DigitalBridge Group, Inc. 10-K

Item 9A. Controls and Procedures. Evaluation of Disclosure Controls and Procedures We maintain disclosure controls and procedures (as defined in Rule 13a-15(e) and 15d-15(e) of the Exchange Act) that are designed to ensure that information required to be disclosed in our reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported within the time period specified in the SEC’s rules and forms, and that such information is accumulated and communicated to our management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives. As required by Rule 13a-15(b) of the Exchange Act, we have evaluated, under the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, the effectiveness of our disclosure controls and procedures. Based upon our evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were effective at December 31, 2022. Changes in Internal Control over Financial Reporting There have been no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) of the Exchange Act) during the quarter ended December 31, 2022 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting. Management’s Annual Report on Internal Control over Financial Reporting Management is responsible for establishing and maintaining adequate internal control over financial reporting (as defined in 13a-15(f) and 15d-15(f) of the Exchange Act). Our internal control over financial reporting includes policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with GAAP, and that receipts and expenditures are being made only in accordance with authorizations of our management and directors; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of assets that could have a material effect on our financial statements. Management evaluated the effectiveness of our internal control over financial reporting using the criteria set forth in the Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on our evaluation, management concluded that our internal control over financial reporting was effective as of December 31, 2022. Our internal control system was designed to provide reasonable assurance to management and our board of directors regarding the preparation and fair presentation of published financial statements. All internal control systems, no matter how well designed, have inherent limitations. Therefore, even those systems determined to be effective can provide only reasonable assurance with respect to financial statement preparation and presentation. Ernst & Young LLP, an independent registered public accounting firm, has audited the effectiveness of our internal control over financial reporting as of December 31, 2022, as stated in their attestation report, which is included herein. 67 Table of Contents Report of Independent Registered Public Accounting Firm To the Shareholders and the Board of Directors of DigitalBridge Group, Inc. Opinion on Internal Control Over Financial Reporting We have audited DigitalBridge Group, Inc.’s internal control over financial reporting as of December 31, 2022 , based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) (the COSO criteria). In our opinion, DigitalBridge Group, Inc. (the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2022 , based on the COSO criteria. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of DigitalBridge Group, Inc. as of December 31, 2022 and 2021 , the related consolidated statements of operations, comprehensive income (loss), equity and cash flows for each of the three years in the period ended December 31, 2022 , and the related notes and financial statement schedule listed in the Index at Item 15, and our report dated February 27, 2023 expressed an unqualified opinion thereon. Basis for Opinion The Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting included in the accompanying Management’s Annual Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, testing and evaluating the design and operating effectiveness of internal control based on the assessed risk, and performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion. Definition and Limitations of Internal Control Over Financial Reporting A company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements. Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate. /s/ Ernst & Young LLP Los Angeles, California February 27, 2023 68 Table of Contents Item 9B. Other Information. None. Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections. Not applicable. 69 Table of Contents PART III Item 10. Directors, Executive Officers and Corporate Governance. The information required by Item 10 is hereby incorporated by reference to the definitive proxy statement to be filed with the SEC pursuant to Regulation 14A within 120 days after our fiscal year ended December 31, 2022. Item 11. Executive Compensation. The information required by Item 11 is hereby incorporated by reference to the definitive proxy statement to be filed with the SEC pursuant to Regulation 14A within 120 days after our fiscal year ended December 31, 2022. Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters. The information required by Item 12 is hereby incorporated by reference to the definitive proxy statement to be filed with the SEC pursuant to Regulation 14A within 120 days after our fiscal year ended December 31, 2022. Item 13. Certain Relationships and Related Transactions, and Director Independence. The information required by Item 13 is hereby incorporated by reference to the definitive proxy statement to be filed with the SEC pursuant to Regulation 14A within 120 days after our fiscal year ended December 31, 2022. Item 14. Principal Accountant Fees and Services. The information required by Item 14 is hereby incorporated by reference to the definitive proxy statement to be filed with the SEC pursuant to Regulation 14A within 120 days after our fiscal year ended December 31, 2022. 70 Table of Contents PART IV Item 15. Exhibits and Financial Statement Schedules. (a)(1) and (2). Financial Statements and Schedules of DigitalBridge Group, Inc. Report of Independent Registered Public Accounting Firm (PCAOB ID: 42 ) F- 2 Consolidated Balance Sheets F- 4 Consolidated Statements of Operations F- 5 Consolidated Statements of Comprehensive Income (Loss) F- 6 Consolidated Statements of Equity F- 7 Consolidated Statements of Cash Flows F- 10 Notes to Consolidated Financial Statements: F- 12 1. Business and Organization F- 12 2. Summary of Significant Accounting Policies F- 13 3. Acquisitions F- 29 4. Real Estate F- 31 5. Equity and Debt Investments F- 33 6. Goodwill, Deferred Leasing Costs and Other Intangibles F- 36 7. Restricted Cash, Other Assets and Other Liabilities F- 37 8. Debt F- 38 9. Stockholders' Equity F- 42 10. Noncontrolling Interests F- 45 1 1 . Fair Value F- 47 1 2 . Variable Interest Entities F- 51 1 3 . Earnings per Share F- 53 1 4 . Fee Income F- 53 1 5 . Equity-Based Compensation F- 54 1 6 . Transactions with Affiliates F- 57 1 7 . Income Taxes F- 59 18 . Segment Reporting F- 62 1 9 . Commitments and Contingencies F- 65 2 0 . Supplemental Disclosure of Cash Flow Information F- 67 2 1. Assets and Related Liabilities Held for Disposition F- 68 2 2. Discontinued Operations F- 70 2 3 . Subsequent Events F- 71 Schedule III—Real Estate and Accumulated Depreciation F- 72 All other schedules are omitted because they are not applicable, or the required information is included in the consolidated financial statements or notes thereto. (a)(3) Exhibits The Exhibit Index attached hereto is incorporated by reference under this item. F-1 Table of Contents Report of Independent Registered Public Accounting Firm To the Shareholders and the Board of Directors of DigitalBridge Group, Inc. Opinion on the Financial Statements We have audited the accompanying consolidated balance sheets of DigitalBridge Group, Inc. (the Company) as of December 31, 2022 and 2021 , the related consolidated statements of operations, comprehensive income (loss), equity and cash flows for each of the three years in the period ended December 31, 2022 , and the related notes and financial statements schedule listed in the Index at Item 15 (collectively referred to as the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2022 and 2021 , and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2022, in conformity with U.S. generally accepted accounting principles. We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company's internal control over financial reporting as of December 31, 2022 , based on criteria established in Internal Control—Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (2013 framework) and our report dated February 27, 2023 , expressed an unqualified opinion thereon. Basis for Opinion These financial statements are the responsibility of the Company's management. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB. We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion. Critical Audit Matter The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that: (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates. F-2 Table of Contents Asset acquisitions—recognition of acquired assets Description of the Matter As more fully discussed in Note 3 to the consolidated financial statements, during the year ended December 31, 2022, the Company completed the acquisition of real estate and related intangible assets for total consideration of approximately $1.7 billion. As explained in Notes 2 and 3 to the consolidated financial statements, the transactions were accounted for as asset acquisitions, and as such, the total consideration was allocated to the acquired assets and liabilities based upon their relative fair values. Auditing the Company’s accounting for the acquisitions was complex due to the significant estimation required by management in estimating the relative fair values of the acquired tangible and intangible assets. The significant estimation was primarily due to the judgmental nature of the inputs to the valuation models used to measure the fair value of the tangible and intangible assets as well as the sensitivity of the respective fair values to the underlying inputs or assumptions. The Company utilized the income approach (discounted cash flow method), sales comparison approach, and cost approach to estimate the fair value of the acquired tangible and intangible assets. The determination of the relative fair value of the acquired tangible assets involved a higher degree of subjectivity due to the lack of availability of directly comparable market information, while the determination of the relative fair value of the acquired intangible assets involved a higher degree of subjectivity due to the use of market assumptions that are forward looking and could be affected by future economic or market conditions. How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company’s process for allocating total consideration to the acquired tangible and intangible assets, including controls over the Company’s review of the inputs and assumptions used in the fair value analysis and accuracy of the underlying data used. For example, we tested controls over the determination of the fair value of acquired tangible and intangible assets, including controls over the review of the valuation models and underlying assumptions used to develop such estimates. To test the fair values of acquired tangible and intangible assets used in the purchase price allocation, we performed audit procedures that included, among others, evaluating the valuation methods and significant assumptions used by management, evaluating the sensitivity of changes in inputs or assumptions on the relative fair values of the acquired assets, testing the completeness and accuracy of the underlying data supporting the determination of the various inputs, and testing its clerical accuracy. For a sample of acquired assets, we involved our valuation specialists to assist in evaluating the methodologies used by the Company, performed procedures to assess the reasonableness of the significant inputs or assumptions utilized in developing the fair value estimates, and performed comparative calculations to assess the reasonableness of the allocations to the acquired assets. /s/ Ernst & Young LLP We have served as the Company’s auditor since 2009. Los Angeles, California February 27, 2023 F-3 Table of Contents DigitalBridge Group, Inc. Consolidated Balance Sheets (In thousands, except per share data) December 31, 2022 December 31, 2021 Assets Cash and cash equivalents $ 918,254 $ 1,602,102 Restricted cash 118,485 99,121 Real estate, net 5,921,298 4,972,284 Equity and debt investments ($ 506,081 and $ 201,912 at fair value) 1,322,050 935,153 Loans receivable (at fair value) 137,945 173,921 Goodwill 761,368 761,368 Deferred leasing costs and intangible assets, net 1,092,167 1,187,627 Other assets ($ 11,793 and $ 944 at fair value) 654,050 740,395 Due from affiliates 45,360 49,230 Assets held for disposition 57,526 3,676,615 Total assets $ 11,028,503 $ 14,197,816 Liabilities Debt, net $ 5,156,140 $ 4,860,402 Accrued and other liabilities ($ 183,628 and $ 37,970 at fair value) 1,272,096 943,801 Intangible liabilities, net 29,824 33,301 Liabilities related to assets held for disposition 380 3,088,699 Total liabilities 6,458,440 8,926,203 Commitments and contingencies (Note 19) Redeemable noncontrolling interests 100,574 359,223 Equity Stockholders’ equity: Preferred stock, $ 0.01 par value per share; $ 827,779 and $ 883,500 liquidation preference; 250,000 shares authorized; 33,111 and 35,340 shares issued and outstanding 800,355 854,232 Common stock, $ 0.04 par value per share Class A, 949,000 shares authorized; 159,763 and 142,144 shares issued and outstanding 6,390 5,685 Class B, 1,000 shares authorized; 166 shares issued and outstanding 7 7 Additional paid-in capital 7,818,068 7,820,807 Accumulated deficit ( 6,962,613 ) ( 6,576,180 ) Accumulated other comprehensive income (loss) ( 1,509 ) 42,383 Total stockholders’ equity 1,660,698 2,146,934 Noncontrolling interests in investment entities 2,743,896 2,653,173 Noncontrolling interests in Operating Company 64,895 112,283 Total equity 4,469,489 4,912,390 Total liabilities, redeemable noncontrolling interests and equity $ 11,028,503 $ 14,197,816 The accompanying notes are an integral part of the consolidated financial statements. F-4 Table of Contents DigitalBridge Group, Inc. Consolidated Statements of Operations (In thousands, except per share data) Year Ended December 31, 2022 2021 2020 Revenues Property operating income $ 927,506 $ 762,750 $ 312,928 Fee income ($ 167,733 , $ 170,929 and $ 83,294 from affiliates) 172,673 180,826 83,355 Interest income 30,107 8,791 7,206 Other income ($ 4,337 , $ 10,185 and $ 8,828 from affiliates) 14,286 13,432 12,941 Total revenues 1,144,572 965,799 416,430 Expenses Property operating expense 389,445 316,178 119,834 Interest expense 198,498 186,949 120,829 Investment expense 33,887 28,257 13,551 Transaction-related costs 10,129 5,781 5,282 Depreciation and amortization 576,911 539,695 241,020 Impairment loss — — 25,079 Compensation expense—cash and equity-based 245,257 235,985 176,152 Compensation expense—incentive fee and carried interest 202,286 65,890 1,906 Administrative expenses 123,184 109,490 78,766 Settlement loss — — 5,090 Total expenses 1,779,597 1,488,225 787,509 Other income (loss) Other losses, net ( 170,555 ) ( 21,412 ) ( 6,493 ) Equity method earnings (losses) 19,412 127,270 ( 273,288 ) Equity method earnings—carried interest 378,342 99,207 12,709 Loss from continuing operations before income taxes ( 407,826 ) ( 317,361 ) ( 638,151 ) Income tax benefit (expense) ( 13,467 ) 100,538 47,063 Loss from continuing operations ( 421,293 ) ( 216,823 ) ( 591,088 ) Loss from discontinued operations ( 148,704 ) ( 600,088 ) ( 3,199,322 ) Net loss ( 569,997 ) ( 816,911 ) ( 3,790,410 ) Net income (loss) attributable to noncontrolling interests: Redeemable noncontrolling interests ( 26,778 ) 34,677 616 Investment entities ( 189,053 ) ( 500,980 ) ( 812,547 ) Operating Company ( 32,369 ) ( 40,511 ) ( 302,720 ) Net loss attributable to DigitalBridge Group, Inc. ( 321,797 ) ( 310,097 ) ( 2,675,759 ) Preferred stock repurchases/redemptions (Note 9) ( 1,098 ) 4,992 — Preferred stock dividends 61,567 70,627 75,023 Net loss attributable to common stockholders $ ( 382,266 ) $ ( 385,716 ) $ ( 2,750,782 ) Loss per share—basic Loss from continuing operations per common share—basic $ ( 1.76 ) $ ( 1.21 ) $ ( 4.33 ) Net loss attributable to common stockholders per common share—basic $ ( 2.47 ) $ ( 3.14 ) $ ( 23.25 ) Loss per share—diluted Loss from continuing operations per common share—diluted $ ( 1.76 ) $ ( 1.21 ) $ ( 4.33 ) Net loss attributable to common stockholders per common share—diluted $ ( 2.47 ) $ ( 3.14 ) $ ( 23.25 ) Weighted average number of shares Basic 154,495 122,864 118,389 Diluted 154,495 122,864 118,389 The accompanying notes are an integral part of the consolidated financial statements. F-5 Table of Contents DigitalBridge Group, Inc. Consolidated Statements of Comprehensive Income (Loss) (In thousands) Year Ended December 31, 2022 2021 2020 Net loss $ ( 569,997 ) $ ( 816,911 ) $ ( 3,790,410 ) Changes in accumulated other comprehensive income (loss) related to: Equity method investments ( 2,867 ) ( 17,048 ) 9,292 Available-for-sale debt securities ( 6,373 ) ( 331 ) ( 1,964 ) Cash flow hedges — 1,285 ( 30 ) Foreign currency translation ( 44,232 ) ( 94,560 ) 160,008 Net investment hedges ( 8,368 ) ( 57,291 ) 21,001 Other comprehensive income (loss) ( 61,840 ) ( 167,945 ) 188,307 Comprehensive loss ( 631,837 ) ( 984,856 ) ( 3,602,103 ) Comprehensive income (loss) attributable to noncontrolling interests: Redeemable noncontrolling interests ( 26,778 ) 34,677 616 Investment entities ( 203,125 ) ( 581,540 ) ( 706,374 ) Operating Company ( 36,116 ) ( 48,783 ) ( 294,577 ) Comprehensive loss attributable to stockholders $ ( 365,818 ) $ ( 389,210 ) $ ( 2,601,768 ) The accompanying notes are an integral part of the consolidated financial statements. F-6 Table of Contents DigitalBridge Group, Inc. Consolidated Statements of Equity (In thousands, except per share data) Preferred Stock Common Stock Additional Paid-in Capital Accumulated Deficit Accumulated Other Comprehensive Income (Loss) Total Stockholders’ Equity Noncontrolling Interests in Investment Entities Noncontrolling Interests in Operating Company Total Equity Balance at December 31, 2019 $ 999,490 $ 4,878 $ 7,553,599 $ ( 3,389,592 ) $ 47,668 $ 5,216,043 $ 3,254,188 $ 456,184 $ 8,926,415 Cumulative effect of adoption of new accounting guidance (Note 2) — — — ( 3,187 ) — ( 3,187 ) ( 1,577 ) ( 349 ) ( 5,113 ) Net loss — — — ( 2,675,759 ) — ( 2,675,759 ) ( 812,547 ) ( 302,720 ) ( 3,791,026 ) Other comprehensive income — — — — 73,991 73,991 106,173 8,143 188,307 Fair value of noncontrolling interests assumed in acquisitions — — — — — — 366,136 — 366,136 Deconsolidation of investment entities (Note 20) — — — — — — ( 80,921 ) — ( 80,921 ) Common stock repurchases — ( 127 ) ( 24,622 ) — — ( 24,749 ) — — ( 24,749 ) Redemption of OP Units for common stock — 22 7,735 — — 7,757 — ( 7,757 ) — Equity awards issued, net of forfeitures — 96 35,265 — — 35,361 1,172 2,673 39,206 Shares canceled for tax withholding on vested equity awards — ( 28 ) ( 7,721 ) — — ( 7,749 ) — — ( 7,749 ) Costs of noncontrolling interests — — ( 6,707 ) — — ( 6,707 ) — — ( 6,707 ) Warrant issuance (Note 10) — — 20,240 — — 20,240 — — 20,240 Contributions from noncontrolling interests — — — — — — 1,832,740 — 1,832,740 Distributions to noncontrolling interests — — — — — — ( 339,414 ) ( 5,857 ) ( 345,271 ) Preferred stock dividends — — — ( 74,064 ) — ( 74,064 ) — — ( 74,064 ) Common stock dividends declared ($ 0.44 per share) — — — ( 52,854 ) — ( 52,854 ) — — ( 52,854 ) Reallocation of equity (Note 2 and 10) — — ( 7,316 ) — 464 ( 6,852 ) 1,422 5,430 — Balance at December 31, 2020 $ 999,490 $ 4,841 $ 7,570,473 $ ( 6,195,456 ) $ 122,123 $ 2,501,471 $ 4,327,372 $ 155,747 $ 6,984,590 The accompanying notes are an integral part of the consolidated financial statements. F-7 Table of Contents DigitalBridge Group, Inc. Consolidated Statements of Equity (Continued) (In thousands, except per share data) Preferred Stock Common Stock Additional Paid-in Capital Accumulated Deficit Accumulated Other Comprehensive Income Total Stockholders’ Equity Noncontrolling Interests in Investment Entities Noncontrolling Interests in Operating Company Total Equity Balance at December 31, 2020 $ 999,490 $ 4,841 $ 7,570,473 $ ( 6,195,456 ) $ 122,123 $ 2,501,471 $ 4,327,372 $ 155,747 $ 6,984,590 Net loss — — — ( 310,097 ) — ( 310,097 ) ( 500,980 ) ( 40,511 ) ( 851,588 ) Other comprehensive loss — — — — ( 79,113 ) ( 79,113 ) ( 80,560 ) ( 8,272 ) ( 167,945 ) Redemption of preferred stock (Note 9) ( 145,258 ) — ( 4,992 ) — — ( 150,250 ) — — ( 150,250 ) Exchange of notes for common stock (Note 8) — 734 181,473 — — 182,207 — — 182,207 Shares issued pursuant to settlement liability (Note 11) — 60 46,982 — — 47,042 — — 47,042 Deconsolidation of investment entities (Note 20) — — 1,956 — ( 1,482 ) 474 ( 1,080,134 ) — ( 1,079,660 ) Redemption of OP Units for common stock — 20 4,627 — — 4,647 — ( 4,647 ) — Equity awards issued, net of forfeitures — 66 51,224 — — 51,290 2,841 3,898 58,029 Shares canceled for tax withholding on vested equity awards — ( 29 ) ( 19,331 ) — — ( 19,360 ) — — ( 19,360 ) Contributions from noncontrolling interests — — — — — — 202,471 — 202,471 Distributions to noncontrolling interests — — — — — — ( 222,519 ) — ( 222,519 ) Preferred stock dividends — — — ( 70,627 ) — ( 70,627 ) — — ( 70,627 ) Reallocation of equity (Notes 2 and 10) — — ( 11,605 ) — 855 ( 10,750 ) 4,682 6,068 — Balance at December 31, 2021 $ 854,232 $ 5,692 $ 7,820,807 $ ( 6,576,180 ) $ 42,383 $ 2,146,934 $ 2,653,173 $ 112,283 $ 4,912,390 The accompanying notes are an integral part of the consolidated financial statements. F-8 Table of Contents DigitalBridge Group, Inc. Consolidated Statements of Equity (Continued) (In thousands, except per share data) Preferred Stock Common Stock Additional Paid-in Capital Accumulated Deficit Accumulated Other Comprehensive Income (Loss) Total Stockholders’ Equity Noncontrolling Interests in Investment Entities Noncontrolling Interests in Operating Company Total Equity Balance at December 31, 2021 $ 854,232 $ 5,692 $ 7,820,807 $ ( 6,576,180 ) $ 42,383 $ 2,146,934 $ 2,653,173 $ 112,283 $ 4,912,390 Net loss — — — ( 321,797 ) — ( 321,797 ) ( 189,053 ) ( 32,369 ) ( 543,219 ) Other comprehensive loss — — — — ( 44,021 ) ( 44,021 ) ( 14,072 ) ( 3,747 ) ( 61,840 ) Stock repurchases ( 53,877 ) ( 168 ) ( 53,740 ) — — ( 107,785 ) — — ( 107,785 ) Cost of DataBank recapitalization — — ( 13,122 ) — — ( 13,122 ) ( 21,247 ) — ( 34,369 ) DataBank recapitalization (Note 10) — — 230,238 — — 230,238 ( 230,238 ) — — Exchange of notes for common stock (Note 8) — 256 177,562 — — 177,818 — — 177,818 Adjustment of redeemable noncontrolling interest and warrants to fair value (Note 10) — — ( 725,026 ) — — ( 725,026 ) — — ( 725,026 ) Shares issued for redemption of redeemable noncontrolling interest (Note 10) — 577 348,182 — — 348,759 — — 348,759 Transaction costs incurred in connection with redemption of redeemable noncontrolling interest — — ( 7,137 ) — — ( 7,137 ) — — ( 7,137 ) Reclassification of carried interest allocated to redeemable noncontrolling interest to noncontrolling interest in investment entities (Note 10) — — — — — — 4,087 — 4,087 Assumption of deferred tax asset resulting from redemption of redeemable noncontrolling interest (Note 10) — — 5,200 — — 5,200 — — 5,200 Deconsolidation of investment entities (Note 20) — — — — — — ( 376,177 ) — ( 376,177 ) Redemption of OP Units for cash and class A common stock — 4 337 — — 341 — ( 341 ) — Equity-based compensation — 63 39,933 — — 39,996 12,834 2,498 55,328 Shares canceled for tax withholding on vested stock awards — ( 27 ) ( 18,212 ) — — ( 18,239 ) — — ( 18,239 ) Acquisition of noncontrolling interest — — — — — — ( 32,076 ) — ( 32,076 ) Contributions from noncontrolling interests — — — — — — 2,613,962 — 2,613,962 Distributions to noncontrolling interests — — — — — — ( 1,677,297 ) ( 254 ) ( 1,677,551 ) Preferred stock dividends — — — ( 61,401 ) — ( 61,401 ) — — ( 61,401 ) Common stock dividends declared ($ 0.02 per share) — — — ( 3,235 ) — ( 3,235 ) — — ( 3,235 ) Reallocation of equity (Notes 2 and 10) — — 13,046 — 129 13,175 — ( 13,175 ) — Balance at December 31, 2022 $ 800,355 $ 6,397 $ 7,818,068 $ ( 6,962,613 ) $ ( 1,509 ) $ 1,660,698 $ 2,743,896 $ 64,895 $ 4,469,489 The accompanying notes are an integral part of the consolidated financial statements. F-9 Table of Contents DigitalBridge Group, Inc. Consolidated Statements of Cash Flows (In thousands) Year Ended December 31, 2022 2021 2020 Cash Flows from Operating Activities Net loss $ ( 569,997 ) $ ( 816,911 ) $ ( 3,790,410 ) Adjustments to reconcile net loss to net cash provided by operating activities: Amortization of discount and net origination fees on loans receivable and debt securities — — ( 6,154 ) Paid-in-kind interest added to loan principal, net of interest received ( 7,144 ) 8,398 ( 38,398 ) Straight-line rent income ( 25,488 ) 2,778 ( 20,453 ) Amortization of above- and below-market lease values, net 208 5,042 ( 6,446 ) Amortization of deferred financing costs and debt discount and premium, net 106,410 65,129 15,602 Equity method (earnings) losses ( 389,584 ) 7,248 463,866 Distributions of income from equity method investments 127,887 3,054 102,612 Allowance for doubtful accounts — 3,294 7,247 Impairment of real estate and related intangibles and right-of-use asset 35,985 319,263 1,987,130 Goodwill impairment — — 594,000 Depreciation and amortization 579,250 636,555 578,282 Equity-based compensation 54,710 59,416 34,959 Unrealized settlement loss — — 3,890 Gain on sales of real estate, net — ( 49,429 ) ( 41,922 ) Deferred income tax (benefit) expense 11,572 ( 68,454 ) ( 25,086 ) Loss on extinguishment of exchangeable notes 133,173 25,088 — Other loss, net 22,245 60,231 211,967 (Increase) decrease in other assets and due from affiliates 35,372 ( 72,700 ) 14,392 Increase in accrued and other liabilities and due to affiliates 148,980 67,719 16,763 Other adjustments, net ( 997 ) ( 7,484 ) ( 11,948 ) Net cash provided by operating activities 262,582 248,237 89,893 Cash Flows from Investing Activities Contributions to and acquisition of equity investments ( 570,035 ) ( 549,621 ) ( 430,548 ) Return of capital from equity method investments 59,248 90,205 294,932 Acquisition of loans receivable and debt securities ( 164,815 ) ( 147,498 ) — Net disbursements on originated loans ( 215,918 ) ( 33,272 ) ( 219,990 ) Repayments of loans receivable 23,956 485,613 227,831 Proceeds from sales of loans receivable and debt securities, including transfers of warehoused loans 401,002 146,004 46,272 Acquisition of and additions to real estate, related intangibles and leasing commissions ( 2,141,237 ) ( 828,361 ) ( 2,559,343 ) Proceeds from sales of real estate, including transfers of warehoused assets, net of property level cash transferred to buyer 162,268 408,391 431,198 Proceeds from paydown and maturity of debt securities 573 1,261 5,721 Proceeds from sale of equity investments 522,337 564,025 287,899 Investment deposits 630 ( 21,418 ) ( 11,660 ) Proceeds from sale of corporate fixed assets — 14,946 — Net receipts on settlement of derivatives 9,352 17,123 27,097 Acquisition of DBH, net of cash acquired, and payment of deferred purchase price — — ( 32,500 ) Other investing activities, net ( 769 ) ( 833 ) 1,111 Net cash (used in) provided by investing activities ( 1,913,408 ) 146,565 ( 1,931,980 ) F-10 Table of Contents DigitalBridge Group, Inc. Consolidated Statements of Cash Flows (Continued) (In thousands) Year Ended December 31, 2022 2021 2020 Cash Flows from Financing Activities Dividends paid to preferred stockholders $ ( 62,395 ) $ ( 73,384 ) $ ( 79,333 ) Dividends paid to common stockholders ( 1,636 ) — ( 106,510 ) Repurchases of common stock ( 55,006 ) — ( 24,749 ) Debt borrowings 1,162,726 2,439,722 2,907,833 Debt repayments ( 514,505 ) ( 1,720,402 ) ( 2,654,999 ) Payment of deferred financing costs ( 18,688 ) ( 48,127 ) ( 54,750 ) Contributions from noncontrolling interests 2,625,612 232,144 1,906,250 Distributions to and redemptions of noncontrolling interests ( 2,109,229 ) ( 249,083 ) ( 360,304 ) Contribution from Wafra — — 253,575 Redemptions/repurchases of preferred stock ( 52,779 ) ( 150,250 ) ( 402,855 ) Shares canceled for tax withholdings on vested equity awards ( 18,239 ) ( 19,360 ) ( 7,749 ) Acquisition of noncontrolling interest ( 32,076 ) — — Other financing activities, net — — ( 3,382 ) Net cash provided by financing activities 923,785 411,260 1,373,027 Effect of exchange rates on cash, cash equivalents and restricted cash ( 2,465 ) ( 2,825 ) 7,370 Net (decrease) increase in cash, cash equivalents and restricted cash ( 729,506 ) 803,237 ( 461,690 ) Cash, cash equivalents and restricted cash—beginning of period 1,766,245 963,008 1,424,698 Cash, cash equivalents and restricted cash—end of period $ 1,036,739 $ 1,766,245 $ 963,008 Reconciliation of cash, cash equivalents and restricted cash to consolidated balance sheets Year Ended December 31, 2022 2021 2020 Beginning of the period Cash and cash equivalents $ 1,602,102 $ 703,544 $ 1,205,190 Restricted cash 99,121 67,772 674 Restricted cash included in assets held for disposition 65,022 191,692 218,834 Total cash, cash equivalents and restricted cash, beginning of period $ 1,766,245 $ 963,008 $ 1,424,698 End of the period Cash and cash equivalents $ 918,254 $ 1,602,102 $ 703,544 Restricted cash 118,485 99,121 67,772 Restricted cash included in assets held for disposition — 65,022 191,692 Total cash, cash equivalents and restricted cash, end of period $ 1,036,739 $ 1,766,245 $ 963,008 The accompanying notes are an integral part of the consolidated financial statements. F-11 Table of Contents DigitalBridge Group, Inc. Notes to Consolidated Financial Statements December 31, 2022 1. Business and Organization DigitalBridge Group, Inc., or DBRG, (together with its consolidated subsidiaries, the "Company") is a leading global digital infrastructure investment manager. The Company deploys and manages capital on behalf of its investors and shareholders across the digital infrastructure ecosystem, including data centers, cell towers, fiber networks, small cells, and edge infrastructure. The Company's investment management platform is anchored by its flagship value-add digital infrastructure equity offerings, and has expanded to include offerings in core equity, credit and liquid securities. In February 2023, the Company further expanded its investment offerings to encompass InfraBridge, a newly-acquired mid-market global infrastructure equity platform, which operates as a separate division of DBRG (Note 3). Organization 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 December 31, 2022, the Company owned 93 % of the OP , as its sole managing member. The remaining 7 % is owned primarily by certain current and former employees of the Company as noncontrolling interests. Transition to Taxable C Corporation Following the completion of the Company's business transformation in the first quarter of 2022 (as described below) and due to the pace of growth of its investment management business and other strategic transactions that it may pursue, the Company’s Board of Directors and management agreed to discontinue actions necessary to maintain qualification as a real estate investment trust ("REIT") for 2022. Commencing with the taxable year ended December 31, 2022, all of the Company’s taxable income, except for income generated by subsidiaries that have elected or anticipate electing REIT status, is subject to U.S. federal and state income tax at the applicable corporate tax rate. Dividends paid to stockholders are no longer tax deductible. The Company is also no longer subject to the REIT requirement for distributions to stockholders when the Company has taxable income. The Company anticipates that operating as a taxable C Corporation will provide the Company with flexibility to execute various strategic initiatives without the constraints of complying with REIT requirements. This includes retaining and reinvesting earnings in other new initiatives in the investment management business. The Company’s transition to a taxable C Corporation is not expected to result in significant incremental current income tax expense in the near term due to the availability of significant capital loss and net operating loss (“NOL”) carryforwards. Furthermore, earnings from the Company's investment management business, which is conducted through its previously designated taxable REIT subsidiaries ("TRS"), remain the primary source of income subject to U.S. federal and state income tax. See Note 17 for additional information. Business Transformation In February 2022, the Company completed the disposition of substantially all of its non-digital assets. This marked the completion of the Company's transformation from a REIT and investment manager in traditional real estate into an investment manager focused primarily on digital infrastructure. The disposition of its hotel portfolio (March 2021), Other Equity and Debt ("OED") investments and non-digital investment management ("Other IM") business (December 2021), and Wellness Infrastructure portfolio (February 2022) each represented a strategic shift in the Company's business that had a significant effect on the Company’s operations and financial results, and accordingly, had 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 21), and the related operating results are presented as discontinued operations on the consolidated statements of operations (Note 22). F-12 Table of Contents 2. Summary of Significant Accounting Policies The significant accounting policies of the Company are described below. Basis of Presentation The accompanying consolidated financial statements include the accounts of the Company and its controlled subsidiaries. 