Company.

For equity method investments, the liabilities of the investment entities may only be settled using the assets of these entities and there is no recourse to the general credit of the Company for the obligations of these entities.

The Company is not required to provide financial or other support in excess of its capital commitments, where applicable, and its exposure is limited to its investment balance.

The Company evaluates its equity method investments for other-than-temporary impairment ("OTTI") at each reporting period.

Other than BRSP, OTTI was recorded only on equity method investments held for disposition, as discussed in Note 11.

The Company owns a 36.15 % interest in BRSP, accounted for under the equity method, as it exercises significant influence over BRSP's operating and financial policies through its substantial ownership interest.

The following discussion encompasses all of the Company's interest in BRSP, including such interest held by NRF Holdco that is presented as held for disposition and discontinued operations.

OTTI —The Company determined there was no OTTI on its investment in BRSP in 2021.

At June 30, 2021, the fair value of the Company's investment in BRSP, based upon its closing stock price of $ 9.40 per share, was in excess of its carrying value.

In the second quarter of 2020, the Company had determined that its investment in BRSP was other-than-temporarily impaired and recorded an impairment charge, included in equity method losses, of $ 274.7 million, measured as the excess of carrying value of its investment in BRSP over market value of $ 336.5 million based upon BRSP's closing stock price of $ 7.02 per share on June 30, 2020.

Basis Difference —The impairment charges recorded by the Company on its investment in BRSP in 2020 and 2019 resulted in a basis difference between the Company's carrying value of its investment in BRSP and the Company's proportionate share of BRSP's book value of equity.

The impairment charges were applied to the Company's investment in BRSP as a whole and were not determined based upon an impairment assessment of individual assets held by BRSP.

In order to address the basis difference, the impairment charges were generally allocated on a relative fair value basis across BRSP's various investments.

Accordingly, for any future write-downs taken by BRSP on these investments, the Company's share thereof is applied to reduce the basis difference and is not recorded as an equity method loss until such time the basis difference associated with the respective investments has been fully eliminated.

Upon resolution of these investments, the associated basis differences is applied to calculate the Company's share of any net gain or loss resulting

from such resolution.

The Company increased its share of net earnings or reduced its share of net losses from BRSP by $ 34.5 million and $ 8.7 million for the three months ended June 30, 2021 and 2020, respectively, and $ 59.2 million and $ 27.9 million for the six months ended June 30, 2021 and 2020 , respectively, representing the basis difference allocated to investments that were resolved or impaired by BRSP during these periods.

The remaining basis difference at June 30, 2021 was $ 218.4 million.

Investment and Lending Commitments

Private Funds— At March 31, 2021, the Company has unfunded commitments of $ 169.9 million to the Company's sponsored digital funds.

Loans Receivable— The Company has lending commitments to borrowers pursuant to certain loan agreements in which the borrower may submit a request for funding contingent on meeting certain criteria, which must be approved by the Company as lender, such as capital expenditures and construction in progress with an approved budget.

At March 31, 2021, total unfunded lending commitments was $ 39.8 million, of which the Company's share was $ 15.3 million, net of amounts attributable to noncontrolling interests in investment entities.

Debt Securities

The Company's investment in debt securities is composed of available-for-sale ("AFS") N-Star CDO bonds, which are subordinate bonds retained by a subsidiary of the Company, NRF Holdco, LLC ("NRF Holdco"), from its sponsored collateralized debt obligations ("CDOs"), and CDO bonds originally issued by NRF Holdco that it subsequently repurchased at a discount.

These CDOs are collateralized primarily by commercial real estate ("CRE") debt and CRE securities.

The following tables summarize the balance of the N-Star CDO bonds.

Amortized Cost Without Allowance for Credit Loss

Allowance for Credit Loss Gross Cumulative Unrealized

(in thousands) Gains Losses Fair Value

March 31, 2021 $ 56,207 $ ( 24,882 ) $ 3,394 $ — $ 34,719

December 31, 2020 46,561 ( 24,688 ) 6,703 — 28,576

There were no sales of N-Star CDO bonds during the three months ended March 31, 2021 and year ended December 31, 2020.

These CDOs have long-dated stated maturities through 2037 and 2041, however, the Company expects the N-Star CDO bonds to have remaining future cash flows up to 3 years from March 31, 2021.

Impairment of AFS Debt Securities

AFS debt securities are considered to be impaired if their fair value is less than their amortized cost basis.

If the Company intends to sell or is more likely than not required to sell the debt security before recovery of its amortized cost, the entire impairment amount is recognized in earnings within other gain (loss) as a write-off of the amortized cost basis of the debt security.

If the Company does not intend to sell or is not more likely than not required to sell the debt security before recovery of its amortized cost, the credit component of the loss is recognized in earnings within other gain (loss) as an allowance for credit loss, which may be subject to reversal for subsequent recoveries in fair value.

The non-credit loss component is recognized in other comprehensive income or loss ("OCI").

The allowance is charged off against the amortized cost basis of the security if in a subsequent period, the Company intends to or is more likely than not required to sell the security, or if the Company deems the security to be uncollectible.

Changes in allowance for credit losses for AFS debt securities are presented below:

Three Months Ended March 31,

(In thousands) 2021 2020

Beginning balance $ 24,688 $ —

Provision for credit losses 194 816

Ending balance $ 24,882 $ 816

Credit losses were determined based upon an analysis of the present value of contractual cash flows expected to be collected from the underlying collateral as compared to the amortized cost basis of the security.

At March 31, 2021 and December 31, 2020, there were no AFS debt securities in unrealized loss position without allowance for credit loss.

Private Funds— At June 30, 2021, the Company has unfunded commitments of $ 128.4 million to the Company's sponsored funds in its flagship digital opportunistic strategy, Digital Colony Partners, LP ("DCP I") and Digital Colony Partners II, LP ("DCP II").

Loans Receivable— The Company has lending commitment to a borrower in which the borrower may submit a request for funding contingent on meeting certain criteria, which must be approved by the Company as lender, such as agreed upon benchmarks, financial and operating metrics and approved budget.

At June 30, 2021, the unfunded lending commitment was $ 25.0 million, of which the Company's share was $ 5.0 million, net of amounts attributable to noncontrolling interests in investment entities.

Goodwill, Deferred Leasing Costs and Other Intangibles

Goodwill balance by reportable segment is as follows, excluding goodwill in the Other segment that is held for disposition (Note 11).

(In thousands) March 31, 2021 December 31, 2020

(In thousands) June 30, 2021 December 31, 2020

Balance by reportable segment:

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Deferred leasing costs and identifiable intangible assets and liabilities, excluding those related to assets held for disposition, are as follows.

March 31, 2021 December 31, 2020

June 30, 2021 December 31, 2020

(In thousands) Carrying Amount (Net of Impairment) (1)

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Amounts are presented net of impairments and write-offs.

(2) Lease intangible assets are composed of in-place leases, above-market leases, lease incentives and tenant relationships.

(2) Lease intangible assets are composed of in-place leases, above-market leases and tenant relationships.

Lease-intangible liabilities are composed of below-market leases.

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(4) In connection with data center services provided in the colocation data center business.

(5) Represents primarily assembled workforce acquired in an asset acquisition and certificates of need associated with certain wellness infrastructure portfolios which are not subject to amortization.

(5) Represents primarily the value of an acquired domain name and assembled workforce in an asset acquisition.

Impairment of Identifiable Intangible Assets

During the year ended December 31, 2020, investment management contracts were impaired by $ 8.2 million to an aggregate fair value of $ 12.4 million at the time of impairment.

Fair value was based upon the revised future net cash flows over the remaining life of the respective contracts, generally discounted at 10 %, and represent Level 3 fair values.

There was no impairment recorded in the three months ended March 31, 2021.

Real estate related intangible assets are subject to impairment as part of the real estate asset group, as discussed in Note 4.

During the year ended December 31, 2020, an investment management contract was impaired by $ 3.8 million to a fair value of $ 4.0 million at the time of impairment.

Fair value was based upon the revised future net cash flows over the remaining life of the contract, and represents fair value using Level 3 inputs.

In 2021, impairment was recorded only on identifiable intangible assets held for disposition, as discussed in Note 11.

Amortization of Intangible Assets and Liabilities

The following table summarizes amortization of deferred leasing costs and finite-lived intangible assets and intangible liabilities, excluding amounts related to discontinued operations (Note 12):

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

(In thousands) 2021 2020 2021 2020

Net increase (decrease) to rental income (1)

Net decrease to rental income (1)

$ ( 748 ) $ ( 1,724 ) $ ( 1,443 ) $ ( 225 )

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Trade name 6,811 1,098 18,763 2,196

Other 464 22 928 44

$ 62,984 $ 18,863 $ 133,836 $ 42,195

(1) Represents the effect of amortizing above- and below-market leases and lease incentives.

(1) Represents the effect of amortizing above- and below-market leases.

The following table presents the future amortization of deferred leasing costs and finite-lived intangible assets and intangible liabilities, excluding those related to assets and liabilities held for disposition.

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Amortization expense 117,368 154,778 136,701 109,297 96,934 573,932 1,189,010

Assets and Related Liabilities Held for Disposition

Total assets and related liabilities held for disposition are summarized below.

Assets and liabilities held for non-sale disposition in all periods presented represent a portfolio of 48 hotels in receivership following the lender's acceleration of the underlying debt that was defaulted in April 2020.

Control over the operations and any eventual sale of these properties has been transferred to the receivers, who are acting for the benefit of the lender.

The Company has not been released from its debt obligations, however, the debt is non-recourse to the Company.

March 31, 2021 December 31, 2020

(In thousands) Disposition by Sale Non-Sale Disposition Total Held for Disposition Disposition by Sale Non-Sale Disposition Total Held for Disposition

Restricted cash $ 117,548 $ 2,523 $ 120,071 $ 129,817 $ 14,695 $ 144,512

Real estate, net 1,193,009 736,218 1,929,227 4,077,698 743,227 4,820,925

Loans receivable 977,759 — 977,759 1,211,307 — 1,211,307

Equity investments 758,953 — 758,953 860,776 — 860,776

Goodwill, deferred leasing costs and other intangible assets, net 139,851 436 140,287 148,552 437 148,989

Other assets (1)

127,235 26,281 153,516 210,238 15,166 225,404

Due from affiliates 14,844 — 14,844 14,355 — 14,355

Total assets held for disposition $ 3,329,199 $ 765,458 $ 4,094,657 $ 6,652,743 $ 773,525 $ 7,426,268

Debt, net (2)

$ 922,425 $ 780,000 $ 1,702,425 $ 3,631,467 $ 780,000 $ 4,411,467

Lease intangibles and other liabilities 180,050 54,168 234,218 272,792 47,513 320,305

Total liabilities related to assets held for disposition $ 1,102,475 $ 834,168 $ 1,936,643 $ 3,904,259 $ 827,513 $ 4,731,772

(1) Included corporate aircraft that was impaired by $ 11.9 million in the second quarter of 2020 to reflect recoverable value prior to its sale to a third party in January 2021.

(2) Represents debt related to assets held for disposition if the debt is expected to be assumed by the acquirer upon sale or if the debt is expected to be extinguished through lender's assumption of underlying collateral.

Discontinued Operations

The table below presents assets and liabilities held for sale and for non-sale disposition that are related to discontinued operations (Note 14).

These assets and liabilities are composed of OED investments and intangible assets of the Other IM business, both of which resided in the Other segment, and, prior to its disposition in March 2021, the Company's hotel business, with one hotel portfolio remaining in receivership, as discussed above.

March 31, 2021 December 31, 2020

(In thousands) Other Hotel Other Hotel

Restricted cash $ 114,074 $ 2,523 $ 51,528 $ 92,870

Real estate, net 944,730 736,218 1,153,724 3,504,249

Loans receivable 977,759 — 1,211,307 —

Equity investments 758,953 — 860,776 —

Goodwill, deferred leasing costs and other intangible assets, net 133,187 436 143,122 1,851

Other assets 119,948 26,281 152,871 70,343

Due from affiliates 14,844 — 14,355 —

Total assets held for disposition—discontinued operations

$ 3,063,495 $ 765,458 $ 3,587,683 $ 3,669,313

Debt, net $ 878,609 $ 780,000 $ 917,388 $ 3,494,079

Lease intangibles and other liabilities 137,583 54,168 138,265 164,339

Total liabilities related to assets held for disposition—discontinued operations

$ 1,016,192 $ 834,168 $ 1,055,653 $ 3,658,418

Impairment of Assets Classified as Held for Disposition and Discontinued Operations

Real Estate and Related Intangible Assets —Impairment loss was recorded on real estate and related intangible assets classified as held for disposition and discontinued operations totaling $ 104.5 million and $ 259.7 million in the three months ended March 31, 2021 and 2020, respectively (Note 14), as discussed in Note 4.

Goodwill — No impairment loss was recorded in the three months ended March 31, 2021 on the Other IM goodwill that is classified as held for disposition and discontinued operations.

In 2020, the Company had recognized impairment loss on its Other IM goodwill of $ 79.0 million in the first quarter and $ 515.0 million in the second quarter.

In light of the economic effects of COVID-19 and the Company's acceleration of its digital transformation in the second quarter of 2020, both of which represented indicators of impairment, the Company's quantitative test in the prior year indicated that the carrying value of the Other IM reporting unit, including goodwill, exceeded its estimated fair value at March 31, 2020 and at June 30, 2020.

In valuing the Other IM reporting unit in 2020, no value was ascribed to (a) the future capital raising potential of the non-digital credit and opportunity fund management business as it is no longer part of the Company's long-term strategy;

and (b) the hypothetical contract of internally managing the Company's non-digital balance sheet assets following significant decreases in asset values in 2020.

The remaining value of the Other IM reporting unit represents principally the CLNC management contract that was valued based upon its contractual termination value, which approximated fair value.

The Other IM goodwill balance of $ 81.6 million at March 31, 2021 was fully realized in April 2021 upon termination of the CLNC management contract.

Other Intangible Assets —In the three months ended March 31, 2021, investor relationship intangible asset in Other IM was impaired by $ 4.0 million (Note 14) to a fair value of $ 5.5 million based upon estimated recoverable value in a potential monetization of the Company's Other IM business.

There was no impairment loss recorded on Other IM identifiable intangible assets held for disposition in 2020.

Equity Method Investments —Impairment was recorded on equity method investments classified as held for disposition and discontinued operations totaling $ 82.9 million and $ 0.8 million for the three months ended March 31, 2021 and 2020, respectively, included within equity method losses (Note 14).

Equity method investments that were impaired and written down to fair value during the three months ended March 31, 2021 and year ended December 31, 2020 had carrying values totaling $ 479.3 million and $ 701.8 million, respectively, at the time of impairment.

Impairment recorded in 2021 was based upon estimated recoverable values, primarily on ADC loans accounted for as equity method investments.

Significant impairment was also recorded on these ADC loans in the fourth quarter of 2020, previously driven by reduced

future cash flow streams expected from these investments, primarily taking into consideration a combination of lower land values, delayed leasing, and/or offer prices in the current market, generally discounted at rates between 10 % to 20 %.

Other impairment charges during 2020 were generally determined using estimated recoverable values for investments resolved or sold, investment values based upon projected exit strategies, or fair values based upon discounted expected future cash flows from the investments.

Assets Carried at Fair Value —For assets classified as held for disposition and discontinued operations that are carried at fair value, unrealized fair value losses were recorded in other loss of $ 3.1 million for interest in a third party fund and $ 200.7 million for loans receivable, and in equity method losses of $ 25.1 million for equity method investments (Note 14).

Additional information is included Note 10 under " —Level 3 Recurring Fair Values.

Restricted Cash, Other Assets and Other Liabilities

Restricted Cash

The following table summarizes the Company's restricted cash balance:

(In thousands) March 31, 2021 December 31, 2020

Capital expenditures reserves (1)

$ 10,618 $ 13,516

Real estate escrow reserves (2)

Lender restricted cash (3)

93,809 82,419

Total restricted cash $ 125,959 $ 114,952

(1) Represents primarily cash held by lenders for capital improvements, tenant improvements, lease renewal and replacement reserves related to real estate assets.

(2) Represents primarily insurance, real estate tax, repair and maintenance, tenant security deposits and other escrows related to real estate assets.

(3) Represents cash from the Company's investment properties that is restricted by lenders in accordance with respective debt agreements.

(4) Includes investment sales proceeds held in escrow.

Restricted cash represents principally cash reserve accounts that are maintained pursuant to requirements under the respective agreements governing the Company's securitized debt.

The following table summarizes the Company's other assets:

(In thousands) March 31, 2021 December 31, 2020

(In thousands) June 30, 2021 December 31, 2020

Straight-line rents $ 18,587 $ 8,991

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Deferred financing costs, net (1)

Derivative assets (Note 10)

Derivative assets 87 99

Prepaid taxes and deferred tax assets, net 39,178 49,729

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(2) Net of impairment of $ 9.4 million at December 31, 2020 for corporate office leases as the Company determined there is a reduced need for office space based upon the Company's current operations and has abandoned certain leased spaces.

