What changed in this filing

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Item 1. Financial Statements

2023-11-03 compared with 2023-08-04 · 331 added, 263 removed, 1404 unchanged (30% of the section changed)

3 unchanged sentences

(In thousands, except per share data)

June 30, 2023 (unaudited)

September 30, 2023 (unaudited)

December 31, 2022

46 unchanged sentences

$ 6,872,091 $ 11,028,503

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

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

DigitalBridge Group, Inc.

2 unchanged sentences

Investment Management Operating Corporate and Other

June 30, 2023 December 31, 2022 June 30, 2023 December 31, 2022 June 30, 2023 December 31, 2022

September 30, 2023 December 31, 2022 September 30, 2023 December 31, 2022 September 30, 2023 December 31, 2022

Cash and cash equivalents $ 62,212 $ 39,563 $ 59,982 $ 65,975 $ 311,850 $ 812,716

12 unchanged sentences

67,424 41,458 — — 2,271 3,902

Assets held for disposition (Note 2) (1)

$ 1,308,794 $ 875,422 $ 3,885,481 $ 8,149,171 $ 1,673,834 $ 1,728,390

$ 1,177,526 $ 875,422 $ 8,372,542 $ 8,149,171 $ 1,201,889 $ 1,728,390

Corporate debt (Note 8)

6 unchanged sentences

369,772 342,696 118,977 725,236 179,823 204,164

Liabilities related to assets held for disposition (Note 2) (1)

$ 569,517 $ 541,373 $ 2,991,946 $ 5,411,945 $ 285,115 $ 504,742

$ 488,955 $ 541,373 $ 5,804,798 $ 5,411,945 $ 302,215 $ 504,742

Redeemable noncontrolling interests (Note 10)

3 unchanged sentences

(1) Excludes amounts related to assets held for disposition in connection with discontinued operations.

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

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

DigitalBridge Group, Inc.

1 unchanged sentence

(In thousands, except per share data)

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

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

2 unchanged sentences

Carried interest allocation 168,891 121,698 193,389 201,398

Principal investment income (loss) 30,409 16,444 33,971 22,898

Principal investment income 17,943 11,531 51,914 34,429

Property operating income 214,058 244,336 679,738 681,098

25 unchanged sentences

Preferred stock dividends 14,645 15,283 43,996 46,801

Preferred stock repurchases/redemptions (Note 9)

Preferred stock repurchases

— ( 1,098 ) ( 927 ) ( 1,098 )

11 unchanged sentences

$ 0.01 $ 0.01 $ 0.03 $ 0.01

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

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

DigitalBridge Group, Inc.

2 unchanged sentences

Investment Management Operating Corporate and Other

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

Three Months Ended September 30, Three Months Ended September 30, Three Months Ended September 30,

2023 2022 2023 2022 2023 2022

2 unchanged sentences

Carried interest allocation 168,891 121,698 — — — —

Principal investment income (loss) 1,604 1,016 — — 28,805 15,428

Principal investment income 1,451 1,016 — — 16,492 10,515

Property operating income (Note 5)

22 unchanged sentences

$ 52,391 $ 24,233 $ ( 10,191 ) $ ( 15,881 ) $ 236,642 $ 16,909

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

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

DigitalBridge Group, Inc.

2 unchanged sentences

Investment Management Operating Corporate and Other

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

Nine Months Ended September 30, Nine Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022 2023 2022

2 unchanged sentences

Carried interest allocation 193,389 201,398 — — — —

Principal investment income (loss) 1,922 1,033 — — 32,049 21,865

Principal investment income 3,373 2,049 — — 48,541 32,380

Property operating income (Note 5)

22 unchanged sentences

$ 50,502 $ 37,900 $ ( 31,489 ) $ ( 43,512 ) $ 70,697 $ ( 152,026 )

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

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

DigitalBridge Group, Inc.

1 unchanged sentence

(In thousands)

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

Three Months Ended September 30, Nine Months Ended September 30,

2023 2022 2023 2022

12 unchanged sentences

Comprehensive income (loss) attributable to stockholders $ 274,499 $ ( 54,600 ) $ 70,654 $ ( 363,770 )

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

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

DigitalBridge Group, Inc.

30 unchanged sentences

— — — — — — 4,087 — 4,087

Deconsolidation of investment entities (Note 18)

Deconsolidation of investment entities

— — — — — — 11,047 — 11,047

8 unchanged sentences

Balance at June 30, 2022 $ 854,232 $ 6,564 $ 7,646,852 $ ( 6,875,817 ) $ 1,455 $ 1,633,286 $ 2,870,528 $ 57,705 $ 4,561,519

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

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

DigitalBridge Group, Inc.

2 unchanged sentences

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 June 30, 2022 $ 854,232 $ 6,564 $ 7,646,852 $ ( 6,875,817 ) $ 1,455 $ 1,633,286 $ 2,870,528 $ 57,705 $ 4,561,519

Net loss — — — ( 49,088 ) — ( 49,088 ) ( 60,623 ) ( 4,834 ) ( 114,545 )

Other comprehensive loss — — — — ( 5,512 ) ( 5,512 ) ( 19,587 ) ( 425 ) ( 25,524 )

Stock repurchases (Note 9)

( 53,877 ) ( 38 ) ( 12,476 ) — — ( 66,391 ) — — ( 66,391 )

DataBank recapitalization (Note 10)

— — 170,770 — — 170,770 ( 170,770 ) — —

Equity-based compensation — 2 9,867 — — 9,869 8,861 311 19,041

Shares canceled for tax withholdings on vested equity awards — ( 2 ) ( 1,533 ) — — ( 1,535 ) — — ( 1,535 )

Cost of DataBank recapitalization — — ( 8,749 ) — — ( 8,749 ) ( 21,247 ) — ( 29,996 )

Contributions from noncontrolling interests — — — — — — 1,502,454 — 1,502,454

Distributions to noncontrolling interests — — — — — — ( 1,219,454 ) ( 127 ) ( 1,219,581 )

Preferred stock dividends — — — ( 15,117 ) — ( 15,117 ) — — ( 15,117 )

Common stock dividends declared ($ 0.01 per share)

— — — ( 1,636 ) — ( 1,636 ) — — ( 1,636 )

Reallocation of equity (Notes 2 and 10)

— — ( 11,239 ) — 1 ( 11,238 ) — 11,238 —

Balance at September 30, 2022 $ 800,355 $ 6,526 $ 7,793,492 $ ( 6,941,658 ) $ ( 4,056 ) $ 1,654,659 $ 2,890,162 $ 63,868 $ 4,608,689

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

DigitalBridge Group, Inc.

Consolidated Statements of Equity (Continued)

(In thousands, except per share data)

Balance at December 31, 2022

28 unchanged sentences

— — — ( 1,622 ) — ( 1,622 ) — — ( 1,622 )

Reallocation of equity (Note 2)

Reallocation of equity (Notes 2 and 10)

— — ( 385 ) — 18 ( 367 ) ( 844 ) 1,211 —

Balance at June 30, 2023 $ 794,670 $ 1,626 $ 7,846,440 $ ( 7,201,651 ) $ 1,122 $ 1,442,207 $ 2,639,606 $ 47,198 $ 4,129,011

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

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

DigitalBridge Group, Inc.

Consolidated Statements of Equity (Continued)

(In thousands, except per share data)

Balance at June 30, 2023 $ 794,670 $ 1,626 $ 7,846,440 $ ( 7,201,651 ) $ 1,122 $ 1,442,207 $ 2,639,606 $ 47,198 $ 4,129,011

Net income (loss) — — — 276,473 — 276,473 ( 17,746 ) 19,918 278,645

Other comprehensive income (loss) — — — — ( 1,974 ) ( 1,974 ) 21 ( 93 ) ( 2,046 )

DataBank recapitalization (Note 10)

— — ( 14,791 ) — — ( 14,791 ) 33,001 — 18,210

DataBank deconsolidation (Note 10)

— — — — 965 965 ( 1,427,435 ) — ( 1,426,470 )

Equity-based compensation — 12 11,023 — — 11,035 3,934 41 15,010

Shares canceled for tax withholdings on vested equity awards — ( 4 ) ( 7,955 ) — — ( 7,959 ) — — ( 7,959 )

Contributions from noncontrolling interests — — — — — — 26,907 — 26,907

Distributions to noncontrolling interests — — — — — — ( 16,732 ) ( 124 ) ( 16,856 )

Preferred stock dividends — — — ( 14,660 ) — ( 14,660 ) — — ( 14,660 )

Common stock dividends declared ($ 0.01 per share)

— — — ( 1,632 ) — ( 1,632 ) — — ( 1,632 )

Reallocation of equity (Notes 2 and 10)

— — 1,109 — — 1,109 — ( 1,109 ) —

Balance at September 30, 2023 $ 794,670 $ 1,634 $ 7,835,826 $ ( 6,941,470 ) $ 113 $ 1,690,773 $ 1,241,556 $ 65,831 $ 2,998,160

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

DigitalBridge Group, Inc.