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. Noncontrolling interests represents predominantly the majority ownership held by third party investors in the Company's Operating segment, carried interest allocation to certain senior executives of the Company (Note 16), and membership interests in OP held by certain current and former employees of the Company. To the extent the Company consolidates a subsidiary that is subject to industry-specific guidance such as investment company accounting applied by the Company's consolidated sponsored funds, the Company retains the industry-specific guidance applied by that subsidiary in its consolidated financial statements. Use of Estimates The preparation of financial statements in conformity with accounting principles generally accepted in the United States ("GAAP") requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes. Actual results could differ from those estimates and assumptions. Principles of Consolidation The Company consolidates entities in which it has a controlling financial interest by first considering if an entity meets the definition of a variable interest entity ("VIE") for which the Company is deemed to be the primary beneficiary, or if the Company has the power to control an entity through a majority of voting interest or through other arrangements. Variable Interest Entities —A VIE is an entity that either (i) lacks sufficient equity to finance its activities without additional subordinated financial support from other parties; (ii) whose equity holders lack the characteristics of a controlling financial interest; 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. This assessment may involve subjectivity in the determination of which activities most significantly affect the VIE’s performance, and estimates about current and future fair value of the assets held by the VIE and financial performance of the VIE. In assessing its interests in the VIE, the Company also considers interests held by its related parties, including de facto agents. Additionally, 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. In performing the related party analysis, the Company considers both qualitative and quantitative factors, including, but not limited to: the characteristics and size of its investment relative to the related party; the Company’s and the related party's ability to control or significantly influence key decisions of the VIE including consideration of involvement by de facto agents; the obligation or likelihood for the Company or the related party to fund operating losses of the VIE; and the similarity and significance of the VIE’s business activities to those of the Company and the related party. The determination of whether an entity is a VIE, and whether the Company is the primary beneficiary, may involve significant judgment, and depends upon facts and circumstances specific to an entity at the time of the assessment. Voting Interest Entities —Unlike VIEs, voting interest entities have sufficient equity to finance their activities and equity investors exhibit the characteristics of a controlling financial interest through their voting rights. The Company consolidates such entities when it has the power to control these entities through ownership of a majority of the entities' voting interests or through other arrangements. At each reporting period, the Company reassesses whether changes in facts and circumstances cause a change in the status of an entity as a VIE or voting interest entity, and/or a change in the Company's consolidation assessment. Changes in consolidation status are applied prospectively. An entity may be consolidated as a result of this reassessment, in which case, the assets, liabilities and noncontrolling interest in the entity are recorded at fair value upon initial consolidation. Any existing equity interest held by the Company in the entity prior to the Company obtaining control will be remeasured at fair value, which may result in a gain or loss recognized upon initial consolidation. However, if the consolidation represents an asset acquisition of a voting interest entity, the Company's existing interest in the acquired assets, if any, is not remeasured to fair value but continues to be carried at historical cost. The Company may also deconsolidate a subsidiary as a result of this reassessment, which may result in a gain or loss recognized upon F-13 Table of Contents deconsolidation depending on the carrying values of deconsolidated assets and liabilities compared to the fair value of any interests retained. Noncontrolling Interests Redeemable Noncontrolling Interests —This represents noncontrolling interests in sponsored open-end funds in the Liquid Strategies that are consolidated by the Company. The limited partners of these funds have the ability to withdraw all or a portion of their interests from the funds in cash with advance notice. Redeemable noncontrolling interests is presented outside of permanent equity. 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. Such adjustments will be recognized in additional paid-in capital. The redeemable noncontrolling interests in the Company's investment management business was redeemed in May 2022 (Note 10). Noncontrolling Interests in Investment Entities —This represents predominantly the majority ownership held by third party investors in the Company's Operating segment and carried interest allocation to certain senior executives of the Company (Note 16). Excluding carried interests, allocation of net income or loss is generally based upon relative ownership interests. Noncontrolling Interests in Operating Company —This represents membership interests in OP held primarily by certain current and former employees of the Company. Noncontrolling interests in OP are allocated a share of net income or loss in OP based upon their weighted average ownership interest in OP during the period. Noncontrolling interests in OP have the right to require OP to redeem part or all of such member’s membership units in OP ("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 reporting 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, as applicable. Foreign Currency Assets and liabilities denominated in a foreign currency for which the functional currency is a foreign currency are translated using the exchange rate in effect at the balance sheet date and the corresponding results of operations for such entities are translated using the average exchange rate in effect during the period. The resulting foreign currency translation adjustments are recorded as a component of accumulated other comprehensive income or loss in stockholders’ equity. Upon sale, complete or substantially complete liquidation of a foreign subsidiary, or upon partial sale of a foreign equity method investment, the translation adjustment associated with the investment, or a proportionate share related to the portion of equity method investment sold, is reclassified from accumulated other comprehensive income or loss into earnings. Financial assets and liabilities denominated in a foreign currency for which the functional currency is the U.S. dollar are remeasured using the exchange rate in effect at the balance sheet date, whereas non-financial assets and liabilities are remeasured using the exchange rate on the date the item was initially recognized (i.e., the historical rate), and the corresponding results of operations for such entities are remeasured using the average exchange rate in effect during the period. The resulting foreign currency remeasurement adjustments are recorded in other gain (loss) on the consolidated statements of operations. Disclosures of non-U.S. dollar amounts to be recorded in the future are translated using exchange rates in effect at the date of the most recent balance sheet presented. Fair Value Measurement Fair value is based on an exit price, defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants. Where appropriate, the Company makes adjustments to estimated fair values to appropriately reflect counterparty credit risk as well as the Company's own credit-worthiness. The estimated fair value of financial assets and financial liabilities are categorized into a three tier hierarchy, prioritized based on the level of transparency in inputs used in the valuation techniques, as follows: Level 1 —Quoted prices (unadjusted) in active markets for identical assets or liabilities. F-14 Table of Contents Level 2 —Observable inputs other than Level 1 prices, such as quoted prices for similar assets or liabilities, quoted prices in non-active markets, or valuation techniques utilizing inputs that are derived principally from or corroborated by observable data directly or indirectly for substantially the full term of the financial instrument. Level 3 —At least one assumption or input is unobservable and it is significant to the fair value measurement, requiring significant management judgment or estimate. Where the inputs used to measure the fair value of a financial instrument falls into different levels of the fair value hierarchy, the financial instrument is categorized within the hierarchy based on the lowest level of input that is significant to its fair value measurement. Due to the inherently judgmental nature of Level 3 fair value, changes in assumptions or inputs applied as of reporting date could result in a higher or lower fair value, and realized value may differ from the estimated unrealized fair value. Fair Value Option The fair value option provides an option to elect fair value as a measurement alternative for selected financial instruments. The fair value option may be elected only upon the occurrence of certain specified events, including when the Company enters into an eligible firm commitment, at initial recognition of the financial instrument, as well as upon a business combination or consolidation of a subsidiary. The election is irrevocable unless a new election event occurs. The Company has elected to account for all of its loans receivable and certain equity method investments at fair value. Business Combinations 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 business. 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 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. The cost of assets acquired in a group is allocated to individual assets within the group based on their relative fair values and does not give rise to goodwill. Transaction costs related to acquisition of assets are included in the cost basis of the assets acquired. Business Combinations —The Company accounts for acquisitions that qualify as business combinations by applying the acquisition method. Transaction costs related to acquisition of a business are expensed as incurred and excluded from the fair value of consideration transferred. The identifiable assets acquired, liabilities assumed and noncontrolling interests in an acquired entity are recognized and measured at their estimated fair values, except as discussed below. The excess of the consideration transferred over the value of identifiable assets acquired, liabilities assumed and noncontrolling interests in an acquired entity, net of fair value of any previously held interest in the acquired entity, is recorded as goodwill. Such valuations require management to make significant estimates and assumptions. With respect to contract assets and contract liabilities acquired in a business combination, these are not accounted for under the fair value basis at the time of acquisition. Instead, the Company determines the value of these revenue contracts as if it had originated the acquired contracts by evaluating the associated performance obligations, transaction price and relative stand-alone selling price at the original contract inception date or subsequent modification dates. Contingent Consideration —Contingent consideration is classified as a liability or equity, as applicable. Contingent consideration in connection with the acquisition of a business or a VIE is measured at fair value on acquisition date, and unless classified as equity, is remeasured at fair value each reporting period thereafter until the consideration is settled, with changes in fair value included in net income. Contingent consideration in connection with the acquisition of assets (and that is not a VIE) is generally recognized when the liability is considered both probable and reasonably estimable, as part of the basis of the acquired assets . F-15 Table of Contents Discontinued Operations 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 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 disposition of (i) NRF Holdco, LLC ("NRF Holdco"), a former subsidiary of the Company that held the Wellness Infrastructure business, in February 2022, (ii) a substantial majority of the OED investments and Other IM business in December 2021, (iii) the hotel business, composed of the Hospitality segment and the THL Hotel Portfolio in March 2021, and (iv) the bulk and light industrial portfolios in December 2020 and December 2019, respectively, 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 21) and the related operating results are presented as income (loss) from discontinued operations on the consolidated statements of operations (Note 22). Discontinued operations in prior periods include investments in the respective segments that have been disposed or otherwise resolved in those periods. Cash and Cash Equivalents Short-term, highly liquid investments with original maturities of three months or less are considered to be cash equivalents. The Company's cash and cash equivalents are held with major financial institutions and may at times exceed federally insured limits. Also included are unrestricted cash held by subsidiaries in third party accounts that have the general characteristics of demand deposits. Restricted Cash Restricted cash consists primarily of cash reserves maintained pursuant to the governing agreements of the various securitized debt of the Company and its subsidiaries. Real Estate Assets Real Estate Acquisitions Real estate acquisitions are recorded at the fair values of the acquired components at the time of acquisition, allocated among land, building, site and building improvements, infrastructure, equipment, lease-related tangible and intangible assets and liabilities, such as tenant improvements, deferred leasing costs, in-place lease values, above- and below-market lease values, and tenant relationships. The estimated fair value of acquired land is derived from recent comparable sales of land and listings within the same local region based on available market data. The estimated fair value of acquired buildings and building improvements is derived from comparable sales, discounted cash flow analysis using market-based assumptions, or replacement cost for a similar property, as appropriate. The fair value of site and tenant improvements and infrastructure assets are estimated based upon current market replacement costs and other relevant market rate information. Real Estate Held for Investment Real estate held for investment are carried at cost less accumulated depreciation. Costs Capitalized or Expensed— Expenditures for ordinary repairs and maintenance are expensed as incurred, while expenditures for significant renovations that improve or extend the useful life of the asset are capitalized and depreciated over their estimated useful lives. F-16 Table of Contents Depreciation— Real estate held for investment, other than land, are depreciated on a straight-line basis over the estimated useful lives of the assets, as follows: Real Estate Assets Term Site improvements 5 to 40 years Building 5 to 50 years Building improvements 5 to 40 years Tenant improvements Lesser of useful life or remaining term of lease Data center infrastructure 5 to 30 years Furniture, fixtures and equipment 1 to 8 years Impairment —The Company evaluates its real estate held for investment for impairment periodically or whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable. The Company evaluates real estate for impairment generally on an individual property basis. If an impairment indicator exists, the Company evaluates the undiscounted future net cash flows that are expected to be generated by the property, including any estimated proceeds from the eventual disposition of the property. If multiple outcomes are under consideration, the Company may apply either a probability-weighted cash flows approach or the single-most-likely estimate of cash flows approach, whichever is more appropriate under the circumstances. Based upon the analysis, if the carrying value of a property exceeds its undiscounted future net cash flows, an impairment loss is recognized for the excess of the carrying value of the property over the estimated fair value of the property. In evaluating and/or measuring impairment, the Company considers, among other things, current and estimated future cash flows associated with each property for the duration of the estimated hold period of each property, market information for each sub-market, including, where applicable, competition levels, foreclosure levels, leasing trends, occupancy trends, lease or room rates, and the market prices of similar properties recently sold or currently being offered for sale, expected capitalization rates at exit, and other quantitative and qualitative factors. Another key consideration in this assessment is the Company's assumptions about the highest and best use of its real estate investments and its intent and ability to hold them for a reasonable period that would allow for the recovery of their carrying values. If such assumptions change and the Company shortens its expected hold period, this may result in the recognition of impairment losses. Real Estate Held for Disposition Real estate is classified as held for disposition in the period when (i) management approves a plan to sell the asset, (ii) the asset is available for immediate sale in its present condition, subject only to usual and customary terms, (iii) a program is initiated to locate a buyer and actively market the asset for sale at a reasonable price, and (iv) completion of the sale is probable within one year. Real estate held for disposition is stated at the lower of its carrying amount or estimated fair value less disposal cost, with any write-down to fair value less disposal cost recorded as an impairment loss. For any increase in fair value less disposal cost subsequent to classification as held for disposition, the impairment loss may be reversed, but only up to the amount of cumulative loss previously recognized. Depreciation is not recorded on assets classified as held for disposition. At the time a sale is consummated, the excess, if any, of sale price less selling costs over carrying value of the real estate is recognized as a gain. If circumstances arise that were previously considered unlikely and, as a result, the Company decides not to sell the real estate asset previously classified as held for disposition, the real estate asset is reclassified as held for investment. Upon reclassification, the real estate asset is measured at the lower of (i) its carrying amount prior to classification as held for disposition, adjusted for depreciation expense that would have been recognized had the real estate been continuously classified as held for investment, or (ii) its estimated fair value at the time the Company decides not to sell. Foreclosed Properties The Company may receive foreclosed properties in full or partial settlement of loans receivable by taking legal title or physical possession of the properties. Foreclosed properties are generally recognized at the time the real estate is received at foreclosure sale or upon execution of a deed in lieu of foreclosure. Foreclosed properties are initially measured at fair value. If the fair value of the property is lower than the carrying value of the loan, the difference is recognized as provision for loan loss and the cumulative loss allowance on the loan is charged off. The Company periodically evaluates foreclosed properties for subsequent decrease in fair value which is recorded as additional impairment loss. Fair value of foreclosed properties is generally based on third party appraisals, broker price opinions, comparable sales or a combination thereof. F-17 Table of Contents Equity Investments A noncontrolling, unconsolidated ownership interest in an entity may be accounted for using one of: (i) equity method where applicable; (ii) fair value option if elected; (iii) fair value through earnings if fair value is readily determinable, including election of net asset value ("NAV") practical expedient where applicable; or (iv) for equity investments without readily determinable fair values, the measurement alternative to measure at cost adjusted for any impairment and observable price changes, as applicable. Marketable equity securities are recorded as of trade date. Dividend income is recognized on the ex-dividend date and is included in other income. Fair value changes of equity method investments under the fair value option are recorded in earnings (losses) from equity method investments. Fair value changes of other equity investments, including adjustments for observable price changes under the measurement alternative, are recorded in other gain (loss). Equity Method Investments The Company accounts for investments under the equity method of accounting if it has the ability to exercise significant influence over the operating and financial policies of an entity, but does not have a controlling financial interest. The equity method investment is initially recorded at cost and adjusted each period for capital contributions, distributions and the Company's share of the entity’s net income or loss as well as other comprehensive income or loss. The Company's share of net income or loss may differ from the stated ownership percentage interest in an entity if the governing documents prescribe a substantive non-proportionate earnings allocation formula or a preferred return to certain investors. For certain equity method investments, the Company records its proportionate share of income on a one to three month lag. Distributions of operating profits from equity method investments are reported as operating activities, while distributions in excess of operating profits are reported as investing activities in the statement of cash flows under the cumulative earnings approach. Carried Interest —The Company's equity method investments include its interests as general partner or equivalent in investment vehicles that it sponsors. The Company recognizes earnings based on its proportionate share of results from these investment vehicles and a disproportionate allocation of returns based on the extent to which cumulative performance exceeds minimum return hurdles pursuant to terms of their respective governing agreements (“carried interests”). Carried interest generally arises when appreciation in value of the underlying investments of the fund exceeds the minimum return hurdles, after factoring in a return of invested capital and a return of certain costs of the fund pursuant to terms of the governing documents of the fund. The amount of carried interest recognized is based upon the cumulative performance of the fund if it were liquidated as of the reporting date. Unrealized carried interest is driven primarily by changes in fair value of the underlying investments of the fund, which could be affected by various factors, including but not limited to the financial performance of the portfolio company, economic conditions, foreign exchange rates, comparable transactions in the market, and equity prices for publicly traded securities. Unrealized carried interest may be subject to reversal until such time it is realized. Realization of carried interest occurs upon disposition of all underlying investments of the fund, or in part with each disposition. Generally, carried interest is distributed upon profitable disposition of an investment if at the time of distribution, cumulative returns of the fund exceed minimum return hurdles. Depending on the final realized value of all investments at the end of the life of a fund (and, with respect to certain funds, periodically during the life of the fund), if it is determined that cumulative carried interest distributions have exceeded the final carried interest amount earned (or amount earned as of the calculation date), the Company is obligated to return the excess carried interest received. Therefore, carried interest distributions may be subject to clawback if decline in investment values results in cumulative performance of the fund falling below minimum return hurdles in the interim period. If it is determined that the Company has a clawback obligation, a liability would be established based upon a hypothetical liquidation of the net assets of the fund at reporting date. The actual determination and required payment of any clawback obligation would generally occur after final disposition of the investments of the fund or otherwise as set forth in the governing documents of the fund. Impairment Evaluation of impairment applies to equity method investments and equity investments under the measurement alternative. If indicators of impairment exist, the Company will first estimate the fair value of its investment. In assessing fair value, the Company generally considers, among others, the estimated enterprise value of the investee or fair value of the investee's underlying net assets, including net cash flows to be generated by the investee as applicable, and for equity method investees with publicly traded equity, the traded price of the equity securities in an active market. F-18 Table of Contents For investments under the measurement alternative, if carrying value of the investment exceeds its fair value, an impairment is deemed to have occurred. For equity method investments, further consideration is made if a decrease in value of the investment is other-than-temporary to determine if impairment loss should be recognized. Assessment of other-than-temporary impairment ("OTTI") involves management judgment, including, but not limited to, consideration of the investee’s financial condition, operating results, business prospects and creditworthiness, the Company's ability and intent to hold the investment until recovery of its carrying value, or a significant and prolonged decline in traded price of the investee’s equity security. If management is unable to reasonably assert that an impairment is temporary or believes that the Company may not fully recover the carrying value of its investment, then the impairment is considered to be other-than-temporary. Investments that are other-than-temporarily impaired are written down to their estimated fair value. Impairment loss is recorded in equity method earnings for equity method investments and in other gain (loss) for investments under the measurement alternative. Loans Receivable Loans that the Company has the intent and ability to hold for the foreseeable future are classified as held for investment. Loans that the Company intends to sell or liquidate in the foreseeable future are classified as held for disposition. Interest income is recognized based upon contractual interest rate and unpaid principal balance of the loans. Loans that are past due 90 days or more as to principal or interest, or where reasonable doubt exists as to timely collection, are generally considered nonperforming, with reversal of interest income and suspension of interest income recognition. Recognition of interest income may be restored when all principal and interest are current and full repayment of the remaining contractual principal and interest are reasonably assured. The Company has elected the fair value option for all loans receivable. Loan fair values are generally determined either: 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 projections 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. For loans that are nonperforming where recognition of interest income is suspended, any interest subsequently collected is recognized on a cash basis by crediting income when received. Origination and other fees charged to the borrower are recognized immediately as interest income when earned. Costs to originate or purchase loans are expensed as incurred. Debt Securities Debt securities are recorded as of the trade date. Debt securities designated as available-for-sale (“AFS”) are carried at fair value with unrealized gains or losses included as a component of other comprehensive income. Upon disposition of AFS debt securities, the cumulative gains or losses in other comprehensive income (loss) that are realized are recognized in other gain (loss), net, on the statement of operations based on specific identification. Interest Income —Interest income from debt securities, including stated coupon interest payments and amortization of purchase premiums or discounts, is recognized using the effective interest method over the expected lives of the debt securities. For beneficial interests in debt securities that are not of high credit quality (generally credit rating below AA) or that can be contractually settled such that the Company would not recover substantially all of its recorded investment, interest income is recognized as the accretable yield over the life of the securities using the effective yield method. The accretable yield is the excess of current expected cash flows to be collected over the net investment in the security, including the yield accreted to date. The Company evaluates estimated future cash flows expected to be collected on a quarterly basis, starting with the first full quarter after acquisition, or earlier if conditions indicating impairment are present. If the cash flows expected to be collected cannot be reasonably estimated, either at acquisition or in subsequent evaluation, the Company may consider placing the securities on nonaccrual, with interest income recognized using the cost recovery method. Impairment —The Company performs an assessment, at least quarterly, to determine whether its AFS debt securities are considered to be impaired; that is, if their fair value is less than their amortized cost basis. F-19 Table of Contents If the Company intends to sell the impaired debt security or is more likely than not will be 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 more likely than not will be required to sell the security, or if the Company deems the security to be uncollectible. In assessing impairment and estimating future expected cash flows, factors considered include, but are not limited to, credit rating of the security, financial condition of the issuer, defaults for similar securities, performance and value of assets underlying an asset-backed security. Identifiable Intangibles In a business combination or asset acquisition, the Company may recognize identifiable intangibles that meet either or both the contractual legal criterion or the separability criterion. An indefinite-lived intangible is not subject to amortization until such time that its useful life is determined to no longer be indefinite, at which point, it will be assessed for impairment and its adjusted carrying amount amortized over its remaining useful life. Finite-lived intangibles are amortized over their useful life in a manner that reflects the pattern in which the intangible is being consumed if readily determinable, such as based upon expected cash flows; otherwise they are amortized on a straight-line basis. The useful life of all identified intangibles will be periodically reassessed and if useful life changes, the carrying amount of the intangible will be amortized prospectively over the revised useful life. The Company's identifiable intangible assets are generally valued under the income approach, using an estimate of future net cash flows, discounted based upon risk-adjusted returns for similar underlying assets. Lease-Related Intangibles —Identifiable intangibles recognized in acquisitions of operating real estate include in-place leases, deferred leasing costs, above- or below-market leases, and tenant relationships. In-place leases generate value over and above the tangible real estate because a property that is occupied with leased space is typically worth more than a vacant building without a lease contract in place. Acquired in-place leases are valued as the forgone rental income had the property been acquired in an as if vacant state, using market data on comparable and recently signed leases. Deferred leasing costs represent leasing commissions and legal fees that would otherwise have been incurred if a lease was not in-place. Acquired in-place leases and deferred leasing costs are amortized on a straight-line basis to depreciation and amortization expense over the remaining term of the applicable leases. If an in-place lease is terminated, the unamortized portion is charged to depreciation and amortization expense. The value of the above- or below-market component of acquired leases represents the difference between contractual rents of acquired leases and market rents at the time of the acquisition for the remaining lease term. Above- or below-market operating lease values are amortized on a straight-line basis as a decrease or increase to rental income, respectively, over the applicable lease terms. This includes fixed rate renewal options in acquired leases that are assumed to be renewed if below market, which are amortized to increase rental income over the renewal period. Tenant relationships represent the estimated net cash flows attributable to the likelihood of lease renewal by an existing tenant relative to the cost of obtaining a new lease, taking into consideration the time it would take to execute a new lease or backfill a vacant space. Tenant relationships are amortized on a straight-line basis to depreciation and amortization expense over its estimated useful life. Investment Management Intangibles —Identifiable intangibles recognized in acquisition of an investment management business generally include management contracts, which represent contractual rights to future fee income from in-place management contracts that is amortized based upon expected cash flows over the remaining term of the contracts; and investor relationships, which represent potential fee income generated from future reinvestment by existing investors that is amortized on a straight-line basis over its estimated useful life. Other Intangible Assets —In addition to leasing activities, data center operators provide various data center services to their customers, largely in the colocation business, which give rise to customer service contract and customer relationship intangible assets in an acquisition of operating data centers. Customer service contracts are valued based upon an estimate of net cash flows from providing data center services that would have been forgone if these service contracts were not in place, taking into consideration the time it would take to execute a new contract. Customer service contracts are amortized on a straight-line basis over the remaining term of the respective contracts, and if the service contract is terminated, the remaining unamortized balance is charged off. Customer relationships represent incremental F-20 Table of Contents net cash flows to the business that is attributable to these in-place relationships, and is amortized on a straight-line basis over its estimated useful life. Trade names are recognized as a separate identifiable