(3) Includes primarily receivables from tenants, resident fees, and reimbursable capital expenditures, and is presented net of immaterial allowance for doubtful accounts, where applicable.

(3) Includes primarily receivables from tenants and is presented net of immaterial allowance for doubtful accounts, where applicable.

Accrued and Other Liabilities

The following table summarizes the Company's accrued and other liabilities:

(In thousands) March 31, 2021 December 31, 2020

Tenant security deposits and payable $ 8,761 $ 9,321

(In thousands) June 30, 2021 December 31, 2020

Deferred income (1)

1 unchanged sentence

Interest payable 20,309 13,653

Derivative liabilities (Note 10) 1,216 103,772

Derivative liabilities 1,291 103,772

Current and deferred income tax liability 4,300 99,470

4 unchanged sentences

Accrued real estate and other taxes 10,643 6,658

Payable for Vantage SDC expansion capacity (Note 3)

Accounts payable and accrued expenses 82,747 120,683

1 unchanged sentence

Accrued and other liabilities $ 854,339 $ 1,034,282

(1) Represents primarily prepaid rental income, prepaid interest from borrowers held in reserve accounts, and deferred management fees from digital investment vehicles.

Deferred management fees totaling $ 1.8 million at March 31, 2021 and $ 6.1 million at December 31, 2020 is expected be recognized as fee income over a weighted average period of 4.9 years and 1.9 years, respectively.

(1) Represents primarily prepaid rental income and deferred management fees from digital investment vehicles.

Deferred management fees of $ 1.7 million at June 30, 2021 and $ 6.1 million at December 31, 2020 is expected to be recognized as fee income over a weighted average period of 4.7 years and 1.9 years, respectively.

Deferred Income Tax

In the second quarter of 2021, the Company's DataBank subsidiary completed a restructuring of its operations to qualify as a REIT and anticipates electing REIT status for U.S.

federal income tax purposes for the 2021 taxable year.

As a REIT, DataBank would generally not be subject to U.S.

federal income taxes on its taxable income to the extent that it annually distributes such taxable income to its stockholders and maintains certain asset and income requirements.

However, DataBank would continue to be subject to U.S.

federal income taxes on income earned by any of its taxable subsidiaries.

In the second quarter of 2021, DataBank recorded a net deferred tax benefit of $ 66.8 million, primarily reflecting the write-off of its deferred tax liabilities.

The Company's debt balance consists of the following components, excluding debt related to assets held for disposition that is expected to be assumed by the counterparty upon disposition, which is included in liabilities related to assets held for disposition (Note 11).

(In thousands) Corporate Credit Facility (1)

Convertible and Exchangeable Senior Notes Secured Debt (2)

Junior Subordinated Notes Total Debt

March 31, 2021

(In thousands) Corporate Credit Facility Convertible and Exchangeable Senior Notes Secured Debt Total Debt

June 30, 2021

Debt at amortized cost

9 unchanged sentences

$ — $ 520,522 $ 3,410,467 $ 3,930,989

(1) Deferred financing costs related to the corporate credit facility are included in other assets.

(2) Debt principal totaling $ 253.7 million at March 31, 2021 and $ 272.5 million at December 31, 2020 relates to financing of assets held for disposition, and is expected to be repaid upon disposition of the respective underlying assets.

Debt associated with assets held for disposition that is expected to be assumed by the counterparty is included in liabilities related to assets held for disposition (Note 7).

The following table summarizes certain characteristics of the Company's debt.

6 unchanged sentences

Weighted Average Years Remaining to Maturity (2)

March 31, 2021

June 30, 2021

Corporate credit facility $ — N/A N/A $ 45,000 4.75 % — $ 45,000 4.75 % —

1 unchanged sentence

500,000 5.45 % 3.1 — N/A N/A 500,000 5.45 % 3.1

Junior subordinated debt (4)

— N/A N/A 280,117 3.06 % 15.2 280,117 3.06 % 15.2

500,000 45,000 545,000

Non-recourse (5)

Digital Operating 2,789,338 2.49 % 4.6 580,000 5.70 % 4.7 3,369,338 3.04 % 4.6

Wellness Infrastructure 400,075 4.55 % 3.9 2,283,458 3.89 % 3.1 2,683,533 4.02 % 3.2

Other—Other Equity and Debt 21,316 5.63 % — 155,317 4.85 % 0.8 176,633 4.94 % 0.7

3,210,729 3,018,775 6,229,504

Secured Debt—Digital Operating 2,787,781 2.49 % 4.4 586,474 5.69 % 4.4 3,374,255 3.05 % 4.4

$ 3,287,781 $ 631,474 $ 3,919,255

December 31, 2020

Corporate credit facility $ — N/A N/A $ — — % 1.0 $ — — % 1.0

Convertible and exchangeable senior notes (3)

$ 531,502 5.36 % 3.4 $ — N/A N/A $ 531,502 5.36 % 3.4

Junior subordinated debt (4)

— N/A N/A 280,117 3.10 % 15.4 280,117 3.10 % 15.4

Secured debt (4)

1 unchanged sentence

564,317 — 564,317

Non-recourse (5)

Digital Operating 2,132,852 2.54 % 4.8 1,093,991 5.92 % 4.4 3,226,843 3.69 % 4.7

Wellness Infrastructure 401,767 4.55 % 4.1 2,331,366 3.95 % 3.3 2,733,133 4.04 % 3.4

Other—Other Equity and Debt 21,316 5.63 % — 164,472 3.85 % 0.1 185,788 4.05 % 0.1

Other—Other Equity and Debt — N/A N/A 164,472 3.85 % 0.1 164,472 3.85 % 0.1

2,132,852 1,258,463 3,391,315

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(2) Calculated based upon initial maturity dates, or extended maturity dates if extension criteria are met and extension is available at the Company's option.

(3) Includes the 5.375 % exchangeable senior notes which is an obligation of NRF Holdco as the issuer, as described further below.

(4) Represents an obligation of NRF Holdco as the junior subordinated debt was issued by certain of its subsidiaries, as described further below.

Accordingly, Colony Capital, Inc.

and its operating company, Colony Capital Operating Company, LLC, are not guarantors to the debt.

(5) Investment-level secured debt that is non-recourse to the Company in the Other segment of $ 21.3 million at March 31, 2021 and December 31, 2020 is in default and has been accelerated by the lender.

(3) Excludes the 5.375 % exchangeable senior notes issued by NRF Holdco as they are classified as held for disposition (Note 11).

(4) The fixed rate recourse debt was secured by the Company's aircraft and was repaid in January 2021 upon sale of the aircraft.

Corporate Credit Facility

On June 29, 2020, the OP entered into the Fourth Amendment (the “Amendment”) to the Second Amended and Restated Credit Agreement, dated as of January 10, 2017 (as amended, supplemented or otherwise modified from time to time prior to the date hereof, the “Credit Agreement”), with JPMorgan Chase Bank, N.A., as administrative agent, and the several lenders from time to time party thereto.

The credit facility provides revolving commitments of $ 400 million as of March 31, 2021 ($ 450 million at December 31, 2020) and is scheduled to mature in July 2021, with one remaining 6 -month extension option, subject to a fee of 0.10 % of the commitment amount upon exercise.

Advances under the credit facility accrue interest at a per annum

rate equal to, at the Company’s election, either LIBOR plus a margin of 2.75 %, or a base rate determined according to a prime rate or federal funds rate plus a margin of 1.75 %.

Unused amounts under the credit facility accrue a per annum commitment fee of 0.35 %.

The maximum amount available to be drawn at any time under the credit facility is limited by a borrowing base of certain investment assets, with the valuation of such investment assets generally determined according to a percentage of adjusted net book value or a multiple of base management fee EBITDA (as defined in the Credit Agreement).

As of the date of this filing, the full $ 400 million is available to be drawn under the facility.

The Credit Agreement contains various affirmative and negative covenants, including financial covenants that require the Company to maintain minimum tangible net worth, and debt service ratios as well as a maximum leverage ratio, as defined in the Credit Agreement.

As of March 31, 2021 and through the date of this filing, the Company was in compliance with all of the financial covenants.

The Credit Agreement also provides the Company with the flexibility to determine not to maintain REIT status without requiring lender approval.

During the term of the Credit Agreement, the Company is prohibited from, among other things, (i) making any investments other than (A) investments in digital infrastructure assets and (B) pre-existing obligations and protective investments in existing assets to preserve, administer or otherwise realize on such investment, (ii) repurchasing capital stock of the Company and (iii) paying dividends, other than for (A) paying dividends to maintain the Company’s status as a REIT, (B) reducing the payment of income taxes and (C) paying dividends on the Company’s preferred equity.

Certain of the Company’s subsidiaries guarantee the obligations of the Company under the Credit Agreement.

As security for the advances under the Credit Agreement, the Company and some of its affiliates pledged their equity interests in certain subsidiaries through which the Company directly or indirectly owns substantially all of its assets.

The Credit Agreement also includes customary events of default, in certain cases subject to reasonable and customary periods to cure.

The occurrence of an event of default may result in the termination of the credit facility, accelerate the Company’s repayment obligations, in certain cases limit the Company’s ability to make distributions, and allow the lenders to exercise all rights and remedies available to them with respect to the collateral.

There have been no events of default since the inception of the credit facility.

In July 2021, the Company repaid the outstanding balance and terminated its corporate credit facility, which was replaced with the Company's new securitized financing facility, as discussed below.

Prior to termination, the credit facility provided revolving commitments of $ 300 million as of June 30, 2021, based upon terms amended in May 2021 ($ 450 million at December 31, 2020), with the maximum amount available to be drawn limited by a borrowing base of certain investment assets, generally valued based upon a percentage of adjusted net book value or a multiple of base management fee EBITDA (as defined in the credit agreement).

Advances under the credit facility accrued interest at a per annum rate equal to, at the Company’s election, either the 1-month London Interbank Offered Rate ("LIBOR") plus a margin of 2.75 %, or a base rate determined according to a prime rate or federal funds rate plus a margin of 1.75 %.

Unused commitments under the credit facility were subject to a commitment fee of 0.35 % per annum.

Securitized Financing Facility

In July 2021, special-purpose subsidiaries of the OP (the "Co-Issuers") issued $ 500 million aggregate principal amount of Series 2021-1 Secured Fund Fee Revenue Notes, composed of:

(i) $ 300 million aggregate principal amount of 3.933 % Secured Fund Fee Revenue Notes, Series 2021-1, Class A-2 (the “Class A-2 Notes”);

and (ii) up to $ 200 million Secured Fund Fee Revenue Variable Funding Notes, Series 2021-1, Class A-1 (the “VFN Notes” and, together with the Class A-2 Notes, the “Series 2021-1 Notes”).

The VFN Notes allow the Co-Issuers to borrow on a revolving basis.

The Series 2021-1 Notes were issued under an Indenture that allows the Co-Issuers to issue additional series of notes in the future, subject to certain conditions.

The Series 2021-1 Notes represent obligations of the Co-Issuers and certain other special-purpose subsidiaries of DBRG, and neither DBRG, the OP nor any of its other subsidiaries are liable for the obligations of the Co-Issuers.

The Series 2021-1 Notes are secured by investment management fees earned by subsidiaries of DBRG, equity interests in certain digital portfolio companies and limited partnership interests in certain digital funds managed by subsidiaries of DBRG, as collateral.

The Class A-2 Notes bear interest at a rate of 3.933 % per annum, payable quarterly.

The VFN Notes bear interest generally based upon 3-month LIBOR (or an alternate benchmark as set forth in the purchase agreement of the VFN Notes) plus 3 %.

Unused amounts under the VFN Notes facility is subject to a commitment fee of 0.5 % per annum.

The final maturity date is in September 2051 for the Class A-2 Notes, with an anticipated repayment date in September 2026.

The anticipated repayment date for the VFN Notes is in September 2024, subject to two one -year extensions at the option of the Co-Issuers.

If the Series 2021-1 Notes are not repaid or refinanced prior to their anticipated repayment date, or such date is not extended for the VFN Notes, interest will accrue at a higher rate and the Series 2021-1 Notes will begin to amortize quarterly.

The Series 2021-1 Notes may be optionally prepaid, in whole or in part, prior to their anticipated repayment dates.

There is no prepayment penalty on the VFN Notes.

However, prepayment of the Class A-2 Notes will be subject to additional consideration based upon the difference between the present value of future payments of principal and interest and the outstanding principal of such Class A-2 Note that is being prepaid;

or 1 % of the outstanding principal of such Class A-2 Note that is being prepaid in connection with a disposition of collateral.

The Indenture of the Series 2021-1 Notes contains various covenants, including financial covenants that require the maintenance of minimum thresholds for debt service coverage ratio and maximum loan-to-value ratio, as defined.

As of the date of this filing, the Co-Issuers are in compliance with all of the financial covenants.

Proceeds from issuance of the Class A-2 Notes of $ 285.1 million, net of offering expenses and $ 5.4 million of interest reserve deposits, will be used for acquisition of digital infrastructure investments, funding of commitments to sponsored funds, redemption or repayment of the Company's other higher cost corporate securities, and/or general corporate purposes.

The full $ 200 million under the VFN Notes is available to be drawn as of the date of this filing.

Convertible and Exchangeable Senior Notes

Convertible and exchangeable senior notes (collectively, the senior notes) outstanding as of March 31, 2021 are as follows, each representing senior unsecured obligations of Colony Capital, Inc.

Convertible and exchangeable senior notes (collectively, the senior notes) outstanding as of June 30, 2021 are as follows, each representing senior unsecured obligations of DigitalBridge Group, Inc.

or a subsidiary as the respective issuers of the senior notes:

2 unchanged sentences

Conversion or Exchange Shares (in thousands) Earliest Redemption Date Outstanding Principal

March 31, 2021 December 31, 2020

Issued by Colony Capital, Inc.

June 30, 2021 December 31, 2020

Issued by DigitalBridge Group, Inc.

5.00% Convertible Senior Notes April 2013 April 15, 2023 5.00 % $ 15.76 63.4700 12,694 April 22, 2020 $ 200,000 $ 200,000

3.875% Convertible Senior Notes January and June 2014 January 15, 2021 3.875 % 16.57 60.3431 1,901 January 22, 2019 — 31,502

Issued by Colony Capital Operating Company, LLC

Issued by DigitalBridge Operating Company, LLC

5.75% Exchangeable Senior Notes July 2020 July 15, 2025 5.750 % 2.30 434.7826 130,435 July 21, 2023 300,000 300,000

Issued by NRF Holdco, LLC

5.375% Exchangeable Senior Notes June 2013 June 15, 2033 5.375 % 12.04 83.0837 1,130 June 15, 2023 13,605 13,605

$ 500,000 $ 531,502

3 unchanged sentences

The outstanding senior notes are convertible or exchangeable at any time by holders of such notes into shares of the Company’s common stock at the applicable conversion or exchange rate, which is subject to adjustment upon occurrence of certain events.

In the case of the 5.375 % exchangeable senior notes, NRF Holdco may elect to settle a holder’s exchange into cash, the Company’s common stock or a combination thereof.

To the extent certain trading conditions of the Company’s common stock are met, the senior notes are redeemable by the applicable issuer thereof in whole or in part for cash at any time on or after their respective earliest redemption dates at a redemption price equal to 100 % of the principal amount of such senior notes being redeemed, plus accrued and unpaid interest (if any) up to, but excluding, the redemption date.

In addition, prior to June 15, 2023 and subject to certain trading conditions of the Company’s common stock, NRF Holdco may redeem its 5.375 % exchangeable senior notes at a make-whole redemption price.

In the event of certain change in control transactions and, for the 5.375 % exchangeable senior notes only, on each of June 15, 2023 and June 15, 2028, holders of the senior notes have the right to require the applicable issuer to purchase all or part of such holder's senior notes for cash in accordance with terms of the governing documents of the respective senior notes.

In the event of certain change in control transactions, holders of the senior notes have the right to require the applicable issuer to purchase all or part of such holder's senior notes for cash in accordance with terms of the governing documents of the respective senior notes.

Repurchase and Repayment of Senior Notes

The 3.875 % convertible senior notes were fully extinguished following a $ 31.5 million repayment upon maturity in January 2021 and a $ 371.0 million repurchase in the third quarter of 2020, primarily funded by net proceeds from the July 2020 issuance of the 5.75 % exchangeable senior notes by the Operating Company.

These are primarily investment level financing, which are non-recourse to the Company, and secured by underlying commercial real estate and mortgage loans receivable.