Consolidated Statements of Cash Flows

(In thousands)

Six Months Ended June 30,

Nine Months Ended September 30,

Cash Flows from Operating Activities

5 unchanged sentences

Amortization of deferred financing costs and debt discount and premium, net 19,755 102,943

Carried interest (allocation) reversal ( 24,498 ) ( 79,700 )

Principal investment (income) loss ( 33,971 ) ( 22,898 )

Unrealized carried interest allocation ( 165,462 ) ( 105,500 )

Unrealized principal investment income ( 51,914 ) ( 34,429 )

Other equity method (earnings) losses 13,283 37,502

Distributions of income from equity method investments 3,727 1,105

Impairment of real estate and related intangibles and right-of-use ("ROU") asset — 35,985

Impairment of real estate and intangible assets — 35,985

Depreciation and amortization 419,136 431,852

1 unchanged sentence

Deferred income tax (benefit) expense ( 868 ) ( 14,794 )

Loss on extinguishment of debt — 133,173

Loss on debt extinguishment — 133,173

Other gain (loss), net ( 102,941 ) 29,287

13 unchanged sentences

Acquisition of and additions to real estate, related intangibles and leasing commissions ( 613,109 ) ( 1,952,718 )

Cash transferred to buyer in sale of real estate, net of proceeds received — ( 92,793 )

Proceeds from sales of real estate investment holding entities — 96,660

Cash and restricted cash assumed by buyer in sales of real estate investment holding entities — ( 189,453 )

Investment deposits ( 2,208 ) 1,051

2 unchanged sentences

( 314,266 ) —

Cash and restricted cash derecognized in DataBank deconsolidation

( 102,448 ) —

Proceeds from DataBank recapitalization, net of carried interest distribution

Other investing activities, net — ( 769 )

3 unchanged sentences

(In thousands)

Six Months Ended June 30,

Nine Months Ended September 30,

Cash Flows from Financing Activities

1 unchanged sentence

Dividends paid to common stockholders ( 4,838 ) —

Repurchases of common stock — ( 8,008 )

Borrowings on corporate debt — 290,000

Repayments of corporate debt, including repurchase of senior notes ( 200,000 ) ( 214,237 )

Repayments of corporate debt, including senior notes ( 200,000 ) ( 304,237 )

Borrowings from investment level debt

5 unchanged sentences

Distributions to and redemptions of noncontrolling interests ( 144,534 ) ( 1,684,752 )

Payment of contingent consideration to Wafra (Note 10)

Redemptions/repurchases of preferred stock ( 4,758 ) —

Payment of contingent consideration to Wafra

Repurchases of preferred stock ( 4,758 ) ( 52,779 )

Shares canceled for tax withholdings on vested equity awards ( 18,176 ) ( 18,012 )

8 unchanged sentences

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

Six Months Ended June 30,

Nine Months Ended September 30,

Beginning of the period

7 unchanged sentences

Total cash, cash equivalents and restricted cash, end of period $ 538,670 $ 770,390

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

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

DigitalBridge Group, Inc.

Notes to Consolidated Financial Statements

June 30, 2023

September 30, 2023

Business and Organization

4 unchanged sentences

In February 2023, the Company further expanded its investment offerings to encompass InfraBridge, a newly-acquired mid-market global infrastructure equity platform (Note 3).

In September 2023, the Company completed a recapitalization of its portfolio company, DataBank, an edge colocation data center business.

As a result of an additional sell down of the Company's ownership interest in DataBank in the final closing of the recapitalization, the Company was determined to no longer hold a controlling financial interest in DataBank and deconsolidated DataBank upon completion of the recapitalization on September 14, 2023 (Note 10).

The Company operates as a taxable C Corporation commencing with the taxable year ended December 31, 2022, except for certain subsidiaries in the Operating segment that have elected to be taxed as real estate investment trusts for U.S.

1 unchanged sentence

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

At June 30, 2023, the Company owned 93 % of the OP , as its sole managing member.

At September 30, 2023, 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.

17 unchanged sentences

• Segregation of the Investment Management segment allows for more clarity and visibility into the financial performance and financial position of the Company's core business;

• The Operating segment represents the consolidation of two data center portfolio companies for which the Company has direct co-investments of 13 % and 11 %, respectively, at both June 30, 2023 and December 31, 2022.

Although the Operating segment makes up a majority of the balances and activities on a consolidated basis, DBRG's exposure and entitlement are limited to its 13 % and 11 % interest in the two portfolio companies in the Operating segment.

The liabilities of the Operating segment are obligations of the respective portfolio companies of the Operating segment and may only be settled using assets of these respective portfolio companies.

• The Operating segment represents the consolidation of data center portfolio companies for which the Company has direct co-investments.

This is represented by the consolidation of two portfolio companies up to mid-September 2023, after which the DataBank portfolio company was deconsolidated.

The Company's direct co-investment in the remaining portfolio company was 13 % at September 30, 2023 and December 31, 2022, while its ownership in DataBank was 11 % at December 31, 2022 and through the final close of the recapitalization in mid-September 2023, thereafter the Company's remaining 9.87 % interest in DataBank is presented within Corporate and Other (Note 10).

Although the Operating segment makes up a majority of the balances and activities on a consolidated basis, DBRG's exposure and entitlement are limited to its ownership interest in the portfolio companies in the Operating segment.

The liabilities of the Operating segment are obligations of the portfolio companies of the Operating segment and may only be settled using assets of the portfolio companies.

The supplemental schedule to the consolidated balance sheets excludes assets and liabilities held for disposition that are related to discontinued operations, and stockholders' equity and noncontrolling interests in OP, as these equity items are not specifically attributable to reportable segments.

26 unchanged sentences

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.

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 deconsolidation depending on the carrying values of deconsolidated assets and liabilities compared to the fair value of any interests retained.

2 unchanged sentences

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.

Prior to full redemption in May 2022, there was also redeemable noncontrolling interests in the Company's investment management business, as discussed further in Note 10.

Redeemable noncontrolling interests is presented outside of permanent equity.

2 unchanged sentences

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

The redeemable noncontrolling interests in the Company's investment management business were 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).

12 unchanged sentences

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.

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 at the end of May 2022 (as discussed further in Note 10).

• Operating— This segment is composed of balance sheet equity interests in digital infrastructure and real estate co-investment 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 June 30, 2023 and December 31, 2022);

and Vantage SDC, a stabilized hyperscale data center business (DBRG ownership of 13% at June 30, 2023 and December 31, 2022).

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 amount of incentive fees and carried interest recognized, a portion of which is allocated to employees and former employees, may be highly variable from period to period.

Earnings from the Investment Management segment were attributed 31.5 % to affiliates of Wafra, Inc.

(collectively, "Wafra"), a private investment firm, prior to the Company's redemption of Wafra's interest in the investment management business at the end of May 2022 (Note 10).

• Operating— This segment is composed of balance sheet equity interests in digital infrastructure portfolio companies, which generally earn rental income from providing use of digital asset space and/or capacity through

leases, services and other agreements.

The Company owned interests in two portfolio companies:

Vantage SDC, a stabilized hyperscale data center business (DBRG ownership of 13% at September 30, 2023 and December 31, 2022), and DataBank, an edge colocation data center business (DBRG ownership of 11% at December 31, 2022 and through the final close of the recapitalization and deconsolidation in mid-September 2023;

thereafter, the Company's remaining 9.87% interest in DataBank is presented within Corporate and Other) (Note 10).

DataBank and Vantage SDC are portfolio companies managed by the Company under its Investment Management segment with respect to equity interests funded through 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) sponsored investment vehicles, primarily the DigitalBridge Partners ("DBP") flagship funds and InfraBridge funds, and seed investments in liquid securities and other potential new strategies;

(i) sponsored investment vehicles, primarily the DigitalBridge Partners ("DBP") flagship funds, InfraBridge funds and funds invested in DataBank, and seed investments in liquid securities and other potential new strategies;

and (ii) remaining non-digital investments.

Outside of its general partner interests, which are presented in the Investment Management segment, the Company's other equity interests in its sponsored and/or managed 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 allocation 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 from sponsored funds.

Outside of its general partner interests, which are presented in the Investment Management segment, the Company's other equity interests in its sponsored and/or managed investment vehicles as general partner affiliate are considered to be incidental to its investment management business.

With respect to seed investments, these are not intended to be a long-term deployment of capital by the Company and are warehoused on the Company's balance sheet potentially until such time that sufficient third party capital has been raised from sponsored funds.

Remaining non-digital investments are composed of a marketable equity security, and equity interest in a non-traded REIT that is not available for immediate sale (Note 11).

These other investment activities generate largely principal investment income or losses, and to a lesser extent, revenues in the form of dividend income from consolidated investment vehicles and non-digital investments.

• 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.

These other investment activities generate largely principal investment income from sponsored funds, and to a lesser extent, revenues in the form of dividend income from consolidated investment vehicles and non-digital investments.

• 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 corporate use, compensation expense not directly attributable to the Investment Management segment, 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 the Investment Management segment.

For all periods presented prior to its deconsolidation on September 14, 2023 (Note 10), the consolidated results of operations of DataBank was included in the Operating segment as it represented the activities of a consolidated portfolio company that directly holds and operates digital infrastructure assets.

The Operating segment continues to be a separate reporting segment that reflects the results of operations of Vantage SDC, the Company's remaining consolidated portfolio company.

Subsequent to deconsolidation, the Company's retained interest in DataBank that is held through a sponsored investment vehicle is treated as an equity method investment for which the Company accounts only for its share of changes in the fair value of DataBank, and is presented in Corporate and Other, consistent with the treatment and presentation of the Company's interests as general partner affiliate in its other sponsored investment vehicles.

Accordingly, the change in segment presentation as a result of deconsolidating DataBank does not represent a change in reporting segments and as a result, there is no change to prior period segment presentation as it relates to the Company's interest in DataBank.