intangible asset to the extent the Company intends to continue using the trade name post-acquisition. Trade names are valued as the savings from royalty fees that would have otherwise been incurred. Trade names are amortized on a straight-line basis over the estimated useful life, or not amortized if they are determined to have an indefinite useful life. Impairment Identifiable intangible assets are reviewed periodically to determine if circumstances exist which may indicate a potential impairment. If such circumstances are considered to exist, the Company evaluates if carrying value of the intangible asset is recoverable based upon an undiscounted cash flow analysis. Impairment loss is recognized for the excess, if any, of carrying value over estimated fair value of the intangible asset. An impairment establishes a new basis for the intangible asset and any impairment loss recognized is not subject to subsequent reversal. Impairment analysis on lease intangible assets is performed in connection with the impairment assessment of the related real estate. In evaluating investment management intangibles for impairment, such as management contracts and investor relationships, the Company considers various factors that may affect future fee income, including but not limited to, changes in fee basis, amendments to contractual fee terms, and projected capital raising for future investment vehicles. Indefinite life trade names are impaired if the Company determines that it no longer intends to use the trade name. Goodwill Goodwill is an unidentifiable intangible asset and is recognized as a residual, generally measured as the excess of consideration transferred in a business combination over the identifiable assets acquired, liabilities assumed and noncontrolling interests in the acquiree. Goodwill is assigned to reporting units that are expected to benefit from the synergies of the business combination. Goodwill is tested for impairment at the reporting units to which it is assigned at least on an annual basis in the fourth quarter of each year, or more frequently if events or changes in circumstances occur that would more likely than not reduce the fair value of a reporting unit below its carrying value, including goodwill. The assessment of goodwill for impairment may initially be performed based on qualitative factors to determine if it is more likely than not that the fair value of the reporting unit to which the goodwill is assigned is less than its carrying value, including goodwill. If so, a quantitative assessment is performed to identify both the existence of impairment and the amount of impairment loss. The Company may bypass the qualitative assessment and proceed directly to performing a quantitative assessment to compare the fair value of a reporting unit with its carrying value, including goodwill. Impairment is measured as the excess of carrying value over fair value of the reporting unit, with the loss recognized limited to the amount of goodwill assigned to that reporting unit. An impairment establishes a new basis for goodwill and any impairment loss recognized is not subject to subsequent reversal. Goodwill impairment tests require judgment, including identification of reporting units, assignment of assets and liabilities to reporting units, assignment of goodwill to reporting units, and determination of the fair value of each reporting unit. Accounts Receivable and Related Allowance Property Operating Income Receivables (excluding lease income receivables) —The Company periodically evaluates aged receivables and considers the collectability of unbilled receivables. The Company estimates allowance for doubtful accounts for specific accounts receivable balances based upon historical collection trends, age of outstanding accounts receivables and existing economic conditions associated with the receivables. Cost Reimbursements and Recoverable Expenses —The Company is entitled to reimbursements and/or recovers certain costs paid on behalf of investment vehicles sponsored by the Company, which include: (i) organization and offering costs associated with the formation and capital raising of the investment vehicles up to specified thresholds; (ii) costs incurred in performing investment due diligence; and (iii) direct and indirect operating costs associated with managing the operations of certain investment vehicles. Indirect operating costs are recorded as expenses of the Company when incurred and amounts allocated and reimbursable are recorded as other income in the consolidated statements of operations. The Company facilitates the payments of organization and offering costs, due diligence costs to the extent the related investments are consummated and direct operating costs, all of which are recorded as due from affiliates on the consolidated balance sheets, until such amounts are repaid. Due diligence costs related to unconsummated investments that are borne by the Company are expensed as transaction-related costs in the consolidated statement of operations. F-21 Table of Contents The Company assesses the collectability of such receivables and establishes an allowance for any balances considered not collectable. Fixed Assets Fixed assets of the Company are presented within other assets and carried at cost less accumulated depreciation and amortization. Ordinary repairs and maintenance are expensed as incurred. Major replacements and betterments which improve or extend the life of assets are capitalized and depreciated over their useful life. Depreciation and amortization is recognized on a straight-line basis over the estimated useful life of the assets, which range between 3 and 7 years for furniture, fixtures, equipment and capitalized software, and over the shorter of the lease term or useful life for leasehold improvements. Transfers of Financial Assets Sale accounting for transfers of financial assets is limited to the transfer of an entire financial asset, a group of financial assets in its entirety, or a component of a financial asset which meets the definition of a participating interest with characteristics that are similar to the original financial asset. Transfers of financial assets are accounted for as sales when control over the assets has been surrendered. If the Company has any continuing involvement, rights or obligations with the transferred financial asset (outside of standard representations and warranties), sale accounting requires that the transfer meets the following conditions: (1) the transferred asset has been legally isolated; (2) the transferee has the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred asset; and (3) the Company does not maintain effective control over the transferred asset through an agreement that provides for (a) both an entitlement and an obligation by the Company to repurchase or redeem the asset before its maturity, (b) the unilateral ability by the Company to reclaim the asset and a more than trivial benefit attributable to that ability, or (c) the transferee requiring the Company to repurchase the asset at a price so favorable to the transferee that it is probable the repurchase will occur. If the criteria for sale accounting are met, the transferred financial asset is removed from the balance sheet and a net gain or loss is recognized upon sale, taking into account any retained interests. Transfers of financial assets that do not meet the criteria for sale are accounted for as financing transactions. Derivative Instruments and Hedging Activities The Company may use derivative instruments to manage its interest rate risk and foreign currency risk. The Company does not use derivative instruments for speculative or trading purposes. All derivative instruments are recorded at fair value and included in other assets or other liabilities on a gross basis on the balance sheet. The accounting for changes in fair value of derivatives depends upon whether the derivative has been designated in a hedging relationship and qualifies for hedge accounting. Changes in fair value of derivatives not designated as accounting hedges are recorded in the statement of operations in other gain (loss). For designated accounting hedges, the relationships between hedging instruments and hedged items, risk management objectives and strategies for undertaking the accounting hedges as well as the methods to assess the effectiveness of the derivative prospectively and retrospectively, are formally documented at inception. Hedge effectiveness relates to the amount by which the gain or loss on the designated derivative instrument exactly offsets the change in the hedged item attributable to the hedged risk. If it is determined that a derivative is not expected to be or has ceased to be highly effective at hedging the designated exposure, hedge accounting is discontinued. Cash Flow Hedges —The Company may use interest rate caps and swaps to hedge its exposure to interest rate fluctuations in forecasted interest payments on floating rate debt and may designate as cash flow hedges. Changes in fair value of the derivative is recorded in accumulated other comprehensive income (loss) or AOCI and reclassified into earnings when the hedged item affects earnings. If the derivative in a cash flow hedge is terminated or the hedge designation is removed, related amounts in AOCI are reclassified into earnings when the hedged item affects earnings. Net Investment Hedges —The Company may use foreign currency hedges to protect the value of its net investments in foreign subsidiaries or equity investees whose functional currencies are not U.S. dollars. Changes in fair value of derivatives used as hedges of net investment in foreign operations are recorded in the cumulative translation adjustment account within AOCI. At the end of each quarter, the Company reassesses the effectiveness of its net investment hedges and as appropriate, dedesignates the portion of the derivative notional that is in excess of the beginning balance of its net investments as undesignated hedges. F-22 Table of Contents Release of amounts in AOCI related to net investment hedges occurs upon losing a controlling financial interest in an investment or obtaining control over an equity method investment. Upon sale, complete or substantially complete liquidation of an investment in a foreign subsidiary, or partial sale of an equity method investment, the gain or loss on the related net investment hedge is reclassified from AOCI to earnings. Leases As lessee, the Company determines if an arrangement contains a lease and determines the classification of a leasing arrangement at its inception. A lease is classified as a finance lease, which represents a financed purchase of the leased asset, if the lease meets any of the following criteria: (a) asset ownership is transferred to lessee by end of lease term; (b) option to purchase asset is reasonably certain to be exercised by lessee; (c) the lease term is for a major part of the remaining economic life of the asset; (d) the present value of lease payments equals or exceeds substantially the fair value of the asset; or (e) the asset is of such a specialized nature that it is expected to have no alternative use at end of lease term. A lease is classified as an operating lease when none of the criteria are met. The Company also made the accounting policy election to treat lease and nonlease components in a lease contract as a single component. The Company's leasing arrangements are composed primarily of finance and operating leases for data centers, operating ground leases for other investment properties, and operating leases for its corporate offices. Short-term leases are not recorded on the balance sheet, with lease payments expensed on a straight-line basis over the lease term. Short-term leases are defined as leases which at commencement date, has a lease term of 12 months or less and does not include an option to purchase the underlying asset that the lessee is reasonably certain to exercise. For leases with terms greater than 12 months, a lessee's rights to use the leased asset and obligation to make future lease payments are recognized on balance sheet at lease commencement date as a right-of-use ("ROU") lease asset and a lease liability, respectively. The lease liability is measured based upon the present value of future lease payments over the lease term, discounted at the incremental borrowing rate. Variable lease payments are excluded and are recognized as lease expense as incurred. Lease renewal or termination options are taken into account only if it is reasonably certain that the option would be exercised. As an implicit rate is not readily determinable in most leases, an estimated incremental borrowing rate is applied, which is the interest rate that the Company or its subsidiary, where applicable, would have to pay to borrow an amount equal to the lease payments, on a collateralized basis over the lease term. In estimating incremental borrowing rates, consideration is given to recent debt financing transactions by the Company or its subsidiaries as well as publicly available data for debt instruments with similar characteristics, adjusted for the lease term. The ROU lease asset is measured based upon the corresponding lease liability, reduced by any lease incentives and adjusted to include capitalized initial direct leasing costs. The Company's ROU lease asset is presented within other assets and is amortized on a straight-line basis over the shorter of its useful life or remaining lease term. The Company's lease liability is presented within accrued and other liabilities. The lease liability is (a) reduced by lease payments made during the period; and (b) accreted to the balance as of the beginning of the period based upon the discount rate used at lease commencement. For finance leases, periodic lease payments are allocated between (i) interest expense, calculated based upon the incremental borrowing rate determined at commencement, to produce a constant periodic interest rate on the remaining balance of the lease liability, and (ii) reduction of lease liability. The combination of periodic interest expense and amortization expense on the ROU lease asset effectively reflects installment purchases on the financed leased asset, and results in a front-loaded expense recognition. Higher interest expense is recorded in the early periods as a constant interest rate is applied to the finance lease liability and the liability decreases over the lease term as cash payments are made. For operating leases, fixed lease expense is recognized over the lease term on a straight-line basis and variable lease expense is recognized in the period incurred. A lease that is terminated before expiration of its lease term would result in a derecognition of the lease liability and ROU lease asset, with the difference recorded in the income statement, reflected as other gain (loss). If a plan has been committed to abandon an ROU lease asset at a future date before the end of its lease term, amortization of the ROU lease asset is accelerated based on its revised useful life. If an ROU lease asset is abandoned with immediate effect and the carrying value of the ROU lease asset is determined to be unrecoverable, an impairment loss is recognized on the ROU lease asset. Financing Costs Debt discounts and premiums as well as debt issuance costs (except for revolving credit arrangements) are presented net against the associated debt on the balance sheet and amortized into interest expense using the effective interest method over the contractual term or expected life of the debt instrument. Costs incurred in connection with revolving credit arrangements are recorded as deferred financing costs in other assets, and amortized on a straight-line basis over the expected term of the credit facility. F-23 Table of Contents Property Operating Income Property operating income includes the following: Lease Income The Company's lease income is composed of (i) fixed lease income for rents, and for interconnection services and a committed amount of power related to contracted data center leased space; and (ii) variable lease income for tenant reimbursements, installation services of Company-owned data center equipment and additional metered power reimbursements based upon usage by data center tenants at prevailing rates. As lessor, the classification of a lease as a sales-type lease is similar to the criteria for a finance lease as lessee (discussed above). If none of the criteria are met, a lease may be classified as a direct financing lease if there is a residual value guarantee from an unrelated third party. Otherwise, all other leases are classified as operating, including leases with variable lease payments that are not based upon a rate or index where classification as sales-type or direct financing lease would result in a loss to the Company at lease commencement. The Company's lease contracts contain lease components, such as leased data center space and equipment, and nonlease components, such as tenant reimbursements for net leases, interconnection services, installation services of Company-owned data center equipment and payments for power by data center tenants. As lessor, the Company made the accounting policy election to account for the lease components and nonlease components in its lease contracts as a single component in instances where the lease component is predominant, the timing and pattern of transfer for the lease and nonlease components are the same (i.e., provided on a consistent basis over the same time period), and the lease component, if accounted for separately, would be classified as an operating lease. Rental Income and Tenant Reimbursements Rental income is recognized on a straight-line basis over the noncancelable term of the related lease which includes the effects of minimum rent increases and rent abatements under the lease. Rents received in advance are deferred. In net lease arrangements, the tenant is generally responsible for operating expenses relating to the property, including real estate taxes, property insurance, maintenance, repairs and improvements. Costs reimbursable from tenants and other recoverable costs are recognized as revenue in the period the recoverable costs are incurred. When the Company is the primary obligor with respect to purchasing goods and services for property operations and has discretion in selecting the supplier and retains credit risk, tenant reimbursement revenue and property operating expenses are presented on a gross basis in the statements of operations. For net leases where the lessee self-manages the property, hires its own service providers and retains credit risk for routine maintenance contracts, no reimbursement revenue and expense are recognized. For property taxes and insurance, amounts paid directly by lessees to third parties on behalf of the Company are not recognized in the statement of operations, while amounts paid by the Company and reimbursed by lessees are presented gross as property operating income and expenses. Also, sales and similar taxes assessed by a governmental authority that is imposed on specific lease income producing transactions are netted against related collections from lessees. When it is determined that the Company is the owner of tenant improvements, the cost to construct the tenant improvements, including costs paid for or reimbursed from the tenants, is capitalized. For Company-owned tenant improvements, the amounts funded by or reimbursed from the tenants are recorded as deferred revenue, which is amortized on a straight-line basis as additional rental income over the term of the related lease. Rental income recognition commences when the leased space is substantially ready for its intended use and the tenant takes possession of the leased space. When it is determined that the tenant is the owner of tenant improvements, the Company's contribution towards those improvements is recorded as a lease incentive, included in deferred leasing costs and intangible assets on the balance sheet, and amortized as a reduction to rental income on a straight-line basis over the term of the lease. Rental income recognition commences when the tenant takes possession of the lease space. Collectability —The Company evaluates collectability of lease payments based upon the creditworthiness of the lessee and recognizes lease income only to the extent collection of all amounts due over the life of the lease is determined to be probable. If collection is subsequently determined to no longer be probable, any previously accrued lease income that has not been collected is subject to reversal. If collection is subsequently determined to be probable, lease income and corresponding receivable would be reestablished to an amount that would have been recognized if collection had always been deemed to be probable. F-24 Table of Contents Costs to Execute Lease —Only incremental costs of obtaining a lease, such as leasing commissions, qualify as initial direct leasing costs to be capitalized. Indirect costs such as allocated overhead, certain legal fees and negotiation costs are expensed as incurred. Resident Fee Income Resident fee income, presented within discontinued operations, was earned from senior housing operating facilities that operate through management agreements with independent third-party operators. Resident fee income related to independent living and assisted living facilities was recorded when services were rendered based on terms of their respective lease agreements. The Company's healthcare business was sold in February 2022. Data Center Service Revenue The Company earns data center service revenue, primarily composed of cloud services, data storage, data protection, network services, software licensing, other services related to installation of customer equipment, and other related information technology services, which are recognized as services are provided to data center customers. Hotel Operating Income Hotel operating income, presented within discontinued operations, included room revenue, food and beverage sales and other ancillary services. Revenue was recognized upon occupancy of rooms, consummation of sales and provision of services. The Company's hotel business was sold in March 2021, with one remaining portfolio that was in receivership sold by the lender in September 2021. Fee Income Fee income consists primarily of the following: Management Fees —The Company earns management fees for providing investment management services to its sponsored private funds and other investment vehicles, portfolio companies and managed accounts, which constitute a series of distinct services satisfied over time. Management fees are recognized over the life of the investment vehicle as services are provided. The governing documents of the investment vehicles may provide for certain fee credits or offsets to management fees. Such amounts include primarily organizational costs of the investment vehicle in excess of prescribed thresholds, termination or similar fees paid in connection with unconsummated investments that are reimbursable by the investment vehicle, and directors' fees paid by portfolio companies to employees of the Company in their capacity as non-management directors. These fee credits or offsets represent a component of the transaction price for the Company's provision of investment management services and are applied to reduce management fees payable to the Company. Incentive Fees —The Company is entitled to incentive fees from sub-advisory accounts in its Liquid Strategies. Incentive fees are determined 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. Incentive fees take the form of a contractual fee arrangement, and unlike carried interests, do not represent an allocation of returns among equity holders of an investment vehicle. Incentive fees are a form of variable consideration and are recognized when it is probable that a significant reversal of the cumulative revenue will not occur, which is generally at the end of the performance measurement period. Management fees and incentive fees earned from consolidated funds and other investment vehicles are eliminated in consolidation. However, because the fees are funded by and earned from third party investors in these consolidated vehicles who represent noncontrolling interests, the Company's allocated share of net income from the consolidated funds and other vehicles is increased by the amount of fees that are eliminated. Accordingly, the elimination of these fees does not affect net income (loss) attributable to DBRG. Other Income Recurring other income includes primarily the following: Cost Reimbursements from Affiliates —For various services provided to certain affiliates, including managed investment vehicles, the Company is entitled to receive reimbursements of expenses incurred, generally based on expenses that are directly attributable to providing those services and/or a portion of overhead costs. The Company acts in the capacity of a principal under these arrangements. Accordingly, the Company records the expenses and corresponding reimbursement income on a gross basis in the period the services are rendered and costs are incurred. F-25 Table of Contents Equity Awards Granted by Managed Companies —These were equity awards granted to the Company to be granted to its employees or granted directly to its employees by BrightSpire Capital, Inc. ("BRSP"), a publicly-traded REIT previously managed by the Company (prior to termination of its management agreement in April 2021). The initial grant was recorded as an other asset and deferred income liability on the balance sheet. The liability was amortized on a straight-line basis to other income over the initial vesting period of the award and equity-based compensation expense was recognized as the award vested to the recipient employee. Compensation expense related to equity awards granted by managed companies is presented within discontinued operations. Compensation Compensation comprises salaries, bonus including discretionary awards and contractual amounts for certain senior executives, benefits, severance payments, and equity-based compensation. Bonus is accrued over the employment period to which it relates. Carried Interest and Incentive Fee Compensation —This represents a portion of carried interest and incentive fees earned by the Company that are allocated to senior management, investment professionals and certain other employees of the Company. Carried interest and incentive fee compensation are generally recorded as the related carried interest and incentive fees are recognized in earnings by the Company. Carried interest compensation amounts may be reversed if there is a decline in the cumulative carried interest amounts previously recognized by the Company. Carried interest and incentive fee compensation are generally not paid to management or other employees until the related carried interest and incentive fee amounts are distributed by the investment vehicles to the Company. If the related carried interest distributions received by the Company are subject to clawback, the previously distributed carried interest compensation would be similarly subject to clawback from employees. The Company generally withholds a portion of the distribution of carried interest compensation to employees to satisfy their potential clawback obligation. The amount withheld resides in entities outside of the Company. Equity-Based Compensation —Equity-classified stock awards granted to employees and non-employees that have a service condition and/or a market or performance condition are measured at fair value at date of grant. A modification in the terms or conditions of an award, unless the change is non-substantive, represents an exchange of the original award for a new award. The modified award is revalued and incremental compensation cost is recognized for the excess, if any, between fair value of the award upon modification and fair value of the award immediately prior to modification. Total compensation cost recognized for a modified award, however, cannot be less than its grant date fair value, unless at the time of modification, the service or performance condition of the original award was not expected to be satisfied. An award that is probable of vesting both before and after modification will result in incremental compensation cost only if terms affecting its estimate of fair value have been modified. Liability-classified stock awards are remeasured at fair value at the end of each reporting period until the award is fully vested. Compensation expense is recognized on a straight-line basis over the requisite service period of each award, with the amount of compensation expense recognized at the end of a reporting period at least equal the portion of fair value of the respective award at grant date or modification date, as applicable, that has vested through that date. For awards with a performance condition, compensation expense is recognized only if and when it becomes probable that the performance condition will be met, with a cumulative adjustment from service inception date, and conversely, compensation cost is reversed to the extent it is no longer probable that the performance condition will be met. For awards with a market condition, compensation cost is not reversed if a market condition is not met so long as the requisite service has been rendered, as a market condition does not represent a vesting condition. Compensation expense is adjusted for actual forfeitures upon occurrence. Income Taxes Provision for income taxes consists of a current and deferred component. Current income taxes represent income tax to be paid or refunded for the current period. The Company uses the asset and liability method to provide for income taxes, which requires that the Company's income tax provision reflect the expected future tax consequences of temporary differences between the carrying amounts of assets or liabilities for financial reporting versus for income tax purposes. Accordingly, a deferred tax asset or liability for each temporary difference is determined based on enacted tax rates that the Company expects to be in effect upon realization of the underlying amounts when they become deductible or taxable and the differences reverse. A deferred tax asset is also recognized for NOL, capital loss and tax credit carryforwards. A valuation allowance for deferred tax assets is established if the Company believes it is more likely than not that all or some portion of the deferred tax assets will not be realized based upon the weight of all available positive and negative evidence. Realization of deferred tax assets is dependent upon the adequacy of future expected taxable income from all F-26 Table of Contents sources, including reversal of taxable temporary differences, forecasted earnings and prudent and feasible tax planning strategies. An established valuation allowance may be reversed in a future period if the Company subsequently determines it is more likely than not that all or some portion of the deferred tax asset will become realizable. Uncertain Tax Positions Income tax benefits are recognized for uncertain tax positions that are more likely than not to be sustained based solely on their technical merits. Such uncertain tax positions are measured as the largest amount of benefit that is more likely than not to be realized upon settlement. The difference between the benefit recognized and the tax benefit claimed on a tax return results in an unrecognized tax benefit. The Company evaluates on a quarterly basis whether it is more likely than not that its uncertain tax positions would be sustained upon examination by a tax authority for all open tax years, as defined by the statute of limitations. The evaluation of uncertain tax positions is based upon various factors including, but not limited to, changes in tax law, measurement of tax positions taken or expected to be taken in tax returns, the effective settlement of matters subject to audit, new audit activity, and changes in facts or circumstances related to a tax position. Income tax related interests and penalties, if any, are included as a component of income tax benefit (expense). Earnings Per Share The Company calculates basic earnings per share ("EPS") using the two-class method which defines unvested share based payment awards that contain nonforfeitable rights to dividends as participating securities. The two-class method is an allocation formula that determines EPS for each share of common stock and participating securities according to dividends declared and participation rights in undistributed earnings. Under this method, all earnings (distributed and undistributed) are allocated to common shares and participating securities based on their respective rights to receive dividends. EPS is calculated by dividing earnings allocated to common shareholders by the weighted-average number of common shares outstanding during the period. Diluted EPS is based on the weighted-average number of common shares and the effect of potentially dilutive common share equivalents outstanding during the period. Potentially dilutive common share equivalents include shares to be issued upon the assumed conversion of the Company's outstanding convertible notes, which are included under the if-converted method when dilutive. The earnings allocated to common shareholders is adjusted to add back the after-tax amount of interest expense associated with the convertible notes, except when doing so would be antidilutive. In circumstances where discontinued operations are reported, income from continuing operations is used as the benchmark to determine whether including potential common shares in diluted EPS computation would be antidilutive. Accordingly, if there is a loss from continuing operations and potential common shares would be antidilutive due to the loss, but there is net income after adjusting for discontinued operations, the potential common shares would be excluded from diluted EPS computation even though the effect on net income would be dilutive, because income from continuing operations is used as the benchmark. Reclassifications Certain prior period amounts disclosed within the notes to the consolidated financial statements have been reclassified to conform to current period presentation. These reclassifications did not affect the Company's financial position, results of operations or cash flows. Adjustments to Beginning Equity On January 1, 2020, upon adoption of Accounting Standards Update ("ASU") No. 2016-13, Financial Instruments— Credit Losses , the Company recorded a $ 5.1 million decrease to beginning equity, composed of: (i) an $ 8.4 million decrease to beginning equity, representing the Company's share of the cumulative