In March 2021 and October 2020, DataBank and Vantage SDC, the Company's subsidiaries in the Digital Operating segment, raised $ 657.9 million and $ 1.3 billion of securitized notes at blended fixed rates of 2.3 % and 1.8 %, with 5 years and 6 years maturity, respectively.

In both instances, the proceeds were applied principally to refinance outstanding debt, which meaningfully reduced the overall cost of debt and extended debt maturities at DataBank and Vantage SDC.

Junior Subordinated Debt

Trust preferred securities ("TruPS") were previously issued in private placement offerings by subsidiaries of NRF Holdco, LLC (the "Issuer," a subsidiary of Colony Capital, Inc.), which were formed as statutory trusts, NorthStar Realty Finance Trust I through VIII (the “Trusts”).

The sole assets of the Trusts consist of a like amount of junior subordinated notes issued by the Issuer at the time of the offerings (the "Junior Notes").

Neither the Company nor the OP is an obligor or guarantor on the Junior Notes or the TruPS.

The Issuer may redeem the Junior Notes at par, in whole or in part, for cash, after five years .

To the extent the Issuer redeems the Junior Notes, the Trusts are required to redeem a corresponding amount of TruPS.

The ability of the Trusts to pay dividends depends on the receipt of interest payments on the Junior Notes.

The Issuer has the right, pursuant to certain qualifications and covenants, to defer payments of interest on the Junior Notes issued to NorthStar Realty Finance Trust I through III for up to six consecutive quarters.

If payment of interest on the Junior Notes is deferred, the Trusts will defer the quarterly distributions on the TruPS for a corresponding period.

Additional interest accrues on deferred payments at the annual rate payable on the Junior Notes, compounded quarterly.

Stockholders’ Equity

The table below summarizes the share activities of the Company's preferred and common stock.

Number of Shares

(In thousands) Preferred Stock Class A

Shares outstanding at December 31, 2019 41,350 487,044 734

Shares issued upon redemption of OP Units — 184 —

Repurchase of common stock, net (1)

— ( 12,733 ) —

Equity awards issued, net of forfeitures — 9,273 —

Shares canceled for tax withholding on vested equity awards — ( 2,377 ) —

Shares outstanding at June 30, 2020 41,350 481,391 734

Shares outstanding at December 31, 2020 41,350 483,406 734

Shares issued upon redemption of OP Units — 5 —

Shares issued pursuant to settlement liability (1)

Equity awards issued, net of forfeitures — 4,996 —

Shares canceled for tax withholding on vested equity awards — ( 2,439 ) —

Shares outstanding at June 30, 2021 41,350 491,922 734

(1) For 2020, activity is presented net of reissuance of 964,160 shares of class A common stock in connection with a settlement liability.

In 2021, the liability was settled through the reissuance of some of the shares previously repurchased and held in a subsidiary (Note 13).

Shares of class A common stock repurchased and not reissued in the settlement of the liability were subsequently cancelled.

Preferred Stock

In the event of a liquidation or dissolution of the Company, preferred stockholders have priority over common stockholders for payment of dividends and distribution of net assets.

The table below summarizes the preferred stock issued and outstanding at June 30, 2021:

Description Dividend Rate Per Annum Initial Issuance Date Shares Outstanding

(in thousands)

Liquidation Preference

(in thousands)

Earliest Redemption Date

Series G 7.5 % June 2014 3,450 $ 35 $ 86,250 Currently redeemable

Series H 7.125 % April 2015 11,500 115 287,500 Currently redeemable

Series I 7.15 % June 2017 13,800 138 345,000 June 5, 2022

Series J 7.125 % September 2017 12,600 126 315,000 September 22, 2022

41,350 $ 414 $ 1,033,750

All series of preferred stock are at parity with respect to dividends and distributions, including distributions upon liquidation, dissolution or winding up of the Company.

Dividends on Series G, H, I and J of preferred stock are payable quarterly in arrears in January, April, July and October.

Each series of preferred stock is redeemable on or after the earliest redemption date for that series at $ 25.00 per share plus accrued and unpaid dividends (whether or not declared) exclusively at the Company’s option.

The redemption period for each series of preferred stock is subject to the Company’s right under limited circumstances to redeem the preferred stock earlier in order to preserve its qualification as a REIT or upon the occurrence of a change of control (as defined in the articles supplementary relating to each series of preferred stock).

Preferred stock generally does not have any voting rights, except if the Company fails to pay the preferred dividends for six or more quarterly periods (whether or not consecutive).

Under such circumstances, the preferred stock will be entitled to vote, together as a single class with any other series of parity stock upon which like voting rights have been conferred and are exercisable, to elect two additional directors to the Company’s board of directors, until all unpaid dividends have been paid or declared and set aside for payment.

In addition, certain changes to the terms of any series of preferred stock cannot be made without the affirmative vote of holders of at least two-thirds of the outstanding shares of each such series of preferred stock voting separately as a class for each series of preferred stock.

Redemption of Preferred Stock

In January 2020, the Company settled the December 2019 redemption of its outstanding Series B and Series E preferred stock for $ 402.9 million.

In July 2021, the Company issued a notice of redemption for all of its outstanding Series G preferred stock, to be settled in August 2021 using proceeds from its securitized financing facility.

All preferred stock redemptions are at $ 25.00 per share liquidation preference plus accrued and unpaid dividends prorated to their respective redemption dates.

The excess or deficit of the $ 25.00 per share liquidation preference over the carrying value of the respective preferred stock redeemed results in a decrease or increase to net income attributable to common stockholders.

Except with respect to voting rights, class A common stock and class B common stock have the same rights and privileges and rank equally, share ratably in dividends and distributions, and are identical in all respects as to all matters.

Class A common stock has one vote per share and class B common stock has thirty-six and one-half votes per share.

This gives the holders of class B common stock a right to vote that reflects the aggregate outstanding non-voting economic interest in the Company (in the form of OP Units) attributable to class B common stock holders and therefore, does not provide any disproportionate voting rights.

Class B common stock was issued as consideration in the Company's acquisition in April 2015 of the investment management business and operations of its former manager, which was previously controlled by the Company's former Executive Chairman.

Each share of class B common stock shall convert automatically into one share of class A common stock if the former Executive Chairman or his beneficiaries directly or indirectly transfer beneficial ownership of class B common stock or OP Units held by them, other than to certain qualified transferees, which generally includes affiliates and employees.

In addition, each holder of class B common stock has the right, at the holder’s option, to convert all or a portion of such holder’s class B common stock into an equal number of shares of class A common stock.

The Company suspended dividends on its class A common stock beginning with the second quarter of 2020.

Payment of common dividends was previously subject to certain restrictions under the terms of the corporate credit facility, which was terminated in July 2021.

The Company continues to monitor its financial performance and liquidity position, and as economic conditions improve, the Company will reevaluate its dividend policy.

Common Stock Repurchases

During the first quarter of 2020, the Company repurchased 12,733,204 shares of its class A common stock at an aggregate cost of $ 24.6 million, or a weighted average price of $ 1.93 per share, pursuant to a $ 300 million share repurchase program that expired in May 2020.

Dividend Reinvestment and Direct Stock Purchase Plan

The Company's Dividend Reinvestment and Direct Stock Purchase Plan (the “DRIP Plan”) provides existing common stockholders and other investors the opportunity to purchase shares (or additional shares, as applicable) of the Company's class A common stock by reinvesting some or all of the cash dividends received on their shares of the Company's class A common stock or making optional cash purchases within specified parameters.

The DRIP Plan involves the acquisition of the Company's class A common stock either in the open market, directly from the Company as newly issued common stock, or in privately negotiated transactions with third parties.

There were no shares of class A common stock acquired under the DRIP Plan in the form of new issuances in 2021 and 2020.

Accumulated Other Comprehensive Income (Loss)

The following tables present the changes in each component of AOCI attributable to stockholders and noncontrolling interests in investment entities, net of immaterial tax effect.

AOCI attributable to noncontrolling interests in Operating Company is immaterial.

Changes in Components of AOCI—Stockholders

(In thousands)

Company's Share in AOCI of Equity Method Investments Unrealized Gain (Loss) on AFS Debt Securities Unrealized Gain (Loss) on Cash Flow Hedges

Foreign Currency Translation Gain (Loss)

Unrealized Gain (Loss) on Net Investment Hedges

AOCI at December 31, 2019 $ 9,281 $ 7,823 $ ( 226 ) $ 139 $ 30,651 $ 47,668

Other comprehensive income (loss) before reclassifications ( 898 ) 2,557 — ( 16,929 ) 15,819 549

Amounts reclassified from AOCI — ( 3,544 ) — 246 ( 552 ) ( 3,850 )

AOCI at June 30, 2020 $ 8,383 $ 6,836 $ ( 226 ) $ ( 16,544 ) $ 45,918 $ 44,367

AOCI at December 31, 2020 $ 17,718 $ 6,072 $ ( 233 ) $ 52,832 $ 45,734 $ 122,123

Other comprehensive income (loss) before reclassifications ( 1,979 ) ( 1,761 ) — ( 14,642 ) 1,297 ( 17,085 )

Amounts reclassified from AOCI — — 233 ( 20,221 ) ( 1,375 ) ( 21,363 )

AOCI at June 30, 2021 $ 15,739 $ 4,311 $ — $ 17,969 $ 45,656 $ 83,675

Changes in Components of AOCI—Noncontrolling Interests in Investment Entities

(In thousands) Unrealized Gain (Loss) on Cash Flow Hedges Foreign Currency Translation Gain (Loss) Unrealized Gain (Loss) on Net Investment Hedges Total

AOCI at December 31, 2019 $ ( 1,005 ) $ ( 17,913 ) $ 10,659 $ ( 8,259 )

Other comprehensive income (loss) before reclassifications ( 1 ) ( 11,689 ) 5,313 ( 6,377 )

Amounts reclassified from AOCI — — ( 873 ) ( 873 )

AOCI at June 30, 2020 $ ( 1,006 ) $ ( 29,602 ) $ 15,099 $ ( 15,509 )

AOCI at December 31, 2020 $ ( 1,030 ) $ 83,845 $ 15,099 $ 97,914

Other comprehensive income (loss) before reclassifications — ( 39,074 ) — ( 39,074 )

Amounts reclassified from AOCI 1,030 810 — 1,840

AOCI at June 30, 2021 $ — $ 45,581 $ 15,099 $ 60,680

Reclassifications out of AOCI—Stockholders

Information about amounts reclassified out of AOCI attributable to stockholders by component is presented below.

Such amounts are included in other gain (loss) in both continuing and discontinued operations on the statements of operations, as applicable, except for amounts related to equity method investments, which are included in equity method losses in discontinued operations.

(In thousands)

Three Months Ended June 30, Six Months Ended June 30,

Component of AOCI reclassified into earnings

2021 2020 2021 2020

Relief of basis of AFS debt securities

$ — $ 3,544 $ — $ 3,544

Release of foreign currency cumulative translation adjustments

20,221 — 20,221 ( 246 )

Unrealized gain (loss) on dedesignated net investment hedges — ( 82 ) — 552

Realized gain on net investment hedges

1,375 — 1,375 —

Realized loss on cash flow hedges — — ( 233 ) —

Noncontrolling Interests

Redeemable Noncontrolling Interests

The following table presents the activity in redeemable noncontrolling interests in the Company's digital investment management business, as discussed below, and in open-end funds sponsored and consolidated by the Company.

Six Months Ended June 30,

(In thousands) 2021 2020

Beginning balance $ 305,278 $ 6,107

Contributions 41,014 25,880

Distributions and redemptions ( 8,255 ) ( 2,763 )

Net income (loss) 8,474 ( 158 )

Ending balance $ 346,511 $ 29,066

Strategic Partnership in the Company's Digital Investment Management Business

In July 2020, the Company formed a strategic partnership with affiliates of Wafra, Inc.

(collectively, "Wafra"), a private investment firm and a global partner for alternative asset managers, in which Wafra made a minority investment in substantially all of the Company's digital investment management business (as defined for purposes of this transaction, the "Digital IM Business").

The investment entitles Wafra to participate in approximately 31.5 % of the net management fees and carried interest generated by the Digital IM Business.

Pursuant to this strategic partnership, Wafra has assumed directly and also indirectly through a participation interest $ 77.0 million of the Company's commitments to DCP I, and has a $ 40.0 million commitment to DCP II that has been partially funded to-date.

Wafra has also agreed to make commitments to the Company's future digital funds and investment vehicles on a pro rata basis with the Company based on Wafra's percentage interest in the Digital IM Business, subject to certain caps.

In addition, the Company issued Wafra five warrants to purchase up to an aggregate of 5 % (on a fully-diluted, post-transaction basis) of the Company’s class A common stock.

Each warrant entitles Wafra to purchase up to 5,352,000 shares of the Company's class A common stock, with staggered strike prices between $ 2.43 and $ 6.00 for each warrant, exercisable until July 17, 2026.

No warrants have been exercised to-date.

Wafra paid cash consideration of $ 253.6 million at closing in exchange for its investment in the Digital IM Business and for the warrants.

As previously agreed, Wafra paid additional consideration of $ 29.9 million in the Digital IM Business in April 2021 based upon the Digital IM Business having achieved a minimum run-rate of earnings before interest, tax, depreciation and amortization (as defined for the purpose of this computation) of $ 72.0 million as of December 31, 2020.

Under certain circumstances following such time as the Digital IM Business comprises 90 % or more of the Company's assets, the Company has agreed to use commercially reasonable efforts to facilitate the conversion of Wafra's interest into shares of the Company's class A common stock.

There can be no assurances that such conversion would occur or on what terms and conditions such conversion would occur, including whether such conversion, if it did occur in the future, would have any adverse impact on the Company, the Company’s stock price, governance and other matters.

Wafra has customary minority rights and certain other structural protections designed to protect its interests, including redemption rights with respect to its investment in the Digital IM Business and its funded commitments in certain digital funds.

Wafra's redemption rights will be triggered upon the occurrence of certain events, including key person or cause events under the governing documents of certain digital funds and for a limited period, upon Marc Ganzi, the Company's Chief Executive Officer, and Ben Jenkins, Chief Investment Officer of the Company's digital real estate and infrastructure platform, ceasing to fulfill certain time and attention commitments to the Digital IM business.

To further enhance the alignment of interests, the Company entered into an amended and restated restrictive covenant agreement with each of Mr.

Ganzi and Mr.

Jenkins, pursuant to which they agreed to certain enhanced non-solicitation provisions and extension of the term of existing non-competition agreements.

Wafra’s investment provides the Company with permanent capital to pursue strategic digital infrastructure investments and further grow the Digital IM Business.

Noncontrolling Interests in Operating Company

Certain current and former employees of the Company directly or indirectly own interests in OP, presented as noncontrolling interests in the Operating Company.

Noncontrolling interests in OP have the right to require OP to redeem part or all of such member’s OP Units for cash based on the market value of an equivalent number of shares of class A common stock at the time of redemption, or at the Company's election as managing member of OP, through issuance of shares of class A common stock (registered or unregistered) on a one -for-one basis.

At the end of each period, noncontrolling interests in OP is adjusted to reflect their ownership percentage in OP at the end of the period, through a reallocation between controlling and noncontrolling interests in OP.

Redemption of OP Units —The Company redeemed 5,367 OP Units during the six months ended June 30, 2021 and 2,184,395 OP Units during the year ended December 31, 2020, with the issuance of an equal number of shares of class A common stock on a one -for-one basis.

Assets and Related Liabilities Held for Disposition

Total assets and related liabilities held for disposition are summarized below, all of which relate to discontinued operations (Note 12).

These assets and liabilities are composed of:

(i) those held by NRF Holdco, predominantly related to Wellness Infrastructure assets and obligations;

(ii) OED investments and intangible assets of the Other IM business, both of which resided in the Other segment;

and (iii) prior to its disposition in March 2021, the Company's hotel business, with one hotel portfolio remaining in receivership and currently under contract for sale by the lender.

(In thousands) June 30, 2021 December 31, 2020

Restricted cash $ 76,784 $ 191,692

Real estate, net 4,636,540 8,179,025

Loans receivable 761,240 1,258,539

Equity and debt investments 776,794 944,483

Goodwill, deferred leasing costs and other intangible assets, net 155,933 275,954

Other assets 233,597 327,309

Due from affiliates 50,504 60,317

Total assets held for disposition $ 6,691,392 $ 11,237,319

Debt, net (1)

$ 4,285,636 $ 7,352,828

Lease intangibles and other liabilities 442,922 533,688

Total liabilities related to assets held for disposition $ 4,728,558 $ 7,886,516

(1) Represents debt related to assets held for disposition if the debt is expected to be assumed by the acquirer upon sale or if the debt is expected to be extinguished through lender's assumption of underlying collateral, and includes debt that is in receivership, in payment default or not in compliance with certain debt covenants.