The results of operations of the Company's reportable segments are presented in the supplemental schedules to the consolidated statements of operations and reconciled to the consolidated statements of operations as follows:

Three Months Ended June 30, 2023 Three Months Ended June 30, 2022

Three Months Ended September 30, 2023 Three Months Ended September 30, 2022

(In thousands) Investment Management Operating Corporate and Other Total Investment Management Operating Corporate and Other Total

Income (Loss) from continuing operations attributable to DigitalBridge Group, Inc.

$ 309 $ ( 10,509 ) $ 5,204 $ ( 4,996 ) $ 21,269 $ ( 14,807 ) $ ( 24,164 ) $ ( 17,702 )

Income (Loss) from discontinued operations attributable to DigitalBridge Group, Inc.

( 3,667 ) ( 3,860 )

Income (Loss) attributable to DigitalBridge Group, Inc.

Continuing operations $ 52,391 $ ( 10,191 ) $ 236,642 $ 278,842 $ 24,233 $ ( 15,881 ) $ 16,909 $ 25,261

Discontinued operations ( 2,369 ) ( 74,349 )

Net income (loss) attributable to DigitalBridge Group, Inc.

$ 276,473 $ ( 49,088 )

Six Months Ended June 30, 2023 Six Months Ended June 30, 2022

Nine Months Ended September 30, 2023 Nine Months Ended September 30, 2022

(In thousands) Investment Management Operating Corporate and Other Total Investment Management Operating Corporate and Other Total

Income (Loss) from continuing operations attributable to DigitalBridge Group, Inc.

$ ( 1,889 ) $ ( 21,298 ) $ ( 165,945 ) $ ( 189,132 ) $ 13,667 $ ( 27,631 ) $ ( 168,935 ) $ ( 182,899 )

Income (Loss) from discontinued operations attributable to DigitalBridge Group, Inc.

( 17,328 ) ( 85,220 )

Income (Loss) attributable to DigitalBridge Group, Inc.

Continuing operations $ 50,502 $ ( 31,489 ) $ 70,697 $ 89,710 $ 37,900 $ ( 43,512 ) $ ( 152,026 ) $ ( 157,638 )

Discontinued operations ( 19,697 ) ( 159,569 )

Net income (loss) attributable to DigitalBridge Group, Inc.

4 unchanged sentences

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.

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.

17 unchanged sentences

BRSP) of approximately 35.0 million shares for net proceeds totaling $ 201.6 million.

The Company's investment in BRSP qualified as held for sale in March 2023 and its disposition represents a strategic shift that has major effects on the Company’s operations and financial results, meeting the criteria as discontinued operations as of March 2023.

The Company's investment in BRSP

qualified as held for sale in March 2023 and its disposition represents a strategic shift that has major effects on the Company’s operations and financial results, meeting the criteria as discontinued operations as of March 2023.

Accordingly, for all prior periods presented, the equity method investment in BRSP is presented as assets held for disposition on the consolidated balance sheets and equity method earnings (loss) from BRSP is presented as loss from discontinued operations on the consolidated statements of operations.

4 unchanged sentences

Loss from discontinued operations is summarized as follows.

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

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands) 2023 2022 2023 2022

4 unchanged sentences

Income (Loss) from discontinued operations ( 2,603 ) ( 90,302 ) ( 20,799 ) ( 188,735 )

Income (Loss) from discontinued operations attributable to noncontrolling interests:

Investment entities ( 55 ) ( 10,227 ) 437 ( 16,016 )

5 unchanged sentences

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.

Assets and related liabilities held for disposition are summarized below.

Primarily, these are composed of:

(i) at June 30, 2023, DataBank's French portfolio of five colocation data centers which are classified as held for disposition effective April 2023;

and (ii) at December 31, 2022, shares in BRSP valued at $ 218.0 million that were sold in March 2023, and an equity method investment carried under the fair value option prior to a sale of the investee's underlying assets and a return of capital to the Company in January 2023.

Both periods also include miscellaneous equity investments excluded from the December 2021 bulk sale of the Company's non-digital investments.

Except for the DataBank portfolio, all assets and related liabilities held for disposition relate to discontinued operations.

(In thousands) June 30, 2023 December 31, 2022

Assets held for disposition

Real estate $ 30,399 $ —

Investments 5,108 275,381

Intangibles and other assets 18,007 139

$ 53,514 $ 275,520

Liabilities related to assets held for disposition

Lease intangibles and other liabilities $ 12,954 $ 380

At September 30, 2023 and December 31, 2022, all assets and related liabilities held for disposition relate to discontinued operations.

Assets held for disposition of $ 4.0 million at September 30, 2023 consisted of equity investments excluded from the December 2021 bulk sale of the Company's non-digital investments.

Additionally, at December 31, 2022, assets held for disposition of $ 275.5 million also included shares in BRSP of $ 218.0 million that were sold in March 2023 and an equity method investment carried under the fair value option of $ 44.5 million prior to a sale of its underlying assets and a return of capital to the Company in January 2023.

Reclassifications

Reclassifications have been made in connection with discontinued operations, as discussed in "— Discontinued Operations.

" Additionally, the Company determined that principal investment income (loss) from its equity interest as general partner and general partner affiliate in its sponsored investment vehicles, and its entitlement to carried interest allocation, represent a core component of returns in its investment management business.

Accordingly, beginning in 2023, principal investment income (loss) and carried interest allocation are presented within total revenues on the consolidated statements of operations.

" Additionally, the Company determined that principal investment income from its equity interest as general partner and general partner affiliate in its sponsored investment vehicles, and its entitlement to carried interest allocation, represent a core component of returns in its investment management business.

Accordingly, beginning in 2023, principal investment income and carried interest allocation are presented within total revenues on the consolidated statements of operations.

Prior periods have been reclassified to conform to current presentation.

1 unchanged sentence

Contractual Sale Restriction on Equity Securities

In June 2022, the Financial Accounting Standards Board issued Accounting Standards Update ("ASU") 2022-03, Fair Value Measurement of Equity Securities Subject to Contractual Sale Restrictions , which amends Accounting Standards Codification ("ASC") Topic 820, Fair Valu e Measurement, 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.

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.

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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.

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.

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The purchase price allocation is provisional and will be finalized through the one year measurement period.

In the second quarter of 2023, certain adjustments were identified that affected the provisional accounting, as presented below.

In the second and third quarters of 2023, certain adjustments were identified that affected the provisional accounting, as presented below.

These were adjustments to net working capital and to the value of acquired interest in an InfraBridge fund based upon a revised net asset value ("NAV") of the fund, applying new information about facts and circumstances that existed at the time of acquisition.

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At March 30, 2023 Measurement Period Adjustments As Revised

At June 30, 2023

At September 30, 2023

Consideration

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$ 375,212 $ 376,314

• Principal investments represent acquired interests in InfraBridge funds, valued at their most recent NAV at closing.

• Principal investments represent acquired interests in InfraBridge funds, valued at their most recent net asset value ("NAV") at closing.

• The investment management intangible assets of InfraBridge were composed of the following:

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Asset Acquisitions

Acquisitions by DataBank were as follows:

Acquisitions by DataBank, prior to its deconsolidation in September 2023 (Note 10), were as follows:

• A building in Dallas, Texas in May 2023, for purchase price of $ 151.0 million, funded by a combination of $ 121.0 million of debt and $ 40.8 million of equity, of which the Company's share was $ 8.2 million.

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In connection with the Company's acquisition of Vantage SDC in July 2020 and an additional data center in September 2021, the Company and its co-investors 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 June 30, 2023, the remaining consideration for the incremental lease-up acquisitions is estimated to be approximately $ 185 million, of which $ 122 million is due by September 2024.

Most, if not all, of the cost of the expansion capacity has been or is expected to be funded by Vantage SDC from borrowings under its credit facilities and/or cash from operations.

Pursuant to this arrangement, Vantage SDC had 15 new tenant leases related to a portion of the expansion capacity that commenced during 2022, respectively, for aggregate consideration of $ 161.3 million.

As of September 30, 2023, the remaining consideration for the incremental lease-up acquisitions is estimated to be approximately $ 163 million, of which $ 122 million is due by September 2024.

Most, if not all, of the cost of the expansion capacity has been or is expected to be funded by Vantage SDC from borrowings under its credit facilities, cash from operations and/or potential capital raise.

Pursuant to this arrangement, Vantage SDC had one new tenant lease that commenced in 2023, and 15 new tenant leases that commenced in 2022 related to a portion of the expansion capacity for aggregate consideration of $ 31.6 million and $ 161.3 million, respectively.

All of these payments were made to the previous owners of Vantage SDC and are treated as asset acquisitions.

There were no new tenant leases that commenced in 2023.

In June 2022, the Company acquired the mobile telecommunications tower business (“TowerCo”) of Telenet Group Holding NV (Euronext Brussels:

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The following table summarizes the allocation of cash consideration to assets acquired, which includes capitalized transaction costs.

(In thousands) Acquisition by DataBank TowerCo Acquisitions by DataBank Vantage SDC Expansion Capacity

(In thousands) Acquisition by DataBank

(prior to deconsolidation) Vantage SDC Expansion Capacity TowerCo Acquisitions by DataBank Vantage SDC Expansion Capacity

Purchase price allocation

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The Company's equity and debt investments are represented by the following:

(In thousands) June 30, 2023 December 31, 2022

(In thousands) September 30, 2023 December 31, 2022

Investment Management

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Principal Investments

Principal investments totaling $ 598.5 million at June 30, 2023 and $ 410.5 million at December 31, 2022 represent investments in the Company's sponsored investment vehicles, accounted for as equity method investments as the Company exerts significant influence in its role as general partner.