effect adjustment of adopting the lifetime current expected credit loss ("CECL") model by its equity method investee, BRSP; partially offset by (ii) a $ 3.3 million increase to beginning equity, 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 2022 Amendment to Lessor Accounting In July 2021, the Financial Accounting Standards Board ("FASB") issued ASU No. 2021-5, Lessors—Certain Leases with Variable Lease Payments , which amends existing lease classification guidance for lessors to better reflect the economics of certain lease arrangements. The ASU requires a lease with variable lease payments that are not based upon a rate or index to be classified as an operating lease if classification as a direct financing lease or sales-type lease F-27 Table of Contents would have resulted in a loss to the lessor at lease commencement. A loss could have otherwise arisen even if the lease is expected to be profitable as the exclusion of these variable lease payments result in the recognition of a lower net investment in a lease relative to the carrying value of the underlying asset that is derecognized at the commencement of a direct financing or sales-type lease. Under the amended guidance, this uneconomic outcome is avoided because the classification as an operating lease does not result in a derecognition of the underlying asset by the lessor, and the recognition of variable lease payments earned and depreciation expense on the underlying asset will partially offset in earnings over time. The Company adopted the ASU on a prospective basis on its effective date of January 1, 2022. At the time of adoption, the Company, as lessor, did not have any leases that would have been subject to this amendment. Acquired Contracts with Customers In October 2021, the FASB issued ASU No. 2021-8, Accounting for Contract Assets and Contract Liabilities From Contracts With Customers , which applies the principles of ASC 606, Revenue from Contracts with Customers , rather than a fair value basis under ASC 805, Business Combinations , in the recognition of contract assets and contract liabilities acquired in a business combination. The ASU addresses the following inconsistencies: (1) measurement of contract liability or deferred revenue at fair value that is typically lower than carrying value, reducing post-acquisition revenues; and (2) timing of contractual payments affecting the fair value of deferred revenue and the amount of post-acquisition revenue in otherwise similar contracts. Under the new guidance, an acquirer records a contract asset or contract liability as if it had originated the acquired revenue contract, which requires the acquirer to evaluate performance obligations, transaction price and relative stand-alone selling price at the original contract inception date or subsequent modification dates. This will generally result in the recognition and measurement of a contract asset and contract liability that will likely be more comparable to the books of the acquiree at acquisition date. In circumstances where an acquirer is unable to assess or rely on the acquiree's accounting under ASC 606, the ASU provides a practical expedient that allows an acquirer to determine the stand-alone selling price of each performance obligation in the contract as of acquisition date, instead of contract inception date, for purposes of allocating the transaction price. The amendments also apply to contract assets and contract liabilities from other contracts to which the provisions of ASC 606 apply, such as contracts within the scope of ASC 610-20, Other Income—Gains and Losses from Derecognition of Nonfinancial Assets, but the amendments do not affect the accounting for other assets or liabilities that may arise from acquired customer contracts such as refund liabilities that do not meet the definition of contract liabilities and continue to be recorded at fair value. The ASU is effective January 1, 2023 and is to be applied prospectively. Early adoption is permitted with retrospective application to all business combinations that occurred during the fiscal year of early adoption. The Company early adopted the ASU on January 1, 2022 with no impact upon adoption. Future Accounting Standards Contractual Sale Restriction on Equity Securities In June 2022, the FASB issued ASU 2022-03, Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions , which amends Topic 820 Fair Value to clarify that a contractual sale restriction that is entity-specific is not part of the unit of account of an equity security and is therefore not considered in measuring the fair value of an equity security, in which case, a discount should not be applied. The amendment further prohibits recognizing the contractual sale restriction as a separate unit of account, that is, as a contra asset or liability. Sale restrictions that are characteristics of the holder of an equity security include, but are not limited to, lock-up agreements, market stand-off agreements, or specific provisions in agreements between shareholders. In contrast, a legal restriction preventing a security from being sold on a national securities exchange or an over-the-counter market is a security-specific characteristic as the restriction would similarly apply to a market participant buyer in an assumed sale of the security. This guidance also applies to issuers of equity securities that are subject to contractual sale restrictions, for example, equity securities issued as consideration in a business combination. The ASU requires additional disclosures related to equity securities that are subject to contractual sale restrictions, specifically (1) the fair value of such equity securities, (2) the nature and remaining duration of the restrictions, and (3) any circumstances that could cause a lapse in restrictions. The ASU is effective January 1, 2024, with early adoption permitted in the interim periods. Transition is prospective with any fair value adjustments resulting from adoption recognized in earnings and the amount adjusted disclosed in the period of adoption. For subsidiaries of the Company that are investment companies as defined in ASC 946, the ASU is applied prospectively to equity securities with contractual sale restrictions entered into or modified on or after the adoption date. For equity securities with contractual sale restrictions entered into or modified before the adoption date, the existing accounting policy continues to be applied until the restrictions expire or are modified, and if the existing accounting policy differs from the amended guidance, the additional disclosure requirements under the ASU would be applicable. F-28 Table of Contents The Company and its investment company subsidiaries do not currently have equity securities subject to contractual sale restrictions. 3. Acquisitions Asset Acquisitions Vantage SDC Hyperscale Data Centers In July 2020 and following an additional investment in October 2020, the Company, alongside fee bearing third party capital, invested $ 1.36 billion for an approximately 90 % equity interest in entities that hold Vantage Data Centers Holdings, LLC's ("Vantage") portfolio of 12 stabilized hyperscale data centers in North America and $ 2.0 billion of secured indebtedness (“Vantage SDC”). The remaining equity interest in Vantage SDC is held by the investors of Vantage prior to the Company's acquisition, and together with the third party capital raised by the Company, represent noncontrolling interests. The Company's balance sheet investment was approximately $ 200 million or a 13 % equity interest in Vantage SDC. Vantage SDC is a carve-out from Vantage's data center business. The acquisition excluded Vantage's remaining portfolio of development-stage data centers and its employees, all of which were retained by Vantage. The day-to-day operations of Vantage SDC continue to be managed by Vantage's existing management company in exchange for management fees, and subject to certain approval rights held by the Company and the co-investors in connection with material actions. Pursuant to a purchase option in connection with the July 2020 acquisition, the Company acquired an additional data center in Santa Clara, California in September 2021 for $ 404.5 million in cash. The acquisition was funded through borrowings by Vantage SDC, with a deferred amount of $ 56.9 million to be paid upon future lease-up, and additional consideration contingent on lease-up of the remaining capacity. In connection with the July 2020 and September 2021 acquisitions, the Company and its co-investors also committed to acquire the future build-out of expansion capacity, along with lease-up of the expanded capacity and existing inventory, the costs of which are borne by the previous owners of Vantage SDC. As of December 31, 2022, the remaining consideration for the incremental lease-up acquisitions is estimated to be approximately $ 198 million. Most, if not all, of the cost of the expansion capacity has been or will be funded by Vantage SDC from borrowings under its credit facilities and/or cash from operations. Pursuant to this arrangement, Vantage SDC had 15 and 11 new tenant leases related to a portion of the expansion capacity that commenced in 2022 and 2021, respectively, for aggregate consideration of $ 161.3 million and $ 100.8 million, respectively. All of these payments were made to the previous owners of Vantage SDC and are treated as asset acquisitions. Acquisitions by DataBank (the Company's edge colocation data center subsidiary) 2022 • Four colocation data centers in Houston, Texas in March 2022 for $ 678 million, funded by a combination of $ 262.5 million of debt and $ 415.5 million of equity, of which the Company's share was $ 88.7 million. • A data center each in Atlanta, Georgia in May 2022 for $ 10.9 million, and in Denver, Colorado in February 2022 that was previously leased by its zColo subsidiary for $ 17.6 million. 2021 • Five data centers in the zColo portfolio in France in February 2021 for $ 33.0 million. • One building each in Colorado and New York in the third quarter of 2021 totaling $ 38.5 million, to be redeveloped into data centers. 2020 ◦ zColo, the colocation business of Zayo Group Holdings, Inc. ("Zayo") in December 2020, composed of 39 data centers in the U.S. 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 was then $ 145 million. Zayo is an anchor tenant within the zColo facilities and is a significant customer of DataBank.data centers Tower Assets In June 2022, the Company acquired the mobile telecommunications tower business (“TowerCo”) of Telenet Group Holding NV (Euronext Brussels: TNET) for € 740.1 million or $ 791.3 million (including transaction costs) . In December F-29 Table of Contents 2022, our interest in the temporarily warehoused TowerCo investment was transferred to the Company's new sponsored fund (Note 16) and TowerCo was deconsolidated. The TowerCo assets acquired had included owned tower sites, tower sites subject to third party leases that gave rise to right-of-use lease assets and corresponding lease liabilities, equipment, as well as customer relationships related primarily to a master lease agreement with Telenet as lessee. The acquisition had been funded through $ 326.1 million of debt, $ 278.1 million of equity from the Company, and $ 213.8 million in third party equity. In addition to the purchase price, the funds had been used to finance transaction costs, debt issuance costs, working capital and as operating cash. Prior to transfer, TowerCo was presented within Corporate and Other. Allocation of Consideration Transferred The following table summarizes the consideration and allocation to assets acquired, liabilities assumed and noncontrolling interests at acquisition. In an asset acquisition, the cost of assets acquired, which includes capitalized transaction costs, is allocated to individual assets within the group based on their relative fair values and does not give rise to goodwill. Asset Acquisitions 2022 2021 2020 (In thousands) TowerCo Acquisitions by DataBank / zColo US Vantage SDC Expansion Capacity Vantage SDC Expansion Capacity and Add-On Acquisition Acquisitions by DataBank / zColo US zColo France Vantage SDC zColo US and UK Assets acquired and liabilities assumed Cash $ — $ — $ — $ — $ — $ — $ — $ 266 Real estate 363,121 627,474 140,140 479,587 38,500 26,083 2,720,870 882,327 Intangible assets 673,218 77,885 21,162 82,603 — 8,702 765,137 303,119 ROU and other assets 234,462 3,994 — — — 9,536 181,260 415,038 Debt — — — — — — ( 2,060,307 ) — Deferred tax liabilities ( 243,223 ) — — — — — — — Intangible, lease and other liabilities ( 236,324 ) ( 2,839 ) — ( 56,889 ) — ( 11,303 ) ( 82,350 ) ( 419,262 ) Fair value of net assets acquired $ 791,254 $ 706,514 $ 161,302 $ 505,301 $ 38,500 $ 33,018 $ 1,524,610 $ 1,181,488 • Real estate was valued based upon (i) current replacement cost for buildings in an as-vacant state and improvements, estimated using construction cost guidelines; (ii) current replacement cost for data center infrastructure by applying an estimated cost per kilowatt based upon current capacity of each location and also considering the associated indirect costs such as design, engineering, construction and installation; (iii) current replacement cost for towers in consideration of their remaining economic life; and (iv) recent comparable sales or current listings for land. Useful lives of real estate acquired range from 30 to 50 years for buildings and improvements, 5 to 40 years for site improvements, 11 to 71 years for towers and related equipment, 11 to 20 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 had been acquired vacant, and the leasing commissions, legal and marketing costs that would have been incurred to lease up the properties, discounted at rates between 4.75 % and 6.8 %, with remaining lease terms ranging between 1 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 6.0 % and 11.25 % with remaining lease terms ranging between 1 and 15 years. • Tenant relationships represent the estimated net cash flows attributable to the likelihood of lease renewal by an existing tenant relative to the cost of obtaining a new lease, taking into consideration the estimated time it would require to execute a new lease or backfill a vacant space, discounted at rates between 4.75 % and 11.5 %, with estimated useful lives between 5 and 15 years. • Customer service contracts were valued based upon estimated net cash flows generated from the zColo customer service contracts that would have been forgone if such contracts were not in place, taking into consideration the time it would require to execute a new contract, with remaining term of the contracts ranging between 1 and 15 years. • Customer relationships for zColo were valued as the incremental net cash flows to business attributable to the in-place customer relationships, discounted at a rate of 10 %, with an estimated useful life of 12 years. F-30 Table of Contents • Customer relationships for towers were valued as the estimated future cash flows to be generated over the life of the tenant relationships based upon rental rates, operating costs, expected renewal terms and attrition, discounted at 6.8 %, with estimated useful lives between 19 and 45 years. • Other intangible assets acquired were as follows: • Trade name of zColo was valued based upon estimated savings from avoided royalty at a rate of 1 %, discounted at 10 %, with a 1 year useful life. • Assembled workforce was valued based upon estimated cost of recruiting and training new data center employees for zColo, with a 3 year useful life. • Deferred tax liabilities were recognized for the book-to-tax basis difference associated with the TowerCo acquisition. • Debt assumed from the Vantage SDC acquisition in 2020 was valued based upon market rates and spreads that prevailed at the time of acquisition for debt with similar terms and remaining maturities. • Other assets acquired and liabilities assumed include primarily lease ROU assets associated with leasehold data centers and ground space hosting tower communication sites, along with corresponding lease liabilities. Lease liabilities were measured based upon the present value of future lease payments over the lease term, discounted at the incremental borrowing rate of the respective acquiree entities. Other liabilities in 2021 also included a deferred purchase consideration associated with the Vantage SDC add-on acquisition. Business Combination in 2023 Infrastructure Investment Management Platform In February 2023, the Company completed its previously announced acquisition of the global infrastructure equity investment management business of AMP Capital Investors International Holdings Limited ("AMP Capital"), which was rebranded as InfraBridge at closing. Consideration for the acquisition consisted of: (i) an upfront amount of $ 316 million (or $ 323.5 million including working capital, net of cash assumed), subject to customary post-closing adjustments up to 90 days after closing; and (ii) a contingent amount of up to A$ 180 million (approximately $ 129 million), generally based upon achievement of future fundraising targets for InfraBridge's new global infrastructure funds. 4. Real Estate The following table summarizes the Company's real estate held for investment. (In thousands) December 31, 2022 December 31, 2021 Land $ 257,588 $ 206,588 Buildings and improvements 1,573,605 1,235,334 Data center infrastructure 4,427,150 3,845,431 Construction in progress 395,393 77,014 6,653,736 5,364,367 Less: Accumulated depreciation ( 732,438 ) ( 392,083 ) Real estate assets, net $ 5,921,298 $ 4,972,284 Real Estate Depreciation Depreciation of real estate held for investment was $ 350.7 million, $ 275.8 million and $ 117.1 million for the years ended December 31, 2022, 2021 and 2020, respectively. F-31 Table of Contents Property Operating Income Components of property operating income are as follows. Year Ended December 31, (In thousands) 2022 2021 2020 Lease income: Fixed lease income $ 729,503 $ 609,005 $ 226,478 Variable lease income 120,442 92,701 38,913 849,945 701,706 265,391 Data center service revenue 77,561 61,044 47,537 $ 927,506 $ 762,750 $ 312,928 For the years ended December 31, 2022 and 2021, property operating income from a single customer accounted for approximately 18 % and 17 %, respectively, of the Company's total revenues from continuing operations, or approximately 8 % for both periods, of 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 2020. Future Fixed Lease Income At December 31, 2022, future fixed lease payments receivable under noncancelable operating leases for real estate held for investment in the Operating segment were as follows. These operating leases have expiration dates through 2041, excluding month-to-month leases, and renewal options and early termination rights at the lessee's election unless such options or rights are reasonably certain to be exercised. Year Ending December 31, (In thousands) 2023 $ 549,020 2024 418,984 2025 367,996 2026 325,024 2027 284,522 2028 and thereafter 1,480,010 Total $ 3,425,556 F-32 Table of Contents 5. Equity and Debt Investments The Company's equity and debt investments, excluding investments held for disposition (Note 21), are represented by the following: (In thousands) December 31, 2022 December 31, 2021 Equity investments Equity method investments BrightSpire Capital, Inc. (BRSP) (1) $ 217,994 $ 284,985 Company-sponsored private funds—equity investment in funds 406,624 270,737 Company-sponsored private funds—unrealized carried interest 341,749 111,957 Other 3,887 5,417 970,254 673,096 Other equity investments Marketable securities (Note 11) 155,866 201,912 Private funds and non-traded REIT 36,436 49,575 Other 108,567 10,570 Total equity investments 1,271,123 935,153 Debt securities CLO subordinated notes 50,927 — Equity and debt investments $ 1,322,050 $ 935,153 __________ (1) At December 31, 2021, excluded approximately 461,000 shares and 3.1 million units in BRSP held by NRF Holdco that were included in assets held for disposition (Note 21). NRF Holdco was sold in February 2022. Equity Investments 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 liquid 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 OTTI at each reporting period. In 2021, OTTI was recorded only on equity method investments held for disposition, as discussed in Note 21. BrightSpire Capital, Inc. (NYSE: BRSP) At December 31, 2022, the Company owned approximately 35.0 million shares in BRSP for a 27.1 % interest in BRSP ( 29.0 % at December 31, 2021, including BRSP shares and units held by NRF Holdco that were disposed in February 2022), accounted for under the equity method as it exercises significant influence over BRSP's operating and financial policies through its substantial ownership interest. In connection with the internalization of BRSP in April 2021, the Company had 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. 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 BRSP's 2023 annual meeting. Except as aforementioned, the Company may vote its shares in its sole discretion in any votes of BRSP’s stockholders and is prohibited from acquiring additional BRSP shares. Disposition —In 2022 and 2020, there were no dispositions of the Company's BRSP shares. In August 2021, the Company sold 9,487,500 BRSP shares through a secondary offering by BRSP for net proceeds of approximately $ 81.8 million, after underwriting discounts. A net gain was recognized in equity method earnings within continuing operations of $ 7.6 million (including basis difference associated with the BRSP shares disposed, as discussed below). F-33 Table of Contents OTTI —In the third and fourth quarters of 2022 and second quarter of 2020, the Company determined that its investment in BRSP was other-than-temporarily impaired and recorded impairment charges, included in equity method losses, of $ 60.4 million in 2022 and $ 274.7 million in 2020. In 2022, the Company determined that given the continuing market volatility, its anticipated hold period for its investment in BRSP may not be sufficient to allow for a recovery of BRSP's stock price relative to the Company's carrying value of its investment in BRSP. In 2020, concerns over the likelihood of a near term recovery of BRSP's stock price stemmed from then uncertainties surrounding the pandemic and its effect on the economy and equity markets. The OTTI charge was measured as the excess of carrying value over market value of the Company's investment in BRSP based upon BRSP's closing stock price on December 30, 2022, the last trading day of the quarter, and on June 30, 2020, respectively. There was no OTTI in 2021 as the fair value of the Company's investment in BRSP was in excess of its carrying value. As a result of the impairment charge, the carrying value of the Company's investment in BRSP as of December 31, 2022 represents a non-recurring fair value that was measured under the Level 1 fair value hierarchy. Basis Difference —The Company recorded impairment charges on its investment in BRSP in 2022, 2020 and 2019, with each instance resulting in a basis difference between the Company's carrying value of its investment in BRSP (based upon BRSP's share price at the time of impairment) and the Company's proportionate share of BRSP's book value of equity at the time of impairment. 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. Therefore, the impairment charges were generally allocated on a relative fair value basis across BRSP's various investments. Accordingly, for any subsequent resolutions or write-downs taken by BRSP on these investments, the Company's share thereof is not recorded as an equity method loss but is applied to reduce the basis difference until such time the basis difference in connection with the respective investments has been fully eliminated. Upon resolution of these investments by BRSP or upon the Company's disposition of its shares in BRSP, the basis difference related to resolved investments or the proportion of basis difference associated with the BRSP shares disposed is applied to calculate the Company's share of net gain or loss resulting from such resolution or disposition. The Company increased its share of net earnings or reduced its share of net losses from BRSP by $ 17.0 million in 2022, $ 110.3 million in 2021 and $ 83.9 million in 2020, representing the basis difference allocated to investments that were resolved or impaired by BRSP during these periods. The basis difference balance at December 31, 2022 was $ 210.7 million. Carried Interest The carried interest on balance sheet date represents unrealized carried interest in connection with sponsored funds that are currently in the early stage of their lifecycle. Unrealized carried interest may be subject to reversal until such time it is realized. Carried interest allocation is presented gross of accrued carried interest compensation (Note 7). Carried Interest Distributed In the second half of 2022, $ 152.5 million of carried interest was distributed and recognized in equity method earnings. $ 119.8 million of the distributed carried interest was allocated to current and former employees and to Wafra (Note 10), recorded as carried interest compensation and amounts attributable to noncontrolling interests (Note 16). Clawback Obligation Carried interest distributions may be subject to clawback if decline in investment values results in cumulative performance of the fund falling below minimum return hurdles in the interim period. At December 31, 2022, the Company does not have a liability for clawback obligations on distributed carried interest. With respect to funds that have distributed carried interest, if in the event all of their investments are deemed to have no value, the likelihood of which is remote, carried interest distributions of $ 75.1 million would be subject to clawback as of December 31, 2022, of which $ 58.4 million would be the responsibility of the employee and former employee recipients. For this purpose, a portion of the carried interest allocated is generally held back from these recipients at the time of distribution. F-34 Table of Contents Combined Financial Information of Equity Method Investees The following tables present selected combined financial information of the Company's equity method investees, excluding investees classified as held for disposition. Amounts presented represent combined totals at the investee level and not the Company's proportionate share. Selected Combined Balance Sheet Information (In thousands) December 31, 2022 December 31, 2021 Total assets $ 27,257,852 $ 19,383,775 Total liabilities 3,440,418 5,500,143 Owners' equity 23,816,178 13,847,605 Noncontrolling interests 1,256 36,027 Selected Combined Statements of Operations Information Year Ended December 31, (In thousands) 2022 2021 2020 Total revenues $ 246,585 $ 264,237 $ 345,053 Net income (loss) 2,197,778 667,381 ( 323,058 ) Net income (loss) attributable to noncontrolling interests 1,001 ( 3,535 ) ( 34,602 ) Net income (loss) attributable to owners 2,196,777 670,916 ( 288,456 ) Investment and Lending Commitments Sponsored Funds At December 31, 2022, the Company had unfunded commitments to its sponsored funds of $ 112.2 million, including commitments to a consolidated fund. Loans Receivable The Company's DataBank subsidiary has lending commitments to a borrower, which is available to be drawn subject to satisfaction by the borrower of certain financial and operating metrics and an agreed upon budget. At December 31, 2022, the unfunded lending commitments was $ 24.2 million, of which the Company's share was $ 2.7 million, net of amounts attributable to noncontrolling interests in investment entities. At December 31, 2022, the borrower has not met the required criteria for further funding. Debt Securities In the third quarter of 2022, bank syndicated loans that the Company previously warehoused were transferred into a third party warehouse entity at their acquisition price totaling $ 232.7 million, and securitized through the issuance of collateralized loan obligation ("CLO") securities. The corresponding warehouse facility of $ 172.5 million was repaid by the Company. The CLO is sponsored and managed by the third party. The Company acquired all of the subordinated notes of the CLO, which are classified as AFS debt securities. The CLO has a stated legal final maturity of 2035. The balance of the CLO subordinated notes is summarized as follows: Amortized Cost without Allowance for Credit Loss Allowance for Credit Loss Gross Cumulative Unrealized (in thousands) Gains Losses Fair Value December 31, 2022 $ 50,927 $ — $ — $ — $ 50,927 F-35 Table of Contents 6. Goodwill, Deferred Leasing Costs and Other Intangibles Goodwill Goodwill balance by reportable segment at both December 31, 2022 and 2021 is as follows. (In thousands) Investment Management (1) $ 298,248 Operating 463,120 Total goodwill $ 761,368 __________ (1) Remaining goodwill deductible for income tax purposes was $ 122.4 million at December 31, 2022 and $ 133.0 million at December 31, 2021. Deferred Leasing Costs, Other Intangible Assets and Intangible Liabilities Deferred leasing costs and identifiable intangible assets and liabilities, excluding those related to assets held for disposition, are as follows. December 31, 2022 December 31, 2021 (In thousands) Carrying Amount (Net of Impairment) (1) Accumulated Amortization (1) Net Carrying Amount (1) Carrying Amount (Net of Impairment) (1) Accumulated Amortization (1) Net Carrying Amount (1) Deferred Leasing Costs and Intangible Assets Deferred leasing costs and lease-related intangible assets (2) $ 1,239,477 $ ( 397,975 ) $ 841,502 $ 1,148,441 $ ( 256,987 ) $ 891,454 Investment management intangibles (3) 164,189 ( 82,432 ) 81,757 164,189 ( 61,435 ) 102,754 Customer relationships and service contracts (4) 218,154 ( 62,788 ) 155,366 218,064 ( 44,496 ) 173,568 Trade names 26,400 ( 15,656 ) 10,744 26,400 ( 11,266 ) 15,134 Other (5) 6,818 ( 4,020 ) 2,798 6,818 ( 2,101 ) 4,717 Total deferred leasing costs and intangible assets $ 1,655,038 $ ( 562,871 ) $ 1,092,167 $ 1,563,912 $ ( 376,285 ) $ 1,187,627 Intangible Liabilities Lease intangible liabilities (2) $ 46,636 $ ( 16,812 ) $ 29,824 $ 44,076 $ ( 10,775 ) $ 33,301 __________ (1) Amounts are presented net of impairments and write-offs. (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. (3) Composed of investment management contracts and investor relationships. (4) In connection with tower assets and data center services provided in the colocation data center business. (5) Represents primarily the value of an acquired domain name and assembled workforce in an asset acquisition. Impairment of Identifiable Intangible Assets There was no impairment on identifiable intangible assets in 2022. In 2021, impairment was recorded only on identifiable intangible assets held for disposition (Note 21). In 2020, an investment management contract was written down by $ 3.8 million to a fair value of $ 4.0 million at the time of impairment, classified as Level 3 and determined based upon the revised future net cash flows over the remaining life of the contract. F-36 Table of Contents Amortization of Intangible Assets and Liabilities The following table summarizes amortization of deferred leasing costs and finite-lived intangible assets and intangible liabilities: Year Ended December 31, (In thousands) 2022 2021 2020 Net increase (decrease) to rental income (1) $ 273 $ ( 2,471 ) $ ( 1,989 ) Amortization expense Deferred leasing costs and lease-related intangibles $ 154,116 $ 165,940 $ 75,099 Investment management intangibles 20,997 26,028 25,285 Customer relationships and service contracts 25,885 31,040 13,297 Trade name 4,392 22,053 4,503 Other 1,911 1,882 174 $ 207,301 $ 246,943 $ 118,358 __________ (1) Represents the net 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. Year Ending December 31, (In thousands) 2023 2024 2025 2026 2027 2028 and thereafter Total Net increase (decrease) to rental income $ ( 978 ) $ ( 1,701 ) $ ( 1,603 ) $ ( 1,623 ) $ ( 1,016 ) $ 1,252 $ ( 5,669 ) Amortization expense 153,861 123,262 111,393 104,813 93,913 469,432 1,056,674 7. Restricted Cash, Other Assets and Other Liabilities Restricted Cash Restricted cash represents principally cash reserves that are maintained pursuant to the governing agreements of the various securitized debt of the Company and its subsidiaries. Other Assets The following table summarizes the Company's other assets: (In thousands) December 31, 2022 December 31, 2021 Straight-line rents $ 42,721 $ 25,516 Investment deposits and pending deal costs 1,377 22,238 Prefunded capital expenditures for Vantage SDC — 24,293 Derivative assets 11,793 944 Prepaid taxes and deferred tax assets, net 8,709 29,347 Receivables from resolution of investment 14,923 10,463 Operating lease right-of-use asset, net 329,449 349,509 Finance lease right-of-use asset, net 120,261 131,909 Accounts receivable, net (1) 66,059 83,878 Prepaid expenses 28,760 20,303 Other assets 15,798 24,835 Fixed assets, net (2) 14,200 17,160 Total other assets $ 654,050 $ 740,395 __________ (1) Includes primarily receivables from tenants. (2) Net of accumulated depreciation of $ 17.9 million at December 31, 2022 and $ 19.2 million at December 31, 2021 . F-37 Table of Contents Accrued and Other Liabilities The following table summarizes the Company's accrued and other liabilities: (In thousands) December 31, 2022 December 31, 2021 Deferred income (1) $ 61,452 $ 37,143 Interest payable 10,055 14,870 Dividends payable 16,491 15,759 Securities sold short—consolidated funds 40,928 37,970 Current and deferred income tax liability 98 2,016 Contingent consideration payable (Note 10) 125,000 — Warrants issued to Wafra (Note 10) 17,700 — Operating lease liability 322,930 342,510 Finance lease liability 135,624 142,777 Accrued compensation 52,031 64,100 Accrued incentive fee and carried interest compensation 171,086 67,258 Accrued real estate and other taxes 21,580 10,523 Payable for Vantage SDC expansion capacity (Note 3) 56,889 55,896 Accounts payable and accrued expenses 185,900 121,931 Due to affiliates (Note 16) 12,451 — Other liabilities 41,881 31,048 Accrued and other liabilities $ 1,272,096 $ 943,801 __________ (1) Represents primarily prepaid rental income, upfront payment received for data center installation services, and deferred investment management fees. Deferred investment management fees of $ 6.3 million at December 31, 2022 and $ 6.0 million at December 31, 2021 are expected to be recognized as fee income over a weighted average period of 2.9 years and 3.2 years, respectively. Deferred investment management fees recognized as income of $ 3.4 million and $ 0.4 million in the years ended December 31, 2022 and 2021 , respectively, pertain to the deferred management fee balance at the beginning of each respective period. 