Includes the 5.375 % exchangeable senior notes and junior subordinated debt (as described in Note 14) which are obligations of NRF Holdco as the issuer.

Impairment of Assets Classified as Held for Disposition and Discontinued Operations

Real Estate and Related Intangible Assets —Real estate classified as held for disposition and discontinued operations that has been written down and carried at fair value totaled $ 3.8 billion at June 30, 2021 and $ 4.7 billion at December 31, 2020, generally representing fair value using Level 3 inputs.

Impairment of real estate and related intangibles held for disposition was $ 242.6 million and $ 1.5 billion for the three months ended June 30, 2021 and 2020, respectively, and $ 362.3 million and $ 1.8 billion for the six months ended June 30, 2021 and 2020, respectively, reflected in discontinued operations (Note 12).

Properties that were written down to estimated fair value at the time they were classified as held for disposition in both years were valued using either estimated recoverable value, sales price, broker opinions of value, or third-party appraisals, and in certain cases, adjusted as deemed appropriate by management to account for the inherent risk associated with specific properties.

The impairment assessment in 2020 also factored in the economic effects of COVID-19 on real estate values.

Fair value of these properties was generally reduced for estimated selling costs, ranging from 1 % to 3 % of fair value.

For properties that were impaired prior to being classified as held for sale and discontinued operations, largely in 2020, impairment was attributed primarily to shortened hold period assumptions, particularly in the hotel and wellness infrastructure portfolios, driven by the Company's accelerated digital transformation in the second quarter of 2020, and/or to a lesser extent, decline in property operating performance, in part from the economic effects of COVID-19.

Fair value of these properties was estimated based upon:

or (iv) discounted cash flow analyses with terminal values determined using terminal capitalization rates between 7.3 % and 11.3 %, and discount rates between 8.5 % and 9.5 %.

The Company considered the risk characteristics of the properties and adjusted the capitalization rates and/or discount rates as applicable.

Goodwill —Upon termination of the BRSP management contract on April 30, 2021, the Other IM goodwill balance of $ 81.6 million was fully written off as the remaining value of the Other IM reporting unit represented principally the BRSP management contract.

The receipt of a one-time termination payment of $ 102.3 million at closing consequently resulted in a net gain of $ 20.7 million, recognized within other gain (loss) in discontinued operations (Note 12).

The Company had previously recognized impairment loss on its Other IM goodwill of $ 79.0 million in the first quarter of 2020 and $ 515.0 million in the second quarter of 2020.

In light of the economic effects of COVID-19 and the Company's acceleration of its digital transformation in the second quarter of 2020, both of which represented indicators of impairment, the Company's quantitative tests indicated that the carrying value of the Other IM reporting unit, including goodwill, was in excess of its estimated fair value at March 31, 2020 and at June 30, 2020.

The remaining fair value of the Other IM reporting unit was determined to be principally in the BRSP management contract, as no value was ascribed to (a) the future capital raising potential of the non-digital credit and opportunity fund management business as it is no longer part of the Company's long-term strategy;

and (b) the hypothetical contract of internally managing the Company's non-digital balance sheet assets following significant decreases in asset values in 2020.

Other Intangible Assets —In the first quarter of 2021, investor relationship intangible asset in Other IM was impaired by $ 4.0 million (Note 12) to a fair value of $ 5.5 million at the time of impairment based upon estimated recoverable value in a potential monetization of the Company's Other IM business.

During the year ended December 31, 2020, management contracts were impaired by $ 4.3 million to an aggregate fair value of $ 8.4 million at the time of impairment.

Fair value was based upon the revised future net cash flows over the remaining life of the contracts, generally discounted at 10 %, and represent fair value using Level 3 inputs.

Equity Method Investments —Impairment on equity method investments classified as held for disposition and discontinued operations was $ 57.5 million and $ 23.1 million in the six months ended June 30, 2021 and 2020, respectively, reflected within equity method losses in discontinued operations (Note 12).

Equity method investments that were impaired and written down to fair value during the six months ended June 30, 2021 and year ended December 31, 2020 totaled $ 491.8 million and $ 701.8 million, respectively, at the time of impairment, representing fair value using Level 3 inputs.

Impairment recorded in 2021 was based upon estimated recoverable values, primarily on ADC loans accounted for as equity method investments.

Significant impairment was also recorded on these ADC loans in the fourth quarter of 2020, previously driven by reduced future cash flow streams expected from these investments, primarily taking into consideration a combination of lower land values, delayed leasing, and/or offer prices in the current market, generally discounted at rates between 10 % to 20 %.

Assets Carried at Fair Value —These assets are composed of equity investments valued based upon NAV, and equity method investments and loans receivable for which the fair value option was elected.

During the six months ended June 30, 2021 when these assets were classified as held for disposition and discontinued operations, unrealized fair value losses were recognized in other loss of $ 3.1 million for equity investments and $ 101.8 million for loans receivable, and in equity method losses of $ 24.3 million for equity method investments (Note 12).

Additional information is included Note 13 under " —Level 3 Recurring Fair Values.

Discontinued Operations

Discontinued operations represent the following:

• Wellness Infrastructure —operations of the Wellness Infrastructure business, along with other non-core assets held by NRF Holdco, primarily:

(i) the Company's equity interest in and management of NorthStar Healthcare, debt securities collateralized largely by certain debt and preferred equity within the capital structure of the Wellness Infrastructure portfolio, limited partnership interests in private equity real estate funds;

as well as (ii) the 5.375 % exchangeable senior notes, trust preferred securities and corresponding junior subordinated debt, all of which were issued by NRF Holdco who acts as guarantor.

• Other —operations of substantially all of the OED investments and Other IM business in the Other segment, composed of various non-digital real estate, real estate-related equity and debt investments, general partner interests and management rights with respect to these assets, management of BRSP prior to termination of its contract, and underlying compensation and administrative costs for managing these assets.

• Hotel —operations of the Company's Hospitality segment and the THL Hotel Portfolio in the Other segment.

In March 2021, the Company sold five of the six portfolios in the Hospitality segment, and the Company's 55.6 % interest in the THL Hotel Portfolio which was deconsolidated upon sale.

One hotel portfolio remains in receivership and is under contract for sale by the lender.

• Industrial —operations of the bulk industrial portfolio prior to its sale in December 2020.

Loss from discontinued operations is presented below.

Three Months Ended June 30, Six Months Ended June 30,

(In thousands) 2021 2020 2021 2020

Property operating income $ 181,381 $ 256,721 $ 410,870 $ 642,368

Interest income 7,281 20,317 13,234 51,397

Fee income (1)

13,902 23,367 34,100 47,794

Other income 7,389 9,067 18,526 10,671

Revenues from discontinued operations 209,953 309,472 476,730 752,230

Property operating expense 98,341 176,982 276,825 425,180

Interest expense 55,714 87,639 166,436 194,374

Transaction-related costs and investment expense 8,085 9,550 18,056 18,903

Depreciation and amortization 31,884 98,940 82,764 198,289

Impairment loss 242,587 1,989,260 366,347 2,376,528

Compensation, including carried interest, and administrative expense (2)

23,957 25,819 52,716 36,980

Expenses from discontinued operations 460,568 2,388,190 963,144 3,250,254

Other income (loss)

Gain (loss) on sale of real estate 2,968 ( 4,919 ) 48,718 3,013

Other gain (loss), net 142,019 ( 174,286 ) ( 58,024 ) ( 174,528 )

Equity method earnings (losses), including carried interest 30,627 ( 58,503 ) ( 64,259 ) 49,134

Loss from discontinued operations before income taxes ( 75,001 ) ( 2,316,426 ) ( 559,979 ) ( 2,620,405 )

Income tax expense ( 23,905 ) ( 9,370 ) ( 20,187 ) ( 22,927 )

Loss from discontinued operations ( 98,906 ) ( 2,325,796 ) ( 580,166 ) ( 2,643,332 )

Income (loss) from discontinued operations attributable to:

Noncontrolling interests in investment entities 43,387 ( 453,660 ) ( 260,464 ) ( 460,905 )

Noncontrolling interests in Operating Company ( 13,623 ) ( 185,789 ) ( 30,531 ) ( 216,418 )

Loss from discontinued operations attributable to DigitalBridge Group, Inc.

$ ( 128,670 ) $ ( 1,686,347 ) $ ( 289,171 ) $ ( 1,966,009 )

(1) Represents management fees from:

(i) the Company's non-digital private real estate credit funds and co-investment vehicles;

(ii) BRSP (based upon 1.5 % per annum of BRSP's stockholders' equity) prior to the BRSP Internalization on April 30, 2021;

and (iii) NorthStar Healthcare (based upon 1.5 % per annum of NorthStar Healthcare's most recently published NAV, with $ 2.5 million per quarter paid in shares of NorthStar Healthcare common stock priced at its most recently published NAV.

Beginning July 2021, fees are paid fully in shares.

(2) Includes equity-based compensation of $ 4.5 million and $ 6.4 million for the three months ended June 30, 2021 and 2020, respectively, and $ 12.6 million and $ 6.8 million for the six months ended June 30, 2021 and 2020, respectively, of which an expense of $ 0.7 million, $ 3.0 million and $ 5.3 million and a reversal of $ 0.4 million, respectively, relates to BRSP awards that is grossed up in other income and compensation expense.

Reversal was due to a decline in BRSP stock price in the first quarter of 2020 (Note 17).

Recurring Fair Values

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(In thousands) Level 1 Level 2 Level 3 Total

March 31, 2021

June 30, 2021

Marketable equity securities $ 177,595 $ — $ — $ 177,595

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Loans held for disposition — — 761,240 761,240

Equity method investments — — 39,342 39,342

Equity method investments held for disposition — — 120,397 120,397

1 unchanged sentence

— 1,291 — 1,291

Other liabilities—settlement liability — — 36,939 36,939

December 31, 2020

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Marketable Equity Securities

Marketable equity securities consist of publicly traded equity securities held by private open-end funds consolidated by the Company and prior to January 2021, equity investment in a third party mutual fund.

Marketable equity securities consist of publicly traded equity securities held largely by private open-end funds sponsored and consolidated by the Company, and prior to January 2021, equity investment in a third party mutual fund.

The equity securities of the consolidated funds comprise listed stocks primarily in the U.S.

and to a lesser extent, in Europe, and predominantly in the digital real estate and telecommunication sectors.

These marketable equity securities are valued based upon listed prices in active markets and classified as Level 1 of the fair value hierarchy.

Debt Securities

Fair value of N-Star CDO bonds are determined using an internal price interpolated based upon third party prices of the senior N-Star CDO bonds of the respective CDOs, and applying the Company's knowledge of the underlying collateral and recent trades, if any within the securitizations.

All N-Star CDO bonds are classified as Level 3 of the fair value hierarchy.

The Company's investment in debt securities is composed of available-for-sale ("AFS") N-Star CDO bonds, which are subordinate bonds retained by NRF Holdco from its sponsored collateralized debt obligations ("CDOs"), and CDO bonds originally issued by NRF Holdco that it subsequently repurchased at a discount.

These CDOs are collateralized primarily by commercial real estate debt and securities.

The following tables summarize the balance of the N-Star CDO bonds.

Amortized Cost without Allowance for Credit Loss

Allowance for Credit Loss Gross Cumulative Unrealized

(in thousands) Gains Losses Fair Value

June 30, 2021 $ 56,032 $ ( 24,882 ) $ 4,749 $ — $ 35,899

December 31, 2020 46,561 ( 24,688 ) 6,703 — 28,576

There were no sales of N-Star CDO bonds during the six months ended June 30, 2021 and year ended December 31, 2020.

These CDOs have long-dated stated maturities through 2037 and 2041, however, the Company expects the N-Star CDO bonds to have remaining future cash flows up to 2.5 years from June 30, 2021.

Fair value of N-Star CDO bonds, classified as Level 3, are determined using an internal price interpolated based upon third party prices of the senior N-Star CDO bonds of the respective CDOs, and applying the Company's knowledge of the underlying collateral and recent trades, if any within the securitizations.

Impairment of AFS Debt Securities

AFS debt securities are considered to be impaired if their fair value is less than their amortized cost basis.

The non-credit loss component is recognized in other comprehensive income or loss ("OCI").

Changes in allowance for credit losses for AFS debt securities are presented below:

Six Months Ended June 30,

(In thousands) 2021 2020

Allowance for credit losses

Beginning balance $ 24,688 $ —

Provision for credit losses 194 22,229

Ending balance $ 24,882 $ 22,229

At June 30, 2021 and December 31, 2020, there were no AFS debt securities in unrealized loss position without allowance for credit loss.

The Company's derivative instruments generally consist of:

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These derivative contracts may be designated as qualifying hedge accounting relationships, specifically as net investment hedges and cash flow hedges, respectively.

At March 31, 2021 and December 31, 2020, notional amounts aggregated to the equivalent of $ 427.1 million and $ 350.5 million, respectively, for foreign exchange contracts, and the equivalent of $ 2.8 billion and $ 4.6 billion, respectively, for interest rate contracts, all of which were composed predominantly of non-designated economic hedges.

At June 30, 2021 and December 31, 2020, notional amounts aggregated to the equivalent of $ 164.6 million and $ 350.5 million, respectively, for foreign exchange contracts, and the equivalent of $ 2.8 billion and $ 4.6 billion, respectively, for interest rate contracts, all of which were composed predominantly of non-designated economic hedges.

The derivative instruments are subject to master netting arrangements with counterparties that allow the Company to offset the settlement of derivative assets and liabilities in the same currency by instrument type or, in the event of default by the counterparty, to offset all derivative assets and liabilities with the same counterparty.

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Realized and unrealized gains and losses on derivative instruments are recorded in other gain (loss) on the consolidated statement of operations, other than interest expense, as follows:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

(In thousands) 2021 2020 2021 2020

Foreign currency contracts:

Unrealized gain transferred from AOCI to earnings (1)

Realized gain transferred from AOCI to earnings $ 1,520 $ — $ 1,520 $ —

Unrealized gain (loss) transferred from AOCI to earnings (1)

— ( 17 ) — 1,485

Unrealized loss in earnings on non-designated contracts ( 83 ) ( 776 ) ( 328 ) ( 776 )

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Unrealized gain (loss) in earnings on non-designated contracts ( 263 ) ( 105 ) ( 235 ) 74

Realized loss transferred from AOCI to earnings ( 1,292 ) —

Realized gain (loss) transferred from AOCI to earnings ( 36 ) — ( 1,328 ) —

(1) The portion of derivative notional that is in excess of the beginning balance of the foreign denominated net investment is dedesignated upon a reassessment of the effectiveness of net investment hedges at period end.

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At December 31, 2020, the forwards and swaps were in a liability position of $ 102.7 million and $ 0.1 million, respectively.

During the three months ended March 31, 2020, the forwards and swaps had realized and unrealized fair value gains totaling $ 34.5 million, which was partially offset by a decrease in the NAV of the mutual fund of $ 33.1 million, both of which were recorded in other loss on the consolidated statement of operations.

During the three and six months ended June 30, 2020, the forwards and swaps had realized and unrealized fair value losses totaling $ 7.4 million and gains totaling $ 27.1 million, respectively, which were partially offset by an increase in NAV of $ 10.8 million and a decrease in NAV of $ 22.3 million, respectively, in the Company's investment in the mutual fund, both of which were recorded in other income on the consolidated statement of operations.

The Company's foreign currency and interest rate contracts are generally traded over-the-counter, and are valued using a third-party service provider.

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Pursuant to the arrangement, the Company contributed its class A common stock, valued at $ 14.7 million by the venture, and Blackwells contributed $ 1.47 million of cash that was then distributed to the Company, resulting in a net capital contribution of $ 13.23 million by the Company in the venture.

All of the class A common stock held in the venture had been repurchased by the Company in March 2020 (Note 12).

Blackwells may cause the arrangement to be dissolved and all underlying assets distributed at any time, and the Company may do the same after three years.

Distributions to be made through the joint venture arrangement effectively represent a settlement of the proxy contest with Blackwells.

The initial fair value of the arrangement was recorded as a settlement loss on the statement of operations, with a corresponding liability on the balance sheet, subject to remeasurement at each period end.

The settlement liability is a fair value measure of the disproportionate allocation of future profits distribution to Blackwells pursuant to the joint venture arrangement.

Such profits will be derived from dividend payments and any appreciation in value of the Company's class A common stock, allocated between the Company and Blackwells based upon specified return hurdles.

The profits distribution is payable in cash, the Company's class A common stock or a

combination of both at the Company's election.

The initial fair value of the arrangement was recorded as a settlement loss on the statement of operations with a corresponding settlement liability on the consolidated balance sheet.

The settlement liability, classified as a Level 3 fair value, is measured using a Monte Carlo simulation under a risk-neutral premise, assuming that the final distribution occurs at the end of the third year in March 2023, and is remeasured at each reporting period.