The Company typically has a small percentage interest in its sponsored funds as general partner (presented in the Investment Management segment).

The Company also has additional investment as general partner affiliate alongside the funds' limited partners, primarily with respect to the Company's flagship value-add funds, DigitalBridge Partners, LP ("DBP I") and DigitalBridge Partners II, LP ("DBP II"), and the InfraBridge funds (presented within Corporate and Other).

The Company's proportionate share of net income (loss) from investments in its sponsored investment vehicles, which includes unrealized gain (loss) from changes in fair value of the underlying fund investments, is recorded in principal investment income (loss) on the consolidated statements of operations.

Principal investments totaling $ 1.05 billion at September 30, 2023 and $ 410.5 million at December 31, 2022 represent investments in the Company's sponsored investment vehicles, accounted for as equity method investments as the Company exerts significant influence in its role as general partner.

The Company typically has a small percentage interest in its sponsored funds as general partner or special limited partner (presented in the Investment Management segment).

The Company also has additional investment as general partner affiliate alongside the funds' limited partners, primarily with respect to the Company's flagship value-add funds, DigitalBridge Partners, LP ("DBP I") and DigitalBridge Partners II, LP ("DBP II"), InfraBridge funds and funds invested in DataBank (presented within Corporate and Other).

Carried Interest Allocation

Carried interest allocation represents a disproportionate allocation of returns to the Company, as general partner, based upon the extent to which cumulative performance of a sponsored fund exceeds minimum return hurdles.

Carried interest allocation represents a disproportionate allocation of returns to the Company, as general partner or special limited partner (which may be paid to the special limited partner entity owned by the Company in place of the general partner entity), based upon the extent to which cumulative performance of a sponsored fund exceeds minimum return hurdles.

Carried interest allocation 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.

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Carried interest allocation is presented gross of accrued carried interest compensation (Note 7).

Carried Interest Allocation Distributed

There was immaterial carried interest allocation distributed and recognized in revenues in 2023.

No carried interest allocation was distributed in the first six months of 2022.

Carried Interest Distributed

During the three and nine months ended September 30, 2023, carried interest of $ 27.9 million and $ 28.4 million, respectively, were distributed and recognized in carried interest allocations, of which $ 0.8 million of the distributed carried interest in the nine months ended September 30, 2023 was allocated to current and former employees and to Wafra (Note 10), and recorded as carried interest compensation, other loss, and amounts attributable to noncontrolling interests (Note 16).

During the three and nine months ended September 30, 2022, carried interest of $ 123.5 million (including $ 51.2 million that had been previously accrued) was distributed and recognized in carried interest allocations, of which $ 103.2 million of the distributed carried interest (including $ 45.9 million that had been previously accrued) was allocated to current and former employees and to Wafra, and recorded as carried interest compensation and amounts attributable to noncontrolling interests.

Clawback Obligation

The Company did not have a liability for clawback obligations on carried interest allocation distributed to-date as of June 30, 2023 and December 31, 2022.

With respect to funds that have distributed carried interest allocation, if in the event all of their investments are deemed to have no value, the likelihood of which is remote, carried interest allocation distributed of $ 75.6 million would be subject to clawback as of June 30, 2023, of which $ 59.2 million would be the responsibility of the employee and former employee recipients.

For this purpose, a portion of the carried interest allocation is generally held back from these recipients at the time of distribution.

The Company did not have a liability for clawback obligations on carried interest allocation distributed to-date as of September 30, 2023 and December 31, 2022.

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 distributed of $ 180.9 million would be subject to clawback as of September 30, 2023, of which $ 116.5 million would be the responsibility of the employee and former employee recipients.

For this purpose, a portion of the carried interest is generally held back from these recipients at the time of distribution.

The amount withheld resides in entities outside of the Company.

Generally, the Company, through the OP, has guaranteed the clawback obligation of its subsidiaries that act as general partner or special limited partner of its respective sponsored funds, for the benefit of these funds and their limited partners.

Equity Investments of Consolidated Funds

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Other Equity Investments

Other equity investments totaling $ 101.3 million at June 30, 2023 and $ 115.0 million at December 31, 2022 include investments warehoused potentially for future sponsored funds, a marketable equity security and equity interest in a non-traded REIT (Note 11) (presented within Corporate and Other), as well as an investment in a managed account (presented in the Investment Management segment).

Other equity investments totaling $ 94.2 million at September 30, 2023 and $ 115.0 million at December 31, 2022 include investments warehoused potentially for future sponsored funds, a marketable equity security and equity interest in a non-traded REIT (Note 11) (presented within Corporate and Other), as well as an investment in a managed account (presented in the Investment Management segment).

These investments are generally carried at fair value or under the measurement alternative, which is at cost, adjusted for impairment and observable price changes.

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(in thousands) Gains Losses Fair Value

At June 30, 2023 and December 31, 2022 $ 50,927 $ — $ — $ — $ 50,927

At September 30, 2023 and December 31, 2022 $ 50,927 $ — $ — $ — $ 50,927

In estimating fair value of the CLO subordinated notes, the Company used a benchmarking approach by looking to the implied credit spreads derived from observed prices on recent comparable CLO issuances, and also considering the current size and diversification of the CLO collateral pool, and projected return on the subordinated notes.

Based upon these data points, the Company determined that the issued price of the subordinated notes in September 2022 was a reasonable representation of their fair value at June 30, 2023 and December 31, 2022, classified as Level 3 of the fair value hierarchy.

Based upon these data points, the Company determined that the issued price of the subordinated notes in September 2022 was a reasonable representation of their fair value at September 30, 2023 and December 31, 2022, classified as Level 3 of the fair value hierarchy.

Loans Receivable

At June 30, 2023, there was no outstanding balance on loans receivable.

At September 30, 2023, there was no outstanding balance on loans receivable.

Activities in the loans receivable balance is discussed further in Note 11.

In September 2023, the Company deconsolidated DataBank.

All real estate related amounts in 2023 below reflect the effect of the deconsolidation.

The following table summarizes the Company's real estate held for investment by subsidiaries in the Operating segment.

(In thousands) June 30, 2023 December 31, 2022

(In thousands) September 30, 2023 December 31, 2022

Land $ 117,409 $ 257,588

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Real Estate Depreciation

Depreciation of real estate held for investment was $ 94.3 million and $ 87.3 million for the three months ended June 30, 2023 and 2022, respectively, and $ 186.7 million and $ 166.4 million for the six months ended June 30, 2023 and 2022.

Depreciation of real estate held for investment was $ 86.2 million and $ 91.3 million for the three months ended September 30, 2023 and 2022, respectively, and $ 272.9 million and $ 257.7 million for the nine months ended September 30, 2023 and 2022.

Property Operating Income

Components of property operating income are as follows.

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

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands) 2023 2022 2023 2022

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$ 214,058 $ 244,336 $ 679,738 $ 681,098

For the six months ended June 30, 2023 and 2022, property operating income from a single customer accounted for approximately 16 % and 15 %, respectively, of the Company's total revenues from continuing operations, or approximately 6 % and 7 %, respectively, of the Company's share of total revenues from continuing operations, net of amounts attributable to noncontrolling interests in investment entities.

Commitment for 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.

To-date, DataBank has funded $ 9.4 million.

For both the nine months ended September 30, 2023 and 2022, property operating income from a single customer accounted for approximately 14 % of the Company's total revenues from continuing operations, or approximately 5 % of the Company's share of total revenues from continuing operations, net of amounts attributable to noncontrolling interests in investment entities.

Goodwill, Deferred Leasing Costs and Other Intangibles

The following table presents changes in goodwill by reportable segment.

Six Months Ended June 30,

Nine Months Ended September 30,

(In thousands) Investment Management (1)

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167,844 — 167,844 — — —

Deconsolidation (Note 10)

— ( 463,120 ) ( 463,120 ) — — —

Ending balance $ 466,092 $ — $ 466,092 $ 298,248 $ 463,120 $ 761,368

(1) Remaining goodwill deductible for income tax purposes was $ 117.1 million at June 30, 2023 and $ 122.4 million at December 31, 2022.

(1) Remaining goodwill deductible for income tax purposes was $ 114.4 million at September 30, 2023 and $ 122.4 million at December 31, 2022.

Deferred Leasing Costs, Other Intangible Assets and Intangible Liabilities

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

June 30, 2023 December 31, 2022

All 2023 amounts below reflect the effect of the deconsolidation of DataBank in September 2023, where applicable.

Deferred leasing costs and identifiable intangible assets and liabilities are as follows.

September 30, 2023 December 31, 2022

(In thousands) Carrying Amount (1)(2)

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

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

(5) In connection with data center services provided in the colocation data center business which was deconsolidated in September 2023.

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

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The following table summarizes amortization of deferred leasing costs and finite-lived intangible assets and intangible liabilities:

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

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands) 2023 2022 2023 2022

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(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 .

The following table presents the future amortization of deferred leasing costs and finite-lived intangible assets and intangible liabilities .

Year Ending December 31,

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Restricted Cash, Other Assets and Other Liabilities

All 2023 amounts in the tables below reflect the effect of the deconsolidation of DataBank in September 2023, where applicable.

Restricted Cash

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The following table summarizes the Company's other assets.