8. Debt The Company's debt balance is composed 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 21). (In thousands) Securitized Financing Facility Convertible and Exchangeable Senior Notes Investment-Level Secured Debt Total Debt December 31, 2022 Debt at amortized cost Principal $ 300,000 $ 278,422 $ 4,634,235 $ 5,212,657 Premium (discount), net — ( 1,293 ) 10,713 9,420 Deferred financing costs ( 7,829 ) ( 388 ) ( 57,720 ) ( 65,937 ) $ 292,171 $ 276,741 $ 4,587,228 $ 5,156,140 December 31, 2021 Debt at amortized cost Principal $ 300,000 $ 338,739 $ 4,283,983 $ 4,922,722 Premium (discount), net — ( 3,091 ) 17,629 14,538 Deferred financing costs ( 8,606 ) ( 1,384 ) ( 66,868 ) ( 76,858 ) $ 291,394 $ 334,264 $ 4,234,744 $ 4,860,402 F-38 Table of Contents The following table summarizes certain key terms of the Company's debt. Fixed Rate Variable Rate Total ($ in thousands) Outstanding Principal Weighted Average Interest Rate (Per Annum) (1) Weighted Average Years Remaining to Maturity (2) Outstanding Principal Weighted Average Interest Rate (Per Annum) (1) Weighted Average Years Remaining to Maturity (2) Outstanding Principal Weighted Average Interest Rate (Per Annum) (1) Weighted Average Years Remaining to Maturity (2) December 31, 2022 Recourse Secured Fund Fee Revenue Notes (3) $ 300,000 3.93 % 3.7 $ — NA 3.7 $ 300,000 3.93 % 3.7 Convertible and exchangeable senior notes 278,422 5.21 % 0.9 — NA NA 278,422 5.21 % 0.9 578,422 — 578,422 Non-recourse Investment-Level Secured Debt Operating segment 3,640,235 2.43 % 3.1 993,500 8.41 % 2.6 4,633,735 3.71 % 3.0 Other — NA NA 500 5.96 % 1.6 500 5.96 % 1.6 3,640,235 994,000 4,634,235 $ 4,218,657 $ 994,000 $ 5,212,657 December 31, 2021 Recourse Secured Fund Fee Revenue Notes (3) $ 300,000 3.93 % 4.7 $ — NA 4.7 $ 300,000 3.93 % 4.7 Convertible and exchangeable senior notes (4) 338,739 5.31 % 2.2 — NA NA 338,739 5.31 % 2.2 638,739 — 638,739 Non-recourse Investment-Level Secured Debt Operating segment 3,646,466 2.44 % 4.1 571,017 5.74 % 4.0 4,217,483 2.88 % 4.1 Other — NA NA 66,500 1.31 % 1.6 66,500 1.31 % 1.6 3,646,466 637,517 4,283,983 $ 4,285,205 $ 637,517 $ 4,922,722 __________ (1) Calculated based upon outstanding debt principal at balance sheet date. For variable rate debt, weighted average interest rate is calculated based upon the applicable index plus spread at balance sheet date. (2) Calculated based upon anticipated repayment dates for notes issued under securitization financing; otherwise based upon initial maturity dates, or extended maturity dates if extension criteria are met for extensions that are at the Company's option. (3) Represent obligations of special-purpose subsidiaries of the OP as co-issuers and certain other special-purpose subsidiaries of DBRG, and secured by assets of these special-purpose subsidiaries, as further described below. DBRG and the OP are not guarantors to the debt. (4) Excludes the 5.375 % exchangeable senior notes issued by NRF Holdco that were classified as held for disposition (Note 21) and subsequently assumed by the acquirer in February 2022. Securitized Financing Facility In July 2021, special-purpose subsidiaries of the OP (the "Co-Issuers") issued 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 $ 300 million (following a $ 100 million increase in April 2022) Secured Fund Fee Revenue Variable Funding Notes, Series 2021-1, Class A-1 (the “VFN” and, together with the Class A-2 Notes, the “Series 2021-1 Notes”). The VFN allow the Co-Issuers to borrow on a revolving basis. The Series 2021-1 Notes were issued under an Indenture dated July 2021, as amended in April 2022, that allows the Co-Issuers to issue additional series of notes in the future, subject to certain conditions. The Series 2021-1 Notes had replaced the Company's previous corporate credit facility. 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 bear interest generally based upon 1-month Adjusted Term Secured Overnight Financing Rate or SOFR (prior to April 2022, 3-month LIBOR) or F-39 Table of Contents an alternate benchmark as set forth in the purchase agreement of the VFN plus 3 %. Unused amounts under the VFN facility is subject to a commitment fee of 0.5 % per annum. The final maturity date of the Class A-2 Notes is in September 2051, with an anticipated repayment date in September 2026. The anticipated repayment date of the VFN 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, 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. 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, and the full $ 300 million under the VFN is available to be drawn. Convertible and Exchangeable Senior Notes Convertible and exchangeable senior notes (collectively, the senior notes) are composed of the following, each representing senior unsecured obligations of DigitalBridge Group, Inc. or a subsidiary as the respective issuers of the senior notes: Description Issuance Date Due Date Interest Rate (per annum) Conversion or Exchange Price (per share of common stock) Conversion or Exchange Ratio (in shares) (1) Conversion or Exchange Shares (in thousands) Earliest Redemption Date Outstanding Principal December 31, 2022 December 31, 2021 Issued by DigitalBridge Group, Inc. 5.00% Convertible Senior Notes April 2013 April 15, 2023 5.00 % $ 63.02 15.8675 3,174 April 22, 2020 $ 200,000 $ 200,000 Issued by DigitalBridge Operating Company, LLC 5.75% Exchangeable Senior Notes July 2020 July 15, 2025 5.750 % 9.20 108.6956 8,524 July 21, 2023 78,422 138,739 $ 278,422 $ 338,739 __________ (1) The conversion or exchange rate for the senior notes is subject to periodic adjustments to reflect certain carried-forward adjustments relating to common stock splits, reverse stock splits, common stock adjustments in connection with spin-offs and cumulative cash dividends paid on the Company's common stock since the issuances of the respective senior notes. The conversion or exchange ratios are presented in shares of common stock per $ 1,000 principal of each senior note. The senior notes mature on their respective due dates, unless earlier redeemed, repurchased, converted or exchanged, as applicable. 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. 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 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. F-40 Table of Contents Exchange of Senior Notes For Common Stock and Cash DBRG and the OP completed separate privately negotiated exchange transactions with certain noteholders of the 5.75 % exchangeable notes, as follows: Principal of 5.75% Exchangeable Notes Exchanged Consideration for Exchange (In thousands) Class A Common Stock Issued Cash Paid March 2022 $ 60,317 6,389 $ 13,887 October and November 2021 161,261 18,341 — $ 221,578 24,730 $ 13,887 The March 2022 exchanges resulted in a debt extinguishment loss of $ 133.2 million, calculated as the excess of consideration paid over the carrying value of the notes exchanged, and recorded in other loss on the consolidated statement of operations. Consideration was measured at fair value based upon the closing price of the Company's class A common stock on the date of the respective exchanges, and cash paid, net of transaction costs. Unlike the exchange transactions in 2021, the March 2022 exchanges did not qualify for debt conversion accounting and were treated as a debt extinguishment as the Company issued less than the number of shares issuable under the stated exchange ratio of 108.696 shares per $1,000 of note principal exchanged. The exchange transactions in the fourth quarter of 2021 were treated as debt conversions that resulted in a debt conversion expense of $ 25.1 million, recorded as interest expense, as the original exchange ratio was adjusted to account for savings on avoided future interest payments otherwise due to the noteholders. The debt conversion expense represents the shares of the Company's class A common stock issued in excess of such shares issuable pursuant to the original exchange ratio, and measured at fair value based upon the closing price of the Company's class A common stock on the date of the respective exchanges. Investment-Level Secured Debt These are investment level financing that are non-recourse to the Company and secured by data center portfolios held by subsidiaries in the Operating segment, and at December 31, 2021, also secured by previously warehoused loans receivable. At December 31, 2022, the subsidiaries in the Operating segment were in compliance with the financial covenants underlying their respective investment-level secured debt. While there were no securitization activities in 2022, in 2021, however, subsidiaries in the Operating segment refinanced or raised additional debt through new securitization transactions, as follows. In March 2021 and October 2021, DataBank raised $ 657.9 million and $ 332 million of 5-year securitized notes at blended fixed rates of 2.32 % and 2.43 % per annum, respectively. Proceeds from the March securitization were applied principally to refinance $ 514 million of outstanding debt, which meaningfully reduced DataBank's overall cost of debt and extended its debt maturities, while the October proceeds were used to repay borrowings on its credit facility and to finance future acquisitions. In November 2021, Vantage SDC issued $ 530 million of 5-year securitized notes at a blended fixed rate of 2.17 % per annum. Proceeds were applied to replace its current bridge financing and fund capital expenditures on the September 2021 add-on acquisition as well as to fund payments for future build-out and lease-up of expansion capacity. Future Minimum Principal Payments The following table summarizes future scheduled minimum principal payments of debt at December 31, 2022, excluding debt classified as held for disposition (Note 21). Future debt principal payments are presented based upon anticipated repayment dates for notes issued under securitization financing, or based upon initial maturity dates or extended maturity dates if extension criteria are met at December 31, 2022 for extensions that are at the Company's option. Year Ending December 31, (In thousands) 2023 2024 2025 2026 2027 Total Secured fund fee revenue notes $ — $ — $ — $ 300,000 $ — $ 300,000 Convertible and exchangeable senior notes 200,000 — 78,422 — — 278,422 Investment-level secured debt Operating segment 228,792 879,003 1,175,250 1,750,690 600,000 4,633,735 Other — 500 — — — 500 Total $ 428,792 $ 879,503 $ 1,253,672 $ 2,050,690 $ 600,000 $ 5,212,657 F-41 Table of Contents 9. Stockholders' Equity The table below summarizes the share activities of the Company's preferred stock and common stock. Number of Shares (In thousands) Preferred Stock Class A Common Stock Class B Common Stock Shares outstanding at December 31, 2019 41,350 121,761 183 Shares issued upon redemption of OP Units — 546 — Repurchase of common stock, net (1) — ( 3,183 ) — Equity-based compensation, net of forfeitures — 2,419 — Shares canceled for tax withholding on vested stock awards — ( 692 ) — Shares outstanding at December 31, 2020 41,350 120,851 183 Redemption of preferred stock ( 6,010 ) — — Exchange of notes for class A common stock — 18,341 — Shares issued upon redemption of OP Units — 501 — Conversion of class B to class A common stock — 17 ( 17 ) Shares issued pursuant to settlement liability (2) — 1,488 — Equity awards issued, net of forfeitures — 1,645 — Shares canceled for tax withholding on vested equity awards — ( 699 ) — Shares outstanding at December 31, 2021 35,340 142,144 166 Stock repurchases ( 2,229 ) ( 4,195 ) — Exchange of notes for class A common stock — 6,389 — Shares issued upon redemption of OP Units — 100 — Shares issued for redemption of redeemable noncontrolling interest (Note 10) — 14,435 — Equity awards issued, net of forfeitures — 1,589 — Shares canceled for tax withholding on vested equity awards — ( 699 ) — Shares outstanding at December 31, 2022 33,111 159,763 166 __________ (1) Shares repurchased in 2020 are 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 repurchased shares that were held in a subsidiary (Note 11). Shares repurchased and not reissued were cancelled. (2) In 2021, the settlement liability was settled through the reissuance of some of the shares previously repurchased and held in a subsidiary (Note 11). 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 December 31, 2022: Description Dividend Rate Per Annum Initial Issuance Date Shares Outstanding (in thousands) Par Value (in thousands) Liquidation Preference (in thousands) Earliest Redemption Date Series H 7.125 % April 2015 8,430 $ 84 $ 210,756 Currently redeemable Series I 7.15 % June 2017 12,989 130 324,728 Currently redeemable Series J 7.125 % September 2017 11,692 117 292,295 Currently redeemable 33,111 $ 331 $ 827,779 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 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) prorated to their redemption dates, 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 upon the occurrence of a change of control (as defined in the articles supplementary relating to each series of preferred stock). F-42 Table of Contents 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. Common Stock 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 reinstated quarterly common stock dividends at $0.01 per share beginning the third quarter of 2022, having previously suspended common stock dividends from the second quarter of 2020 through the second quarter of 2022. 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. To date, no shares of class A common stock have been acquired under the DRIP Plan in the form of new issuances in the last three years. Reverse Stock Split In August 2022, the Company effectuated a one-for-four reverse stock split of its outstanding shares of class A and class B common stock. The number of authorized shares of common stock was not adjusted in connection with the reverse stock split, however, the Company intends to seek stockholder approval to make a proportional change to the number of authorized shares of class A and class B common stock at its next annual meeting of stockholders. Par value of common stock was proportionately increased from $ 0.01 to $ 0.04 per share. Common stock share and per share information, including OP Units and stock award units, as well as the Company's senior note conversion or exchange ratio in common stock shares have been revised for all periods presented to give effect to the reverse stock split. Stock Repurchases and Redemptions Pursuant to a $ 200 million stock repurchase program announced in July 2022, the Company repurchased (i) 2,228,805 shares in aggregate across Series H, I and J preferred stock at a discount for $ 52.6 million, or a weighted average price of $ 23.62 per share; and (ii) 4,195,020 shares of class A common stock for $ 54.9 million, or a weighted average price of $ 13.09 per share, in the third and fourth quarters of 2022. The program expires on June 30, 2023 and may be extended, modified, or discontinued at any time by the Company's Board of Directors. In 2021, the Company redeemed all of its outstanding 7.5 % Series G preferred stock in August for $ 86.8 million using proceeds from its securitized financing facility and 2,560,000 shares of its 7.125 % Series H preferred stock in November for approximately $ 64.4 million. All redemptions were made at the liquidation preference of $ 25.00 per share. F-43 Table of Contents In January 2020, the Company settled the December 2019 redemption of its outstanding Series B and Series E preferred stock for $ 402.9 million. During the first quarter of 2020, pursuant to a $ 300 million stock repurchase program that expired in May 2020, the Company repurchased 3,183,301 shares of class A common stock for $ 24.6 million, or a weighted average price of $ 7.73 per share. With respect to preferred stock, the excess or deficit of the repurchase or redemption price over the carrying value of the preferred stock results in a decrease or increase to net income attributable to common stockholders, respectively. 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 Total AOCI at December 31, 2019 $ 9,281 $ 7,823 $ ( 226 ) $ 139 $ 30,651 $ 47,668 Other comprehensive income (loss) before reclassifications 8,437 1,844 ( 7 ) 52,468 16,008 78,750 Amounts reclassified from AOCI ( 3,595 ) 225 ( 925 ) ( 4,295 ) AOCI at December 31, 2020 $ 17,718 $ 6,072 $ ( 233 ) $ 52,832 $ 45,734 $ 122,123 Other comprehensive income (loss) before reclassifications ( 12,386 ) ( 211 ) — ( 35,001 ) 1,731 ( 45,867 ) Amounts reclassified from AOCI ( 2,998 ) — 233 10,153 ( 39,779 ) ( 32,391 ) Deconsolidation of investment entities — — — ( 1,482 ) — ( 1,482 ) AOCI at December 31, 2021 $ 2,334 $ 5,861 $ — $ 26,502 $ 7,686 $ 42,383 Other comprehensive income (loss) before reclassifications ( 2,429 ) — — ( 10,923 ) 8,396 ( 4,956 ) Amounts reclassified from AOCI ( 200 ) ( 5,861 ) — ( 16,793 ) ( 16,082 ) ( 38,936 ) AOCI at December 31, 2022 $ ( 295 ) $ — $ — $ ( 1,214 ) $ — $ ( 1,509 ) 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 ( 25 ) 101,853 5,313 107,141 Amounts reclassified from AOCI — ( 95 ) ( 873 ) ( 968 ) AOCI at December 31, 2020 $ ( 1,030 ) $ 83,845 $ 15,099 $ 97,914 Other comprehensive loss before reclassifications — ( 65,127 ) — ( 65,127 ) Amounts reclassified from AOCI 1,030 ( 1,364 ) ( 15,099 ) ( 15,433 ) Deconsolidation of investment entities — ( 6,297 ) — ( 6,297 ) AOCI at December 31, 2021 $ — $ 11,057 $ — $ 11,057 Other comprehensive loss before reclassifications — ( 4,571 ) — ( 4,571 ) Amounts reclassified from AOCI — ( 9,501 ) — ( 9,501 ) AOCI at December 31, 2022 $ — $ ( 3,015 ) $ — $ ( 3,015 ) F-44 Table of Contents 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) Year Ended December 31, Affected Line Item in the Consolidated Statements of Operations Component of AOCI reclassified into earnings 2022 2021 2020 Relief of basis of AFS debt securities $ 5,861 $ — $ 3,595 Other gain (loss), net Release of foreign currency cumulative translation adjustments 16,793 ( 10,153 ) ( 225 ) Other gain (loss), net Unrealized gain on dedesignated net investment hedges — — 552 Other gain (loss), net Realized gain on net investment hedges 16,082 39,779 373 Other gain (loss), net Realized loss on cash flow hedges — ( 233 ) — Other gain (loss), net Deconsolidation of investment entities — 1,482 — Other gain (loss), net Release of equity in AOCI of equity method investments 200 2,998 — Equity method earnings (losses) 10. Noncontrolling Interests Redeemable Noncontrolling Interests The following table presents the activity in redeemable noncontrolling interests in the Company's investment management business through redemption in May 2022, as discussed below, and in open-end funds sponsored and consolidated by the Company. Year Ended December 31, (In thousands) 2022 2021 2020 Redeemable noncontrolling interests Beginning balance $ 359,223 $ 305,278 $ 6,107 Contributions 11,650 42,514 307,414 Distributions paid and payable, including redemptions by limited partners in consolidated funds ( 20,784 ) ( 23,246 ) ( 8,859 ) Net income (loss) ( 26,778 ) 34,677 616 Adjustment of Wafra's interest to redemption value and warrants held by Wafra to fair value 725,026 — — Redemption of Wafra's interest ( 862,276 ) — — Reclassification of warrants held by Wafra to liability in May 2022 (Note 7) ( 81,400 ) — — Reclassification of Wafra's carried interest allocation to noncontrolling interests in investment entities in May 2022 ( 4,087 ) — — Ending balance $ 100,574 $ 359,223 $ 305,278 Redeemable Noncontrolling Interest in Investment Management Strategic Investment in 2020 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 investment management business. The investment entitled Wafra to participate in approximately 31.5 % of the net management fees and carried interest generated by the investment management business. Pursuant to this strategic partnership, Wafra assumed directly and also indirectly through a participation interest $ 124.9 million of the Company's commitments to DigitalBridge Partners, LP ("DBP I"), and has a $ 125.0 million commitment to DigitalBridge Partners II, LP ("DBP II") that has been partially funded to-date. These are the Company's flagship value-add equity infrastructure funds. Wafra had also agreed to make commitments to the Company's future funds and investment vehicles on a pro rata basis with the Company based on Wafra's percentage interest in the investment management business, subject to certain caps. F-45 Table of Contents In addition, the Company issued Wafra five warrants to purchase up to an aggregate of 5 % of the Company’s class A common stock ( 5 % at the time of the transaction, on a fully-diluted, post-transaction basis). Each warrant entitles Wafra to purchase up to 1,338,000 shares of the Company's class A common stock at staggered strike prices between $ 9.72 and $ 24.00 each, exercisable through 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 investment management business and for the warrants. As previously agreed, Wafra paid additional consideration of $ 29.9 million in April 2021 based upon the investment management 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. The Compensation Committee of the Board of Directors had approved an allocation of 50 % of the contingent consideration received from Wafra as incentive compensation to management, to be paid on behalf of certain employees to fund a portion of their share of capital contributions to the DBP funds as capital calls are made for these funds. Compensation expense is recognized over time based upon an estimated timeline for deployment of capital by the funds, adjusted as necessary to correspond to the actual timing of capital calls to be funded by the Company on behalf of management. Wafra had customary minority rights and certain other structural protections designed to protect its interests, including redemption rights with respect to its investment in the investment management business and its funded commitments in certain digital funds. Wafra's redemption rights were subject to triggering events, including key person or cause events under the governing documents of certain digital funds. Redemption of Strategic Investment in 2022 On May 23, 2022, pursuant to a purchase and sale agreement ("PSA") entered into with Wafra in April 2022: (a) the Company acquired Wafra's 31.5 % interest in its investment management business; (b) Wafra’s entitlement to carried interest in DBP II was reduced from 12.6 % to 7 %; and (c) with certain limited exceptions, Wafra sold or gave up its right to invest in, or receive carried interest from, future investment management products, but except as otherwise provided, retained its investment in and its allocation of carried interest from existing investment management products. Consideration for the redemption of Wafra's interest consisted of: (i) an upfront payment of $ 388.5 million in cash (after certain net cash adjustments) and 14,435,399 shares of the Company's Class A common stock valued at $ 348.8 million based upon the closing price of the Company's class A common stock on May 23, 2022; and (ii) Wafra's right to earn a contingent amount between $ 90 million and $ 125 million if the Company raises fee earning equity under management (as defined in the PSA) between $ 4 billion and $ 6 billion during the period from December 31, 2021 to December 31, 2023, payable in March 2023 for portion earned in 2022 and March 2024 for any remaining portion earned in 2023, with up to 50 % payable in shares of the Company's Class A common stock at the Company's election. Based upon the capital raised by the Company in 2022, $ 90 million is payable to Wafra in March 2023. The carrying value of Wafra's redeemable noncontrolling interest was adjusted to fair value prior to redemption, initially based upon an estimate of consideration payable at March 31, 2022 when redemption was deemed to be probable, including the maximum potential contingent amount of $ 125 million. This adjustment resulted in an allocation from additional paid-in capital to redeemable noncontrolling interests on the consolidated balance sheet. Additionally, the unrealized carried interest earnings allocated to Wafra that was retained and no longer subject to redemption was reclassified in May 2022 to permanent equity, included in noncontrolling interests in investment entities. In connection with the redemption, the terms of the warrants previously issued to Wafra were amended, among other things, to provide for net cash settlement upon exercise of the warrants, at election of either the Company or Wafra, if such exercise would result in Wafra beneficially owning in excess of 9.8 % of the issued and outstanding shares of the Company's class A common stock. Inclusion of the cash settlement feature changed the classification of the warrants from equity to liability. The warrants were remeasured to fair value prior to reclassification in May 2022, with the increase in value recorded in equity to reduce additional paid-in capital. Subsequent changes in fair value of the warrant liability is recorded in earnings (Note 11). The Company's redemption of Wafra's interest also resulted in the assumption of $ 5.2 million of deferred tax asset that now accrues to the Company. Following the redemption, the Chief Investment Officer of Wafra, Adel Alderbas, will serve as a senior advisor to the Company for a period of three years. F-46 Table of Contents Noncontrolling Interests in Investment Entities DataBank Additional Investment In January 2022, a shareholder of DataBank sold its equity interest to the Company and an existing investor, resulting in an additional $ 32.0 million investment by the Company in DataBank. Following this transaction and additional equity funded by the shareholders of DataBank in connection with its data center acquisition in March 2022 (Note 3), the Company's interest in DataBank increased from 20 % to 21.8 % (prior to recapitalization as discussed below). DataBank Recapitalization DataBank was partially recapitalized in the second half of 2022 through multiple sales of equity interest to new investors totaling $ 2.0 billion in cash. The Company's ownership interest in DataBank decreased from 21.8 % (as noted above) to 11.0 %. The Company's share of proceeds from the sale was $ 425.5 million, including its share of carried interest net of allocation to employees. As the transaction involved a change in ownership of a consolidated subsidiary, it was accounted for as an equity transaction. The difference between the book value of the Company's interest and its ownership based upon the current value of DataBank resulted in a reallocation from noncontrolling interests in investment entities to additional paid-in capital of $ 230.2 million. The recapitalization transaction triggered an accelerated vesting of certain profits interest units that had been issued by DataBank to its employees. As a result of the accelerated vesting, $ 10 million of additional equity based compensation was recorded in 2022 based upon DataBank's original grant date fair value of these awards, of which $ 7.8 million was attributable to noncontrolling interests in investment entities. 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 100,220 OP Units in 2022 and 501,341 OP Units in 2021 through the issuance of an equal number of shares of class A common stock on a one -for-one basis . 11. Fair Value Recurring Fair Values Financial assets and financial liabilities carried at fair value on a recurring basis include financial instruments for which the fair value option was elected, but exclude financial assets under the NAV practical expedient. Fair value is categorized into a three tier hierarchy that is prioritized based upon the level of transparency in inputs used in the valuation techniques. Marketable Equity Securities Marketable equity securities with long positions of $ 155.9 million at December 31, 2022 and $ 201.9 million at December 31, 2021, included in equity investments (Note 5), and short positions of $ 40.9 million at December 31, 2022 and $ 38.0 million at December 31, 2021, included in other liabilities (Note 7), consist of publicly traded equity securities held largely by private open-end funds sponsored and consolidated by the Company. 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 technology, media and telecommunications 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 At December 31, 2022, the CLO subordinated notes were carried at their recently issued price of $ 50.9 million (Note 5), which represents their current estimated fair value, classified as Level 3 of the fair value hierarchy. Fair value was determined using a benchmarking approach by looking to the implied credit spreads derived from observed prices on comparable CLO issuances in the fourth quarter of 2022, and also considering the current size and diversification of the CLO collateral pool and projected return on the subordinated notes. F-47 Table of Contents Equity Investment of Consolidated Fund A consolidated fund, investing alongside other affiliated managed funds, holds an indirect investment in a portfolio of loans. The investment has a fair value of $ 46.8 million at December 31, 2022, classified as Level 3 of the fair value hierarchy. Fair value was determined based upon discounted cash flow projections of distributions of principal and interest expected to be collected from the underlying loans, which include, but are not limited to, consideration of the financial standing and operating results of the borrowers, and applying a discount rate of 10.1 %. Derivatives The Company's derivative instruments generally consist of: (i) foreign currency put options, forward contracts and costless collars to hedge the foreign currency exposure of certain foreign-denominated investments or investments in foreign subsidiaries (in GBP and EUR), with notional amounts and termination dates based upon the anticipated return of capital from these investments; and (ii) interest rate caps and swaps to limit the exposure to changes in interest rates on various floating rate debt obligations (indexed to LIBOR or Euribor). These derivative contracts may be designated as qualifying hedge accounting relationships, specifically as net investment hedges and cash flow hedges, respectively. Fair values were $ 11.8 million (Note 16) at December 31, 2022 and $ 0.9 million at December 31, 2021 for derivative assets, included in other assets. There were no derivatives in a liability position at December 31, 2022 and 2021. At December 31, 2022, all derivative positions in both periods were non-designated hedges. Derivative notional amounts aggregated to the equivalent of $ 321.1 million at December 31, 2022 and $ 182.3 million at December 31, 2021 for foreign exchange contracts, and $ 2.0 billion at December 31, 2021 for interest rate contracts. There were no outstanding interest rate contracts at December 31, 2022. 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. Notwithstanding the conditions for right of offset may have been met, the Company presents derivative assets and liabilities with the same counterparty on a gross basis on the consolidated balance sheets. 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: Year Ended December 31, (In thousands) 2022 2021 2020 Foreign currency contracts: Designated contracts Realized gain transferred from AOCI to earnings $ 17,334 $ 58,727 $ 414 Unrealized gain transferred from AOCI to earnings — — 1,485 Non-designated contracts Realized and unrealized gain (loss) in earnings (1) 17,092 889 ( 2,727 ) Interest rate contracts: Designated contracts Interest expense (2) — 20 24 Realized loss transferred from AOCI to earnings — ( 1,328 ) — Non-designated contracts Realized and unrealized gain (loss) in earnings 11,533 ( 213 ) ( 209 ) __________ (1) In 2022, includes unrealized gain on foreign currency contract entered into on behalf of sponsored fund, which has no net impact to the Company's earnings, as discussed in Note 16. (2) Represents amortization of the cost of designated interest rate caps to interest expense based upon expected hedged interest payments on variable rate debt. The Company's foreign currency and interest rate contracts are generally traded over-the-counter, and are valued using a third-party service provider. Quotations on over-the-counter derivatives are not adjusted and are generally valued using observable inputs such as contractual cash flows, yield curve, foreign currency rates and credit spreads, and are classified as Level 2 of the fair value hierarchy. Although credit valuation adjustments, such as the risk of default, rely on Level 3 inputs, these inputs are not significant to the overall valuation of the derivatives. As a result, derivative valuations in their entirety are classified as Level 2 of the fair value hierarchy. F-48 Table of Contents Warrants As discussed in Note 10, the Company issued five warrants to Wafra. Each warrant entitles Wafra to purchase up to 1,338,000 shares of the Company's class A common stock at staggered strike prices between $ 9.72 and $ 24.00 each, exercisable through July 17, 2026. No warrants have been exercised to-date. The warrants are carried at fair value effective May 2022 when they were reclassified from equity to liability, with subsequent changes in fair value recorded in earnings. At December 31, 2022, the warrants, classified as Level 3 fair value, were valued at $ 17.7 million using a Black-Scholes option pricing model, applying the following inputs: (a) estimated volatility for DBRG's class A common stock of 40.8 %; (b) closing stock price of DBRG's class A common stock on the last trading day of the quarter; (c) the strike price for each warrant; (d) remaining term to expiration of the warrants; and (e) risk free rate of 4.16 % per annum, derived from the daily U.S. Treasury yield curve rates to correspond to the remaining term to expiration of the warrants. Fair value of the warrants decreased $ 63.7 million from its initial remeasurement in May 2022, recorded in other gain on the consolidated statement of operations. Settlement Liability In March 2020, the Company entered into a cooperation agreement with Blackwells Capital LLC ("Blackwells"), a stockholder of the Company. Pursuant to the cooperation agreement, Blackwells agreed to a standstill in its proxy contest with the Company, and to abide by certain voting commitments, including a standstill with respect to the Company until the expiration of the agreement in March 2030 and voting in favor of the Board of Directors' recommendations until the third anniversary of the agreement. Contemporaneously, the Company and Blackwells entered into a joint venture arrangement for the purpose of acquiring, holding and disposing of the Company's class A common stock. 