At March 31, 2021, the settlement liability was valued at $ 36.9 million, applying the following assumptions:

All of the class A common stock held in the venture was repurchased by the Company in March 2020 (Note 9).

Distributions from the joint venture arrangement upon dissolution effectively represent a settlement of the proxy contest with Blackwells.

The initial fair value of the arrangement was recorded as a settlement loss on the statement of operations in March 2020, with a corresponding liability on the balance sheet, subject to remeasurement at each period end.

The settlement liability represents the fair value of the disproportionate allocation of profits distribution to Blackwells pursuant to the joint venture arrangement.

The profits are derived from dividend payments and appreciation in value of the Company's class A common stock, allocated between the Company and Blackwells based upon specified return hurdles.

In June 2021, Blackwells terminated the arrangement and the joint venture was dissolved.

The profits distribution allocated to Blackwells was valued at $ 47.0 million and paid in the form of 5.95 million shares of the Company's class A common stock, with $ 22.8 million recognized in 2021 through termination as other loss on the consolidated statement of operations.

Prior to dissolution of the arrangement, the settlement liability, classified as a Level 3 fair value, was measured using a Monte Carlo simulation under a risk-neutral premise, assuming that the final distribution would occur at the end of the third year in March 2023.

At December 31, 2020, the settlement liability was valued at $ 24.3 million, applying the following assumptions:

(a) expected volatility of the Company's class A common stock of 67.2 % based upon a combination of historical and implied volatility of the Company's class A common stock;

2 unchanged sentences

Treasury yield.

The settlement liability increased approximately $ 12.7 million in the three months ended March 31, 2021, recorded as other loss on the consolidated statement of operations.

During 2020, the settlement liability increased approximately $ 20.4 million from inception in March 2020, recorded as other loss on the consolidated statement of operations.

Fair Value Option

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Fair value of loans held for investment is determined by comparing the current yield to the estimated yield of newly originated loans with similar credit risk or the market yield at which a third party might expect to purchase such investment, or based upon discounted cash flow projections of principal and interest expected to be collected, which include, but are not limited to, consideration of the financial standing of the borrower or sponsor as well as operating results and/or value of the underlying collateral.

Loans that are 90 days or more past due as to principal or interest, or where reasonable doubt exists as to timely collection, are generally considered nonperforming and placed on nonaccrual status, as presented in the table below.

Such loans include distressed loan portfolios that are held for disposition, previously acquired by the Company at a discount (classified as purchased credit-impaired loans prior to the election of fair value option).

March 31, 2021 December 31, 2020

June 30, 2021 December 31, 2020

(In thousands) Fair Value Unpaid Principal Balance Fair Value less Unpaid Principal Balance Fair Value Unpaid Principal Balance Fair Value less Unpaid Principal Balance

90 days or more past due or nonaccrual

Loans held for investment (1)

$ 48,449 $ 43,374 $ 5,075 $ 47,233 $ 43,007 $ 4,226

Loans held for disposition $ 522,192 $ 1,772,094 $ ( 1,249,902 ) $ 873,205 $ 2,159,538 $ ( 1,286,333 )

(1) Fair value includes accrued interest that is currently expected to be collected.

Level 3 Recurring Fair Values

4 unchanged sentences

Weighted Average (1)

March 31, 2021

June 30, 2021

AFS debt securities

5 unchanged sentences

Loans held for disposition 761,240 Transaction price (4)

Equity method investments—third party private equity funds

2,542 NAV (3)

Equity method investments—other

36,800 Discounted cash flows Discount rate 25.0 %

Equity method investments held for disposition 3,240 NAV (3)

Equity method investments held for disposition 117,157 Transaction price (4)

8 unchanged sentences

( 6.9 % - 25.7 %)

Equity method investments—third party private equity funds 2,472 NAV (3)

Equity method investments—other

28,540 Discounted cash flows Discount rate 30 % Decrease

Equity method investments held for disposition 2,472 NAV (3)

Equity method investments held for disposition 8,383 Discounted cash flows Discount rate 19.3 %

21 unchanged sentences

Allowance for credit losses

( 22,229 ) — —

Realized and unrealized gains (losses) in earnings, net

2 unchanged sentences

1,021 ( 6,514 ) ( 1,408 )

Fair value at March 31, 2020 $ 54,474 $ 1,588,427 $ 218,340

Net unrealized gains (losses) on instruments held at March 31, 2020

Fair value at June 30, 2020 $ 32,271 $ 1,398,087 $ 209,263

Net unrealized gains (losses) on instruments held at June 30, 2020

$ — $ ( 281,266 ) $ ( 12,139 )

In other comprehensive income (loss)

$ 1,488 $ — $ —

$ 1,021 N/A N/A

Fair value at December 31, 2020 $ 28,576 $ 1,295,337 $ 181,799

4 unchanged sentences

Change in accrued interest and capitalization of paid-in-kind interest — 8,851

Change in accounting method for equity interest

— — ( 27,626 )

Deconsolidation of investment entities (Note 21 )

— ( 73,059 ) —

Allowance for credit losses

2 unchanged sentences

( 1,953 ) ( 25,004 ) ( 3,612 )

Fair value at March 31, 2021 $ 34,719 $ 1,063,031 $ 154,503

Net unrealized gains (losses) on instruments held at March 31, 2021

Fair value at June 30, 2021 $ 35,899 $ 814,031 $ 120,397

Net unrealized gains (losses) on instruments held at June 30, 2021

$ — $ ( 81,188 ) $ ( 23,022 )

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Investments Carried at Fair Value Using Net Asset Value

Investments in Company-sponsored private fund and non-traded REIT, and limited partnership interest in a third party real estate private fund that is held for disposition are valued using NAV of the respective vehicles.

March 31, 2021 December 31, 2020

Investments in Company-sponsored private fund and non-traded REIT, and limited partnership interest in a third party real estate private fund, all of which are held for disposition (Note 11), are valued using NAV of the respective vehicles.

June 30, 2021 December 31, 2020

(In thousands) Fair Value Unfunded Commitments Fair Value Unfunded Commitments

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No secondary market currently exists for shares of the non-traded REIT and the Company does not currently expect to seek liquidity of its shares of the non-traded REIT.

Subject to then-existing market conditions, the board of directors of the non-traded REIT, along with the Company, as sponsor, are expected to consider alternatives for providing liquidity to the non-traded REIT shares beginning 2021, five years from completion of the offering stage, but with no definitive date by

which it must do so.

In addition, the Company has agreed that any right to have its shares redeemed is subordinated to third party stockholders for so long as its advisory agreement is in effect.

2 unchanged sentences

Adjustments to fair value generally result from the application of lower of amortized cost or fair value accounting for assets held for disposition or otherwise, write-down of asset values due to impairment.

Impairments are discussed in Note 4 for real estate, Notes 5 and 14 for equity method investments, and Notes 6 and 14 for investment management intangible assets, including goodwill.

Impairment is discussed in Note 11 for real estate, Notes 5 and 11 for equity method investments, and Notes 6 and 11 for intangible assets, including goodwill.

Fair Value Information on Financial Instruments Reported at Cost

2 unchanged sentences

(In thousands) Level 1 Level 2 Level 3 Total

March 31, 2021

June 30, 2021

Debt at amortized cost

Corporate credit facility $ — $ 45,000 $ — $ 45,000 $ 45,000

Convertible and exchangeable senior notes 1,264,838 — — 1,264,838 490,211

Secured debt — — 3,342,453 3,342,453 3,342,453

Secured debt related to assets held for disposition — — 1,691,130 1,691,130 1,702,425

Junior subordinated debt — — 227,697 227,697 204,618

Debt related to assets held for disposition — 13,095 4,295,704 4,308,799 4,285,636

December 31, 2020

2 unchanged sentences

Secured debt — — 3,407,175 3,407,175 3,410,467

Secured debt related to assets held for disposition — — 4,258,019 4,258,019 4,411,467

Junior subordinated debt — — 201,018 201,018 203,848

Debt —Senior notes were valued using the last trade price in active markets and unadjusted quoted prices in non-active markets.

Fair value of the corporate credit facility and secured debt was estimated by discounting expected future cash outlays at interest rates available to the Company for similar instruments.

Junior subordinated debt was valued based upon unadjusted quotations from a third party valuation firm, with such quotes derived using a combination of internal valuation models, comparable trades in non-active markets and other market data.

Debt related to assets held for disposition — 13,095 7,055,237 7,068,332 7,352,828

Debt —Senior notes were valued using the last trade price in active markets or unadjusted quoted price in non-active market for the senior note that is held for disposition.

Fair value of the corporate credit facility and secured debt, including amounts held for disposition, was estimated by discounting expected future cash outlays at interest rates available to the Company for similar instruments.

Junior subordinated debt that is held for disposition was valued based upon unadjusted quotations from a third party valuation firm, with such quotes derived using a combination of internal valuation models, comparable trades in non-active markets and other market data.

Other —The carrying values of cash, accounts receivable, due from and to affiliates, interest payable and accounts payable approximate fair value due to their short term nature and credit risk, if any, are negligible.

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The absence of such rights, which represent voting rights in a limited partnership equivalent structure, would render OP to be a VIE.

The Company, as managing member, has the power to direct the core activities of OP that most significantly affect OP's performance, and through its majority interest in OP, has both the right to receive benefits from and the obligation to absorb losses of OP.

The Company, as managing member, has the power to direct the core

activities of OP that most significantly affect OP's performance, and through its majority interest in OP, has both the right to receive benefits from and the obligation to absorb losses of OP.

Accordingly, the Company is the primary beneficiary of OP and consolidates OP.

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As a result, the Company is considered to be acting in the capacity of a principal of the sponsored private fund and is therefore the primary beneficiary of the fund.

The Company’s exposure is limited to the value of its outstanding investment in the consolidated private funds of $ 47.1 million at March 31, 2021 and $ 46.5 million at December 31, 2020.

The Company’s exposure is limited to the value of its outstanding investment in the consolidated private funds of $ 49.0 million at June 30, 2021 and $ 46.5 million at December 31, 2020.

The Company, as general partner, is not obligated to provide any financial support to the consolidated private funds.

At March 31, 2021 and December 31, 2020, the consolidated private funds had total assets of $ 192.2 million and $ 172.2 million, respectively, and total liabilities of $ 49.0 million and $ 41.8 million, respectively, made up primarily of cash, marketable equity securities and unsettled trades.

At June 30, 2021 and December 31, 2020, the consolidated private funds had total assets of $ 207.6 million and $ 172.2 million, respectively, and total liabilities of $ 56.8 million and $ 41.8 million, respectively, made up primarily of cash, marketable equity securities and unsettled trades.

Unconsolidated Company-Sponsored Private Funds —The Company does not consolidate its sponsored private funds where it has insignificant direct equity interests or capital commitments to these funds as general partner.

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The Company accounts for its equity interests in unconsolidated sponsored private funds under the equity method.

The Company's maximum exposure to loss is limited to the carrying value of its investment in the unconsolidated sponsored private funds, totaling $ 221.9 million at March 31, 2021 and $ 214.4 million at December 31, 2020, included within equity and debt investments.

The Company's maximum exposure to loss is limited to the carrying value of its investment in the unconsolidated sponsored private funds, totaling $ 304.0 million at June 30, 2021 and $ 214.4 million at December 31, 2020, included within equity and debt investments.

Securitizations

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The Company concluded that it does not have the power to direct the activities that most significantly impact the economic performance of these CDOs, which include but are not limited to, the ability to sell distressed collateral, and therefore the Company is not the primary beneficiary of such CDOs and does not consolidate these CDOs.

The Company’s exposure to loss is limited to its investment in these unconsolidated CDOs, comprising CDO bonds, which aggregate to $ 31.3 million at March 31, 2021 and $ 21.9 million at December 31, 2020.

The Trusts, wholly-owned subsidiaries of NRF Holdco, formed as statutory trusts, previously issued preferred securities and used the proceeds to purchase junior subordinated notes to evidence loans made to NRF Holdco (Note 9).

The Company’s exposure to loss is limited to its investment in these unconsolidated CDOs, comprising CDO bonds, which

aggregate to $ 31.2 million at June 30, 2021 and $ 21.9 million at December 31, 2020, as described further in Note 13.

These CDOs are included within assets held for disposition on the consolidated balance sheet (Note 11).

Wholly-owned subsidiaries of NRF Holdco that were formed as statutory trusts, NorthStar Realty Finance Trust I through VIII (the “Trusts”), previously issued trust preferred securities ("TruPS") in private placement offerings and used the proceeds to purchase junior subordinated notes to evidence loans made to NRF Holdco.

The sole assets of the Trusts consist of a like amount of junior subordinated notes issued by the Issuer at the time of the offerings (the "Junior Notes").

Neither the Company nor the OP is an obligor or guarantor on the Junior Notes or the TruPS.

NRF Holdco may redeem the Junior Notes at par, in whole or in part, for cash, after five years .

To the extent NRF Holdco redeems the Junior Notes, the Trusts are required to redeem a corresponding amount of TruPS.

The Company owns all of the common stock of the Trusts but does not consolidate the Trusts as the holders of the preferred securities issued by the Trusts are the primary beneficiaries of the Trusts.

The Company accounts for its interest in the Trusts under the equity method and its maximum exposure to loss is limited to its investment carrying value of $ 3.7 million at March 31, 2021 and December 31, 2020, recorded in investments in unconsolidated ventures on the consolidated balance sheet.

The junior subordinated notes are recorded as debt on the consolidated balance sheet.

Stockholders’ Equity

The table below summarizes the share activities of the Company's preferred and common stock.

Number of Shares

(In thousands) Preferred Stock Class A

Shares outstanding at December 31, 2019 41,350 487,044 734

Repurchase of common stock, net (1)

— ( 12,733 ) —

Equity-based compensation, net of forfeitures — 7,646 —

Shares canceled for tax withholding on vested stock awards — ( 1,839 ) —

Shares outstanding at March 31, 2020 41,350 480,118 734

Shares outstanding at December 31, 2020 41,350 483,406 734

Shares issued upon redemption of OP Units — 5 —

Equity-based compensation, net of forfeitures — 4,839 —

Shares canceled for tax withholding on vested stock awards — ( 1,147 ) —

Shares outstanding at March 31, 2021 41,350 487,103 734

(1) Net of reissuance of 964,160 shares of class A common stock that had been repurchased by the Company during March 2020.

Refer to discussion of settlement liability in Note 10.

Preferred Stock

In the event of a liquidation or dissolution of the Company, preferred stockholders have priority over common stockholders for payment of dividends and distribution of net assets.

The table below summarizes the preferred stock issued and outstanding at March 31, 2021:

Description Dividend Rate Per Annum Initial Issuance Date Shares Outstanding

(in thousands)

Liquidation Preference

(in thousands)

Earliest Redemption Date

Series G 7.5 % June 2014 3,450 $ 35 $ 86,250 Currently redeemable

Series H 7.125 % April 2015 11,500 115 287,500 Currently redeemable

Series I 7.15 % June 2017 13,800 138 345,000 June 5, 2022

Series J 7.125 % September 2017 12,600 126 315,000 September 22, 2022

41,350 $ 414 $ 1,033,750

All series of preferred stock are at parity with respect to dividends and distributions, including distributions upon liquidation, dissolution or winding up of the Company.

Dividends on Series G, H, I and J of preferred stock are payable quarterly in arrears in January, April, July and October.

Preferred stock generally does not have any voting rights, except if the Company fails to pay the preferred dividends for six or more quarterly periods (whether or not consecutive).

In addition, certain changes to the terms of any series of

preferred stock cannot be made without the affirmative vote of holders of at least two-thirds of the outstanding shares of each such series of preferred stock voting separately as a class for each series of preferred stock.

Redemption of Preferred Stock

In January 2020, the Company settled the December 2019 redemption of its outstanding Series B and Series E preferred stock for $ 402.9 million.

All preferred stock redemptions were at $ 25.00 per share liquidation preference plus accrued and unpaid dividends prorated to their respective redemption dates.

Class A common stock has one vote per share and class B common stock has thirty-six and one-half votes per share.

The Company suspended dividends on its class A common stock beginning with the second quarter of 2020.

Under the terms of the Company's amended credit facility, the Company is restricted from paying common dividends other than to maintain the Company’s status as a REIT or to reduce income tax payments.

The Company will continue to monitor its financial performance and liquidity position, and as economic conditions improve, the Company will reevaluate its dividend policy in consultation with its revolver lending group.

Common Stock Repurchases

Effective June 29, 2020, the Company is restricted from repurchasing additional common shares, subject to certain exceptions, under the terms of its Credit Agreement (Note 9).

Dividend Reinvestment and Direct Stock Purchase Plan

There were no shares of class A common stock acquired under the DRIP Plan in the form of new issuances in 2021 and 2020.