(In thousands) June 30, 2023 December 31, 2022

(In thousands) September 30, 2023 December 31, 2022

Straight-line rents $ 52,470 $ 42,721

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Operating lease right-of-use asset—investment properties

273,243 305,760

Finance lease right-of-use asset—investment properties

114,438 120,261

Accounts receivable, net (1)

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Fixed assets, net (2)

12,061 14,200

Total other assets $ 165,340 $ 654,050

(1) Includes primarily receivables from tenants in the Operating segment.

(2) Net of accumulated depreciation of $ 16.5 million at June 30, 2023 and $ 17.9 million at December 31, 2022 .

(2) Net of accumulated depreciation of $ 8.4 million at September 30, 2023 and $ 17.9 million at December 31, 2022 .

Other Liabilities

The following table summarizes the Company's other liabilities:

(In thousands) June 30, 2023 December 31, 2022

(In thousands) September 30, 2023 December 31, 2022

Deferred investment management fees (1)

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Due to custodians—consolidated funds

11,794 35,458

Current and deferred income tax liability

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Operating lease liability—investment properties

255,169 282,433

Finance lease liability—investment properties

131,786 135,624

Accrued compensation 48,756 52,031

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Payable for Vantage SDC expansion capacity (3)

38,538 56,889

Accounts payable and accrued expenses 45,118 185,900

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Other liabilities $ 668,572 $ 1,272,096

(1) Deferred investment management fees are expected to be recognized as fee income over a weighted average period of 2.7 years as of June 30, 2023 and 2.9 years as of December 31, 2022.

Deferred investment management fees recognized as income of $ 1.5 million and $ 0.4 million in the three months ended June 30, 2023 and 2022 , respectively, and $ 2.2 million and $ 2.8 million in the six months ended June 30, 2023 and 2022, respectively, pertain to the deferred management fee balance at the beginning of each respective period.

(1) Deferred investment management fees are expected to be recognized as fee income over a weighted average period of 2.8 years as of September 30, 2023 and 2.9 years as of December 31, 2022.

Deferred investment management fees recognized as income of $ 1.5 million and $ 0.6 million in the three months ended September 30, 2023 and 2022 , respectively, and $ 2.8 million and $ 3.1 million in the nine months ended September 30, 2023 and 2022, respectively, pertain to the deferred management fee balance at the beginning of each respective period.

(2) Represents primarily prepaid rental income and upfront payment received for data center installation services in the Operating segment.

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The Company has significant deferred tax assets, related principally to capital loss carryforwards, outside basis difference in DBRG's interest in the OP, outside basis difference in investment in partnerships and net operating losses generated by a taxable U.S.

As of June 30, 2023 and December 31, 2022 , a full valuation allowance has been established as the realizability of these deferred tax assets did not meet the more-likely-than-not threshold.

As of September 30, 2023 and December 31, 2022 , a full valuation allowance has been established as the realizability of these deferred tax assets did not meet the more-likely-than-not threshold.

As a result, income tax expense in 2023 generally reflects the income tax effect of foreign subsidiaries.

Corporate Debt —This is composed of a securitized financing facility and senior notes issued by DigitalBridge Group, Inc.

or its OP subsidiary and are recourse to the Company, as discussed further below.

or the OP and are recourse to the Company, as discussed further below.

Corporate debt is presented within Corporate and Other, except that a portion of the securitized financing facility is allocated to the Investment Management and Operating segments consistent with the cash flows that service the debt and the underlying collateral that resides across the Company's various lines of business.

June 30, 2023 December 31, 2022

September 30, 2023 December 31, 2022

(In thousands) Investment Management Operating Corporate and Other Total Investment Management Operating Corporate and Other Total

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Investment-level Debt —This represents non-recourse debt, including:

(i) investment level financing in the Operating segment, and (ii) debt within consolidated funds and debt on warehoused investments, if any, in Corporate and Other.

(i) investment level financing in the Operating segment, which excludes DataBank following deconsolidation in September 2023;

and (ii) debt within consolidated funds and debt on warehoused investments, if any, in Corporate and Other.

The components that make up the carrying value of corporate and investment-level debt are as follows.

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(In thousands) Securitized Financing Facility Convertible and Exchangeable Senior Notes Total Non-Recourse Investment-Level Debt

June 30, 2023

September 30, 2023

Debt at amortized cost

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Weighted Average Years Remaining to Maturity (2)

June 30, 2023

September 30, 2023

Corporate debt

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Investment-Level Secured Debt

Operating segment $ 4,628,433 3.25 % 3.2 $ 494,767 8.68 % 2.6 $ 5,123,200 3.77 % 3.2

Operating segment $ 2,801,748 2.84 % 2.7 $ — NA NA $ 2,801,748 2.84 % 2.7

Corporate and Other—Consolidated fund

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$ 2,801,748 $ 4,660 $ 2,806,408

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

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

June 30, 2023 December 31, 2022

September 30, 2023 December 31, 2022

Issued by DigitalBridge Group, Inc.

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Non-Recourse Investment-Level Secured Debt

These are investment level financing that are non-recourse to DBRG and are primarily secured by data center portfolios held by subsidiaries in the Operating segment.

At June 30, 2023, subsidiaries in the Operating segment were in compliance with the financial covenants underlying their respective investment-level secured debt.

These are investment level financing that are non-recourse to DBRG and are primarily secured by data center portfolios held by subsidiaries in the Operating segment, which excludes DataBank following deconsolidation in September 2023.

At September 30, 2023, the remaining subsidiary in the Operating segment was in compliance with the financial covenants underlying the respective investment-level secured debt.

In 2023, subsidiaries in the Operating segment refinanced or raised additional debt, primarily through new securitization transactions, as follows.

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Future Minimum Principal Payments

The following table summarizes future scheduled minimum principal payments of debt at June 30, 2023.

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 June 30, 2023 for extensions that are at the option of the respective borrower entities.

The following table summarizes future scheduled minimum principal payments of debt at September 30, 2023.

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 September 30, 2023 for extensions that are at the option of the respective borrower entities.

(In thousands) Remaining 2023 2024 2025 2026 2027 2028 and thereafter Total

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Shares outstanding at December 31, 2021 35,340 142,144 166

Stock repurchases ( 2,229 ) ( 945 ) —

Exchange of notes for class A common stock — 6,389 —

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Shares canceled for tax withholding on vested equity awards — ( 681 ) —

Shares outstanding at June 30, 2022 35,340 163,937 166

Shares outstanding at September 30, 2022 33,111 162,975 166

Shares outstanding at December 31, 2022 33,111 159,763 166

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Shares canceled for tax withholding on vested equity awards — ( 1,567 ) —

Shares outstanding at June 30, 2023 32,876 162,475 166

Shares outstanding at September 30, 2023 32,876 163,264 166

Preferred Stock

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

The table below summarizes the preferred stock issued and outstanding at June 30, 2023:

The table below summarizes the preferred stock issued and outstanding at September 30, 2023:

Description Dividend Rate Per Annum Initial Issuance Date Shares Outstanding

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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.

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.

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Following stockholder approval in May 2023, the number of authorized shares of class A and class B common stock was proportionally decreased to 237,250,000 shares and 250,000 shares, respectively and p ar value of common stock was proportionately decreased from $ 0.04 to $ 0.01 per share, resulting in approximately $ 4.9 million increase in additional paid-in capital.

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 prior periods presented in this Quarterly Report on Form 10-Q to give effect to the reverse stock split.

Stock Repurchases

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Amounts reclassified from AOCI ( 200 ) ( 5,861 ) ( 17,016 ) ( 7,768 ) ( 30,845 )

AOCI at June 30, 2022 $ ( 127 ) $ — $ ( 12,673 ) $ 14,255 $ 1,455

AOCI at September 30, 2022 $ ( 1,656 ) $ — $ ( 26,795 ) $ 24,395 $ ( 4,056 )

AOCI at December 31, 2022 $ ( 295 ) $ — $ ( 1,214 ) $ — $ ( 1,509 )

1 unchanged sentence

Amounts reclassified from AOCI 296 — ( 902 ) — ( 606 )

AOCI at June 30, 2023 $ — $ — $ 1,122 $ — $ 1,122

Deconsolidation of DataBank — — 965 — 965

AOCI at September 30, 2023 $ — $ — $ 113 $ — $ 113

Changes in Components of AOCI—Noncontrolling Interests in Investment Entities

3 unchanged sentences

Amounts reclassified from AOCI ( 9,819 )

AOCI at June 30, 2022 $ ( 8,726 )

AOCI at September 30, 2022 $ ( 28,313 )

AOCI at December 31, 2022 $ ( 3,015 )

1 unchanged sentence

Amounts reclassified from AOCI 2,082

AOCI at June 30, 2023 $ ( 2,620 )

Deconsolidation of DataBank 2,550

AOCI at September 30, 2023 $ ( 49 )

Reclassifications out of AOCI—Stockholders

1 unchanged sentence

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

For the three months ended June 30, 2022, there were no reclassifications out of AOCI into earnings.

(In thousands)

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

Three Months Ended September 30, Nine Months Ended September 30,

Component of AOCI reclassified into earnings 2023 2022 2023 2022

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Release of foreign currency cumulative translation adjustments 284 ( 3,664 ) 902 17,016

Realized gain on net investment hedges — 7,768 — 7,768

Deconsolidation of DataBank ( 965 ) ( 965 ) —

Release of AOCI of equity method investments — — ( 296 ) 200

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The following table presents the activities in redeemable noncontrolling interests in the Company's investment management business through its redemption in May 2022 as discussed below, and in open-end funds in the liquid securities strategy consolidated by the Company.