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 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 1.49 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. Fair Value Option The following discussion excludes loans receivable and equity method investments held for disposition which are addressed in Note 21. Loans Receivable Loans receivable held for investment are carried at fair value under the fair value option. At December 31, 2022, loans held for investments, which primarily consisted of an unsecured promissory note in connection with the sale of NRF Holdco (Note 22), had fair value totaling $ 137.9 million (unpaid principal balance, inclusive of paid-in-kind ("PIK") interest, of $ 167.8 million), classified as Level 3 in the fair value hierarchy. At December 31, 2021, loans held for investments, which primarily consisted of corporate loans and bank syndicated loans then warehoused by the Company, had fair value totaling $ 173.9 million (unpaid principal balance, inclusive of PIK interest, of $ 173.5 million), of which $ 91.0 million was classified as Level 2 and $ 82.9 million as Level 3 in the fair value hierarchy. During 2022, all of the warehoused loans were either transferred to the Company's new sponsored fund or securitized into a third party sponsored CLO (Note 5). Fair value of Level 3 loans held for investment were determined 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 and operating results of the borrower, and applying discount rates ranging between 10.0 % to 10.5 % at December 31, 2022 and 8.9 % to 10.0 % at December 31, 2021. Level 2 loans held for investment at December 31, 2021 represent bank syndicated loans for which fair value was obtained from a reputable pricing service and was based upon quotations from dealers who act as market makers for these loans. F-49 Table of Contents There were no loans that were 90 days or more past due as to principal or interest at December 31, 2022 and December 31, 2021. As of December 31, 2022, one loan with fair value of $ 4.6 million and unpaid principal balance of $ 5.8 million has been placed on nonaccrual. Equity Method Investments At December 31, 2022 and 2021, there were no equity method investments under the fair value option other than investments held for disposition (Note 21). One equity method investment that was under the fair value option is accounted for as a marketable equity security beginning May 2021 following a merger of the investee into a special purpose acquisition company. The following table presents changes in recurring Level 3 fair value assets held for investment. Realized and unrealized gains (losses) are included in other gain (loss) for loans receivable and equity method earnings (losses) for equity method investments. Fair Value Option Equity Investment of Consolidated Fund (In thousands) AFS Debt Securities Loans Held for Investment Equity Method Investments Fair value at December 31, 2020 $ — $ 36,798 $ 28,540 $ — Purchases, originations, drawdowns and contributions — 61,026 — — Paydowns, distributions and sales — ( 16,470 ) ( 9,174 ) — Change in accounting method for equity interest — — ( 27,626 ) — Change in accrued interest and capitalization of paid-in-kind interest — 1,761 — — Realized and unrealized gain (loss) in earnings, net — ( 185 ) 8,260 — Fair value at December 31, 2021 $ — $ 82,930 $ — $ — Net unrealized loss in earnings on instruments held at December 31, 2021 $ — $ ( 1,114 ) $ — $ — Fair value at December 31, 2021 $ — $ 82,930 $ — $ — Purchases, originations, drawdowns and contributions 50,927 371,415 — 35,566 Paydowns, distributions and sales — ( 159,501 ) — — Transfer of warehoused loans to sponsored fund — ( 123,312 ) — — Consolidation of sponsored fund — — — 10,536 Change in accrued interest and capitalization of paid-in-kind interest — 5,814 — — Realized and unrealized gain (loss) in earnings, net — ( 39,401 ) — 668 Fair value at December 31, 2022 $ 50,927 $ 137,945 $ — $ 46,770 Net unrealized gain (loss) in earnings on instruments held at December 31, 2022 $ — $ ( 29,311 ) $ — $ 668 Investment Carried at Fair Value Using Net Asset Value The Company has an investment in a non-traded healthcare REIT of $ 34.5 million at December 31, 2022 and $ 44.6 million at December 31, 2021, with no commitment for any further investment in the future. The investment is valued based upon actual or estimated NAV beginning October 2021 when the investee, a healthcare real estate investor/manager, was acquired in conjunction with a merger of its co-sponsored non-traded REITs. The transaction diluted the Company's equity interest in the investee, which was previously accounted for as an equity method investment. Redemption of the Company's partnership interest in the non-traded healthcare REIT is restricted until the earliest of (1) the second anniversary of the issuance to the Company of such partnership units, (2) change in control of the general partner, and (3) initial public offering of the equity of the non-traded healthcare REIT, which may be subject to further restriction on redemption by the underwriters. Nonrecurring Fair Values The Company measures fair value of certain assets on a nonrecurring basis when events or changes in circumstances indicate that the carrying value of the assets may not be recoverable. 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. Impairment is discussed in Note 5 for equity investments and Note 21 for assets held for disposition. F-50 Table of Contents Fair Value of Financial Instruments Reported at Cost Fair value of financial instruments reported at amortized cost, excluding those held for disposition, are presented below. Fair Value Measurements Carrying Value (In thousands) Level 1 Level 2 Level 3 Total December 31, 2022 Liabilities Debt at amortized cost Secured fund fee revenue notes $ — $ 250,547 $ — $ 250,547 $ 292,171 Convertible and exchangeable senior notes 304,513 — — 304,513 276,741 Investment-level secured debt — 3,268,508 944,984 4,213,492 4,587,228 December 31, 2021 Liabilities Debt at amortized cost Secured fund fee revenue notes $ — $ — $ 291,394 $ 291,394 $ 291,394 Convertible and exchangeable senior notes 716,970 — — 716,970 334,264 Investment-level secured debt — 3,598,655 655,270 4,253,925 4,234,744 Debt —Senior notes and secured fund fee revenue notes were valued using their last traded price. Fair value of investment-level debt were estimated by either discounting expected future cash outlays at interest rates available to the respective borrower subsidiaries for similar instruments or for securitized debt, based upon indicative bond prices quoted by brokers in the secondary market. Other —The carrying values of cash and cash equivalents, accounts receivable, due from and to affiliates, interest payable and accounts payable generally approximate fair value due to their short term nature, and credit risk, if any, is negligible. 12. Variable Interest Entities A VIE is an entity that lacks sufficient equity to finance its activities without additional subordinated financial support from other parties, or whose equity holders lack the characteristics of a controlling financial interest. The following discusses the Company's involvement with VIEs where the Company is the primary beneficiary and consolidates the VIEs or where the Company is not the primary beneficiary and does not consolidate the VIEs. Operating Subsidiary The Company's operating subsidiary, OP, is a limited liability company that has governing provisions that are the functional equivalent of a limited partnership. The Company holds the majority of membership interest in OP, acts as the managing member of OP and exercises full responsibility, discretion and control over the day-to-day management of OP. The noncontrolling interests in OP do not have substantive liquidation rights, substantive kick-out rights without cause, or substantive participating rights that could be exercised by a simple majority of noncontrolling interest members (including by such a member unilaterally). 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. Accordingly, the Company is the primary beneficiary of OP and consolidates OP. As the Company conducts its business and holds its assets and liabilities through OP, the total assets and liabilities, earnings (losses), and cash flows of OP represent substantially all of the total consolidated assets and liabilities, earnings (losses), and cash flows of the Company. Company-Sponsored Private Funds The Company sponsors private funds and other investment vehicles as general partner for the purpose of providing investment management services in exchange for management fees and carried interest. These private funds are established as limited partnerships or equivalent structures. Limited partners of the private funds do not have either substantive liquidation rights, or substantive kick-out rights without cause, or substantive participating rights that could be exercised by a simple majority of limited partners or by a single limited partner. Accordingly, the absence of such rights, which represent voting rights in a limited partnership, results in the private funds being considered VIEs. The nature of the Company's involvement with its sponsored funds comprise fee arrangements and general partner and limited partner F-51 Table of Contents equity interests. The fee arrangements are commensurate with the level of management services provided by the Company, and contain terms and conditions that are customary to similar at-market fee arrangements. Consolidated Company-Sponsored Private Funds —The Company currently consolidates sponsored private funds in which it has more than an insignificant equity interest in the fund as general partner. 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 $ 94.7 million at December 31, 2022 and $ 53.1 million at December 31, 2021. The liabilities of the consolidated funds may only be settled using assets of the consolidated funds, and the Company, as general partner, is not obligated to provide any financial support to the consolidated private funds. At December 31, 2022 and December 31, 2021, the consolidated private funds had total assets of $ 274.2 million and $ 230.6 million, respectively, and total liabilities of $ 79.6 million and $ 63.0 million, respectively, made up primarily of cash, marketable equity securities, unsettled trades, and other equity investment. 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. The Company may invest alongside certain of its sponsored private funds through joint ventures between the Company and these funds, or the Company may have capital commitments to its sponsored private funds that are satisfied directly through the co-investment joint ventures as an affiliate of the general partner. In these instances, the co-investment joint ventures are consolidated by the Company. As the Company's direct equity interests in its sponsored private funds as general partner absorb insignificant variability, the Company is considered to be acting in the capacity of an agent of these funds and is therefore not the primary beneficiary of these funds. 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 $ 748.4 million at December 31, 2022 and $ 382.7 million at December 31, 2021, included in equity investments, and $ 1.0 million at December 31, 2022 and $ 45.4 million at December 31, 2021, included within assets held for disposition. Securitizations The Company previously securitized loans receivable and CRE debt securities using VIEs. Upon securitization, the Company had retained beneficial interests in the securitization vehicles, usually in the form of equity tranches or subordinate securities. The securitization vehicles were structured as pass-through entities that receive principal and interest on the underlying loans or debt securities and distribute those payments to the holders of the notes, certificates or bonds issued by the securitization vehicles. The loans and debt securities were transferred into securitization vehicles such that these assets were restricted and legally isolated from the creditors of the Company, and therefore were not available to satisfy the Company's obligations but only the obligations of the securitization vehicles. The obligations of the securitization vehicles did not have any recourse to the general credit of the Company and its other subsidiaries. The Company also acquired securities issued by securitization trusts that are VIEs. Unconsolidated Securitizations —The Company does not consolidate the assets and liabilities of CLOs or collateralized debt obligations ("CDOs") in which the Company has an interest but does not retain the collateral management function. The Company’s exposure to loss is limited to its investment in these CLOs of $ 50.9 million at December 31, 2022, or CDOs of $ 30.2 million at December 31, 2021, previously presented as debt securities within assets held for disposition prior to disposition of the CDOs in February 2022 (Note 21). Trusts Prior to the sale of NRF Holdco in February 2022, 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 consisted 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 was an obligor or guarantor on the Junior Notes or the TruPS. The Company had owned all of the common stock of the Trusts but did not consolidate the Trusts as the holders of the preferred securities issued by the Trusts were the primary beneficiaries of the Trusts. The Company had accounted for its interest in the Trusts under the equity method and its maximum exposure to loss was limited to its investment carrying value of $ 3.7 million at December 31, 2021. The Trusts were recorded as equity investments and the junior subordinated notes as debt, both previously classified as held for disposition (Note 21) . F-52 Table of Contents 13. Earnings per Share The following table provides the basic and diluted earnings per common share computations. Year Ended December 31, (In thousands, except per share data) 2022 2021 2020 Net income (loss) allocated to common stockholders Loss from continuing operations $ ( 421,293 ) $ ( 216,823 ) $ ( 591,088 ) Loss from continuing operations attributable to noncontrolling interests 209,589 144,184 155,340 Loss from continuing operations attributable to DigitalBridge Group, Inc. ( 211,704 ) ( 72,639 ) ( 435,748 ) Loss from discontinued operations attributable to DigitalBridge Group, Inc. ( 110,093 ) ( 237,458 ) ( 2,240,011 ) Preferred stock repurchases/redemptions (Note 9) 1,098 ( 4,992 ) — Preferred dividends ( 61,567 ) ( 70,627 ) ( 75,023 ) Net loss attributable to common stockholders ( 382,266 ) ( 385,716 ) ( 2,750,782 ) Net income allocated to participating securities ( 34 ) — ( 1,250 ) Net loss allocated to common stockholders—basic ( 382,300 ) ( 385,716 ) ( 2,752,032 ) Interest expense attributable to convertible and exchangeable notes (1) — — — Net loss allocated to common stockholders—diluted $ ( 382,300 ) $ ( 385,716 ) $ ( 2,752,032 ) Weighted average common shares outstanding Weighted average number of common shares outstanding—basic 154,495 122,864 118,389 Weighted average effect of dilutive shares (1)(2)(3) — — — Weighted average number of common shares outstanding—diluted 154,495 122,864 118,389 Income (loss) per share—basic Loss from continuing operations $ ( 1.76 ) $ ( 1.21 ) $ ( 4.33 ) Loss from discontinued operations ( 0.71 ) ( 1.93 ) ( 18.92 ) Net loss attributable to common stockholders per common share—basic $ ( 2.47 ) $ ( 3.14 ) $ ( 23.25 ) Income (loss) per share—diluted Loss from continuing operations $ ( 1.76 ) $ ( 1.21 ) $ ( 4.33 ) Loss from discontinued operations ( 0.71 ) ( 1.93 ) ( 18.92 ) Net loss attributable to common stockholders per common share—diluted $ ( 2.47 ) $ ( 3.14 ) $ ( 23.25 ) __________ (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 years ended December 31, 2022, 2021 and 2020, the effect of adding back interest expense of $ 16.6 million, $ 54.7 million and $ 29.9 million, respectively, and 12,901,700 , 33,849,100 and 21,869,600 of weighted average dilutive common share equivalents, respectively. Also excluded from the calculation of diluted earnings per share was $ 133.2 million of debt extinguishment loss (Note 8) for the year ended December 31, 2022. (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 15) with weighted average shares of 1,298,900 , 2,712,700 and 1,444,200 for the years ended December 31, 2022, 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 1,742,800 , 2,659,400 and 215,500 for the years ended December 31, 2022, 2021 and 2020, 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 December 31, 2022, 2021 and 2020, 12,628,900 , 12,613,800 and 12,769,200 of OP Units, respectively, were not included in the computation of diluted earnings per share in the respective periods presented. 14. Fee Income The following table presents the Company's fee income by type, excluding amounts classified as discontinued operations (Note 22). Year Ended December 31, (In thousands) 2022 2021 2020 Management fees $ 169,922 $ 168,618 $ 78,421 Incentive fees — 7,174 35 Other fees 2,751 5,034 4,899 Total fee income $ 172,673 $ 180,826 $ 83,355 F-53 Table of Contents Management Fees — The Company earns management fees for providing investment management services to its sponsored private funds and other investment vehicles, portfolio companies and managed accounts. Management fees are calculated generally at contractual rates ranging from 0.2 % per annum to 1.5 % per annum of investors' committed capital during the commitment period of the vehicle, and thereafter, contributed or invested capital; or net asset value for vehicles in the Liquid Strategies. Incentive Fees —The Company is entitled to incentive fees from sub-advisory accounts in its Liquid Strategies. Incentive fees are determined 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 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. 15. Equity-Based Compensation The DigitalBridge Group, Inc. 2014 Omnibus Stock Incentive Plan (the "Equity Incentive Plan") provides for the grant of restricted stock, performance stock units ("PSUs"), Long Term Incentive Plan ("LTIP") units, restricted stock units ("RSUs"), deferred stock units ("DSUs"), options, warrants or rights to purchase shares of the Company's common stock, cash incentives and other equity-based awards to the Company's officers, directors (including non-employee directors), employees, co-employees, consultants or advisors of the Company or of any parent or subsidiary who provides services to the Company. 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 December 31, 2022, an aggregate 21.3 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. Restricted stock is entitled to dividends declared and paid on the Company's class A common stock and such dividends are not forfeitable prior to vesting of the award. 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 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 that coincides with the recipients' term of service. 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. Equity-based compensation expense is recognized when it becomes probable that the performance condition will be met. Performance Stock Units — 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"). 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. PSUs also contain dividend equivalent rights which entitle the recipients to a payment equal to the amount of dividends that would have been paid on the shares that are ultimately issued at the end of the measurement period. F-54 Table of Contents Fair value of PSUs, including dividend equivalent rights, was determined using a Monte Carlo simulation under a risk-neutral premise, with the following assumptions: 2022 PSU Grants 2021 PSU Grants 2020 PSU Grants Expected volatility of the Company's class A common stock (1) 32.4 % 35.4 % 34.1 % Expected annual dividend yield (2) 0.0 % 0.0 % 9.3 % Risk-free rate (per annum) (3) 2.0 % 0.3 % 0.4 % __________ (1) Based upon the historical volatility of the Company's stock and those of a specified peer group. (2) Based upon the Company's expected annualized dividends. Expected dividend yield was zero for the March 2022 and 2021 PSU awards as common dividends were suspended beginning the second quarter of 2020 and reinstated in the third quarter of 2022. (3) Based upon the continuously compounded zero-coupon U.S. Treasury yield for the term coinciding with the measurement period of the award as of valuation date. Fair value of PSU awards, excluding dividend equivalent rights, is recognized on a straight-line basis over their measurement period as compensation expense, and is not subject to reversal even if the market condition is not achieved. The dividend equivalent right is accounted for as a liability-classified award. The fair value of the dividend equivalent right is recognized as compensation expense on a straight-line basis over the measurement period, and is subject to adjustment to fair value at each reporting period. LTIP Units — LTIP units are units in the Operating Company that are designated as profits interests for federal income tax purposes. Unvested LTIP units that are subject to market conditions do not accrue distributions. Each vested LTIP unit is convertible, at the election of the holder (subject to capital account limitation), into one common OP Unit and upon conversion, subject to the redemption terms of OP Units (Note 9). LTIP units issued have either (1) a service condition only, valued based upon the Company's class A common stock price on grant date; or (2) both a service condition and a market condition based upon the Company's class A common stock achieving a target price over a predetermined measurement period, subject to continuous employment to the time of vesting, and valued using a Monte Carlo simulation. The following assumptions were applied in the Monte Carlo model under a risk-neutral premise: 2022 LTIP Grant 2019 LTIP Grant (1) Expected volatility of the Company's class A common stock (2) 34.0 % 28.3 % Expected dividend yield (3) 0.0 % 8.1 % Risk-free rate (per annum) (4) 3.6 % 1.8 % __________ (1) Represents 2.5 million LTIP units granted to the Company's Chief Executive Officer, Marc Ganzi, in connection with the Company's acquisition of Digital Bridge Holdings, LLC in July 2019, with vesting based upon achievement of the Company's class A common stock price closing at or above $ 40 over any 90 consecutive trading days prior to the fifth anniversary of the grant date. (2) Based upon historical volatility of the Company's stock and those of a specified peer group. (3) Based upon the Company's most recently issued dividend prior to grant date and closing price of the Company's class A common stock on grant date. Expected dividend yield was zero for the June 2022 award as common dividends were suspended beginning the second quarter of 2020 and reinstated in the third quarter of 2022. (4) Based upon the continuously compounded zero-coupon US Treasury yield for the term coinciding with the measurement period of the award as of valuation date. Equity-based compensation cost on LTIP units is recognized on a straight-line basis either over (1) the service period for awards with a service condition only; or (2) the derived service period for awards with both a service condition and a market condition, irrespective of whether the market condition is satisfied. The derived service period is a service period that is inferred from the application of the simulation technique used in the valuation of the award, and represents the median of the terms in the simulation in which the market condition is satisfied. Deferred Stock Units — Certain non-employee directors may elect to defer the receipt of annual base fees and/or restricted stock awards, and in lieu, receive awards of DSUs. 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. Upon separation of service from the Company, vested DSUs will be settled in shares of the Company’s class A common stock. Fair value of DSUs are determined based on the price of the Company's class A common stock on grant date and recognized immediately if fully vested upon grant, or on a straight-line basis over the vesting period as equity based compensation expense and equity. F-55 Table of Contents Equity-based compensation cost, excluding amounts related to businesses presented as discontinued operations (Note 22), is included in the following line items on the consolidated statement of operations. Separately, additional compensation expense was also recorded in connection with the DataBank recapitalization transaction, as described in Note 10. Year Ended December 31, (In thousands) 2022 2021 2020 Compensation expense (including $( 410 ) net reversal, $ 1,194 and $ 568 expense related to dividend equivalent rights) $ 33,441 $ 38,268 $ 22,892 Administrative expense 1,422 222 — $ 34,863 $ 38,490 $ 22,892 In 2022, the amended employment agreements for certain senior executives provided for continued vesting of their outstanding equity awards notwithstanding the expiration of their employment term. This modification resulted in a revaluation of their equity awards, which decreased cumulative compensation expense recognized by $ 3.3 million. There were no equity award modifications in connection with continuing operations in 2021 and 2020. Changes in the Company’s unvested equity awards are summarized below, after giving effect to the Company's one-for-four reverse stock split in August 2022. Weighted Average Grant Date Fair Value Restricted Stock LTIP Units (1) DSUs RSUs (2) PSUs (3) Total PSUs All Other Awards Unvested shares and units at December 31, 2021 2,047,566 2,615,314 25,437 2,397,391 2,621,850 9,707,558 $ 14.74 $ 10.05 Granted 1,154,652 125,000 61,079 — 185,674 1,526,405 30.48 24.52 Vested ( 1,465,812 ) ( 115,314 ) ( 66,458 ) — ( 382,589 ) ( 2,030,173 ) 17.48 18.28 Forfeited ( 29,732 ) — — — ( 535,348 ) ( 565,080 ) 7.31 26.03 Unvested shares and units at December 31, 2022 1,706,674 2,625,000 20,058 2,397,391 1,889,587 8,638,710 17.84 10.84 __________ (1) Represents the number of LTIP units granted subject to vesting upon achievement of market condition. LTIP units that do not meet the market condition within the measurement period will be forfeited. (2) Represents the number of RSUs granted subject to vesting upon achievement of performance condition. RSUs that do not meet the performance condition at the end of the measurement period will be forfeited. (3) Number of PSUs granted does not reflect potential increases or decreases that could result from the final outcome of the total shareholder return measured at the end of the performance period. 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 $ 53.9 million in 2022, $ 68.3 million in 2021 and $ 17.9 million in 2020. At December 31, 2022, aggregate unrecognized compensation cost for all unvested equity awards was $ 39.5 million, which is expected to be recognized over a weighted average period of 1.6 years. This excludes $ 18.8 million of unvested RSUs that are not currently probable of achieving their performance conditions and have a remaining performance measurement period of 1.4 years. Awards Granted by Managed Companies Prior to the termination of the Company’s management agreement with BRSP on April 30, 2021, BRSP granted equity awards to the Company and certain of the Company's employees ("managed company awards") that typically vest over a three-year period, subject to service conditions. 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 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 asset and other liability on the consolidated balance sheet. The deferred revenue liability is amortized into other income as the awards vest to the Company. Managed company awards granted to employees, either directly or through the Company, are recorded as other asset and other liability, and amortized on a straight-line basis as equity-based compensation expense and as other income, respectively, as the awards vest to the employees. The other asset and other liability associated with managed F-56 Table of Contents 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. The BRSP equity awards granted by the Company to its employees fully vested and accelerated upon termination of the management contract in April 2021. Equity-based compensation expense related to managed company awards was $ 5.3 million in 2021 and $ 2.1 million in 2020, with a corresponding amount recognized in other income, all of which were reflected in discontinued operations (Note 22). 16. Transactions with Affiliates 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; and (iii) directors, senior executives and employees of the Company (collectively, "employees"). Amounts due from and due to affiliates consist of the following, excluding amounts related to discontinued operations that are presented as assets held for disposition (Note 21): (In thousands) December 31, 2022 December 31, 2021 Due from Affiliates Investment vehicles, portfolio companies and unconsolidated ventures Fee income $ 35,010 $ 41,859 Cost reimbursements and recoverable expenses 7,031 7,317 Employees and other affiliates 3,319 54 $ 45,360 $ 49,230 Due to Affiliates (Note 7) Investment vehicles—Derivative obligation $ 11,793 $ — Employees and other affiliates 658 — $ 12,451 $ — 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 14, except for amounts included within discontinued operations (Note 22) and assets held for disposition (Note 21). Substantially all fee income are from affiliates, other than primarily fees from sub-advisory accounts. Cost Reimbursements and Recoverable Expenses — The Company receives reimbursements and recovers certain costs paid on behalf of investment vehicles sponsored by the Company, which include: (i) organization and offering costs related to the formation and capital raising of the investment vehicles up to specified thresholds; (ii) costs incurred in performing investment due diligence; and (iii) direct and indirect operating costs for managing the operations of certain investment vehicles. Such cost reimbursements and recoverable expenses, included in other income, totaled $ 4.3 million in 2022, $ 10.2 million in 2021 and $ 8.8 million in 2020. Separately, reimbursements of direct and indirect operating costs for managing the operations of BRSP prior to termination of the BRSP management agreement in April 2021 were reflected in other income within discontinued operations (Note 22). Warehoused Investments— The Company may acquire and temporarily warehouse investments on behalf of prospective sponsored investment vehicles that are actively fundraising. The warehoused investments are transferred to the investment vehicle when sufficient third party capital, including debt, is raised. The Company is generally paid a fee by the investment vehicle, akin to an interest charge, typically calculated as a percentage of the acquisition price of the investment, to compensate the Company for its cost of holding the investment during the warehouse period. The terms of such arrangements may differ for each sponsored investment vehicle or by investment. In the second half of 2022, the Company transferred all of its warehoused loans and the investment in TowerCo to its new sponsored funds and received an aggregate return of capital of $ 413.2 million, inclusive of holding fees. Derivative Obligations of Sponsored Fund— In the third quarter of 2022, the Company, in its capacity as general partner and for the benefit of its sponsored fund, entered into foreign currency forward contracts to economically hedge the foreign currency exposure of an investment commitment of its sponsored fund (Note 11). The investment committee of the sponsored fund has ratified the fund's responsibility and obligation to assume all resulting liabilities and benefits from F-57 Table of Contents the foreign currency contracts effective from trade date through the novation of the contracts to the fund, which occurred in January 2023. At December 31, 2022, the foreign currency contracts were in an unrealized gain position. The Company recorded a payable in due to affiliates to reflect the fund's obligation to assume the resulting asset from the foreign currency contracts, with a corresponding loss recorded in the consolidated income statement. Accordingly, there is no net effect to the Company's earnings resulting from these foreign currency contracts. Digital Real Estate Acquisitions— Marc Ganzi, Chief Executive Officer of the Company, and Ben Jenkins, President and Chief Investment Officer of the Company, were former owners of Digital Bridge Holdings, LLC ("DBH") prior to its merger into the Company in July 2019. Messrs. Ganzi and Jenkins had retained their equity investments and general partner interests in the portfolio companies of DBH, which include DataBank and Vantage. As a result of the personal investments made by Messrs. Ganzi and Jenkins in DataBank and Vantage SDC prior to the Company’s acquisition of DBH, additional investments made by the Company in DataBank and Vantage SDC subsequent to their initial acquisitions may trigger future carried interest payments to Messrs. Ganzi and Jenkins upon the occurrence of future realization events. Such investments made by the Company include ongoing payments for the build-out of expansion capacity, including lease-up of the expanded capacity and existing inventory, in Vantage SDC (Note 3) and the acquisition of additional interest in DataBank from an existing investor in January 2022. Carried Interest Allocation from Sponsored Investment Vehicles —With respect to investment vehicles sponsored by the Company for which Messrs. Ganzi and Jenkins are invested in their capacity as former owners of DBH, and not in their capacity as employees of the Company, any carried interest entitlement attributed to such investments by Messrs. Ganzi and Jenkins as general partner are not subject to continuing vesting provisions and do not represent compensatory arrangements to the Company. Such carried interest allocation to Messrs. Ganzi and Jenkins that are unrealized or realized but unpaid are included in noncontrolling interests on the balance sheet, in the amount of $ 70.4 million at December 31, 2022 and $ 20.8 million at December 31, 2021. Carried interest allocated is recorded as net income attributable to noncontrolling interests totaling $ 65.0 million in 2022, $ 17.6 million in 2021 and $ 3.2 million in 2020. Additionally, in connection with the DataBank recapitalization (Note 10), Messrs. Ganzi and Jenkins received realized carried interest in the form of equity interest in vehicles that invest in DataBank, of which $ 86.1 million in aggregate is not deemed a compensatory arrangement. Such equity interest represent noncontrolling interests in DataBank. A portion of such equity interest was sold by Messrs. Ganzi and Jenkins in connection with the recapitalization transaction. 