Accumulated Other Comprehensive Income (Loss)

The following tables present the changes in each component of AOCI attributable to stockholders and noncontrolling interests in investment entities, net of immaterial tax effect.

AOCI attributable to noncontrolling interests in Operating Company is immaterial.

Changes in Components of AOCI—Stockholders

(In thousands)

Company's Share in AOCI of Equity Method Investments Unrealized Gain (Loss) on AFS Debt Securities Unrealized Gain (Loss) on Cash Flow Hedges

Foreign Currency Translation Gain (Loss)

Unrealized Gain (Loss) on Net Investment Hedges

AOCI at December 31, 2019 $ 9,281 $ 7,823 $ ( 226 ) $ 139 $ 30,651 $ 47,668

Other comprehensive income (loss) before reclassifications ( 23,850 ) 1,330 7 ( 24,929 ) 16,384 ( 31,058 )

Amounts reclassified from AOCI — — — 246 ( 634 ) ( 388 )

AOCI at March 31, 2020 $ ( 14,569 ) $ 9,153 $ ( 219 ) $ ( 24,544 ) $ 46,401 $ 16,222

AOCI at December 31, 2020 $ 17,718 $ 6,072 $ ( 233 ) $ 52,832 $ 45,734 $ 122,123

Other comprehensive income (loss) before reclassifications ( 2,438 ) ( 2,992 ) — ( 19,631 ) 3,761 ( 21,300 )

Amounts reclassified from AOCI — — 233 — — 233

AOCI at March 31, 2021 $ 15,280 $ 3,080 $ — $ 33,201 $ 49,495 $ 101,056

Changes in Components of AOCI—Noncontrolling Interests in Investment Entities

(In thousands) Unrealized Gain (Loss) on Cash Flow Hedges Foreign Currency Translation Gain (Loss) Unrealized Gain (Loss) on Net Investment Hedges Total

AOCI at December 31, 2019 $ ( 1,005 ) $ ( 17,913 ) $ 10,659 $ ( 8,259 )

Other comprehensive income (loss) before reclassifications 33 ( 32,958 ) 4,865 ( 28,060 )

Amounts reclassified from AOCI — — ( 799 ) ( 799 )

AOCI at March 31, 2020 $ ( 972 ) $ ( 50,871 ) $ 14,725 $ ( 37,118 )

AOCI at December 31, 2020 $ ( 1,030 ) $ 83,845 $ 15,099 $ 97,914

Other comprehensive income (loss) before reclassifications — ( 37,686 ) — ( 37,686 )

Amounts reclassified from AOCI 1,030 — — 1,030

AOCI at March 31, 2021 $ — $ 46,159 $ 15,099 $ 61,258

Reclassifications out of AOCI—Stockholders

Information about amounts reclassified out of AOCI attributable to stockholders by component is presented below.

On the consolidated statement of operations, such amounts are included in other gain (loss) for continuing and discontinued operations, as applicable, except for amounts related to equity method investments, where applicable, are included in equity method losses in discontinued operations.

(In thousands)

Three Months Ended March 31,

Component of AOCI reclassified into earnings

Release of foreign currency cumulative translation adjustments

$ — $ ( 246 )

Unrealized gain on dedesignated net investment hedges — 634

Realized loss on cash flow hedges ( 233 ) —

Noncontrolling Interests

Redeemable Noncontrolling Interests

Three Months Ended March 31,

(In thousands) 2021 2020

Beginning balance $ 305,278 $ 6,107

Contributions 10,640 250

Distributions and redemptions ( 2,445 ) ( 2,647 )

Net income (loss) 2,449 ( 548 )

Ending balance $ 315,922 $ 3,162

Strategic Partnership in the Company's Digital Investment Management Business

In July 2020, the Company formed a strategic partnership with affiliates of Wafra, Inc.

The investment entitles Wafra to participate in approximately 31.5 % of the net management fees and carried interest generated by the Digital IM Business.

In addition, the Company issued Wafra five warrants to purchase up to an aggregate of 5 % (on a fully-diluted, post-transaction basis) of the Company’s class A common stock.

No warrants have been exercised to-date.

Wafra paid cash consideration of $ 253.6 million at closing in exchange for its investment in the Digital IM Business and for the warrants.

As previously agreed, Wafra paid additional consideration of $ 29.9 million in the Digital IM Business in April 2021 based upon the Digital IM Business having achieved a minimum run-rate of earnings before interest, tax, depreciation and amortization ("EBITDA") of $ 72.0 million as of December 31, 2020.

To further enhance the alignment of interests, the Company entered into an amended and restated restrictive covenant agreement with each of Mr.

Ganzi and Mr.

Jenkins, pursuant to which they agreed to certain enhanced non-solicitation provisions and extension of the term of existing non-competition agreements.

Wafra’s investment provides the Company with permanent capital to pursue strategic digital infrastructure investments and further grow the Digital IM Business.

Noncontrolling Interests in Operating Company

Certain current and former employees of the Company directly or indirectly own interests in OP, presented as noncontrolling interests in the Operating Company.

Redemption of OP Units —The Company redeemed 5,147 OP Units during the three months ended March 31, 2021 and 2,184,395 OP Units during the year ended December 31, 2020, with the issuance of an equal number of shares of class A common stock on a one -for-one basis.

Discontinued Operations

Discontinued operations represent the following:

• Other —operations of substantially all of the OED investments and Other IM business in the Other segment, composed of non-digital real estate, real estate-related equity and debt investments, fee income from CLNC and the Company's private real estate credit funds and co-investment vehicles, and underlying compensation and administrative costs for managing these non-digital investments and investment vehicles.

• Hotel —operations of the Company's Hospitality segment and the THL Hotel Portfolio in the Other segment.

In March 2021, the Company sold five of the six portfolios in the Hospitality segment and the Company's 55.6 % interest in the THL Hotel Portfolio which was deconsolidated upon sale.

One hotel portfolio remains in receivership.

• Industrial —operations of the bulk industrial portfolio prior to its sale in December 2020.

Income (loss) from discontinued operations is presented below.

Three Months Ended March 31, 2021 Three Months Ended March 31, 2020

(In thousands) Other Hotel Total Other Hotel Industrial Total

Property operating income $ 21,169 $ 122,106 $ 143,275 $ 28,352 $ 213,111 $ 5,379 $ 246,842

Interest income 4,132 — 4,132 30,262 — 17 30,279

Fee income 15,962 — 15,962 18,377 — — 18,377

Other income 8,260 22 8,282 136 62 — 198

Revenues from discontinued operations 49,523 122,128 171,651 77,127 213,173 5,396 295,696

Property operating expense 13,253 112,829 126,082 12,612 167,543 1,473 181,628

Interest expense 15,700 62,318 78,018 10,002 49,971 2,406 62,379

Transaction-related, investment and servicing costs 5,894 1,794 7,688 4,711 1,560 — 6,271

Depreciation and amortization 11,670 7,668 19,338 13,062 47,561 633 61,256

Impairment loss 108,528 — 108,528 86,373 252,363 — 338,736

Compensation, including carried interest, and administrative expense (1)

20,557 2,410 22,967 2,282 2,033 414 4,729

Expenses from discontinued operations 175,602 187,019 362,621 129,042 521,031 4,926 654,999

Other income (loss)

Gain on sale of real estate 391 45,359 45,750 7,932 — — 7,932

Other gain (loss), net ( 200,683 ) 3 ( 200,680 ) 3,375 2,857 4 6,236

Equity method earnings (losses), including carried interest ( 92,611 ) — ( 92,611 ) 109,170 — — 109,170

Income (loss) from discontinued operations before income taxes ( 418,982 ) ( 19,529 ) ( 438,511 ) 68,562 ( 305,001 ) 474 ( 235,965 )

Income tax benefit (expense) 2,613 ( 1,524 ) 1,089 ( 16,482 ) 2,589 — ( 13,893 )

Income (loss) from discontinued operations ( 416,369 ) ( 21,053 ) ( 437,422 ) 52,080 ( 302,412 ) 474 ( 249,858 )

Income (loss) from discontinued operations attributable to:

Noncontrolling interests in investment entities ( 302,387 ) 3,370 ( 299,017 ) 35,116 ( 31,655 ) 170 3,631

Noncontrolling interests in Operating Company ( 10,863 ) ( 2,328 ) ( 13,191 ) 1,674 ( 26,726 ) 30 ( 25,022 )

Income (loss) from discontinued operations attributable to Colony Capital, Inc.

$ ( 103,119 ) $ ( 22,095 ) $ ( 125,214 ) $ 15,290 $ ( 244,031 ) $ 274 $ ( 228,467 )

(1) Includes equity-based compensation of $ 7.3 million and a reversal of $ 0.4 million for the three months ended March 31, 2021 and 2020, respectively, of which $ 4.6 million and a reversal of $ 3.4 million, respectively, relates to CLNC awards that is grossed up in other income and compensation expense.

Reversal was due to a decline in CLNC stock price (Note 17).

The Company accounts for its interest in the Trusts under the equity method and its maximum exposure to loss is limited to its investment carrying value of $ 3.7 million at June 30, 2021 and December 31, 2020.

The Trusts are recorded as equity investments and the junior subordinated notes as debt, both classified as held for disposition on the consolidated balance sheet (Note 11).

Earnings per Share

The following table provides the basic and diluted earnings per common share computations:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

(In thousands, except per share data) 2021 2020 2021 2020

Net loss allocated to common stockholders

Loss from continuing operations $ ( 190,177 ) $ ( 154,199 )

Income (loss) from continuing operations $ 3,823 $ ( 393,197 ) $ ( 142,516 ) $ ( 479,718 )

Loss from continuing operations attributable to noncontrolling interests 2,103 55,270 62,653 79,294

Loss from continuing operations attributable to Colony Capital, Inc.

( 121,076 ) ( 113,692 )

Loss from discontinued operations attributable to Colony Capital, Inc.

Income (loss) from continuing operations attributable to DigitalBridge Group, Inc.

$ 5,926 $ ( 337,927 ) $ ( 79,863 ) $ ( 400,424 )

Net loss attributable to Colony Capital, Inc.

Loss from discontinued operations attributable to DigitalBridge Group, Inc.

( 128,670 ) ( 1,686,347 ) ( 289,171 ) ( 1,966,009 )

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Net loss attributable to common stockholders per common share—diluted $ ( 0.29 ) $ ( 4.33 ) $ ( 0.85 ) $ ( 5.06 )

(1) For the three months ended March 31, 2021 and 2020, excluded from the calculation of diluted earnings per share is the effect of adding back $ 7.7 million and $ 7.1 million of interest expense, respectively, and 144,576,000 and 38,112,100 of weighted average dilutive common share equivalents, respectively, for the assumed conversion or exchange of the Company's outstanding convertible and exchangeable notes, as their inclusion would be antidilutive.

(2) No unvested non-participating restricted shares were outstanding during the three months ended March 31, 2021 and 2020.

The calculation of diluted earnings per share excludes the effect of class A common stock that are contingently issuable in relation to performance stock units (Note 17) with weighted average shares of 10,395,900 and 1,520,700 for the three months ended March 31, 2021 and 2020, respectively, as the effect would be antidilutive.

Also excluded from the calculation of diluted earnings per share is the effect of class A common stock that are issuable to net settle the exercise of warrants (Note 13) with weighted average shares of 7,680,900 for the three months ended March 31, 2021 as the effect would be antidilutive.

(3) OP Units may be redeemed for registered or unregistered class A common stock on a one -for-one basis.

At March 31, 2021 and 2020 there were 51,072,000 and 53,261,100 OP Units, respectively.

OP Units would not be dilutive and were not included in the computation of diluted earnings per share for all periods presented.

The Company's real estate investment management platform manages capital on behalf of institutional and retail investors in private funds, non-traded REIT, and other investment vehicles for which the Company earns fee income.

Fee income, as presented below, excludes base management fees from CLNC (which was based upon 1.5% per annum of CLNC's stockholders' equity) and the Company's private real estate credit funds and co-investment vehicles, all of which are included in discontinued operations (Note 14).

The Company earns fee income from the following sources:

Three Months Ended March 31,

(In thousands) 2021 2020

Institutional funds and other investment vehicles

$ 30,200 $ 20,562

Non-traded REIT

$ 33,679 $ 25,128

The following table presents the Company's fee income by type:

Three Months Ended March 31,

(1) With respect to the assumed conversion or exchange of the Company's outstanding senior notes, the following are excluded from the calculation of diluted earnings per share as their inclusion would be antidilutive:

(a) for the three months ended June 30, 2021 and 2020, the effect of adding back $ 7.9 million and $ 7.1 million of interest expense, respectively, and 144,259,100 and 38,112,100 of weighted average dilutive common share equivalents, respectively;

and (b) for the six months ended June 30, 2021 and 2020, the effect of adding back $ 15.6 million and $ 14.2 million of interest expense, respectively, and 144,416,700 and 38,112,100 of weighted average dilutive common share equivalents, respectively.

(2) The calculation of diluted earnings per share excludes the effect of the following as their inclusion would be antidilutive:

(a) class A common shares that are contingently issuable in relation to performance stock units (Note 17) with weighted average shares of 13,225,000 and 6,047,300 for the three months ended June 30, 2021 and 2020, respectively, and 11,810,500 and 3,784,000 for the six months ended June 30, 2021 and 2020, respectively;

and (b) class A common shares that are issuable to net settle the exercise of warrants (Note 10) with weighted average shares of 11,458,300 and 9,670,500 for the three and six months ended June 30, 2021, respectively.

(3) OP Units may be redeemed for registered or unregistered class A common stock on a one -for-one basis and are not dilutive.

At June 30, 2021 and 2020, 51,993,800 and 53,076,700 of OP Units, respectively, were not included in the computation of diluted earnings per share for all periods presented.

The Company's digital real estate investment management platform manages capital on behalf of largely institutional investors in private funds and other investment vehicles for which the Company earns fee income.

The following table presents the Company's fee income by type, excluding amounts classified as discontinued operations (Note 12):

Three Months Ended June 30, Six Months Ended June 30,

(In thousands) 2021 2020 2021 2020

Management fees ($ 32,096 and $ 24,116 from affiliates, respectively)

Management fees

$ 39,727 $ 18,599 $ 67,466 $ 36,545

Incentive fees

Other fee income—affiliates

Total fee income

4,489 — 5,083 —

Management Fees — The Company earns management fees for the day-to-day operations and administration of its managed private funds, non-traded REIT, and other investment vehicles, calculated as follows:

• Private Funds and similar investment vehicles—generally 0.45 % to 1.50 % per annum of investors' committed capital during commitment or investment period and thereafter, of contributed or invested capital;

• Non-Traded REIT— 1.5 % per annum of most recently published NAV (as may be subsequently adjusted for any special distribution) for NorthStar Healthcare.

$ 2.5 million per quarter of base management fee for NorthStar Healthcare is paid in shares of NorthStar Healthcare common stock at a price per share equal to its most recently published NAV per share (as may be subsequently adjusted for any special distribution).

Incentive Fees —Pursuant to the terms of a sub-advisory agreement, the Company manages a sub-account of a third party private fund and earns an incentive fee, but not management fees, based upon the returns of the sub-account, measured on a monthly basis, and subject to the recovery of any initial losses in the account that are allocated to the Company.

Other fee income

941 1,574 2,051 2,706

Total fee income—affiliates $ 45,157 $ 20,173 $ 74,600 $ 39,251

Management Fees — The Company earns management fees for the day-to-day operations and administration of its sponsored digital private funds and other digital investment vehicles, generally at an annual rate ranging from 0.45 % to 1.50 % of investors' committed capital during commitment or investment period, and thereafter, of contributed or invested capital.

Incentive Fees —The Company earns incentive fees from various managed accounts based upon the performance of the respective accounts, subject to the achievement of specified return thresholds in accordance with the terms set out in their respective governing agreements.

A portion of the incentive fees earned by the Company (generally 60 %) is allocable to senior management, investment professionals, and certain other employees of the Company, included in carried interest and incentive fee compensation expense.

Other Fee Income —Other fees include primarily service fees for information technology, facilities and operational support provided to portfolio companies.

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Shares reserved for the issuance of awards under the Equity Incentive Plan are subject to equitable adjustment upon the occurrence of certain corporate events, provided that this number automatically increases each January 1st by 2 % of the outstanding number of shares of the Company’s class A common stock on the immediately preceding December 31st.

At March 31, 2021, an aggregate 73.8 million shares of the Company's class A common stock were reserved for the issuance of awards under the Equity Incentive Plan.

At June 30, 2021, an aggregate 73.8 million shares of the Company's class A common stock were reserved for the issuance of awards under the Equity Incentive Plan.

Restricted Stock — Restricted stock awards in the Company's class A common stock are granted to senior executives, directors and certain employees, generally subject to a service condition only, with annual time-based vesting in equal tranches over a three -year period.