Six Months Ended June 30,

Nine Months Ended September 30,

(In thousands) 2023 2022

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Reclassification of Wafra's carried interest allocation to noncontrolling interests in investment entities in May 2022 — ( 4,087 )

Balance at June 30 $ 31,920 $ 102,011

Balance at September 30 $ 27,178 $ 96,028

Redeemable Noncontrolling Interest in Investment Management

On May 23, 2022, the Company redeemed the 31.5 % noncontrolling interest in its investment management business held by affiliates of Wafra, Inc.

(collectively, "Wafra"), a private investment firm, pursuant to a purchase and sale agreement ("PSA") entered into in April 2022.

On May 23, 2022, the Company redeemed the 31.5 % noncontrolling interest in its investment management business held by Wafra pursuant to a purchase and sale agreement ("PSA") entered into in April 2022.

In connection with Wafra's initial investment in the Company's investment management business in July 2020, Wafra had assumed directly and also indirectly through a participation interest $ 124.9 million of the Company's commitments to DBP I, and has a $ 125.0 million commitment to DBP II that has been partially funded to-date.

4 unchanged sentences

(i) an upfront payment of $ 388.5 million in cash 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;

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.

and (ii) Wafra's right to earn a contingent amount up to $ 125 million if the Company raises fee earning equity under management (as defined in the PSA) up to $ 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.

The Company paid Wafra in cash $ 90 million of the contingent amount in March 2023.

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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.

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.

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Noncontrolling Interests in Investment Entities

DataBank Additional Investment in 2022

2022 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 in 2022

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 received its share of proceeds from the sale of $ 425.5 million in the third and fourth quarters of 2022, 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 totaling $ 230.2 million in the third and fourth quarters of 2022.

2022 DataBank Recapitalization

The Company began a partial recapitalization of DataBank in the second half of 2022 through multiple sales of equity interest to new investors, resulting in net proceeds to the Company of approximately $ 425.5 million, including its share of carried interest, net of allocation to employees and former employees of $ 20.1 million (the "2022 Recapitalization").

As a result of the 2022 Recapitalization, the Company's ownership decreased from 21.8 % to 11.0 % at December 31, 2022.

Upon completion of the 2022 Recapitalization, the Company reconsidered its consolidation assessment and concluded that it remained the primary beneficiary of the VIE through which it holds its interest in DataBank.

As the 2022 Recapitalization 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 fair value of DataBank resulted in a reallocation from noncontrolling interests in investment entities to additional paid-in capital totaling $ 230.2 million in the third and fourth quarters of 2022.

The 2022 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, $ 10.0 million of additional equity based compensation was recorded in the third quarter of 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.

2023 DataBank Recapitalization and Deconsolidation

In September 2023, the Company completed the partial recapitalization of DataBank through additional sales of equity interest to new investors (the "2023 Recapitalization"), resulting in net proceeds to the Company of $ 49.4 million, including carried interest of $ 27.9 million.

As a result of the 2023 Recapitalization, the Company's ownership interest in DataBank decreased from 11.0 % to 9.87 %.

Upon completion of the 2023 Recapitalization, the Company reconsidered its consolidation assessment and concluded that it no longer held a controlling financial interest in DataBank and was no longer the primary beneficiary of the VIE through which it holds its interest in DataBank.

As a result, the Company derecognized the assets and liabilities of DataBank effective September 14, 2023, and accounts for its remaining investment in DataBank using the equity method.

Accordingly, prior to September 14, 2023, the assets and liabilities and operating results of DataBank were included in the Company's consolidated financial statements and presented in the Operating segment, with the portion of DataBank's operating results attributable to third party investors presented as noncontrolling interests in investment entities.

Subsequent to September 14, 2023, the Company's consolidated financial statements include only its equity investment and its share of changes in the fair value of DataBank, which are presented in Corporate and Other, consistent with the treatment and presentation of the Company's interests as general partner affiliate in its other sponsored investment vehicles (Note 4).

The deconsolidation of DataBank resulted in the derecognition of the following assets, liabilities and noncontrolling interests in investment entities as of September 14, 2023:

(In thousands) September 14, 2023

Cash and cash equivalents $ 52,902

Restricted cash

Real estate 3,234,888

Goodwill 463,120

Deferred leasing costs and intangible assets 322,187

Other assets 461,223

Assets held for disposition 49,696

Debt $ 2,309,596

Intangible liabilities 6,696

Other liabilities 718,211

Liabilities related to assets held for disposition 12,165

Noncontrolling interests in investment entities $ 1,427,435

In connection with the deconsolidation, the Company realized a $ 3.7 million gain from the sale of its equity interest in the 2023 Recapitalization, and remeasured its remaining 9.87 % equity interest in DataBank at a fair value of $ 434.5 million (Note 4) based upon the pricing of the recapitalization, which resulted in an unrealized gain of $ 275.0 million.

The total gain of $ 278.7 million was recorded in other gain (loss), net on the Company's consolidated statements of operations, and is presented in Corporate and Other.

Noncontrolling Interests in Operating Company

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Marketable Equity Securities

Marketable equity securities with long positions of $ 96.5 million at June 30, 2023 and $ 155.9 million at December 31, 2022, included within equity investments of Corporate and Other (Note 4), and short positions of $ 45.6 million at June 30, 2023 and $ 40.9 million at December 31, 2022, included in other liabilities (Note 7), consist of publicly traded equity securities held predominantly by sponsored liquid strategy funds consolidated by the Company.

Marketable equity securities with long positions of $ 84.0 million at September 30, 2023 and $ 155.9 million at December 31, 2022, included within equity investments of Corporate and Other (Note 4), and short positions of $ 43.8 million at September 30, 2023 and $ 40.9 million at December 31, 2022, included in other liabilities (Note 7), consist of publicly traded equity securities held predominantly by sponsored liquid strategy funds consolidated by the Company.

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

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A consolidated credit fund has equity interests in pooling entities that hold a portfolio of loans, invested alongside other managed credit funds.

The fund's equity interests in the pooling entities had a fair value of $ 95.4 million at June 30, 2023 and $ 46.8 million at December 31, 2022, classified as Level 3 of the fair value hierarchy.

The fund's equity interests in the pooling entities had a fair value of $ 107.0 million at September 30, 2023 and $ 46.8 million at December 31, 2022, classified as Level 3 of the fair value hierarchy.

Fair value of the fund's equity interests in the pooling entities is based upon its share of expected cash flows from the loan assets held by the pooling entities.

In estimating fair value of the underlying loans, the pooling entities considered the prevailing market yields at which a third party might expect to receive on equivalent loans with similar credit risk.

Based upon a comparison to market yields, it was determined that the transacted price or par value of the loans held by the pooling entities approximated their fair value at June 30, 2023 and at December 31, 2022 .

Based upon a comparison to market yields, it was determined that the transacted price or par value of the loans held by the pooling entities approximated their fair value at September 30, 2023 and at December 31, 2022 .

The Company's derivative instruments generally consist of:

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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.

The Company had no outstanding derivatives at June 30, 2023.

The Company had no outstanding derivatives at September 30, 2023.

At December 31, 2022, fair value of derivative assets was $ 11.8 million, included in other assets, and there were no derivatives in a liability position.

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

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

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands) 2023 2022 2023 2022

Foreign currency contracts:

Realized gain transferred from AOCI to earnings $ — $ 8,367 $ — $ 8,367

Realized and unrealized gain in earnings on non-designated contracts (1)

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Realized and unrealized gain in earnings on non-designated contracts — 10,258 — 11,284

(1) Amount in 2023 relates to foreign currency contract entered into on behalf of a sponsored fund, which has no net impact to the Company's earnings, as discussed in Note 16.

(1) Include amount related to foreign currency contract entered into on behalf of a sponsored fund, which had no net impact to the Company's earnings, (Note 16).

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

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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 other gain (loss) on the consolidated statements of operations.

The warrants were valued at $ 29.0 million at June 30, 2023 and $ 17.7 million at December 31, 2022 using a Black-Scholes option pricing model, applying the following inputs:

The warrants were valued at $ 41.4 million at September 30, 2023 and $ 17.7 million at December 31, 2022 using a Black-Scholes option pricing model, applying the following inputs:

(a) estimated volatility for DBRG's class A common stock of 37.2 % ( 40.8 % at December 31, 2022);

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Treasury yield curve rates to correspond to the remaining term to expiration of the warrants.

Fair value of the warrant liability, classified as Level 3 fair value, increased $ 11.3 million during the six months ended June 30, 2023.

Fair value of the warrant liability, classified as Level 3 fair value, increased $ 23.7 million during the nine months ended September 30, 2023.

Contingent Consideration

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In measuring the contingent consideration, the Company applied a probability-weighted approach to the likelihood of meeting various fundraising targets and discounted the estimated future contingent consideration payment at 4.9 % to derive a present value amount.

The contingent consideration of $ 11.1 million at June 30, 2023 is classified as Level 3 of the fair value hierarchy, with increase in fair value of $ 0.2 million during the six months ended June 30, 2023 recorded in other gain (loss).

The contingent consideration of $ 11.2 million at September 30, 2023 is classified as Level 3 of the fair value hierarchy, with increase in fair value of $ 0.3 million during the nine months ended September 30, 2023 recorded in other gain (loss).

Fair Value Option

Loans Receivable

At June 30, 2023, there was no outstanding balance on loans receivable, which had been carried at fair value under the fair value option.

At September 30, 2023, there was no outstanding balance on loans receivable, which had been carried at fair value under the fair value option.

Previously, loans receivable consisted of two unsecured promissory notes, one in connection with the 2022 sale of the Company's Wellness Infrastructure business (Note 2) and one held by DataBank, presented within Corporate and Other and in the Operating segment, respectively.

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In April 2023, the DataBank note was fully repaid.

At December 31, 2022, loan fair

values were based upon a discounted cash flow projection of principal and interest, which at the time of valuation, were expected to be collected, discounted at 10.0 % and 10.5 %.

At December 31, 2022, loan fair values were based upon a discounted cash flow projection of principal and interest, which at the time of valuation, were expected to be collected, discounted at 10.0 % and 10.5 %.

Changes in Level 3 Fair Value

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Paydowns ( 159,501 ) —

Transfer of warehoused loans to sponsored fund ( 83,083 ) —

Consolidation of sponsored fund — 10,536

Unrealized gain (loss) in earnings, net ( 41,863 ) 673

Fair value at June 30, 2022 $ 300,618 $ —

Net unrealized gain (loss) in earnings on instruments held at June 30, 2022 $ ( 21,676 ) $ —

Fair value at September 30, 2022 $ 174,389 $ 11,209

Net unrealized gain (loss) in earnings on instruments held at September 30, 2022 $ ( 38,649 ) $ 673

Fair value at December 31, 2022 $ 137,945 $ 46,770

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Unrealized and realized gain (loss) in earnings, net ( 131,685 ) 1,812

Fair value at June 30, 2023 $ — $ 95,383

Net unrealized gain (loss) in earnings on instruments held at June 30, 2023 $ ( 133,307 ) $ 832

Fair value at September 30, 2023 $ — $ 107,032

Net unrealized gain (loss) in earnings on instruments held at September 30, 2023 $ ( 133,307 ) $ 1,812

(1) Represents reallocation of investment value when relative ownership of the pooling entity across its fund owners change following additional capital contributions.

Investment Carried at Fair Value Using Net Asset Value

The Company holds an investment in a non-traded healthcare REIT, valued at $ 34.5 million at June 30, 2023 and at December 31, 2022, presented within Corporate and Other in Note 4.

The Company holds an investment in a non-traded healthcare REIT, valued at $ 34.5 million at September 30, 2023 and at December 31, 2022, presented within Corporate and Other in Note 4.

The Company has no commitment for any further investment in the non-traded REIT in the future.

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(i) on the acquisition date for business combinations;

and (ii) when events or changes in circumstances indicate that the carrying value of the assets may not be recoverable.

(ii) when events or changes in circumstances indicate that the carrying value of the assets may not be recoverable;

and (iii) upon deconsolidation of a subsidiary for any retained interest.

Adjustments to fair value generally result from an application of the lower of amortized cost or fair value for assets held for disposition or otherwise, a write-down of asset values due to impairment.

There were no assets carried at nonrecurring fair value at June 30, 2023 and December 31, 2022.

There were no assets carried at nonrecurring fair value at September 30, 2023 and December 31, 2022.

Fair Value of Financial Instruments Reported at Cost

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(In thousands) Level 1 Level 2 Level 3 Total

June 30, 2023

September 30, 2023

Corporate debt

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As a result, the Company is considered to be acting in the capacity of a principal of the sponsored fund and is therefore the primary beneficiary of the fund.

The Company’s exposure is limited to its capital account balance in the consolidated funds of $ 120.3 million at June 30, 2023 and $ 94.7 million at December 31, 2022.

The Company’s exposure is limited to its capital account balance in the consolidated funds of $ 157.5 million at September 30, 2023 and $ 94.7 million at December 31, 2022.

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 funds.

At June 30, 2023, the Company had unfunded equity commitment to a consolidated fund of $ 39.3 million.

At September 30, 2023, the Company had unfunded equity commitment to a consolidated fund of $ 41.9 million.

The following table presents the assets and liabilities of the consolidated funds, which are presented within Corporate and Other in the supplemental schedule to the consolidated balance sheets.

(In thousands) June 30, 2023 December 31, 2022

(In thousands) September 30, 2023 December 31, 2022

Cash and cash equivalents $ 70,122 $ 86,433

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The Company accounts for its equity interests in unconsolidated funds under the equity method.

The Company's maximum exposure to loss is limited to the outstanding balance of its investment in the unconsolidated funds (Note 4) of $ 964.3 million at June 30, 2023 and $ 752.3 million at December 31, 2022.

The Company's maximum exposure to loss is limited to the outstanding balance of its investment in the unconsolidated funds (Note 4) of $ 1.56 billion at September 30, 2023 and $ 752.3 million at December 31, 2022.

The Company also has receivables from its unconsolidated funds for fee income and reimbursable or recoverable costs, as discussed in Note 16.

At June 30, 2023, the Company's unfunded equity commitments to its unconsolidated funds as general partner and general partner affiliate totaled $ 93.0 million.

At September 30, 2023, the Company's unfunded equity commitments to its unconsolidated funds as general partner and general partner affiliate totaled $ 86.9 million.

Generally, the timing for funding of these commitments is not known and the commitments are callable on demand at any time prior to their respective expirations.

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The following table provides the basic and diluted earnings per common share computations.

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

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands, except per share data) 2023 2022 2023 2022

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Preferred stock repurchases/redemptions (Note 9)

— 1,098 927 1,098

Preferred dividends ( 14,645 ) ( 15,283 ) ( 43,996 ) ( 46,801 )

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Weighted average effect of dilutive shares (1)(2)(3)

13,298 — 4,420 —

Weighted average number of common shares outstanding—diluted 173,862 162,398 164,020 153,028

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(1) With respect to the assumed conversion or exchange of the Company's outstanding senior notes, the following are excluded from the calculation of diluted earnings per share as their inclusion would be antidilutive:

(a) for the three months ended June 30, 2023 and 2022, the effect of adding back interest expense of $ 1.7 million and $ 3.9 million, respectively, and 9,047,200 and 11,697,600 of weighted average dilutive common share equivalents, respectively;

and (b) for the six months ended June 30, 2023 and 2022, the effect of adding back $ 5.6 million and $ 8.7 million of interest expense, respectively, and 9,749,200 and 14,125,700 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 six months ended June 30, 2022.

(a) for the three months ended September 30, 2022 only, the effect of adding back interest expense of $ 4.0 million and 11,698,000 of weighted average dilutive common share equivalents;

and (b) for the nine months ended September 30, 2023 and 2022, the effect of adding back $ 6.9 million and $ 12.7 million of interest expense, respectively, and 9,744,700 and 13,307,000 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 nine months ended September 30, 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 635,600 and 1,907,900 for the three months ended June 30, 2023 and 2022, respectively;

and, 317,800 and 2,036,100 for the six months ended June 30, 2022, respectively;

and (b) class A common shares that are issuable to net settle the exercise of warrants (Note 10) with weighted average shares of 307,800 and 2,210,300 for the three months ended June 30, 2023 and 2022, respectively, and 335,600 and 2,606,100 for the six months ended June 30, 2023 and 2022, respectively.

(a) class A common shares that are contingently issuable in relation to performance stock units (Note 15) with weighted average shares of 1,076,000 for the three months ended September 30, 2022;

and, 1,727,000 for the nine months ended September 30, 2022;

and (b) class A common shares that are issuable to net settle the exercise of warrants (Note 10) with weighted average shares of 957,600 and 1,393,000 for the three months ended September 30, 2023 and 2022, respectively, and 569,600 and 2,174,000 for the nine months ended September 30, 2023 and 2022, respectively.

(3) OP Units may be redeemed for registered or unregistered class A common stock on a one -for-one basis and are not dilutive.

At June 30, 2023 and 2022, 12,375,800 and 12,628,900 of OP Units, respectively, were not included in the computation of diluted earnings per share in the respective periods presented.

At September 30, 2023 and 2022, 12,375,800 and 12,628,900 of OP Units, respectively, were not included in the computation of diluted earnings per share in the respective periods presented.

The following table presents the Company's fee income by type.

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

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands) 2023 2022 2023 2022

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4 566 1,930 1,971

827 759 1,926 1,405

Total fee income $ 65,240 $ 41,263 $ 190,108 $ 128,418

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;

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 fund, and thereafter, contributed or invested capital (subject to certain reductions for NAV write-downs);

invested capital for co-investment vehicles;

or NAV for vehicles in the liquid securities strategy.

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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 incentive fees earned by the Company is allocable to certain employees, 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, and on a non-recurring basis, loan origination fees from co-investors.

A portion of incentive fees earned by the Company is allocable to certain employees and former employees, 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 certain portfolio companies, and on a non-recurring basis, loan origination fees from co-investors.

Equity-Based Compensation

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Shares reserved for the issuance of awards under the Equity Incentive Plan are subject to equitable adjustment upon the occurrence of certain corporate events, provided that this number automatically increases each January 1st by 2 % of the outstanding number of shares of the Company’s class A common stock on the immediately preceding December 31st.

At June 30, 2023, an aggregate 24.5 million shares of the Company's class A common stock were reserved for the issuance of awards under the Equity Incentive Plan.

At September 30, 2023, an aggregate 24.5 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.

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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.

RSUs are initially valued based upon the Company's class A common stock price on grant date and not subsequently remeasured for equity-classified awards, while liability-classified awards are remeasured at fair value at the end of each reporting period until the award is fully vested.

Equity-based compensation expense is recognized when it becomes probable that the performance condition will be met.

A liability classified award that met its performance condition and became fully vested over the course of the year was settled in cash totaling $ 2.4 million and $ 3.3 million for the three and nine months ended September 30, 2023, respectively.

There was no cash settlement of awards in 2022.

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").

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.

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.

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.

Fair value of PSUs, including dividend equivalent rights, was determined using a Monte Carlo simulation under a risk-neutral premise, with the following assumptions:

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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 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.

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.

Equity-based compensation cost pursuant to DBRG's Equity Incentive Plan is presented on the consolidated statement of operations, as follows.

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

Separately, additional compensation expense was also recorded in 2022 in connection with the DataBank recapitalization transaction, as described in Note 10.

Three Months Ended September 30, Nine Months Ended September 30,

(In thousands)

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Forfeited ( 21,675 ) — — — ( 424,065 ) ( 445,740 ) 26.92 13.79

Unvested shares and units at June 30, 2023

Unvested shares and units at September 30, 2023

2,956,588 2,625,000 64,059 599,347 1,275,169 7,520,163 8.51 9.93

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PSUs for which the total shareholder return was not met at the end of the performance period are forfeited.

Fair value of equity awards that vested, as shown above, determined based upon their respective fair values at vesting date, was $ 13.7 million and $ 15.7 million for the three months ended June 30, 2023 and 2022, respectively, and $ 34.6 million and $ 49.1 million for the six months ended June 30, 2023 and 2022, respectively.

At June 30, 2023, aggregate unrecognized compensation cost for all unvested equity awards pursuant to DBRG's Equity Incentive Plan was $ 50.1 million, which is expected to be recognized over a weighted average period of 2.0 years.

Fair value of equity awards that vested, as shown above, determined based upon their respective fair values at vesting date, was $ 13.3 million and $ 4.2 million for the three months ended September 30, 2023 and 2022, respectively, and $ 47.5 million and $ 53.3 million for the nine months ended September 30, 2023 and 2022, respectively.

At September 30, 2023, aggregate unrecognized compensation cost for all unvested equity awards pursuant to DBRG's Equity Incentive Plan was $ 44.6 million, which is expected to be recognized over a weighted average period of 1.9 years.

This excludes $ 6.3 million of unvested RSUs that are not currently probable of achieving their performance condition and have a remaining performance measurement period of approximately one year .

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Amounts due from and due to affiliates consist of the following:

(In thousands) June 30, 2023 December 31, 2022

(In thousands) September 30, 2023 December 31, 2022

Due from Affiliates

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Investment vehicles—Derivative obligation $ — $ 11,793

Investment vehicles—InfraBridge working capital (Note 3)

Investment vehicles—InfraBridge (Note 3)

Employees and other affiliates 1,932 658

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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 $ 1.4 million and $ 0.8 million for the three months ended June 30, 2023 and 2022, respectively, and $ 2.6 million and $ 4.7 million for the six months ended June 30, 2023 and 2022, respectively.

Such cost reimbursements and recoverable expenses, included in other income, totaled $ 1.2 million and $ 1.0 million for the three months ended September 30, 2023 and 2022, respectively, and $ 3.8 million and $ 5.7 million for the nine months ended September 30, 2023 and 2022, respectively.

Warehoused Investments— The Company may acquire and temporarily warehouse investments on behalf of prospective sponsored investment vehicles that are actively fundraising (Note 4).

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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 Investment Management segment, in the amount of $ 91.0 million at June 30, 2023 and $ 70.4 million at December 31, 2022.

Carried interest allocated is recorded as net income attributable to noncontrolling interests in the Investment Management segment totaling $ 19.2 million and $ 28.9 million for the three months ended June 30, 2023 and 2022, respectively, and $ 21.4 million and $ 29.6 million for the six months ended June 30, 2023 and 2022 respectively.

Ganzi and Jenkins that are unrealized or distributed but unpaid are included in noncontrolling interests on the balance sheet in the Investment Management segment, in the amount of $ 109.9 million at September 30, 2023 and $ 70.4 million at December 31, 2022.

Carried interest allocated is recorded as net income attributable to noncontrolling interests in the Investment Management segment totaling $ 18.9 million and $ 13.8 million for the three months ended September 30, 2023 and 2022, respectively, and $ 40.3 million and $ 43.5 million for the nine months ended September 30, 2023 and 2022 respectively.

Additionally, in connection with the DataBank recapitalization (Note 10) in the second half of 2022, 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 was not deemed a compensatory arrangement.

Such equity interest represent noncontrolling interests in DataBank.

Ganzi and Jenkins received distributed carried interest in the form of equity interest in vehicles that invest in DataBank, of which $ 86.1 million in aggregate was not deemed a compensatory arrangement.

Such equity interest represent ownership interests in DataBank.

A portion of such equity interest was sold by Messrs.

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Investment in Managed Investment Vehicles —Subject to the Company's related party policies and procedures, certain employees may invest on a discretionary basis in investment vehicles sponsored by the Company, either directly in the vehicle or indirectly through the Company's 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 $ 19.8 million at June 30, 2023 and $ 17.7 million at December 31, 2022, reflected in redeemable noncontrolling interests and noncontrolling interests on the balance sheet in the Investment Management segment.

The employees' share of earnings was a net income of $ 1.5 million and a net loss of $ 0.1 million for the three months ended June 30, 2023 and 2022, respectively, and net income of $ 2.1 million and net loss of $ 0.3 million for the six months ended June 30, 2023 and 2022, respectively.

These investments are generally not subject to management fees or carried interest, 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 $ 21.0 million at September 30, 2023 and $ 17.7 million at December 31, 2022, reflected in redeemable noncontrolling interests and noncontrolling interests on the balance sheet in the Investment Management segment.

The employees' share of net income was $ 1.4 million and $ 0.4 million for the three months ended September 30, 2023 and 2022, respectively, and $ 3.5 million and $ 0.1 million for the nine months ended September 30, 2023 and 2022, respectively.

Such amounts are reflected in net income (loss) attributable to noncontrolling interests on the consolidated statement of operations in the Investment Management segment and exclude their share of carried interest allocation, which is reflected in compensation expense—incentive fee and carried interest allocation.

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The Company reimbursed Mr.

Ganzi $ 0.8 million and $ 0.9 million for the three months ended June 30, 2023 and 2022, respectively, and $ 2.6 million and $ 1.1 million for the six months ended June 30, 2023 and 2022 respectively.

Ganzi $ 1.7 million and $ 0.7 million for the three months ended September 30, 2023 and 2022, respectively, and $ 4.3 million and $ 1.8 million for the nine months ended September 30, 2023 and 2022 respectively.

Advancement of Expenses— Effective April 1, 2021, Thomas J.

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Barrack to reimburse the Company for such advanced expenses under certain circumstances.

Pursuant to the Advancement Agreement , the Company expensed $ 4.1 million and $ 9.7 million in the three and six months ended June 30, 2022, respectively, with immaterial expenses in 2023.

Pursuant to the Advancement Agreement , the Company expensed $ 7.5 million and $ 17.2 million in the three and nine months ended September 30, 2022, respectively, with immaterial expenses in 2023.

The Company believes it has met all of its financial obligations under the Advancement Agreement and does not expect to make any further advances to Mr.

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The Company may be involved in litigation in the ordinary course of business.

As of June 30, 2023, the Company was not involved in any legal proceedings that are expected to have a material adverse effect on the Company’s results of operations, financial position or liquidity.

As of September 30, 2023, 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.

Supplemental Disclosure of Cash Flow Information

Six Months Ended June 30,

Nine Months Ended September 30,

(In thousands) 2023 2022

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Dividends and distributions payable $ 16,418 $ 16,527

Improvements in operating real estate included in other liabilities 98,058 15,023

Payables for improvements in operating real estate and acquired lease intangibles 33,456 108,468

Receivables from asset sales 2,091 12,373

Operating lease ROU assets and lease liabilities established 29,050 16,840

Finance lease ROU assets and lease liabilities established 21,475 —

Contingent consideration for acquisition of InfraBridge 10,874 —

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Redemption of redeemable noncontrolling interest for common stock — 348,759

Seller note received in sale of NRF Holdco equity — 154,992

Seller note received in sale of NRF Holdco equity (Note 2) — 154,992

Loan receivable relieved in exchange for equity investment acquired — 20,676

Redemption of OP Units for common stock 984 341

Distribution payable to noncontrolling interest — 2,850

Assets disposed in sale of equity of investment entities

Liabilities disposed in sale of equity of investment entities

Noncontrolling interests of investment entities sold (1)

Assets disposed or deconsolidated in sale of equity of investment entities (1)

4,633,562 3,420,783

Liabilities disposed or deconsolidated in sale of equity of investment entities (1)

3,046,668 3,144,700

Noncontrolling interests of investment entities sold and deconsolidated (1)

1,427,435 204,730

Exchange of notes for class A common shares — 60,317

(1) Represents deconsolidation of noncontrolling interests in connection with sale of the Wellness Infrastructure business.

(1) Represents deconsolidation of DataBank in September 2023 and sale of Wellness Infrastructure business in February 2022 (Notes 10 and 2).

Subsequent Events

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• whether we will be able to utilize existing tax attributes to offset taxable income to the extent contemplated;

• our ability to maintain our exemption from registration as an investment company under the Investment Company Act of 1940, as amended (the “1940 Act”);

• our ability to maintain our exemption from registration as an investment company under the Investment Company Act of 1940, as amended;

• changes in our board of directors or management team, and availability of qualified personnel;

9 unchanged sentences

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 1. Financial Statements