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. Such investments in consolidated investment vehicles and general partner entities totaled $ 17.7 million at December 31, 2022 and $ 19.5 million at December 31, 2021, reflected in redeemable noncontrolling interests and noncontrolling interests on the balance sheet. Their share of net income was $ 2.2 million in 2022, $ 2.1 million in 2021 and $ 0.8 million in 2020. These amounts are reflected in net income (loss) attributable to noncontrolling interests and exclude their share of carried interest allocation, which is reflected in compensation expense (reversal)—carried interest. Aircraft— P ursuant to Mr. Ganzi’s employment agreement, as amended, the Company has agreed to reimburse Mr. 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. Additionally, the Company has also agreed to reimburse Mr. Ganzi for certain defined fixed costs of any aircraft owned by Mr. Ganzi. 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 $ 2.7 million in 2022, $ 3.0 million in 2021 and $ 1.8 million in 2020. Investment Venture— Pursuant to an investment agreement entered into between a subsidiary of the Company and Thomas J. Barrack, the Company's former Executive Chairman, 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 subsequent events which significantly reduced 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. F-58 Table of Contents Advancement of Expenses— Effective April 1, 2021, Mr. Barrack stepped down as Executive Chairman of the Company and in July 2021, resigned as a member of the Company's Board of Directors. In October 2021, the Company entered into an Agreement Regarding Advancement of Certain Expenses ("Advancement Agreement") with Mr. Barrack, which is generally consistent with the Company’s obligations and Mr. Barrack’s rights regarding advancement of expenses under the terms of a January 2017 Indemnification Agreement between the Company and Mr. Barrack, and under the Company’s Bylaws. The Advancement Agreement (a) memorializes the parties’ disagreement as to the Company’s obligations and Mr. Barrack’s rights under the earlier Indemnification Agreement and the Company's Bylaws, and (b) obligates Mr. Barrack to reimburse the Company for such advanced expenses under certain circumstances. Pursuant to the Advancement Agreement, the Company expensed $ 27.6 million in 2022 and $ 5.6 million in 2021. 17. Income Taxes As discussed in Note 1, commencing with the taxable year ended December 31, 2022, the Company is taxed as a C Corporation, except for subsidiaries that have elected or anticipate electing REIT status. Given the availability of significant capital loss and NOL carryforwards, the Company’s transition from a REIT to a taxable C Corporation, in and of itself, did not result in significant incremental current income tax expense in 2022. The Company's primary source of income subject to tax remains its investment management business, which was already subject to tax previously through its TRS. Income Tax Benefit (Expense) The components of current and deferred tax benefit (expense), excluding amounts related to discontinued operations (Note 22), are as follows. Year Ended December 31, (In thousands) 2022 2021 2020 Current Federal $ 3,935 $ 3,355 $ ( 3,019 ) State and local ( 1,143 ) ( 20 ) ( 104 ) Foreign ( 864 ) ( 347 ) ( 327 ) Total current tax benefit (expense) 1,928 2,988 ( 3,450 ) Deferred Federal ( 13,734 ) 94,659 41,603 State and local ( 2,405 ) 2,491 8,910 Foreign 744 400 — Total deferred tax benefit (expense) ( 15,395 ) 97,550 50,513 Income tax benefit (expense) on continuing operations $ ( 13,467 ) $ 100,538 $ 47,063 The Company has no income tax benefits recognized for uncertain tax positions. F-59 Table of Contents Deferred Income Tax Asset and Liability Deferred tax asset and deferred tax liability are presented within other assets, and accrued and other liabilities, respectively. The components of deferred tax asset and deferred tax liability are as follows, excluding amounts in connection with assets held for disposition. (In thousands) December 31, 2022 December 31, 2021 Deferred tax asset Capital losses (1) $ 252,904 $ — Net operating losses (2) 92,224 21,552 Investment in partnerships 317,048 — Equity-based compensation 11,856 11,486 Real estate, leases and related intangible liabilities 3,987 14,853 Deferred income 2,086 535 Deferred interest expense 5,556 1,799 Lease liability—corporate offices 16,130 19,295 Other 5,847 — Gross deferred tax asset 707,638 69,520 Valuation allowance ( 679,057 ) ( 12,766 ) Deferred tax asset, net of valuation allowance 28,581 56,754 Deferred tax liability Investment in partnerships — 22,399 Real estate, leases and related intangible assets 3,026 — Other intangible assets 11,754 5,528 ROU lease asset—corporate offices 11,376 14,274 Other 381 7,857 Gross deferred tax liability 26,537 50,058 Net deferred tax asset $ 2,044 $ 6,696 __________ (1) At December 31, 2022, deferred tax asset was recognized on capital losses of $ 1.0 billion, which expire between 2024 and 2027, with full valuation allowance established. (2) At December 31, 2022 and 2021, deferred tax asset was recognized on NOL of $ 378.7 million and $ 89.8 million, respectively, for which full valuation allowance was established in 2022 and partial in 2021. NOL, which is largely attributable to U.S. federal losses incurred after December 31, 2017, can be carried forward indefinitely. Valuation Allowance Changes in the deferred tax asset valuation allowance are presented below, which include activities classified as continuing and discontinued operations: Year Ended December 31, (In thousands) 2022 2021 2020 Beginning balance $ 12,766 $ 1,852 $ — Addition 666,291 33,756 1,852 Utilization, expiration and/or reversal — ( 22,842 ) — Ending balance $ 679,057 $ 12,766 $ 1,852 F-60 Table of Contents In 2022, significant deferred tax assets were recognized with an offsetting valuation allowance. As a result of the Company's transition to a taxable C Corporation, $ 400.2 million of deferred tax asset was recognized as of January 1, 2022 related principally to capital loss carryforwards and outside basis difference in DBRG's interest in the OP, and $ 134.2 million was recorded during the year related to changes in DBRG’s interest in the OP that were treated as equity transactions. Outside basis difference in investment in partnerships along with NOL generated by a subsidiary during the year further contributed to the deferred tax asset balance in 2022. At December 31, 2022, it was determined that the realizability of these deferred tax assets did not meet the more-likely-than-not threshold, and consequently, a full valuation allowance was established against these deferred tax assets. In assessing realizability, the Company determined that there were no prudent and feasible tax planning strategies that the Company could employ to reasonably assure the future realizability of its carryforward losses and other deferred tax assets. In the absence of tax planning strategies and given the Company’s history of cumulative operating losses, which was largely a product of the recent transition in the Company's business, it was difficult to overcome the resulting uncertainties over the Company’s ability to generate future taxable income to realize these deferred tax assets. In future periods, if the realizability of all or some portion of these deferred tax assets becomes more likely than not, the associated valuation allowance would be reversed as a deferred tax benefit. Foreign Subsidiary Earnings The Company has evaluated all unremitted earnings of its foreign subsidiaries, which may be repatriated at the Company’s election, and has not recorded any deferred tax liability as no material taxes are expected to be due if and when these amounts are repatriated. Effective Income Tax The Company's income tax benefit attributable to continuing operations varied from the amount computed by applying the statutory income tax rate to loss from continuing operations before income taxes. The following table presents a reconciliation of the statutory U.S. income tax to the Company's effective income tax attributable to continuing operations: Year Ended December 31, (In thousands) 2022 2021 2020 Loss from continuing operations before income taxes $ ( 407,826 ) $ ( 317,361 ) $ ( 638,151 ) Loss from continuing operations before income taxes attributable to pass-through subsidiaries NA 198,180 386,352 Loss from continuing operations before income taxes attributable to taxable subsidiaries ( 407,826 ) ( 119,181 ) ( 251,799 ) Federal income tax benefit at statutory tax rate (21%) 85,643 25,028 52,878 State and local income taxes, net of federal income tax benefit 23,944 3,721 3,008 Foreign income tax differential 782 ( 86 ) — Noncontrolling interests ( 44,014 ) — — Separately taxable subsidiaries of OP 21,226 — — Change in ownership of OP, including equity reallocation (Note 2) ( 2,838 ) — — Equity-based compensation 1,971 1,814 ( 4,121 ) DataBank REIT election — 79,547 — Valuation allowance (1) ( 95,344 ) ( 10,914 ) ( 1,852 ) Other, net ( 4,837 ) 1,428 ( 2,850 ) Income tax benefit (expense) on continuing operations $ ( 13,467 ) $ 100,538 $ 47,063 __________ (1) Excludes changes in valuation allowance related to the Company's transition to taxable C Corporation as of January 1, 2022, outside basis difference in changes in DBRG’s interest in the OP that were treated as equity transactions, and other activities associated with discontinued operations. In 2021, the Company's DataBank subsidiary completed a restructuring of its operations to qualify as a REIT and elected REIT status for U.S. federal income tax purposes for the 2021 taxable year. As a result, DataBank recorded a net deferred tax benefit of $ 66.8 million in 2021, reflecting principally the write-off of its deferred tax liabilities. As a REIT, DataBank is generally not 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 continues to be subject to U.S. federal income taxes on income earned by its taxable subsidiaries. F-61 Table of Contents Tax Examinations The Company is no longer subject to new income tax examinations by tax authorities for years prior to 2018 . 18. Segment Reporting The Company conducts its business through two reportable segments: (i) Investment Management (formerly, Digital Investment Management); and (ii) Operating (formerly, Digital Operating), the Company's direct co-investment in digital infrastructure assets held by its portfolio companies. • Investment Management — This segment represents the Company's global investment management platform, deploying and managing capital on behalf of a diverse base of global institutional investors. The Company's investment management platform is composed of a growing number of long-duration, private investment funds designed to provide institutional investors access to investments across different segments of the digital infrastructure ecosystem. In addition to its flagship value-add digital infrastructure equity offerings, the Company's investment offerings have expanded to include core equity, credit and liquid securities. The Company earns management fees based upon the assets or capital managed in investment vehicles, and may earn incentive fees and carried interest based upon the performance of such investment vehicles, subject to achievement of minimum return hurdles. The amount of incentive fees and carried interest recognized, a portion of which is allocated to employees, may be highly variable from period to period. Through the end of May 2022, earnings from the Investment Management segment were attributed 31.5% to Wafra prior to the Company's redemption of Wafra's interest in the investment management business (as discussed further in Note 10). • Operating— This segment is composed of balance sheet equity interests in digital infrastructure and real estate operating companies, which generally earn rental income from providing use of digital asset space and/or capacity through leases, services and other agreements. The Company currently owns interests in two companies: DataBank, an edge colocation data center business (DBRG ownership of 11% at December 31, 2022 and 20% at December 31, 2021); and Vantage SDC, a stabilized hyperscale data center business (DBRG ownership of 13% at December 31, 2022 and 2021). DataBank and Vantage SDC are portfolio companies managed by the Company under its Investment Management segment with respect to equity interests owned by third party capital. The Company's remaining investment activities and corporate level activities are presented as Corporate and Other. • Other investment activities are composed of the Company's equity interests in: (i) digital investment vehicles, the largest of which is in the DBP flagship funds, and seed investments in liquid securities and other potential new strategies; and (ii) remaining non-digital investments, primarily in BRSP. Outside of its general partner interests, the Company's other equity interests in its sponsored and/or managed digital investment vehicles are considered to be incidental to its investment management business. The primary economics to the Company are represented by fee income and carried interest as general partner and/or manager, rather than economics from its equity interest in the investment vehicles as a limited partner or equivalent. With respect to seed investments, these are not intended to be a long-term deployment of capital by the Company and are expected to be warehoused temporarily on the Company's balance sheet until sufficient third party capital has been raised. At this time, the remaining non-digital investments are not substantially available for immediate sale and are expected to be monetized over an extended period beyond the near term. These other investment activities generate largely equity method earnings or losses and to a lesser extent, revenues in the form of interest income or dividend income from warehoused investments and consolidated investment vehicles. Effective the third quarter of 2021, these activities are no longer presented separately as the Digital Other and Other segments, which is consistent with and reflects management's focus on its core digital operations and overall simplification of the Company's business. This change in segment presentation is reflected retrospectively. • Corporate activities include corporate level cash and corresponding interest income, corporate level financing and related interest expense, corporate level transaction costs, costs in connection with unconsummated investments, income and expense related to cost reimbursement arrangements with affiliates, fixed assets for administrative use, compensation expense not directly attributable to reportable segments, corporate level administrative and overhead costs, and adjustments to eliminate intercompany fees. Costs which are directly attributable, or otherwise can be subjected to a reasonable and systematic attribution, have been attributed to each of the reportable segments. As segment results are presented before elimination of intercompany fees, elimination adjustment pertains to fee income earned by the Investment Management segment from third party capital in investment vehicles managed by the Company and consolidated within the Operating segment and in Corporate and Other. Such adjustments amounted to $ 3.4 million, $ 6.6 million and $ 1.5 million for the years ended December 31, 2022, 2021 and 2020, respectively. F-62 Table of Contents Segment Results of Operations The following table summarizes results of operations of the Company's reportable segments, including reconciliation to the consolidated statement of operations. (In thousands) Investment Management Operating Corporate and Other Total Year Ended December 31, 2022 Total revenues $ 182,045 $ 884,874 $ 77,653 $ 1,144,572 Property operating expense — ( 376,255 ) ( 13,190 ) ( 389,445 ) Interest expense ( 10,872 ) ( 159,409 ) ( 28,217 ) ( 198,498 ) Investment expense and transaction costs ( 9,007 ) ( 24,338 ) ( 10,671 ) ( 44,016 ) Depreciation and amortization ( 22,155 ) ( 532,640 ) ( 22,116 ) ( 576,911 ) Compensation expense, including $ 202,286 of incentive fee and carried interest compensation ( 303,719 ) ( 90,505 ) ( 53,319 ) ( 447,543 ) Administrative expense ( 21,515 ) ( 30,915 ) ( 70,754 ) ( 123,184 ) Other loss, net ( 3,341 ) ( 808 ) ( 166,406 ) ( 170,555 ) Equity method earnings, including carried interest 382,463 — 15,291 397,754 Income tax benefit (expense) ( 7,815 ) ( 335 ) ( 5,317 ) ( 13,467 ) Income (loss) from continuing operations 186,084 ( 330,331 ) ( 277,046 ) ( 421,293 ) Net income (loss) from continuing operations attributable to DigitalBridge Group, Inc. 69,884 ( 53,178 ) ( 228,410 ) ( 211,704 ) Net loss from discontinued operations attributable to DigitalBridge Group, Inc. ( 110,093 ) Net loss attributable to DigitalBridge Group, Inc. $ ( 321,797 ) Year Ended December 31, 2021 Total revenues $ 191,682 $ 763,199 $ 10,918 $ 965,799 Property operating expense — ( 316,178 ) — ( 316,178 ) Interest expense ( 4,766 ) ( 125,387 ) ( 56,796 ) ( 186,949 ) Investment expense and transaction costs ( 3,423 ) ( 21,835 ) ( 8,780 ) ( 34,038 ) Depreciation and amortization ( 26,736 ) ( 495,342 ) ( 17,617 ) ( 539,695 ) Compensation expense, including $ 65,890 of incentive fee and carried interest compensation ( 136,945 ) ( 76,213 ) ( 88,717 ) ( 301,875 ) Administrative expense ( 21,683 ) ( 36,867 ) ( 50,940 ) ( 109,490 ) Other gain (loss), net 797 ( 1,293 ) ( 20,916 ) ( 21,412 ) Equity method earnings, including carried interest 101,811 — 124,666 226,477 Income tax benefit (expense) ( 9,822 ) 79,075 31,285 100,538 Income (loss) from continuing operations 90,915 ( 230,841 ) ( 76,897 ) ( 216,823 ) Net income (loss) from continuing operations attributable to DigitalBridge Group, Inc. 51,531 ( 36,664 ) ( 87,506 ) ( 72,639 ) Net loss from discontinued operations attributable to DigitalBridge Group, Inc. ( 237,458 ) Net loss attributable to DigitalBridge Group, Inc. $ ( 310,097 ) F-63 Table of Contents (In thousands) Investment Management Operating Corporate and Other Total Year Ended December 31, 2020 Total revenues $ 85,782 $ 313,283 $ 17,365 $ 416,430 Property operating expense — ( 119,729 ) ( 105 ) ( 119,834 ) Interest expense — ( 77,976 ) ( 42,853 ) ( 120,829 ) Investment expense and transaction costs ( 204 ) ( 6,704 ) ( 11,925 ) ( 18,833 ) Depreciation and amortization ( 26,056 ) ( 210,188 ) ( 4,776 ) ( 241,020 ) Impairment loss ( 3,832 ) — ( 21,247 ) ( 25,079 ) Compensation expense, including $ 1,906 of incentive fee and carried interest compensation ( 47,959 ) ( 37,005 ) ( 93,094 ) ( 178,058 ) Administrative expense ( 9,724 ) ( 14,960 ) ( 54,082 ) ( 78,766 ) Settlement and other gain (loss), net 169 ( 245 ) ( 11,507 ) ( 11,583 ) Equity method earnings (losses), including carried interest 13,039 — ( 273,618 ) ( 260,579 ) Income tax benefit (expense) ( 60 ) 21,461 25,662 47,063 Income (loss) from continuing operations 11,155 ( 132,063 ) ( 470,180 ) ( 591,088 ) Net income (loss) from continuing operations attributable to DigitalBridge Group, Inc. 10,423 ( 20,903 ) ( 425,268 ) ( 435,748 ) Net loss from discontinued operations attributable to DigitalBridge Group, Inc. ( 2,240,011 ) Net loss attributable to DigitalBridge Group, Inc. $ ( 2,675,759 ) Total assets and equity method investments of reportable segments, including reconciliation to the consolidated balance sheet, are summarized as follows: December 31, 2022 December 31, 2021 (In thousands) Total Assets Equity Method Investments Total Assets Equity Method Investments Investment Management $ 875,422 $ 393,414 $ 655,152 $ 140,027 Operating 8,149,171 — 7,608,451 — Corporate and Other 1,946,384 576,840 2,257,598 533,069 10,970,977 970,254 10,521,201 673,096 Assets held for disposition related to discontinued operations 57,526 54,495 3,676,615 182,552 $ 11,028,503 $ 1,024,749 $ 14,197,816 $ 855,648 Geography Geographic information about the Company's total income from continuing operations and long-lived assets, excluding assets held for disposition, 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. Year Ended December 31, (In thousands) 2022 2021 2020 Total income by geography: United States $ 1,494,713 $ 1,112,265 $ 382,920 Europe 58,548 18,147 1,442 Other 45,090 51,679 17,126 Total (1) $ 1,598,351 $ 1,182,091 $ 401,488 (In thousands) December 31, 2022 December 31, 2021 Long-lived assets by geography: United States $ 6,566,576 $ 5,792,711 Europe 95,217 109,555 Other 720,282 633,618 Total (2) $ 7,382,075 $ 6,535,884 __________ (1) Total income includes the Company's share of earnings and losses from its equity method investments, including carried interest, but excludes the Company's impairment of equity method investments of $ 60.4 million in 2022 and $ 254.5 million in 2020 (no impairment in 2021). Total income excludes cost reimbursement income from affiliates (Note 16), presented within other income, and income from discontinued operations (Note 22). F-64 Table of Contents (2) Long-lived assets include real estate held for investment, lease related intangible assets, operating lease right-of-use assets and fixed assets, and exclude financial instruments, goodwill, non-lease related intangible assets and assets held for disposition. 19. Commitments and Contingencies Litigation The Company may be involved in litigation in the ordinary course of business. As of December 31, 2022, 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. Leases As lessee, the Company's leasing arrangements are composed of (i) leases on investment properties, consisting primarily of finance and operating leases on powered shell spaces for data centers, an air rights operating lease, lease on data center equipment, and operating ground leases; and (ii) operating leases for corporate offices. The weighted average remaining lease term based upon outstanding lease liability balances at December 31, 2022, excluding leases on investment properties held for disposition, was 10.4 years for finance leases on investment properties, 9.7 years for operating leases on investment properties and 5.7 years for operating leases on corporate offices. The following table summarizes total lease cost for operating leases and finance leases, excluding leases on investment properties classified as discontinued operations. Year Ended December 31, 2022 2021 2020 (In thousands) Investment Properties Corporate Offices Investment Properties Corporate Offices Investment Properties Corporate Offices Operating leases: (1) Fixed lease expense $ 69,292 $ 7,090 $ 63,356 $ 7,010 $ 18,456 $ 9,005 Variable lease expense 13,981 2,073 14,897 1,829 5,612 1,986 Total operating lease cost $ 83,273 $ 9,163 $ 78,253 $ 8,839 $ 24,068 $ 10,991 Finance leases: Interest expense $ 8,519 NA $ 8,936 NA $ 414 NA Amortization of ROU lease asset 11,648 NA 11,648 NA 475 NA Total finance lease cost $ 20,167 NA $ 20,584 NA $ 889 NA __________ (1) Total lease cost for operating leases is included in property operating expense for investment properties and administrative expense for corporate offices. Lease Commitments Finance and operating lease liabilities take into consideration renewal or termination options when such options are deemed reasonably certain to be exercised by the Company and exclude variable lease payments which are expensed as incurred. The Company makes variable lease payments for: (i) leases with rental payments that are adjusted periodically for inflation, and/or (ii) nonlease services, such as common area maintenance and operating expenses, primarily for power, in data center leases. F-65 Table of Contents The table below presents the Company's future lease commitments at December 31, 2022 , determined using weighted average discount rates of 6.2 % for finance leases on investment properties, 6.6 % for operating leases on investment properties, excluding properties held for disposition, and 4.9 % for operating leases on corporate offices: (In thousands) Finance Leases Operating Leases Year Ending December 31, Investment Properties Investment Properties Corporate Offices 2023 $ 15,942 $ 53,090 $ 8,709 2024 16,332 51,519 8,934 2025 16,735 41,053 8,071 2026 17,312 37,711 7,346 2027 17,773 36,760 6,402 2028 and thereafter 101,782 232,882 7,423 Total lease payments 185,876 453,015 46,885 Present value discount ( 50,252 ) ( 167,082 ) ( 6,388 ) Finance / Operating lease liability $ 135,624 $ 285,933 $ 40,497 Commitments on Future Leases At December 31, 2022, the Company had operating lease commitments on two corporate office spaces commencing in 2023, including one assumed through the acquisition of InfraBridge in February 2023. The fixed lease payments (undiscounted) total $ 21.4 million over a 9.7 year weighted average lease term. Tenant Allowance In connection with DataBank’s acquisition of a data center portfolio in March 2022 (Note 3), DataBank and the seller concurrently entered into a master lease agreement which provides that the seller leases from DataBank land acquired in the transaction. If the seller does not exercise its rights to early terminate the lease, the seller is obligated to develop a data center facility on a portion of the acquired land and DataBank is committed to provide the seller a tenant allowance of up to $ 37.5 million to finance the construction. In December 2022, the seller waived its right to terminate the lease with respect to the portion of the land subject to development. The seller will be responsible for undertaking the construction and any resulting overages. Title to the to-be constructed building, improvements and fixtures will be vested in the seller for the duration of the lease and transfers to DataBank thereafter. The timing of funding of DataBank’s commitment to the seller will be based on agreed upon milestones, with construction to be completed no later than January 1, 2026. DataBank expects to fund its commitment through future debt drawdowns. F-66 Table of Contents 20. Supplemental Disclosure of Cash Flow Information Year Ended December 31, (In thousands) 2022 2021 2020 Supplemental Disclosure of Cash Flow Information Cash paid for interest, net of amounts capitalized of $ 3,206 , $ 1,567 and $ 852 $ 219,851 $ 444,365 $ 392,004 Cash received, net of cash paid, for income taxes 11,747 5,927 39,151 Operating lease payments 72,891 66,858 31,138 Finance lease payments 15,672 15,346 889 Supplemental Disclosure of Cash Flows from Discontinued Operations Net cash provided by (used in) operating activities of discontinued operations $ ( 10,599 ) $ 175,782 $ 106,696 Net cash provided by (used in) investing activities of discontinued operations ( 23,375 ) 1,021,239 1,029,647 Net cash used in financing activities of discontinued operations ( 18,706 ) ( 658,831 ) ( 940,441 ) Supplemental Disclosure of Noncash Investing and Financing Activities Dividends and distributions payable $ 16,491 $ 15,759 $ 18,516 Improvements in operating real estate in accrued and other liabilities 76,832 17,926 27,096 Receivable from loan repayments and asset sales 16,824 14,045 1,858 Operating lease right-of-use assets and lease liabilities established 28,328 31,032 262,169 Finance lease right-of-use assets and lease liabilities established — — 148,974 Redemption of OP Units for common stock 341 4,647 7,757 Redemption of redeemable noncontrolling interest for common stock 348,759 — — Exchange of notes into shares of Class A common stock 60,317 161,261 — Assets and liabilities of investment entities liquidated or conveyed to lender (1) — — 172,927 Assets consolidated from real estate acquisitions, net of cash and restricted cash — — 5,399,611 Liabilities assumed in real estate acquisitions — — 1,854,760 Noncontrolling interests assumed in real estate acquisitions — — 366,136 Debt assumed by buyer in sale of real estate — 44,148 — Seller Note received in sale of NRF Holdco equity 154,992 — — Loan receivable relieved in exchange for equity investment acquired 20,676 — — Assets disposed in sale of equity of investment entities or sale by receiver 4,689,188 5,263,443 395,351 Liabilities disposed in sale of equity of investment entities or sale by receiver 3,948,016 4,291,557 235,425 Assets of investment entities deconsolidated (2) — 351,022 80,921 Liabilities of investment entities deconsolidated (1) — — — Noncontrolling interests of investment entities sold or deconsolidated (2) 415,098 1,080,134 — __________ (1) The Company indirectly conveyed the equity of certain of its wellness infrastructure borrower subsidiaries to an affiliate of the lender, which released the Company from all rights and obligations with respect to the assets and previously defaulted debt of these subsidiaries.. (2) Represents deconsolidation of noncontrolling interests upon sale of the Company's equity interests in investment entities (Note 22). F-67 Table of Contents 21. 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 22). At December 31, 2022, these were composed of remaining equity investments excluded from the December 2021 OED sale. At December 31, 2021, also included are assets and liabilities held by NRF Holdco, related primarily to the Wellness Infrastructure business prior to its sale in February 2022. (In thousands) December 31, 2022 December 31, 2021 Assets Restricted cash $ — $ 65,022 Real estate, net — 3,079,416 Loans receivable — 55,878 Equity and debt investments 57,387 250,246 Deferred leasing costs and other intangible assets, net — 118,300 Other assets 139 100,720 Due from affiliates — 7,033 Total assets held for disposition $ 57,526 $ 3,676,615 Liabilities Debt, net (1) $ — $ 2,869,360 Lease intangibles and other liabilities 380 219,339 Total liabilities related to assets held for disposition $ 380 $ 3,088,699 __________ (1) Represents debt related to assets held for disposition that was assumed by the acquirer upon sale of the assets. At December 31, 2021 , included the 5.375 % exchangeable senior notes and junior subordinated debt (as described in Note 12) which were obligations of NRF Holdco as the issuer. Nonrecurring Fair Value of Assets Classified as Held for Disposition and Discontinued Operations The Company measures fair value of certain assets on a nonrecurring basis when events or changes in circumstances indicate that the carrying value of the assets may not be recoverable. The Company initially measures assets classified as held for disposition at the lower of their carrying amounts or fair value less disposal costs. For bulk sale transactions, the unit of account is the disposal group, with any excess of the aggregate carrying value over estimated fair value less costs to sell allocated to the individual assets within the group. 2022 At December 31, 2022, there were no assets held for sale that were measured at fair value on a nonrecurring basis. Impairment loss of $ 36.0 million was recorded in 2022 primarily based upon the final carrying value of net assets of the Wellness Infrastructure business upon closing of the disposition of NRF Holdco in February 2022. 2021 At December 31, 2021, only real estate held for disposition that pertained to the Wellness Infrastructure business was carried at nonrecurring fair value, having been impaired $ 313.4 million during the year ended December 31, 2021 based upon the sales price for NRF Holdco. Other assets that had been impaired during 2021 pertained to real estate, equity investments and intangible assets of the OED and Other IM portfolio that were disposed in December 2021. Recurring Fair Value of Assets Classified as Held for Disposition and Discontinued Operations Equity Investments Carried at NAV —These include equity interest in a private fund and prior to its disposition as part of NRF Holdco in February 2022, investment in a Company-sponsored non-traded REIT, amounting to $ 2.9 million at December 31, 2022 and $ 31.2 million at December 31, 2021. Equity Method Investments under Fair Value Option —Equity method investments under the fair value option of $ 44.5 million at December 31, 2022 and $ 79.3 million at December 31, 2021 were measured based upon indicative sales price, classified as Level 3 fair value. F-68 Table of Contents Loans Receivable under Fair Value Option —There were no loans held for disposition at December 31, 2022. At December 31, 2021, the loan held for disposition represents a component of the overall sales price for NRF Holdco, which was disposed in February 2022. Debt Securities —Prior to the sale of NRF Holdco in February 2022, the Company had investments in debt securities, composed of AFS N-Star CDO bonds, which were subordinate bonds retained by NRF Holdco in its sponsored CDOs. The CDO bonds were collateralized primarily by commercial real estate debt and securities. The balance of N-Star CDO bonds at December 31, 2021, classified as Level 3 fair value, is summarized as follows. Amortized Cost without Allowance for Credit Loss Allowance for Credit Loss Gross Cumulative Unrealized (in thousands) Gains Losses Fair Value December 31, 2021 $ 55,041 $ ( 24,882 ) $ 6,372 $ — $ 36,531 Prior to its sale, the fair value of N-Star CDO bonds represents a component of the overall sales price for the disposition of NRF Holdco. There was no provision for credit loss in 2022 prior to disposition but $ 0.2 million was recognized in 2021. 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. Level 3 Recurring Fair Values The following table presents changes in recurring Level 3 fair value assets held for disposition. Realized and unrealized gains (losses) are included in AOCI for AFS debt securities, other gain (loss) for loans receivable and equity method losses for equity method investments, all of which are presented in discontinued operations (Note 22). Fair Value Option (In thousands) AFS Debt Securities Held for Disposition Loans Held for Disposition Equity Method Investments Held for Disposition Fair value at December 31, 2020 $ 28,576 $ 1,258,539 $ 153,259 Purchases, drawdowns, contributions and accretion 10,049 19,070 8 Paydowns, distributions and sales ( 1,569 ) ( 440,646 ) ( 12,594 ) Change in accrued interest and capitalization of paid-in-kind interest — 5,801 — Allowance for credit losses ( 194 ) — — Realized and unrealized losses in earnings, net — ( 92,701 ) ( 29,961 ) Deconsolidation of investment entities (Note 20) — ( 647,218 ) ( 27,402 ) Other — ( 7,088 ) — Other comprehensive loss (1) ( 331 ) ( 39,879 ) ( 4,001 ) Fair value at December 31, 2021 $ 36,531 $ 55,878 $ 79,309 Net unrealized gains (losses) on instruments held at December 31, 2021 In earnings $ — $ — $ ( 28,216 ) In other comprehensive loss $ ( 331 ) N/A N/A Fair value at December 31, 2021 $ 36,531 $ 55,878 $ 79,309 Purchases, drawdowns, contributions and accretion 195 — — Paydowns, distributions and sales ( 36,726 ) ( 54,490 ) ( 10,183 ) Change in accrued interest and capitalization of paid-in-kind interest — ( 1,013 ) — Realized and unrealized losses in earnings, net — ( 375 ) ( 19,845 ) Other comprehensive loss (1) — — ( 4,822 ) Fair value at December 31, 2022 $ — $ — $ 44,459 Net unrealized gains (losses) on instruments held at December 31, 2022 In earnings $ — $ — $ ( 19,845 ) In other comprehensive loss $ — N/A N/A __________ (1) Amounts recorded in OCI for loans receivable and equity method investments represent foreign currency translation of the Company's foreign subsidiaries that hold the respective foreign currency denominated investments. F-69 Table of Contents 22. 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 prior to the sale of 100 % of the equity of NRF Holdco in February 2022. The non-core assets held by NRF Holdco were composed primarily of: (i) the Company's equity interest in and management of NorthStar Healthcare Income, Inc., 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; 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. The sales price for 100 % of the equity of NRF Holdco was $ 281 million, composed of $ 126 million cash and a $ 155 million unsecured promissory note (the "Seller Note"). In addition, NRF Holdco distributed approximately $ 35 million of cash to the Company prior to closing. The Seller Note, which is classified as held for investment and carried at fair value under the fair value option, matures five years from closing of the sale, accruing paid-in-kind interest at 5.35 % per annum. The sale included the acquirer's assumption of $ 2.57 billion of consolidated investment level debt on various healthcare portfolios in which the Company owned between 69.6 % and 81.3 %, and $ 293.7 million of debt at NRF Holdco. • Other —operations of substantially all of the Company's OED investments and Other IM business that were previously in the Other segment prior to sale of the Company's equity interests and subsequent deconsolidation of these subsidiaries in December 2021. The OED investments and Other IM business are 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, and underlying compensation and administrative costs for managing these assets. Also included in discontinued operations are the economics related to the management of BRSP prior to termination of its management contract in April 2021. • Hotel —operations of the Company's Hospitality segment and the THL Hotel Portfolio that was previously in the Other segment. In March 2021, the Company sold 100 % of the equity in its hotel subsidiaries holding 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. The remaining hotel portfolio that was in receivership was sold by the lender in September 2021. F-70 Table of Contents Income (loss) from discontinued operations is presented below. Year Ended December 31, (In thousands) 2022 2021 2020 Revenues Property operating income $ 69,202 $ 737,282 $ 1,217,236 Fee income 9,797 58,197 94,399 Interest income 1,075 19,143 73,345 Other income 10,338 29,037 29,450 Revenues from discontinued operations 90,412 843,659 1,414,430 Expenses Property operating expense 36,669 462,896 799,850 Interest expense 112,947 256,567 353,577 Transaction-related costs and investment expense 21,540 38,820 70,993 Depreciation and amortization 2,339 96,860 337,262 Impairment loss 35,985 317,405 2,556,051 Compensation and administrative expense 38,704 109,620 100,011 Expenses from discontinued operations 248,184 1,282,168 4,217,744 Other income (loss) Gain on sale of real estate — 49,429 41,922 Other gain (loss), net 14,490 72,617 ( 194,860 ) Equity method losses ( 8,170 ) ( 233,725 ) ( 203,399 ) Loss from discontinued operations before income taxes ( 151,452 ) ( 550,188 ) ( 3,159,651 ) Income tax benefit (expense) 2,748 ( 49,900 ) ( 39,671 ) Loss from discontinued operations ( 148,704 ) ( 600,088 ) ( 3,199,322 ) Loss from discontinued operations attributable to: Noncontrolling interests in investment entities ( 29,145 ) ( 337,685 ) ( 712,771 ) Noncontrolling interests in Operating Company ( 9,466 ) ( 24,945 ) ( 246,540 ) Loss from discontinued operations attributable to DigitalBridge Group, Inc. $ ( 110,093 ) $ ( 237,458 ) $ ( 2,240,011 ) 23. Subsequent Events Other than as disclosed elsewhere, no subsequent events have occurred that would require recognition in the consolidated financial statements or disclosure in the accompanying notes. F-71 Table of Contents DigitalBridge Group, Inc. Schedule III—Real Estate and Accumulated Depreciation December 31, 2022 (Amounts in thousands) Initial Cost Costs Capitalized Gross Cost Basis (2) Accumulated Depreciation (3) Net Carrying Amount (4) Date of Acquisition or Construction Encumbrances Land Buildings and Improvements (1) Land Buildings and Improvements (1) Total Data Centers—Colocation Owned Atlanta, GA ATL 2 & 3 $ 49,622 $ 1,467 $ 73,640 $ 40,153 $ 1,467 $ 113,793 $ 115,260 $ ( 12,970 ) $ 102,290 2020 Denver, CO DEN 1 29,136 2,405 41,695 10,754 2,405 52,449 54,854 ( 5,713 ) 49,141 2020 Westminster, CO DEN 4 9,433 992 13,286 642 992 13,928 14,920 ( 1,459 ) 13,461 2020 Denver, CO DEN 5 (5) 9,775 1,690 13,106 12,524 1,690 25,630 27,320 — 27,320 2021 Dallas, TX DFW 4 31,666 1,896 46,034 2,294 1,896 48,328 50,224 ( 7,016 ) 43,208 2020 Washington, DC IAD 3 (5) 8,336 12,618 — 166,584 12,618 166,584 179,202 — 179,202 2021 New York, NY LGA 3 (5) 15,661 23,704 — 14,900 23,704 14,900 38,604 — 38,604 2021 Irvine, CA SNA 1 33,611 10,574 40,300 6,454 10,574 46,754 57,328 ( 6,007 ) 51,321 2020 Atlanta, GA ATL 1 80,528 — 75,594 17,451 — 93,045 93,045 ( 16,246 ) 76,799 2019 Atlanta, GA ATL 4 (5) — 2,728 — 9,443 2,728 9,443 12,171 — 12,171 2021 Denver, CO DEN 2 — 4,458 52,295 1,951 4,458 54,246 58,704 ( 7,168 ) 51,536 2022 Plano, TX DFW 3 202,538 12,039 58,097 29,345 12,039 87,442 99,481 ( 12,646 ) 86,835 2019 Minneapolis, MN MSP 3 — 5,116 — 50,057 5,116 50,057 55,173 ( 1,798 ) 53,375 2020 Overland Park, KS KC 2 50,553 453 58,394 2,163 453 60,557 61,010 ( 12,798 ) 48,212 2019 Lenexa, KS KC 3 70,547 884 15,089 15,243 884 30,332 31,216 ( 970 ) 30,246 2019 North Fayette, PA PIT 2 51,872 1,555 36,682 22,170 1,555 58,852 60,407 ( 10,937 ) 49,470 2019 Bluffdale, UT SLC 2 87,912 3,729 95,689 5,322 3,729 101,011 104,740 ( 20,899 ) 83,841 2019 Bluffdale, UT SLC 3 96,128 2,699 106,464 5,843 2,699 112,307 115,006 ( 23,329 ) 91,677 2019 Bluffdale, UT SLC 4 49,300 1,491 52,862 3,647 1,491 56,509 58,000 ( 10,983 ) 47,017 2019 Bluffdale, UT SLC 5 78,938 3,104 32,485 51,937 3,104 84,422 87,526 ( 12,243 ) 75,283 2019 Bluffdale, UT SLC 6 — 4,064 — 133,355 4,064 133,355 137,419 ( 1,203 ) 136,216 2019 Houston, TX HOU 1 102,595 6,443 230,441 1,328 6,443 231,769 238,212 ( 15,669 ) 222,543 2022 Houston, TX HOU 2 74,934 4,970 165,931 866 4,970 166,797 171,767 ( 9,224 ) 162,543 2022 Houston, TX HOU 3 60,492 15,260 120,274 778 15,260 121,052 136,312 ( 5,096 ) 131,216 2022 Houston, TX HOU 4 4,583 9,942 — — 9,942 — 9,942 — 9,942 2022 Houston, TX HOU 5 19,895 5,898 39,189 307 5,898 39,496 45,394 ( 2,240 ) 43,154 2022 Leased Waco, TX ACT 1 6,697 — 10,137 797 — 10,934 10,934 ( 1,798 ) 9,136 2020 Austin, TX AUS 1 2,298 — 3,478 471 — 3,949 3,949 ( 645 ) 3,304 2020 Boston, MA BOS 1 4,005 — 6,062 259 — 6,321 6,321 ( 1,061 ) 5,260 2020 Denver, CO DEN 3 12,081 — 18,286 894 — 19,180 19,180 ( 3,196 ) 15,984 2020 Dallas, TX DFW 5 7,091 — 10,733 1,316 — 12,049 12,049 ( 1,945 ) 10,104 2020 Dallas, TX DFW 6 4,333 — 6,559 252 — 6,811 6,811 ( 1,146 ) 5,665 2020 Dallas, TX DFW 7 6,697 — 10,137 803 — 10,940 10,940 ( 1,818 ) 9,122 2020 F-72 Table of Contents (Amounts in thousands) Initial Cost Costs Capitalized Gross Cost Basis (2) Accumulated Depreciation (3) Net Carrying Amount (4) Date of Acquisition or Construction Encumbrances Land Buildings and Improvements (1) Land Buildings and Improvements (1) Total Newark, NJ EWR 1 14,314 — 21,665 1,463 — 23,128 23,128 ( 3,850 ) 19,278 2020 Piscataway, NJ EWR 2 15,561 — 23,553 1,875 — 25,428 25,428 ( 4,122 ) 21,306 2020 Ashburn, VA IAD 1 62,376 — 94,412 9,468 — 103,880 103,880 ( 16,986 ) 86,894 2020 McLean, VA IAD 2 7,249 — 10,972 2,019 — 12,991 12,991 ( 2,031 ) 10,960 2020 Las Vegas, NV LAS 1 16,349 — 24,746 18,533 — 43,279 43,279 ( 6,242 ) 37,037 2020 Las Angeles, CA LAX 1 13,132 — 19,876 1,164 — 21,040 21,040 ( 3,474 ) 17,566 2020 New York, NY LGA 1 9,520 — 14,410 5,804 — 20,214 20,214 ( 2,901 ) 17,313 2020 New York, NY LGA 2 10,571 — 16,000 1,109 — 17,109 17,109 ( 2,823 ) 14,286 2020 Memphis, TN MEM 1 2,889 — 4,373 1,394 — 5,767 5,767 ( 877 ) 4,890 2020 Miami, FL MIA 1 9,652 — 14,609 5,164 — 19,773 19,773 ( 2,890 ) 16,883 2020 Minneapolis, MN MSP 4 4,530 — 6,857 80 — 6,937 6,937 ( 1,183 ) 5,754 2020 Chicago, IL ORD 1 7,879 — 11,926 1,377 — 13,303 13,303 ( 2,176 ) 11,127 2020 Chicago, IL ORD 2 12,081 — 18,286 828 — 19,114 19,114 ( 3,232 ) 15,882 2020 Mount Prospect, IL ORD 3 12,410 — 18,783 2,457 — 21,240 21,240 ( 3,410 ) 17,830 2020 Chicago, IL ORD 4 59,754 — 90,443 5,074 — 95,517 95,517 ( 15,969 ) 79,548 2020 Philadelphia, PA PHL 1 3,808 — 5,764 410 — 6,174 6,174 ( 1,026 ) 5,148 2020 Phoenix, AZ PHX 1,2 & 3 6,369 — 9,640 306 — 9,946 9,946 ( 1,677 ) 8,269 2020 San Diego, CA SAN 1 9,915 — 15,007 18,622 — 33,629 33,629 ( 3,327 ) 30,302 2020 San Diego, CA SAN 2 361 — 547 261 — 808 808 ( 114 ) 694 2020 Seattle, WA SEA 1 3,940 — 5,963 500 — 6,463 6,463 ( 1,068 ) 5,395 2020 Tukwila, WA SEA 2 6,041 — 9,143 3,736 — 12,879 12,879 ( 1,792 ) 11,087 2020 Santa Clara, CA SFO 1 20,420 — 30,907 925 — 31,832 31,832 ( 5,386 ) 26,446 2020 Irvine, CA SNA 2 22,652 — 34,286 35,236 — 69,522 69,522 ( 6,169 ) 63,353 2020 Feltham, UK LHR 1 20,551 — 31,106 93 — 31,199 31,199 ( 5,369 ) 25,830 2020 Paris, France PAR 1 6,970 — 10,549 1,365 — 11,914 11,914 ( 1,725 ) 10,189 2021 Saint-Denis, France PAR 2 2,217 — 3,356 — — 3,356 3,356 ( 493 ) 2,863 2021 Vélizy-Villacoublay, France PAR 3 4,815 — 7,288 8,066 — 15,354 15,354 ( 1,567 ) 13,787 2021 Montpellier, France MPL 1 1,584 — 2,397 236 — 2,633 2,633 ( 380 ) 2,253 2021 Balma, France TLS 1 1,647 — 2,493 626 — 3,119 3,119 ( 448 ) 2,671 2021 Lenexa, KS KC 1 9,979 — 5,286 5,859 — 11,145 11,145 ( 1,628 ) 9,517 2019 Salt Lake City, UT SLC 1 16,705 — 9,144 9,297 — 18,441 18,441 ( 2,510 ) 15,931 2019 Baltimore, MD BWI 1 — — 16,002 970 — 16,972 16,972 ( 4,789 ) 12,183 2019 Cleveland, OH CLE 1 8,273 — 10,348 194 — 10,542 10,542 ( 2,652 ) 7,890 2019 Dallas, TX DFW 1 78,881 — 93,453 6,880 — 100,333 100,333 ( 25,105 ) 75,228 2019 Richardson, TX DFW 2 25,852 — 28,756 3,853 — 32,609 32,609 ( 7,954 ) 24,655 2019 F-73 Table of Contents (Amounts in thousands) Initial Cost Costs Capitalized Gross Cost Basis (2) Accumulated Depreciation (3) Net Carrying Amount (4) Date of Acquisition or Construction Encumbrances Land Buildings and Improvements (1) Land Buildings and Improvements (1) Total Indianapolis, IN IND 1 & IND 2 58,715 — 19,747 13,219 — 32,966 32,966 ( 7,793 ) 25,173 2019 Edina, MN MSP 1 7,555 — 9,113 481 — 9,594 9,594 ( 2,389 ) 7,205 2019 Eagan, MN MSP 2 41,426 — 48,762 2,421 — 51,183 51,183 ( 11,675 ) 39,508 2019 Pittsburgh, PA PIT 1 31,988 — 37,128 2,951 — 40,079 40,079 ( 9,572 ) 30,507 2019 Data Centers—Hyperscale Owned Santa Clara, CA 11 346,568 30,327 445,334 5,736 30,327 451,070 481,397 ( 47,244 ) 434,153 2020 Santa Clara, CA 12 294,952 12,026 298,042 2,163 12,026 300,205 312,231 ( 36,821 ) 275,410 2020 Santa Clara, CA 13 98,317 10,276 115,031 2,302 10,275 117,334 127,609 ( 13,685 ) 113,924 2020 Santa Clara, CA 14 98,317 8,813 122,892 2,461 8,813 125,353 134,166 ( 14,756 ) 119,410 2020 Santa Clara, CA 15 270,372 15,459 409,419 16,136 15,459 425,555 441,014 ( 44,947 ) 396,067 2020 Santa Clara, CA 16 147,476 8,148 171,634 113 8,148 171,747 179,895 ( 21,169 ) 158,726 2020 Santa Clara, CA 21 322,542 11,394 326,807 4,283 11,394 331,090 342,484 ( 35,620 ) 306,864 2020 Santa Clara, CA 22 368,619 12,258 379,417 41 12,258 379,458 391,716 ( 20,049 ) 371,667 2021 Quincy, WA 11 94,021 1,742 151,754 3,302 1,742 155,056 156,798 ( 23,844 ) 132,954 2020 Quincy, WA 12 236,846 1,967 179,865 26,469 1,967 206,334 208,301 ( 21,355 ) 186,946 2020 Montreal, Canada 11 90,556 2,445 208,639 37,016 2,445 245,655 248,100 ( 18,748 ) 229,352 2020 Quebec City, Canada 21 125,470 900 136,277 6,755 900 143,032 143,932 ( 16,515 ) 127,417 2020 Quebec City, Canada 22 229,489 1,655 278,054 11,551 1,655 289,605 291,260 ( 30,688 ) 260,572 2020 Total real estate $ 4,633,733 $ 257,589 $ 5,493,200 $ 902,947 $ 257,588 $ 6,396,148 $ 6,653,736 $ ( 732,438 ) $ 5,921,298 __________ (1) Includes construction in progress and data center infrastructure. (2) Presented net of impairment of real estate, where applicable. (3) Depreciation is calculated using useful life ranging from 5 to 40 years for site improvements, 5 to 50 years for buildings, 5 to 40 years for building improvements, and 5 to 30 years for data center infrastructure. (4) The aggregate gross cost of real estate for federal income tax purposes was approximately $ 3.8 billion at December 31, 2022. (5) Represents construction or data center build-out that are in progress. F-74 Table of Contents The following tables summarize the activity in real estate and accumulated depreciation: Year Ended December 31, (In thousands) 2022 2021 2020 Real Estate, at Gross Cost Basis Balance at January 1 $ 8,777,385 $ 14,028,516 $ 12,702,355 Asset acquisitions and business combinations 1,130,735 572,738 3,650,180 Measurement period adjustments for real estate acquired in business combinations — — ( 8,405 ) Foreclosures and exchanges of loans receivable for real estate — — 124,335 Improvements and capitalized costs (1) 523,049 325,281 180,787 Dispositions (2) ( 3,720,789 ) ( 5,744,919 ) ( 869,776 ) Impairment (Note 21) ( 34,990 ) ( 316,135 ) ( 1,878,012 ) Effect of changes in foreign exchange rates ( 21,654 ) ( 88,096 ) 127,052 Balance at December 31 6,653,736 8,777,385 14,028,516 Classified as held for disposition, net (3) — ( 3,413,018 ) ( 9,458,467 ) Balance at December 31, held for investment $ 6,653,736 $ 5,364,367 $ 4,570,049 Year Ended December 31, (In thousands) 2022 2021 2020 Accumulated Depreciation Balance at January 1 $ 725,685 $ 1,397,627 $ 1,042,422 Depreciation 350,732 345,769 420,209 Dispositions (2) ( 339,460 ) ( 1,010,599 ) ( 74,692 ) Effect of changes in foreign exchange rates ( 4,519 ) ( 7,112 ) 9,688 Balance at December 31 732,438 725,685 1,397,627 Classified as held for disposition, net (3) — ( 333,602 ) ( 1,279,443 ) Balance at December 31, held for investment $ 732,438 $ 392,083 $ 118,184 __________ (1) Includes transaction costs capitalized for asset acquisitions. (2) Includes amounts classified as held for disposition during the year and disposed before the end of the year. (3) Amounts classified as held for disposition during the year and remain as held for disposition at the end of the year. Includes amounts retrospectively classified as held for disposition in connection with discontinued operations. F-75 Table of Contents Item 16. Form 10-K Summary None. EXHIBIT INDEX Exhibit Number Description 3.1* Restated Charter of DigitalBridge Group, Inc. (incorporated by reference to Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q filed on November 7, 2022) 3.2 Amended and Restated Bylaws of DigitalBridge Group, Inc. (incorporated by reference to Exhibit 3.2 to the Company's Current Report on Form 8-K filed on June 23, 2021) 3.3 Articles Supplementary designating 7.15% Series I Cumulative Redeemable Perpetual Preferred Stock, liquidation preference $25.00 per share, par value $0.01 per share (incorporated by reference to Exhibit 3.2 to the Company’s Form 8-A filed on June 5, 2017) 3.4 Articles Supplementary designating 7.125% Series J Cumulative Redeemable Perpetual Preferred Stock, liquidation preference $25.00 per share, par value $0.01 per share (incorporated by reference to Exhibit 3.3 to Colony NorthStar, Inc.’s Registration Statement on Form 8-A filed on September 22, 2017) 4.1 Form of stock certificate evidencing the 7.125% Series J Cumulative Redeemable Perpetual Preferred Stock, liquidation preference $25.00 per share, par value $0.01 per share (incorporated by reference to Exhibit 4.1 to the Company’s Registration Statement on Form 8-A filed on September 22, 2017) 4.2 Form of stock certificate evidencing the 7.15% Series I Cumulative Redeemable Perpetual Preferred Stock, liquidation preference $25.00 per share, par value $0.01 per share (incorporated by reference to Exhibit 4.1 to the Company’s Registration Statement on Form 8-A filed on June 5, 2017) 4.3 Indenture, dated as of April 10, 2013, between DigitalBridge Group, Inc. (f/k/a Colony Financial, Inc.) and The Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.1 to Colony Financial, Inc.’s Current Report on Form 8-K filed on April 10, 2013) 4.4 First Supplemental Indenture, dated as of April 10, 2013, by and between DigitalBridge Group, Inc. (f/k/a Colony Financial, Inc.) and The Bank of New York Mellon (incorporated by reference to Exhibit 4.2 to Colony Capital, Inc.’s Current Report on Form 8-K filed on April 10, 2013) 4.5 Third Supplemental Indenture, dated as of January 10, 2017, between DigitalBridge Group, Inc. (f/k/a Colony NorthStar, Inc.) and The Bank of New York Mellon (incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on January 10, 2017) 4.6* Description of Securities Registered Pursuant to Section 12 of the Securities Exchange Act of 1934 4.7 Form of Class A Common Stock Purchase Warrant of DigitalBridge Group, Inc. (incorporated by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K filed on May 24, 2022) 4.8 Indenture, dated as of July 21, 2020, among DigitalBridge Operating Company, LLC (f/k/a Colony Capital Operating Company, LLC), DigitalBridge Group, Inc. (f/k/a Colony Capital, Inc.) and The Bank of New York Mellon, as trustee (incorporated by reference to Exhibit 4.2 to the Company's Current Report on Form 8-K filed on July 23, 2020) 4.9 Form of 5.75% Exchangeable Senior Notes due 2025 (included in Exhibit 4.8) 4.10 Registration Rights Agreement, dated as of July 21, 2020, by and among DigitalBridge Operating Company, LLC (f/k/a Colony Capital Operating Company, LLC), DigitalBridge Group, Inc. (f/k/a Colony Capital, Inc.) and the initial purchasers party thereto (incorporated by reference to Exhibit 10.7 to the Company's Current Report on Form 8-K filed on July 23, 2020) 4.11 Base Indenture, dated as of July 9, 2021, by and among DigitalBridge Issuer, LLC, DigitalBridge Co-Issuer, LLC, together as Co-Issuers, certain indirect and direct subsidiaries of the Co-Issuers and Citibank, N.A., as Trustee (incorporated by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K filed on July 15, 2021) 4.12 First Amendment to Base Indenture, dated as of April 1, 2022, by and among DigitalBridge Issuer, LLC, DigitalBridge Co-Issuer, LLC, together as Co-Issuers, certain indirect and direct subsidiaries of the Co-Issuers and Citibank, N.A., as Trustee (incorporated by reference to Exhibit 4.1 to the Company's Current Report on Form 8-K filed on April 5, 2022) 4.13 Series 2021-1 Supplement to Base Indenture, dated as of July 9, 2021, by and between DigitalBridge Issuer, LLC and DigitalBridge Co-Issuer, LLC, together as Co-Issuers of the Series 2021-1 secured fund fee revenue notes, Class A-2, and Series 2021-1 variable funding senior notes, Class A-1, certain indirect and direct subsidiaries of the Co-Issuers and Citibank, N.A., as Trustee (incorporated by reference to Exhibit 4.2 to the Company's Current Report on Form 8-K filed on July 15, 2021) 4.14 Amendment No. 1 to Series 2021-1 Supplement to Base Indenture, dated as of April 1, 2022, by and among DigitalBridge Issuer, LLC and DigitalBridge Co-Issuer, LLC, together as Co-Issuers, certain indirect and direct subsidiaries of the Co-Issuers and Citibank, N.A., as Trustee (incorporated by reference to Exhibit 4.2 to the Company's Current Report on Form 8-K filed on April 5, 2022) Certain Instruments defining the rights of holders of long-term debt securities of the Registrant and its subsidiaries are omitted pursuant to Item 601(b)(4)(iii) of Regulation S-K. The Registrant hereby undertakes to furnish to the SEC, upon request, copies of any such instruments. 10.1 Third Amended and Restated Limited Liability Company Agreement of DigitalBridge Operating Company, LLC (f/k/a Colony Capital Operating Company, LLC) (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on January 10, 2017) 10.2 Amendment No. 1 to the Third Amended and Restated Limited Liability Company Agreement of DigitalBridge Operating Company, LLC (f/k/a Colony Capital Operating Company, LLC), dated as of June 23, 2017 (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed on August 9, 2017) 10.3 Amendment No. 2 to the Third Amended and Restated Limited Liability Company Agreement of DigitalBridge Operating Company, LLC (f/k/a Colony Capital Operating Company, LLC), dated as of October 13, 2017 (incorporated by reference to Exhibit 10.1 to the Company’s Quarterly Report on Form 10-Q filed on November 9, 2017) F-76 Table of Contents Exhibit Number Description 10.4 Amendment No. 3 to the Third Amended and Restated Limited Liability Company Agreement of DigitalBridge Operating Company, LLC (f/k/a Colony Capital Operating Company, LLC), dated as of October 18, 2017 (incorporated by reference to Exhibit 10.2 to the Company’s Quarterly Report on Form 10-Q filed on November 9, 2017) 10.5 Amendment No. 4 to the Third Amended and Restated Limited Liability Company Agreement of DigitalBridge Operating Company, LLC (f/k/a Colony Capital Operating Company, LLC), dated as of November 5, 2018 (incorporated by reference to Exhibit 10.2 to the Company's Quarterly Report on Form 10-Q filed on November 9, 2018) 10.6 Amendment No. 5 to the Third Amended and Restated Limited Liability Company Agreement of DigitalBridge Operating Company, LLC (f/k/a Colony Capital Operating Company, LLC), dated as of July 1, 2021 (incorporated by reference to Exhibit 10.1 to the Company's Quarterly Report on Form 10-Q, filed on August 9, 2021) 10.7† DigitalBridge Group, Inc. 2014 Omnibus Stock Incentive Plan, as amended and restated on August 22, 2022 (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on August 22, 2022) 10.8 Form of Indemnification Agreement, by and between DigitalBridge Group, Inc. (f/k/a Colony NorthStar, Inc.) and the Officers and Directors of DigitalBridge Group, Inc. (incorporated by reference to Exhibit 10.17 to the Company’s Current Report on Form 8-K12B filed on January 10, 2017) 10.9† Amended and Restated Employment Agreement, dated as of December 9, 2022, between DigitalBridge Group, Inc. and Ronald M. Sanders (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on December 22, 2022) 10.10† Employment Agreement, dated as of July 25, 2019, between DigitalBridge Group, Inc. (f/k/a Colony Capital, Inc.) and Marc Ganzi (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on July 30, 2019) 10.11† Form of Restricted Stock Agreement (incorporated by reference to Exhibit 10.8 to the Company’s Quarterly Report on Form 10-Q filed on May 9, 2022) 10.12† Form of Performance Restricted Stock Unit Agreement (incorporated by reference to Exhibit 10.9 to the Company’s Quarterly Report on Form 10-Q filed on May 9, 2022) 10.13 Investment Agreement, dated as of July 7, 2020, by and among Colony Valhalla Partners I-A Holdings, L.P., a Delaware limited partnership, Colony Valhalla Partners I-B Holdings, L.P., a Delaware limited partnership, Colony Valhalla Partners II Holdings, L.P., a Delaware limited partnership, CBRE Caledon Valhalla Aggregator Holdings LP, a Delaware limited partnership and Vantage Data Centers Holdings, LLC, a Delaware limited liability company (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on July 13, 2020) 10.14 Agreement of Purchase and Sale, dated as of April 14, 2022, by and among DigitalBridge Digital IM Holdco, LLC, Wafra Strategic Holdings LP, W-Catalina (B) LLC, W-Catalina (S) LLC, W-Catalina (C) LLC, and, solely with respect to certain sections, DigitalBridge Group, Inc. and DigitalBridge Operating Company, LLC (incorporated by reference to Exhibit 2.1 to the Company's Current Report on Form 8-K filed on April 18, 2022) 10.15 Termination Agreement, dated as of May 23, 2022, by and among DigitalBridge Management Holdings, LLC, DigitalBridge Digital IM Holdco, LLC, DigitalBridge IM Manager, LLC, DigitalBridge Operating Company, LLC, DigitalBridge Group, Inc., Colony DCP (CI) Bermuda, LP, Marc Ganzi, Ben Jenkins, W-Catalina (C) LLC and W-Catalina (S) LLC (incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed on May 24, 2022) 10.16 Registration Rights Agreement, dated as of May 23, 2022, by and between DigitalBridge Group, Inc. and Wafra Strategic Holdings LP (incorporated by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed on May 24, 2022) 10.17 Amended and Restated Carried Interest Participation Agreement, dated as of May 23, 2022, by and among Colony DCP (CI) Bermuda, LP, Colony DCP (CI) GP, LLC, DigitalBridge Operating Company, LLC, DigitalBridge Group, Inc. and W-Catalina (C) LLC (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on May 24, 2022) 10.18† Amended and Restated Restrictive Covenant Agreement, dated as of July 17, 2020, by and between DigitalBridge Group, Inc. (f/k/a Colony Capital, Inc.) and Marc Ganzi (incorporated by reference to Exhibit 10.5 to the Company's Current Report on Form 8-K filed on July 23, 2020) 10.19 Joinder and Amendment to Letter Agreement, dated as of July 22, 2020, by and among Digital Bridge Holdings, LLC, CC Valhalla Investor, LLC, Marc Ganzi, Benjamin Jenkins and the other parties named therein (incorporated by reference to Exhibit 10.11 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2020) 10.20 Assignment and Contribution Agreement, dated as of July 22, 2020, by and among Marc Ganzi, Benjamin Jenkins, MCG Analog, LLC, the Ganzi Extended Family Trust, BJJ Analog, LLC, DB Aviator Manager Rollover Holdings, L.P., DCR YieldCo Holdings, LP and DCR and Aviator Holdings GP, LLC (incorporated by reference to Exhibit 10.12 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2020) 10.21 Amended and Restated Partnership Agreement of DB Aviator Manager Rollover Holdings, L.P., dated as of July 22, 2020, by and among Colony Valhalla GP, LLC, Colony Capital Acquisitions, LLC, MCG Analog, LLC, Ganzi Extended Family Trust, BJJ Analog, LLC and Valhalla Management Holdings, LLC (incorporated by reference to Exhibit 10.13 to the Company's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2020) 10.22† Second Amended and Restated Employment Agreement, dated as of September 27, 2022, between DigitalBridge Group, Inc. and Jacky Wu (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on October 3, 2022) 10.23† Employment Agreement, dated as of May 5, 2021 between DigitalBridge Group, Inc. (f/k/a Colony Capital, Inc.) and Sonia Kim (incorporated by reference to Exhibit 10.8 to the Company’s Quarterly Report on Form 10-Q filed on May 10, 2021) 10.24† Amended and Restated Employment Agreement, dated as of March 28, 2022, between DigitalBridge Group, Inc. and Benjamin J. Jenkins (incorporated by reference to the Company’s Quarterly Report on Form 10-Q filed on May 9, 2022) 10.25† Amended and Restated Employment Agreement, dated as of March 28, 2022, between DigitalBridge Group, Inc. and Liam Stewart (incorporated by reference to the Company’s Quarterly Report on Form 10-Q filed on May 9, 2022) 10.26 Registration Rights Agreement, dated as of January 31, 2018, by and among BrightSpire Capital, Inc. (f/k/a Colony NorthStar Credit Real Estate), Inc., DigitalBridge Operating Company, LLC (f/k/a Colony Capital Operating Company, LLC) and NRF RED REIT Corp. (incorporated by reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on February 1, 2018) 10.27 Amended and Restated Stockholders Agreement, dated as of April 30, 2021, by and between BrightSpire Capital, Inc. (f/k/a Colony Credit Real Estate, Inc.) and DigitalBridge Operating Company, LLC (f/k/a Colony Capital Operating Company, LLC) (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on May 4, 2021) Table of Contents Exhibit Number Description 10.28 Class A-1 Note Purchase Agreement, dated as of July 9, 2021, by and among DigitalBridge Issuer, LLC and DigitalBridge Co-Issuer, LLC, together as Co-Issuers, each of DigitalBridge Holdings 1, LLC, DigitalBridge Holdings 2, LLC and DigitalBridge Holdings 3, LLC, DigitalBridge Guarantor, LLC and DigitalBridge Co-Guarantor, LLC, as Co-Guarantors, Colony Capital Investment Holdco, LLC, as Manager, the conduit investors party thereto, the financial institutions party thereto, certain funding agents, and Barclays Bank PLC, as L/C Provider and Administrative Agent (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on July 15, 2021) 10.29 Amendment No. 1 Class A-1 Note Purchase Agreement, dated as of April 1, 2022, by and among DigitalBridge Issuer, LLC and DigitalBridge Co-Issuer, LLC, together as Co-Issuers, each of DigitalBridge Holdings 1, LLC, DigitalBridge Holdings 2, LLC and DigitalBridge Holdings 3, LLC, together as Asset Entities, DigitalBridge Guarantor, LLC and DigitalBridge Co-Guarantor, LLC, together as Co-Guarantors, DigitalBridge Investment Holdco, LLC, as Manager, the conduit investors party thereto, the financial institutions party thereto, certain funding agents, and Barclays Bank PLC, as L/C Provider and Administrative Agent (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on April 5, 2022) 10.30 The Guarantee and Security Agreement, dated as of July 9, 2021, between DigitalBridge Guarantor, LLC and Citibank, N.A., as Trustee (incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed on July 15, 2021) 10.31 The Guarantee and Security Agreement, dated as of July 9, 2021, between DigitalBridge Co-Guarantor, LLC and Citibank, N.A., as Trustee (incorporated by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed on July 15, 2021) 10.32 Management Agreement, dated as of July 9, 2021, by and among DigitalBridge Issuer, LLC and DigitalBridge Co-Issuer, LLC, together as Co-Issuers, each of DigitalBridge Holdings 1, LLC, DigitalBridge Holdings 2, LLC and DigitalBridge Holdings 3, LLC, DigitalBridge Guarantor, LLC and DigitalBridge Co-Guarantor, LLC, as Co-Guarantors, and Colony Capital Investment Holdco, LLC, as Manager (incorporated by reference to Exhibit 10.4 to the Company's Current Report on Form 8-K filed on July 15, 2021) 10.33 Purchase and Sale Agreement, dated September 6, 2021, between DigitalBridge Operating Company, LLC and CWP Bidco LP (incorporated by reference to Exhibit 2.1 to the Company's Current Report on Form 8-K filed on September 10, 2021) 10.34 Amendment to the Purchase and Sale Agreement, dated February 28, 2022, between DigitalBridge Operating Company, LLC and CWP Bidco LP (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on March 3, 2022) 10.35 Agreement for Sale and Purchase, dated March 25, 2022, between Telenet Group Holding NV and DB SAF Pillar Holdings, LLC (incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on March 31, 2022) 10.36 Amended and Restated Equity Purchase Agreement, by and among AMP Group Holdings Limited, AMP Capital Investors International Holdings Limited, DigitalBridge Operating Company, LLC and DigitalBridge Investment Holdco, LLC, dated as of December 19, 2022 (incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on December 22, 2022) 21.1* List of Subsidiaries of DigitalBridge Group, Inc. 23.1* Consent of Ernst & Young LLP 31.1* Certification of Marc C. Ganzi, Chief Executive Officer, pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 31.2* Certification of Jacky Wu, Chief Financial Officer, pursuant to Rule 13a-14(a)/15d-14(a), as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002 32.1* Certification of Marc C. Ganzi, Chief Executive Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 32.2* Certification of Jacky Wu, Chief Financial Officer, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 101.INS** XBRL Instance Document 101.SCH Inline XBRL Taxonomy Extension Schema 101.CAL Inline XBRL Taxonomy Extension Calculation Linkbase 101.LAB Inline XBRL Taxonomy Extension Label Linkbase 101.PRE Inline XBRL Taxonomy Extension Presentation Linkbase 101.DEF Inline XBRL Taxonomy Extension Definition Linkbase 104** Cover Page Interactive Data File __________ † Denotes a management contract or compensatory plan contract or arrangement. * Filed herewith. ** The document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL document. *** Schedules and exhibits to such agreement have been omitted from this filing pursuant to Item 601(a)(5) of Regulation S-K. The Registrant will furnish copies of such schedules and exhibits to the SEC upon request. Table of Contents SIGNATURES Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. Dated: February 27, 2023 DigitalBridge Group, Inc. By: /s/ Marc C. Ganzi Marc C. Ganzi Chief Executive Officer (Principal Executive Officer) Table of Contents POWER OF ATTORNEY KNOW ALL PERSONS BY THESE PRESENTS, that each person whose signature appears below constitutes and appoints Jacky Wu and Ronald M. Sanders and each of them severally, her or his true and lawful attorney-in-fact with power of substitution and re-substitution to sign in her or his name, place and stead, in any and all capacities, to do any and all things and execute any and all instruments that such attorney may deem necessary or advisable under the Securities Exchange Act of 1934 and any rules, regulations and requirements of the U.S. Securities and Exchange Commission in connection with this Annual Report on Form 10-K and any and all amendments hereto, as fully for all intents and purposes as she or he might or could do in person, and hereby ratifies and confirms all said attorneys-in-fact and agents, each acting alone, and her or his substitute or substitutes, may lawfully do or cause to be done by virtue hereof. Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, this report has been signed below on behalf of the Registrant in the capacities and on the dates indicated. Signature Title Date /s/ Marc C. Ganzi Chief Executive Officer (Principal Executive Officer) February 27, 2023 Marc C. Ganzi /s/ Jacky Wu Chief Financial Officer (Principal Financial Officer) February 27, 2023 Jacky Wu /s/ Sonia Kim Chief Accounting Officer (Principal Accounting Officer) February 27, 2023 Sonia Kim /s/ Nancy A. Curtin Director February 27, 2023 Nancy A. Curtin /s/ J. Braxton Carter Director February 27, 2023 J. Braxton Carter /s/ Jeannie H. Diefenderfer Director February 27, 2023 Jeannie H. Diefenderfer /s/ Jon A. Fosheim Director February 27, 2023 Jon A. Fosheim /s/ Gregory J. McCray Director February 27, 2023 Gregory J. McCray /s/ Sháka Rasheed Director February 27, 2023 Sháka Rasheed /s/ Dale Anne Reiss Director February 27, 2023 Dale Anne Reiss /s/ David M. Tolley Director February 27, 2023 David M. Tolley