1 unchanged sentence

Restricted stock awards are valued based on the Company's class A common stock price on grant date and equity-based compensation expense is recognized on a straight-line basis over the requisite service period.

Restricted Stock Units ("RSUs") — RSUs in the Company's class A common stock are subject to a performance condition.

Restricted Stock Units — RSUs in the Company's class A common stock are subject to a performance condition.

Vesting of performance-based RSUs occur upon achievement of certain Company-specific metrics over a performance measurement period.

Only vested RSUs are entitled to accrued dividends declared and paid on the Company's class A common stock during the time period the RSUs are outstanding.

Fair value of RSUs are based on the

Company's class A common stock price on grant date.

Fair value of RSUs are based on the Company's class A common stock price on grant date.

Equity-based compensation expense is recognized when it becomes probable that the performance condition will be met.

Performance Stock Units ("PSUs") — PSUs are granted to senior executives and certain employees, and are subject to both a service condition and a market condition.

Following the end of the measurement period, the recipients of PSUs who remain employed will vest in, and be issued a number of shares of the Company's class A common stock, generally ranging from 0 % to 200 % of the number of PSUs granted and determined based upon the performance of the Company's class A common stock relative to that of a specified peer group over a three-year measurement period (such measurement metric the "total shareholder return").

Performance Stock Units — PSUs are granted to senior executives and certain employees, and are subject to both a service condition and a market condition.

measurement metric the "total shareholder return").

In addition, recipients of PSUs whose employment is terminated after the first anniversary of their PSU grant are eligible to vest in a portion of the PSU award following the end of the measurement period based upon achievement of the total shareholder return metric applicable to the award.

37 unchanged sentences

DSUs awarded in lieu of annual base fees are fully vested on their grant date, while DSUs awarded in lieu of restricted stock awards vest one year from their grant date.

DSUs are entitled to a dividend equivalent, in the form of additional DSUs based on dividends declared and paid on the Company's class A common stock, subject to the same restrictions and vesting conditions, where applicable.

entitled to a dividend equivalent, in the form of additional DSUs based on dividends declared and paid on the Company's class A common stock, subject to the same restrictions and vesting conditions, where applicable.

Upon separation of service from the Company, vested DSUs will be settled in shares of the Company’s class A common stock.

1 unchanged sentence

Equity-based compensation expense, excluding amounts related to businesses presented as discontinued operations (Note 12), is as follows:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

(In thousands)

2021 2020 2021 2020

Compensation expense (including $ 50 , $ 580 , $ 1,114 and $ 863 amortization of fair value of dividend equivalent rights, respectively)

11 unchanged sentences

Forfeited ( 155,703 ) — — — ( 871,467 ) ( 1,027,170 ) 4.88 3.01

Unvested shares and units at March 31, 2021

Unvested shares and units at June 30, 2021

8,571,144 10,922,510 127,185 9,589,564 10,501,080 39,711,483 3.69 2.40

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PSUs for which the total shareholder return was not met at the end of the performance period are forfeited.

Fair value of equity awards that vested, determined based upon their respective fair values at vesting date, was $ 27.5 million and $ 10.1 million for the three months ended March 31, 2021 and 2020, respectively.

At March 31, 2021, aggregate unrecognized compensation cost for all unvested equity awards was $ 92.0 million, which is expected to be recognized over a weighted average period of 2.6 years.

Fair value of equity awards that vested, determined based upon their respective fair values at vesting date, was $ 26.1 million and $ 3.3 million for the three months ended June 30, 2021 and 2020, respectively, and $ 53.7 million and $ 13.4 million for the six months ended June 30, 2021 and 2020, respectively.

At June 30, 2021, aggregate unrecognized compensation cost for all unvested equity awards was $ 73.7 million, which is expected to be recognized over a weighted average period of 2.5 years.

Awards Granted by Managed Companies

Prior to the termination of the Company’s management agreement with CLNC on April 30, 2021, CLNC granted restricted stock to the Company and certain of the Company's employees ("managed company awards") that typically vest over a three-year period, subject to a service condition.

Prior to the termination of the Company’s management agreement with BRSP on April 30, 2021, BRSP granted restricted stock to the Company and certain of the Company's employees ("managed company awards") that typically vest over a three -year period, subject to a service condition.

Generally, the Company granted the managed company awards that it received in its capacity as manager to its employees with substantially the same terms and service requirements.

Such grants were made at the discretion of the Company, and the Company may consult with the board of directors or compensation committee of CLNC as to final allocation of awards to its employees.

Such grants were made at the discretion of the Company, and the Company may consult with the board of directors or compensation committee of BRSP as to final allocation of awards to its employees.

Managed company awards granted to the Company, pending grant by the Company to its employees, are recognized based upon their fair value at grant date as other assets and other liabilities on the consolidated balance sheet.

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The other asset and other liability associated with managed company awards granted to employees are subject to adjustment to fair value at each reporting period, with changes reflected in equity-based compensation and other income, respectively.

Equity-based compensation related to CLNC awards granted by the Company to its employees was accelerated in 2021 as the awards fully vest upon termination of the CLNC management contract in April 2021.

For the three months ended March 31, 2021, equity-based compensation of $ 4.6 million was recognized, with a corresponding amount recorded in other income.

For the three months ended March 31, 2020, an expense reversal of $ 3.4 million was recognized based upon a remeasurement of the awards at CLNC's stock price on March 31, 2020.

Equity-based compensation related to BRSP awards granted by the Company to its employees was accelerated in the six months ended June 30, 2021 as the awards fully vested upon termination of the BRSP management contract in April 2021.

Equity-based compensation was an expense of $ 0.7 million and $ 3.0 million for the three months ended June 30, 2021 and 2020, respectively, and an expense of $ 5.3 million and expense reversal of $ 0.4 million for the six months ended June 30, 2021 and 2020, respectively, with corresponding amounts recognized in other income.

The expense reversal occurred in the first quarter of 2020 due to a decrease in BRSP's stock price on March 31, 2020.

Amounts recorded in both years are reflected within discontinued operations (Note 12).

Transactions with Affiliates

Affiliates include (i) private funds, traded and non-traded REITs and other investment vehicles that the Company manages or sponsors, and in which the Company may have an equity interest or co-invests with;

Affiliates include (i) private funds and other investment vehicles that the Company manages or sponsors, and in which the Company may have an equity interest or co-invests with;

(ii) the Company's investments in unconsolidated ventures;

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Amounts due from and due to affiliates consist of the following, excluding amounts related to discontinued operations that are presented as assets held for sale (Note 11):

(In thousands) March 31, 2021 December 31, 2020

(In thousands) June 30, 2021 December 31, 2020

Due from Affiliates

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Cost reimbursements and recoverable expenses 3,658 5,545

Loan and interest receivable 35,088 35,089

Employees and other affiliates 125 541

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Employees and other affiliates

Transactions with affiliates include the following:

Fee Income —Fee income earned from investment vehicles that the Company manages and/or sponsors, and may have an equity interest or co-investment, are presented in Note 16, except for fee income and fee receivable from CLNC and the Company's private real estate credit funds and co-investment vehicles that are included within discontinued operations (Note 14) and assets held for sale (Note 7).

Cost Reimbursements— The Company received cost reimbursement income related largely to the following arrangements.

• Direct and indirect operating costs, including but not limited to compensation, overhead and other administrative costs, for managing the operations of NorthStar Healthcare, with reimbursements limited to the greater of 2 % of average invested assets or 25 % of net income (net of management fees);

• Costs incurred in performing investment due diligence for NorthStar Healthcare and private funds managed by the Company;

• Services provided to the Company's unconsolidated investment ventures for servicing and managing their loan portfolios, including foreclosed properties.

Such cost reimbursements, included in other income, totaled $ 1.5 million and $ 4.2 million for the three months ended March 31, 2021 and 2020, respectively.

Reimbursements of direct and indirect operating costs for managing the operations of CLNC is reflected in other income within discontinued operations (Note 14) and related receivable is reflected as amount due from affiliates within assets held for sale (Note 7).

Significant transactions with affiliates include the following:

Fee Income —Fee income earned from investment vehicles that the Company manages and/or sponsors, and may have an equity interest or co-investment, are presented in Note 16, except for amounts included within discontinued operations (Note 12) and assets held for sale (Note 11).

Cost Reimbursements— The Company receives reimbursements related largely to costs incurred in performing investment due diligence for funds and other investment vehicles managed by the Company.

Such cost reimbursements, included in other income, totaled $ 0.9 million and $ 2.8 million for the three months ended June 30, 2021 and 2020, respectively, and $ 1.4 million and $ 6.1 million for the six months ended June 30, 2021 and 2020, respectively.

Reimbursements of direct and indirect operating costs for managing the operations of BRSP prior to April 30, 2021 and NorthStar Healthcare are reflected in other income within discontinued operations (Note 12) and related receivables are reflected as amounts due from affiliates within assets held for sale (Note 11).

Recoverable Expenses— The Company pays organization and offering costs associated with the formation and capital raising of investment vehicles sponsored by the Company, for which the Company recovers from these investment vehicles up to specified thresholds, as applicable.

NorthStar Healthcare Credit Facility— The Company has committed to provide NorthStar Healthcare with an unsecured revolving credit facility at market terms with a maximum principal amount of $ 35.0 million.

The credit facility matures in December 2022, with a six-month extension option.

Advances under the credit facility accrue interest at LIBOR plus 3.5 %.

There is no commitment fee for the unused portion of the facility.

The credit facility is intended to provide additional liquidity to NorthStar Healthcare on an as needed basis.

In April 2020, the credit facility was drawn for the full amount of $ 35.0 million and remained outstanding a t March 31, 2021 .

NorthStar Healthcare Credit Facility— The Company provided NorthStar Healthcare with an unsecured revolving credit facility at market terms with a maximum principal amount of $ 35.0 million.

In June 2021, the credit facility was extended from December 2022 to June 2023, with a six-month extension option.

Advances under the credit facility accrue interest at LIBOR plus 3.5 %, with no commitment fee for the unused portion.

In April 2020, the credit facility was fully drawn and remained outstanding a t June 30, 2021, reflected as amounts due from affiliates within assets held for sale (Note 11) .

The borrowing was fully repaid by NorthStar Healthcare in July 2021.

Digital Real Estate Acquisitions— In connection with acquisition of Vantage SDC in July 2020 (Note 3), the Company entered into a series of agreements with Messrs.

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Ganzi and Jenkins in connection with the Vantage SDC acquisition as a result of their respective personal investments in Vantage made prior to the Company’s acquisition of DBH.

Payments to be made by the Company and its co-investors to the previous owners of Vantage SDC for future build-out of expansion capacity within the portfolio, including lease up of the expanded capacity and existing inventory, will trigger additional carried interest payments to Messrs.

Payments to be made by the Company and its co-investors to the previous owners of Vantage SDC for future build-out of expansion capacity within the portfolio, including lease-up of the expanded capacity and existing inventory, will trigger additional carried interest

payments to Messrs.

Ganzi and Jenkins.

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Ganzi and Jenkins own a 50 % interest in the aggregate.

Fees paid to the Vantage management company for Vantage SDC was $ 3.0 million for the three months ended March 31, 2021.

Fees paid to the Vantage management company were $ 3.2 million and $ 6.2 million for the three and six months ended June 30, 2021, respectively.

DataBank acquired all of zColo's colocation business in December 2020 and February 2021 from Zayo, which is a portfolio company of DCP I and other co-invest vehicles sponsored and managed by the Company.

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Such costs expensed in the periods presented were immaterial and relate primarily to the Company's share of the funds' operating costs and deferred financing costs on borrowings of the funds.

Equity Awards of CLNC —As discussed in Note 17, prior to termination of the Company’s management agreement with CLNC on April 30, 2021, CLNC granted equity awards to the Company and certain of the Company's employees, either directly or indirectly through the Company, are recognized as a gross-up of equity-based compensation expense over the vesting period with a corresponding amount in other income.

Equity Awards of BRSP —As discussed in Note 17, prior to termination of the Company’s management agreement with BRSP in April 2021, BRSP granted equity awards to the Company and certain of the Company's employees, either directly or indirectly through the Company, are recognized as a gross-up of equity-based compensation expense over the vesting period with a corresponding amount in other income, reflected in discontinued operations.

Investment in Managed Investment Vehicles —Subject to the Company's related party policies and procedures, senior management, investment professionals and certain other employees may invest on a discretionary basis in investment vehicles sponsored by the Company, either directly in the vehicle or indirectly through the general partner entity.

These investments are generally not subject to management fees, but otherwise bear their proportionate share of other operating expenses of the investment vehicles.

At March 31, 2021 and December 31, 2020, such investments in consolidated investment vehicles and general partner entities totaled $ 27.3 million and $ 19.1 million, respectively, reflected in redeemable noncontrolling interests and noncontrolling interests on the balance sheet.

Their share was a net income of $ 0.3 million and a net loss of $ 0.5 million for the three months ended March 31, 2021 and 2020, respectively.

At June 30, 2021 and December 31, 2020, such investments in consolidated investment vehicles and general partner entities totaled $ 31.7 million and $ 19.1 million, respectively, reflected in redeemable noncontrolling interests and noncontrolling interests on the balance sheet.

For the three months ended June 30, 2021 and 2020, their share of net income was $ 2.3 million and $ 0.3 million, respectively.

For the six months ended June 30, 2021 and 2020, their share of net income was $ 2.5 million and a net loss of $ 0.2 million, respectively.

Aircraft— P ursuant to Mr.

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Ganzi for certain variable operational costs of business travel on a chartered or private jet (including any aircraft that Mr.

Ganzi may partially or fully own);

provided that the Company will not reimburse the allocable share (based on the number of passengers) of variable operational costs for any passenger on such flight who is not traveling on Company business.

Ganzi may partially or fully own), provided that the Company will not reimburse the allocable share (based on the number of passengers) of variable operational costs for any passenger on such flight who is not traveling on Company business.

Additionally, the Company has also agreed to reimburse Mr.

Ganzi for certain defined fixed costs of any aircraft owned by Mr.

The fixed cost reimbursements will be made based on an allocable portion of an aircraft’s annual budgeted cash fixed operating costs, based on the number of hours the aircraft will be used for business purposes.

At least once a

year, the Company will reconcile the budgeted fixed operating costs with the actual fixed operating costs of the aircraft, and the Company or Mr.

Ganzi, as applicable, will make a true-up payment for any difference.

The fixed cost reimbursements will be made based on an allocable portion of an aircraft’s annual budgeted fixed cash operating costs, based on the number of hours the aircraft will be used for business purposes.

At least once a year, the Company will reconcile the budgeted fixed operating costs with the actual fixed operating costs of the aircraft, and the Company or Mr.

Ganzi, as applicable, will make a payment for any difference.

The Company reimbursed Mr.

Ganzi $ 1.1 million and $ 0.3 million for the three months ended March 31, 2021 and 2020, respectively.

Separately, based upon an agreement between Colony Capital Advisors, LLC, a subsidiary of the Company, and Thomas J.

Barrack, Jr., the Company's former Executive Chairman, Mr.

Barrack was previously provided use of the Company’s aircraft for personal travel.

Under this arrangement, Mr.

Barrack paid the Company for personal usage based on the incremental cost to the Company, including direct and indirect variable costs, but in no case more than the maximum reimbursement permitted by the Federal Aviation Regulations under the agreement.

Barrack reimbursed the Company $ 0.4 million for the three months ended March 31, 2020.

The Company's aircraft was sold in January 2021.

Ganzi $ 0.9 million and $ 0.1 million for the three months ended June 30, 2021 and 2020, respectively, and $ 2.0 million and $ 0.4 million for the six months ended June 30, 2021 and 2020, respectively.

Separately, prior to the sale of the Company's aircraft in January 2021, Thomas J.

Barrack, Jr., the Company's former Executive Chairman, was provided use of the Company’s aircraft for personal travel.

Pursuant to an agreement with a subsidiary of the Company, Mr.

Barrack paid the Company for personal usage based upon the incremental cost to the Company, including direct and indirect variable costs, but in no case more than the maximum reimbursement permitted by the Federal Aviation Regulations under the agreement.

Barrack reimbursed the Company $ 0.4 million for the six months ended June 30, 2020.

Such reimbursements were immaterial in 2021.

Investment Venture— Pursuant to an investment agreement entered into between a subsidiary of the Company and Mr.

Barrack effective April 1, 2021, the Company invested $ 26.0 million in Mr.

Barrack's newly formed investment entity (the “Venture”), which entitles the Company to a portion of carried interest payable to Mr.

Barrack from the Venture.

Following recent events which significantly reduce the likelihood that fundraising by the Venture will sufficiently support its value, the Company determined that its investment would likely not be recoverable and wrote off its investment as of June 30, 2021.

Commitments and Contingencies

The Company may be involved in litigation in the ordinary course of business.

As of March 31, 2021, the Company was not involved in any legal proceedings that are expected to have a material adverse effect on the Company’s results of operations, financial position or liquidity.

As of June 30, 2021, the Company was not involved in any legal proceedings that are expected to have a material adverse effect on the Company’s results of operations, financial position or liquidity.

Segment Reporting

The Company currently conducts its business through five reportable segments as follows:

The Company currently conducts its business through four reportable segments as follows:

• Digital Investment Management ("Digital IM")— This business encompasses the investment and stewardship of third party capital in digital infrastructure and real estate.

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This segment also includes the Company’s investment and commitment to the digital liquid strategies and seed investments for future digital investment vehicles.

• Wellness Infrastructure— This segment is composed of a diverse portfolio of senior housing, skilled nursing facilities, medical office buildings, and hospitals.

The Company earns rental income from senior housing, skilled nursing facilities and hospital assets that are under net leases to single tenants/operators and from medical office buildings which are both single tenant and multi-tenant.

In addition, certain of the Company's senior housing properties are managed by operators under a RIDEA (REIT Investment Diversification and Empowerment Act) structure, which allows the Company to gain financial exposure to underlying operations of the facility in a tax efficient manner versus receiving contractual rent under a net lease arrangement.

This segment also holds other wellness infrastructure-related assets, principally equity interests in and the management contract of NorthStar Healthcare .

• Other— This segment primarily composed of the Company's interest in CLNC.

The Company expects to monetize the remaining assets in its Other segment as it completes its digital evolution.

• Other— This segment is composed of the remaining non-digital equity investments, primarily the Company's interest in BRSP, that are not substantially available for immediate sale and are expected to be monetized over an extended period beyond the near term.

Amounts not allocated to specific segments generally include corporate level cash and corresponding interest income, fixed assets for administrative use, corporate level financing and related interest expense, costs in connection with unconsummated investments, compensation expense not directly attributable to reportable segments, corporate level administrative and overhead costs as well as corporate level transaction costs.

Costs which are directly attributable, or otherwise can be subjected to a reasonable and systematic allocation, have been allocated to each of the reportable segments.

In connection with accelerating the monetization of a substantial majority of the assets in the Company's Other segment in the first quarter of 2021, the Company reorganized its Wellness Infrastructure segment to retrospectively include other healthcare related assets and obligations.

These assets and obligations encompass:

(i) the Company's equity interests in and the management contract of NorthStar Healthcare, equity investment in a healthcare asset manager, and N-Star CDOs collateralized largely by certain debt and preferred equity within the capital structure of Wellness Infrastructure, all of which previously resided in the Other segment;

as well as (ii) the 5.375% exchangeable senior notes, trust preferred securities and corresponding junior subordinated debt that were not previously allocated to reportable segments, all of which were issued by NRF Holdco, which holds the Wellness Infrastructure portfolio as its primary asset and acts as guarantor.

Fee income is earned by the Digital Investment Management segment from third party capital in investment vehicles managed by the Company and consolidated within the Digital Operating and Digital Other segments.

Prior to the second quarter of 2021, the fee income in Digital Investment Management and fee expense in Digital Operating and Digital Other were eliminated within the respective segments.

Effective the second quarter of 2021, segment results are presented before elimination of intercompany fees and the elimination adjustment is included within amounts not allocated to segments.

This change in presentation was made for all prior periods presented.

Segment Results of Operations

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Refer to Note 12 for further details on discontinued operations.

(In thousands) Digital Operating Digital Investment Management Digital Other Wellness Infrastructure Other Amounts Not Allocated to Segments Total

Three Months Ended March 31, 2021

(In thousands) Digital Operating Digital Investment Management Digital Other Other Amounts Not Allocated to Segments Total

Three Months Ended June 30, 2021

Total revenues $ 189,093 $ 46,873 $ 1,720 $ — $ ( 499 ) $ 237,187

Income (loss) from continuing operations ( 10,850 ) 15,786 13,280 45,983 ( 60,376 ) 3,823

Income (loss) from continuing operations attributable to Colony Capital, Inc.

Net income (loss) from continuing operations attributable to DigitalBridge Group, Inc.

( 376 ) 12,100 5,424 41,606 ( 52,828 ) 5,926

Loss from discontinued operations attributable to Colony Capital, Inc.

Net loss attributable to Colony Capital, Inc.

Net loss from discontinued operations attributable to DigitalBridge Group, Inc.

Net loss attributable to DigitalBridge Group, Inc.

$ ( 122,744 )

Three Months Ended March 31, 2020

Three Months Ended June 30, 2020

Total revenues $ 42,021 $ 20,849 $ 663 $ — $ 4,340 $ 67,873

Income (loss) from continuing operations ( 21,262 ) 2,424 12,292 ( 324,456 ) ( 62,195 ) ( 393,197 )

Income (loss) from continuing operations attributable to Colony Capital, Inc.

Net income (loss) from continuing operations attributable to DigitalBridge Group, Inc.

( 4,277 ) 2,073 10,723 ( 292,254 ) ( 54,192 ) ( 337,927 )

Loss from discontinued operations attributable to Colony Capital, Inc.

Net loss attributable to Colony Capital, Inc.

Net income from discontinued operations attributable to DigitalBridge Group, Inc.

( 1,686,347 )

The following table presents selected income and expense items of reportable segments.

(In thousands) Digital Operating Digital Investment Management Digital Other Wellness Infrastructure Other Amounts Not Allocated to Segments Total

Three Months Ended March 31, 2021

Net loss attributable to DigitalBridge Group, Inc.

$ ( 2,024,274 )

Six Months Ended June 30, 2021

Total revenues $ 378,295 $ 77,993 $ 2,860 $ — $ ( 1,380 ) $ 457,768

Income (loss) from continuing operations ( 75,110 ) 23,449 20,943 16,393 ( 128,191 ) ( 142,516 )

Net income (loss) from continuing operations attributable to DigitalBridge Group, Inc.

( 10,450 ) 18,979 9,187 14,842 ( 112,421 ) ( 79,863 )

Net loss from discontinued operations attributable to DigitalBridge Group, Inc.

Net loss attributable to DigitalBridge Group, Inc.

$ ( 369,034 )

Six Months Ended June 30, 2020

Total revenues $ 87,188 $ 40,148 $ 823 $ 814 $ 9,050 $ 138,023

Income (loss) from continuing operations ( 39,677 ) 4,654 9,257 ( 334,361 ) ( 119,591 ) ( 479,718 )

Net income (loss) from continuing operations attributable to DigitalBridge Group, Inc.

( 7,803 ) 4,083 8,481 ( 301,176 ) ( 104,009 ) ( 400,424 )

Net loss from discontinued operations attributable to DigitalBridge Group, Inc.

( 1,966,009 )

Net loss attributable to DigitalBridge Group, Inc.

$ ( 2,366,433 )

Included in the table below are selected income and expense items of reportable segments.

(In thousands) Digital Operating Digital Investment Management Digital Other Other Amounts Not Allocated to Segments Total

Three Months Ended June 30, 2021

Property operating income $ 188,985 $ — $ — $ — $ — $ 188,985

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Depreciation and amortization 126,227 6,299 — 5,167 536 138,229

Equity method earnings (losses), including carried interest — 11,202 6,396 45,052 — 62,650

Income tax benefit (expense) 66,788 ( 2,236 ) ( 1,047 ) 3,648 8,086 75,239

Three Months Ended June 30, 2020

Property operating income $ 42,017 $ — $ — $ — $ — $ 42,017

Interest income — 4 2 — 2,096 2,102

Fee income — 20,293 — — ( 120 ) 20,173

Property operating expense 18,055 — — — — 18,055

Interest expense 8,170 — — — 12,682 20,852

Depreciation and amortization 28,571 6,606 — — 1,503 36,680

Impairment loss — — — — 12,297 12,297

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Income tax benefit (expense) 2,673 ( 280 ) ( 679 ) — ( 64 ) 1,650

Three Months Ended March 31, 2020

Six Months Ended June 30, 2021

Property operating income $ 377,987 $ — $ — $ — $ — $ 377,987

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Depreciation and amortization 248,448 12,566 — 15,500 1,140 277,654

Equity method earnings (losses), including carried interest — 11,007 9,172 25,832 — 46,011

Income tax benefit (expense) 79,056 ( 4,881 ) 43 3,648 20,569 98,435

Six Months Ended June 30, 2020

Property operating income $ 87,166 $ — $ — $ — $ — $ 87,166

Interest income — 34 9 43 3,820 3,906

Fee income — 39,357 — 134 ( 240 ) 39,251

Property operating expense 34,961 — — — — 34,961

Interest expense 17,572 — — — 22,364 39,936

Depreciation and amortization 58,602 13,208 — — 3,013 74,823

Impairment loss — — — — 12,297 12,297

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Total assets and equity method investments of the reportable segments are summarized as follows:

March 31, 2021 December 31, 2020

June 30, 2021 December 31, 2020

(In thousands) Total Assets Equity Method Investments Total Assets Equity Method Investments

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Digital Other 475,553 232,887 482,464 158,564

Wellness Infrastructure 4,006,161 13,868 4,025,743 14,941

Other 482,524 375,176 602,394 396,781

Amounts not allocated to segments 818,116 — 461,117 —

Assets held for disposition related to discontinued operations 3,828,953 745,538 7,256,996 845,094

9,229,954 633,771 8,963,241 574,512

Geographic information about the Company's total income and long-lived assets are as follows.

Geography is generally presented as the location in which the income producing assets reside or the location in which income generating services are performed.

Three Months Ended March 31,

(In thousands)

Total income by geography:

United States $ 289,933 $ 188,753

( 5,946 ) 11,522

$ 295,311 $ 201,152

(In thousands) March 31, 2021 December 31, 2020

Long-lived assets by geography:

United States $ 7,912,752 $ 8,139,565

Europe 771,768 730,358

Other 631,039 624,680

Assets held for disposition related to discontinued operations 6,691,392 702,356 11,237,319 879,732

$ 15,921,346 $ 1,336,127 $ 20,200,560 $ 1,454,244

(1) Total income includes the Company's share of earnings (loss) from its equity method investments (but excludes the Company's impairment of its equity method investments of $ 0.8 million for the three months ended March 31, 2020);

and excludes cost reimbursement income from affiliates (Note 18) and income from discontinued operations (Note 14).

Income (loss) from discontinued operations for the three months ended March 31, 2021 and 2020 is composed of $ 143.8 million and $ 369.8 million from United States, respectively, and ($ 2.3 million) and $ 32.8 million from Europe, respectively.

The negative income attributed to Europe for the three months ended March 31, 2021 for continuing operations reflects a reversal of straight-line rent receivable based upon current assessment of collectability, and for discontinued operations, due to losses from equity method investments.

(2) Long-lived assets comprise real estate held for investment, lease related intangible assets, lease right-of-use assets and fixed assets, and exclude financial instruments, assets held for disposition and non-lease related intangible assets.

Long-lived assets that are held for disposition at March 31, 2021 and December 31, 2020 included $ 1.1 billion and $ 3.8 billion located in the United States, respectively, and $ 1.0 billion and $ 1.2 billion located in Europe, respectively.

Supplemental Disclosure of Cash Flow Information

Three Months Ended March 31,

Six Months Ended June 30,

(In thousands) 2021 2020

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$ 214,698 $ 182,062

Cash paid for income taxes, net of refunds 2,123 1,272

Cash paid for operating lease liabilities 16,781 7,096

Cash received (paid) for income tax, net 3,279 ( 8,099 )

Operating lease payments 34,121 13,860

Finance lease payments 7,647 —

Supplemental Disclosure of Cash Flows from Discontinued Operations

Net cash provided by (used in) operating activities of discontinued operations $ ( 34,154 ) $ ( 8,535 )

Net cash provided by (used in) investing activities of discontinued operations ( 20,243 ) ( 43,020 )

Net cash provided by (used in) financing activities of discontinued operations ( 3,416 ) ( 920 )

Net cash provided by (used in) operating activities of discontinued operations — ( 38,822 )

Net cash provided by (used in) investing activities of discontinued operations — 4,534

Net cash provided by (used in) financing activities of discontinued operations — ( 3,886 )

Net cash provided by (used in) operating activities of discontinued operations ( 640 ) 22,954

Net cash provided by (used in) investing activities of discontinued operations 52,907 27,465

Net cash provided by (used in) financing activities of discontinued operations ( 1,563 ) ( 57,627 )

Net cash provided by operating activities of discontinued operations $ 123,548 $ 22,722

Net cash provided by investing activities of discontinued operations 584,255 48,730

Net cash used in financing activities of discontinued operations ( 466,992 ) ( 155,101 )

Supplemental Disclosure of Noncash Investing and Financing Activities

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Operating lease right-of-use assets and lease liabilities established 36,320 4,973

Finance lease payments accrued in accounts payable 2,224 —

Finance lease payments accrued 3,796 —

Redemption of OP Units for common stock

Assets of investment entities deconsolidated, net of cash and restricted cash contributed (Note 14)

Liabilities of investment entities deconsolidated (Note 14)

Noncontrolling interests of investment entities deconsolidated (Note 14)

Debt assumed by buyer in sale of real estate 44,148 —

Assets disposed in sale of equity of investment entities 2,813,856 —

Liabilities disposed in sale of equity of investment entities 2,850,158 —

Assets of investment entities deconsolidated (1)

Noncontrolling interests of investment entities deconsolidated (1)

(1) Represents (a) deconsolidation of noncontrolling interests in THL Hotel portfolio following a sale of the Company's equity interest (Note 12);

and (b) deconsolidation of two investment holding entities for which the Company is no longer the primary beneficiary as a result of a reconsideration event in the second quarter of 2021, following which the Company accounts for its interests in these entities under the equity method (presented as held for disposition in Note 11).

Subsequent Events

Other than as disclosed elsewhere, and in particular, termination of the CLNC management contract as discussed in Note 1, no subsequent events have occurred that would require recognition in the consolidated financial statements or disclosure in the accompanying notes.

On August 9, 2021, the Company agreed to provide a commitment of up to $ 650 million in the form of a preferred equity investment to support the acquisition of a digital infrastructure business by the Company's investment management platform.

In July 2021, the Company's corporate credit facility was terminated and replaced with a new securitized financing facility (Note 8), and a notice of redemption was sent for all outstanding Series G preferred stock (Note 9) .

FORWARD-LOOKING STATEMENTS

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• whether we will successfully execute our strategic transformation to become a digital infrastructure and real estate focused company within the timeframe contemplated or at all, and the impact of such transformation on the Company's legacy portfolios and assets, including whether such transformation will be consistent with the Company’s REIT status;

• our ability to obtain and maintain financing arrangements, including securitizations, on favorable or comparable terms or at all, including our ability to extend and/or replace our corporate credit facility;

• our ability to obtain and maintain financing arrangements, including securitizations, on favorable or comparable terms or at all;

• the Company's ability to complete anticipated monetizations of non-core assets within the timeframe and on the terms contemplated, if at all;

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• our ability to integrate and maintain consistent standards and controls, including our ability to manage our acquisitions in the digital industry effectively;

• the ability to realize efficiencies, as well as anticipated strategic and financial benefits from terminating the management agreement with Colony Credit Real Estate, Inc.

• the ability to realize anticipated strategic and financial benefits from terminating the management agreement with Brightspire Capital, Inc.

formerly, Colony Credit Real Estate, Inc.

• the impact to our business operations and financial condition of realized or anticipated compensation and administrative savings through cost reduction programs;

• our ability to redeploy any proceeds received from the sale of our non-digital or other legacy assets within the timeframe and manner contemplated or at all;

• our business and investment strategy, including the ability of the businesses in which we have a significant investment (such as CLNC) to execute their business strategies, particularly in light of the current COVID-19 pandemic;

• CLNC's trading price and its impact on the carrying value of the Company's investment in CLNC, including whether the Company will recognize further other-than-temporary impairments on such CLNC investment;

• our business and investment strategy, including the ability of the businesses in which we have a significant investment (such as BRSP) to execute their business strategies;

• BRSP's trading price and its impact on the carrying value of the Company's investment in BRSP, including whether the Company will recognize further other-than-temporary impairment on its investment in BRSP;

• performance of our investments relative to our expectations and the impact on our actual return on invested equity, as well as the cash provided by these investments and available for distribution;

31 unchanged sentences

“Management’s Discussion and Analysis of Financial Condition and Results of Operations” in this Quarterly Report.

Readers of this

Quarterly Report should also read our other periodic filings made with the Securities and Exchange Commission and other publicly filed documents for further discussion regarding such factors.

Readers of this Quarterly Report should also read our other periodic filings made with the Securities and Exchange Commission (the "SEC") and other publicly filed documents for further discussion regarding such factors.

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements