What changed in this filing

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Item 9A. Controls and Procedures

2024-02-23 compared with 2023-02-27 · 1114 added, 1560 removed, 1135 unchanged (70% of the section changed)

8 unchanged sentences

There have been no changes in our internal control over financial reporting (as defined in Rule 13a-15(f) and 15d-15(f) of the Exchange Act) during the quarter ended December 31, 2023 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

As of December 31, 2023, our evaluation is ongoing for InfraBridge, which was acquired in February 2023.

Management’s Annual Report on Internal Control over Financial Reporting

4 unchanged sentences

Management evaluated the effectiveness of our internal control over financial reporting using the criteria set forth in the Internal Control—Integrated Framework (2013) issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).

Based on our evaluation, management concluded that our internal control over financial reporting was effective as of December 31, 2022.

As permitted by the SEC, management has elected to exclude InfraBridge, which was acquired in February 2023, from its assessment of the effectiveness of internal control over financial reporting.

As of and for the year ended December 31, 2023, InfraBridge represented 12.1% of assets, 3.2% of liabilities and 6.3% of revenues.

Based on our evaluation, except for InfraBridge, management concluded that our internal control over financial reporting was effective as of December 31, 2023.

We are in the process of integrating InfraBridge into our process of internal control over financial reporting.

Our internal control system was designed to provide reasonable assurance to management and our board of directors regarding the preparation and fair presentation of published financial statements.

8 unchanged sentences

(the Company) maintained, in all material respects, effective internal control over financial reporting as of December 31, 2023 , based on the COSO criteria.

As indicated in the accompanying Management’s Annual Report on Internal Control over Financial Reporting, management’s assessment of and conclusion on the effectiveness of internal control over financial reporting did not include the internal controls of InfraBridge, which is included in the 2023 consolidated financial statements of the Company and comprised 12.1% of total assets and 3.2% of total liabilities as of December 31, 2023 , and 6.3% of total revenues for the year then ended.

Our audit of internal control over financial reporting of the Company also did not include an evaluation of the internal control over financial reporting of InfraBridge.

We also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated balance sheets of DigitalBridge Group, Inc.

as of December 31, 2022 and 2021 , the related consolidated statements of operations, comprehensive income (loss), equity and cash flows for each of the three years in the period ended December 31, 2022 , and the related notes and financial statement schedule listed in the Index at Item 15, and our report dated February 27, 2023 expressed an unqualified opinion thereon.

as of December 31, 2023 and 2022 , the related consolidated statements of operations, comprehensive income (loss), equity and cash flows for each of the three years in the period ended December 31, 2023 , and the related notes, and our report dated February 23, 2024 expressed an unqualified opinion thereon.

Basis for Opinion

18 unchanged sentences

Other Information.

Rule 10b5-1 Trading Plans

During the quarter ended December 31, 2023, none of the Company’s directors or executive officers adopted or terminated any contract, instruction or written plan for the purchase or sale of Company securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement.”

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections.

10 unchanged sentences

The information required by Item 14 is hereby incorporated by reference to the definitive proxy statement to be filed with the SEC pursuant to Regulation 14A within 120 days after our fiscal year ended December 31, 2023.

Exhibits and Financial Statement Schedules.

Exhibits and Financial Statements.

(a)(1) and (2).

9 unchanged sentences

Summary of Significant Accounting Policies

Equity and Debt Investments

Goodwill, Deferred Leasing Costs and Other Intangibles

Business Combinations

Goodwill and Intangible Assets

Restricted Cash, Other Assets and Other Liabilities

1 unchanged sentence

Noncontrolling Interests

Variable Interest Entities

Earnings per Share

Equity-Based Compensation

Variable Interest Entities

Transactions with Affiliates

1 unchanged sentence

Commitments and Contingencies

Supplemental Disclosure of Cash Flow Information

Assets and Related Liabilities Held for Disposition

Discontinued Operations

Subsequent Events

Schedule III—Real Estate and Accumulated Depreciation

All other schedules are omitted because they are not applicable, or the required information is included in the consolidated financial statements or notes thereto.

5 unchanged sentences

We have audited the accompanying consolidated balance sheets of DigitalBridge Group, Inc.

(the Company) as of December 31, 2022 and 2021 , the related consolidated statements of operations, comprehensive income (loss), equity and cash flows for each of the three years in the period ended December 31, 2022 , and the related notes and financial statements schedule listed in the Index at Item 15 (collectively referred to as the “consolidated financial statements”).

(the Company) as of December 31, 2023 and 2022, the related consolidated statements of operations, comprehensive income (loss), equity and cash flows for each of the three years in the period ended December 31, 2023, and the related notes (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2023 and 2022, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2023, in conformity with U.S.

16 unchanged sentences

The communication of the critical audit matter does not alter in any way our opinion on the consolidated financial statements taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinion on the critical audit matter or on the accounts or disclosures to which it relates.

Asset acquisitions—recognition of acquired assets

Description of the Matter As more fully discussed in Note 3 to the consolidated financial statements, during the year ended December 31, 2022, the Company completed the acquisition of real estate and related intangible assets for total consideration of approximately $1.7 billion.

As explained in Notes 2 and 3 to the consolidated financial statements, the transactions were accounted for as asset acquisitions, and as such, the total consideration was allocated to the acquired assets and liabilities based upon their relative fair values.

Auditing the Company’s accounting for the acquisitions was complex due to the significant estimation required by management in estimating the relative fair values of the acquired tangible and intangible assets.

The significant estimation was primarily due to the judgmental nature of the inputs to the valuation models used to measure the fair value of the tangible and intangible assets as well as the sensitivity of the respective fair values to the underlying inputs or assumptions.

The Company utilized the income approach (discounted cash flow method), sales comparison approach, and cost approach to estimate the fair value of the acquired tangible and intangible assets.

The determination of the relative fair value of the acquired tangible assets involved a higher degree of subjectivity due to the lack of availability of directly comparable market information, while the determination of the relative fair value of the acquired intangible assets involved a higher degree of subjectivity due to the use of market assumptions that are forward looking and could be affected by future economic or market conditions.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design and tested the operating effectiveness of controls over the Company’s process for allocating total consideration to the acquired tangible and intangible assets, including controls over the Company’s review of the inputs and assumptions used in the fair value analysis and accuracy of the underlying data used.

For example, we tested controls over the determination of the fair value of acquired tangible and intangible assets, including controls over the review of the valuation models and underlying assumptions used to develop such estimates.

To test the fair values of acquired tangible and intangible assets used in the purchase price allocation, we performed audit procedures that included, among others, evaluating the valuation methods and significant assumptions used by management, evaluating the sensitivity of changes in inputs or assumptions on the relative fair values of the acquired assets, testing the completeness and accuracy of the underlying data supporting the determination of the various inputs, and testing its clerical accuracy.

For a sample of acquired assets, we involved our valuation specialists to assist in evaluating the methodologies used by the Company, performed procedures to assess the reasonableness of the significant inputs or assumptions utilized in developing the fair value estimates, and performed comparative calculations to assess the reasonableness of the allocations to the acquired assets.

Description of the Matter At December 31, 2023, the carrying value of the Company’s investments totaled $2.5 billion, including principal investments in Company-sponsored funds of $1.2 billion and carried interest allocation of $676.4 million.

As discussed further in Notes 2 and 4 to the consolidated financial statements, the underlying investments of the Company’s sponsored investment vehicles (“underlying investments”) are reported at fair value as determined by management by applying the valuation techniques and using the significant unobservable inputs described therein, and the Company’s unrealized carried interest allocation is driven primarily by changes in fair value of the underlying investments.

Fair value of the underlying investments is typically estimated using unobservable inputs and assumptions that involve significant judgement including, but not limited to, the financial performance of the portfolio company, economic conditions, foreign exchange rates, comparable transactions in the market, and equity prices for publicly traded securities.

Auditing management’s determination of the fair value of the underlying investments that contribute to the Company’s unrealized carried interest allocation which are valued using significant unobservable inputs is complex and involves a high degree of auditor subjectivity to address the higher estimation uncertainty.

How We Addressed the Matter in Our Audit We obtained an understanding, evaluated the design, and tested the operating effectiveness of controls over the Company’s recognition of carried interest allocation, including controls over the Company’s investment valuation process for the underlying investments.

This included management’s review controls over the assessment of the valuation techniques and significant unobservable inputs used to estimate the fair value of the underlying investments and management’s evaluation of the completeness and accuracy of the data used in the valuations of the underlying investments.

Our audit procedures included, among others, evaluating changes in fair value of the underlying investments to determine which investments contributed to the Company’s unrealized carried interest allocation, testing the mathematical accuracy of the distribution waterfalls used to determine the Company’s share of income or loss from the underlying funds and agreeing data used in the waterfall calculations to the funds’ accounting records.

For a sample of underlying investments where an increase in fair value contributed to the Company’s unrealized carried interest allocation, we performed procedures to evaluate the appropriateness of the methodology and key inputs and assumptions used in the valuation, including, but not limited to, performing sensitivities on the inputs or assumptions used in the valuation, comparing key inputs and assumptions used in the valuations to source documents or market data, and evaluating the existence of corroborating or contrary evidence obtained through other audit procedures.

Our procedures varied based on the nature of each investment selected for testing.

For certain investments, we involved our internal valuation specialists to perform corroborative analyses to assess whether the key assumptions used in the valuation and the estimated fair values were supported by observable market data.

/s/ Ernst & Young LLP

8 unchanged sentences

Cash and cash equivalents $ 345,335 $ 855,564

$ 918,254 $ 1,602,102

Restricted cash 4,915 4,854

118,485 99,121

Real estate, net

5,921,298 4,972,284

Equity and debt investments ($ 506,081 and $ 201,912 at fair value)

1,322,050 935,153

Loans receivable (at fair value) 137,945 173,921

761,368 761,368

Deferred leasing costs and intangible assets, net

Investments ($ 572,749 and $ 421,393 at fair value)

2,476,093 1,237,363

Goodwill 465,991 298,248

Intangible assets 103,750 85,698

Other assets ($ 0 and $ 11,793 at fair value)

1 unchanged sentence

Due from affiliates 85,815 45,360

45,360 49,230

Assets held for disposition 57,526 3,676,615

$ 11,028,503 $ 14,197,816

Debt, net $ 5,156,140 $ 4,860,402

Accrued and other liabilities ($ 183,628 and $ 37,970 at fair value)

Assets of discontinued operations 1,698 8,420,595

$ 3,562,550 $ 11,028,503

Intangible liabilities, net

Debt $ 371,783 $ 569,375

Other liabilities ($ 124,019 and $ 183,628 at fair value)

681,451 546,923

Liabilities related to assets held for disposition 380 3,088,699

Liabilities of discontinued operations 153 5,342,142

Total liabilities

9 unchanged sentences

794,670 800,355

Common stock, $ 0.04 par value per share

Common stock, $ 0.01 and $ 0.04 par value per share

Class A, 237,250 shares authorized;

15 unchanged sentences

$ 3,562,550 $ 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.

3 unchanged sentences

2023 2022 2021

Property operating income $ 927,506 $ 762,750 $ 312,928

Fee income ($ 167,733 , $ 170,929 and $ 83,294 from affiliates)

Fee revenue ($ 254,429 , $ 167,733 and $ 170,929 from affiliates)

$ 264,117 $ 172,673 $ 180,826

Interest income 30,107 8,791 7,206

Carried interest allocation 363,075 378,342 99,207

Principal investment income 145,448 56,731 86,023

Other income ($ 10,400 , $ 4,337 and $ 10,185 from affiliates)

1 unchanged sentence

Total revenues 821,383 694,771 387,830

Property operating expense 389,445 316,178 119,834

Interest expense 24,540 42,926 63,244

Investment expense 33,887 28,257 13,551

Investment-related expense 3,155 23,219 7,168

Transaction-related costs 10,823 10,129 5,515

Depreciation and amortization 36,651 44,271 44,353

Impairment loss — — 25,079

Compensation expense—cash and equity-based 206,892 154,752 159,772

Compensation expense—incentive fee and carried interest 202,286 65,890 1,906

Administrative expenses 123,184 109,490 78,766

Settlement loss — — 5,090

Compensation expense—incentive fee and carried interest allocation 186,030 202,286 65,890

Administrative expense 83,782 94,122 77,768

Total expenses 551,873 571,705 423,710

Other income (loss)

Other losses, net ( 170,555 ) ( 21,412 ) ( 6,493 )

Equity method earnings (losses) 19,412 127,270 ( 273,288 )

Equity method earnings—carried interest 378,342 99,207 12,709

Loss from continuing operations before income taxes

( 407,826 ) ( 317,361 ) ( 638,151 )

Other gain (loss), net 96,119 ( 169,747 ) ( 20,119 )

Income (loss) from continuing operations before income taxes 365,629 ( 46,681 ) ( 55,999 )

Income tax benefit (expense) ( 6 ) ( 13,132 ) 21,463

Loss from continuing operations ( 421,293 ) ( 216,823 ) ( 591,088 )

Loss from discontinued operations ( 148,704 ) ( 600,088 ) ( 3,199,322 )

Net loss ( 569,997 ) ( 816,911 ) ( 3,790,410 )

Income (loss) from continuing operations 365,623 ( 59,813 ) ( 34,536 )

Income (loss) from discontinued operations ( 320,458 ) ( 510,184 ) ( 782,375 )

Net income (loss) 45,165 ( 569,997 ) ( 816,911 )

Net income (loss) attributable to noncontrolling interests:

2 unchanged sentences

Operating Company 9,138 ( 32,369 ) ( 40,511 )

Net loss attributable to DigitalBridge Group, Inc.

( 321,797 ) ( 310,097 ) ( 2,675,759 )

Preferred stock repurchases/redemptions (Note 9)

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

185,280 ( 321,797 ) ( 310,097 )

Preferred stock dividends 58,656 61,567 70,627

Net loss attributable to common stockholders $ ( 382,266 ) $ ( 385,716 ) $ ( 2,750,782 )

Loss per share—basic

Loss from continuing operations per common share—basic $ ( 1.76 ) $ ( 1.21 ) $ ( 4.33 )

Net loss attributable to common stockholders per common share—basic $ ( 2.47 ) $ ( 3.14 ) $ ( 23.25 )

Loss per share—diluted

Loss from continuing operations per common share—diluted $ ( 1.76 ) $ ( 1.21 ) $ ( 4.33 )

Net loss attributable to common stockholders per common share—diluted $ ( 2.47 ) $ ( 3.14 ) $ ( 23.25 )

Preferred stock repurchases

( 927 ) ( 1,098 ) 4,992

Net income (loss) attributable to common stockholders $ 127,551 $ ( 382,266 ) $ ( 385,716 )

Income (loss) per share—basic

Income (loss) from continuing operations per common share—basic $ 1.13 $ ( 1.23 ) $ ( 1.27 )

Net income (loss) attributable to common stockholders per common share—basic $ 0.78 $ ( 2.47 ) $ ( 3.14 )

Income (loss) per share—diluted

Income (Loss) from continuing operations per common share—diluted $ 1.10 $ ( 1.23 ) $ ( 1.27 )

Net income (loss) attributable to common stockholders per common share—diluted $ 0.77 $ ( 2.47 ) $ ( 3.14 )

Weighted average number of shares

1 unchanged sentence

Diluted 169,720 154,495 122,864

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

Dividends declared per common share

$ 0.04 $ 0.02 $ —

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

DigitalBridge Group, Inc.

3 unchanged sentences

2023 2022 2021

Net loss $ ( 569,997 ) $ ( 816,911 ) $ ( 3,790,410 )

Net income (loss) $ 45,165 $ ( 569,997 ) $ ( 816,911 )

Changes in accumulated other comprehensive income (loss) related to:

1 unchanged sentence

Available-for-sale debt securities — ( 6,373 ) ( 331 )

Cash flow hedges — 1,285 ( 30 )

Foreign currency translation 2,279 ( 44,232 ) ( 94,560 )

Cash flow hedges — — 1,285

Net investment hedges — ( 8,368 ) ( 57,291 )

Other comprehensive income (loss) 2,597 ( 61,840 ) ( 167,945 )

Comprehensive loss ( 631,837 ) ( 984,856 ) ( 3,602,103 )

Comprehensive income (loss) 47,762 ( 631,837 ) ( 984,856 )

Comprehensive income (loss) attributable to noncontrolling interests:

2 unchanged sentences

Operating Company 9,365 ( 36,116 ) ( 48,783 )

Comprehensive loss attributable to stockholders $ ( 365,818 ) $ ( 389,210 ) $ ( 2,601,768 )

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

Comprehensive income (loss) attributable to stockholders $ 187,234 $ ( 365,818 ) $ ( 389,210 )

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

DigitalBridge Group, Inc.

3 unchanged sentences

Balance at December 31, 2020 $ 999,490 $ 4,841 $ 7,570,473 $ ( 6,195,456 ) $ 122,123 $ 2,501,471 $ 4,327,372 $ 155,747 $ 6,984,590

Cumulative effect of adoption of new accounting guidance (Note 2)

— — — ( 3,187 ) — ( 3,187 ) ( 1,577 ) ( 349 ) ( 5,113 )

Net loss — — — ( 2,675,759 ) — ( 2,675,759 ) ( 812,547 ) ( 302,720 ) ( 3,791,026 )

Other comprehensive income — — — — 73,991 73,991 106,173 8,143 188,307

Fair value of noncontrolling interests assumed in acquisitions

Net income (loss) — — — ( 310,097 ) — ( 310,097 ) ( 500,980 ) ( 40,511 ) ( 851,588 )

Other comprehensive income (loss) — — — — ( 79,113 ) ( 79,113 ) ( 80,560 ) ( 8,272 ) ( 167,945 )

Redemption of preferred stock (Note 8)

( 145,258 ) — ( 4,992 ) — — ( 150,250 ) — — ( 150,250 )

Exchange of notes for common stock — 734 181,473 — — 182,207 — — 182,207

Shares issued pursuant to settlement liability — 60 46,982 — — 47,042 — — 47,042

Deconsolidation of investment entities (Note 2)

— — 1,956 — ( 1,482 ) 474 ( 1,080,134 ) — ( 1,079,660 )

Common stock repurchases — ( 127 ) ( 24,622 ) — — ( 24,749 ) — — ( 24,749 )

Redemption of OP Units for common stock — 22 7,735 — — 7,757 — ( 7,757 ) —

Equity awards issued, net of forfeitures — 96 35,265 — — 35,361 1,172 2,673 39,206

Shares canceled for tax withholding on vested equity awards — ( 28 ) ( 7,721 ) — — ( 7,749 ) — — ( 7,749 )

Costs of noncontrolling interests — — ( 6,707 ) — — ( 6,707 ) — — ( 6,707 )

Warrant issuance (Note 10)

— — 20,240 — — 20,240 — — 20,240

Redemption of OP Units for class A common stock — 20 4,627 — — 4,647 — ( 4,647 ) —

Equity-based compensation — 66 51,224 — — 51,290 2,841 3,898 58,029

Shares canceled for tax withholdings on vested equity awards — ( 29 ) ( 19,331 ) — — ( 19,360 ) — — ( 19,360 )

Contributions from noncontrolling interests — — — — — — 202,471 — 202,471

1 unchanged sentence

Preferred stock dividends — — — ( 70,627 ) — ( 70,627 ) — — ( 70,627 )

Common stock dividends declared ($ 0.44 per share)

— — — ( 52,854 ) — ( 52,854 ) — — ( 52,854 )

Reallocation of equity (Note 2 and 10)

Reallocation of equity (Notes 2 and 9)

— — ( 11,605 ) — 855 ( 10,750 ) 4,682 6,068 —

Balance at December 31, 2021 854,232 5,692 7,820,807 ( 6,576,180 ) 42,383 2,146,934 2,653,173 112,283 4,912,390

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

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

DigitalBridge Group, Inc.

1 unchanged sentence

(In thousands, except per share data)

Preferred Stock Common Stock Additional Paid-in Capital Accumulated Deficit Accumulated Other Comprehensive Income Total Stockholders’ Equity Noncontrolling Interests in Investment Entities Noncontrolling Interests in Operating Company Total Equity

Preferred Stock Common Stock Additional Paid-in Capital Accumulated Deficit Accumulated Other Comprehensive Income (Loss) Total Stockholders’ Equity Noncontrolling Interests in Investment Entities Noncontrolling Interests in Operating Company Total Equity

Balance at December 31, 2021

Net loss — — — ( 310,097 ) — ( 310,097 ) ( 500,980 ) ( 40,511 ) ( 851,588 )

Other comprehensive loss — — — — ( 79,113 ) ( 79,113 ) ( 80,560 ) ( 8,272 ) ( 167,945 )

Redemption of preferred stock (Note 9)

$ 854,232 $ 5,692 $ 7,820,807 $ ( 6,576,180 ) $ 42,383 $ 2,146,934 $ 2,653,173 $ 112,283 $ 4,912,390

Net income (loss) — — — ( 321,797 ) — ( 321,797 ) ( 189,053 ) ( 32,369 ) ( 543,219 )

Other comprehensive income (loss) — — — — ( 44,021 ) ( 44,021 ) ( 14,072 ) ( 3,747 ) ( 61,840 )

Stock repurchases ( 53,877 ) ( 168 ) ( 53,740 ) — — ( 107,785 ) — — ( 107,785 )

Cost of DataBank recapitalization — — ( 13,122 ) — — ( 13,122 ) ( 21,247 ) — ( 34,369 )

DataBank recapitalization (Note 9)

— — 230,238 — — 230,238 ( 230,238 ) — —

Exchange of notes for common stock (Note 7)

— 256 177,562 — — 177,818 — — 177,818

Shares issued pursuant to settlement liability (Note 11)

Adjustment of redeemable noncontrolling interest and warrants to fair value (Note 9)

— — ( 725,026 ) — — ( 725,026 ) — — ( 725,026 )

Shares issued for redemption of redeemable noncontrolling interest (Note 9)

— 577 348,182 — — 348,759 — — 348,759

Transaction costs incurred in connection with redemption of redeemable noncontrolling interest — — ( 7,137 ) — — ( 7,137 ) — — ( 7,137 )

Reclassification of carried interest allocated to redeemable noncontrolling interest to noncontrolling interest in investment entities (Note 9)

— — — — — — 4,087 — 4,087

Assumption of deferred tax asset resulting from redemption of redeemable noncontrolling interest (Note 9)

— — 5,200 — — 5,200 — — 5,200

Deconsolidation of investment entities (Note 2)

— — — — — — ( 376,177 ) — ( 376,177 )

Redemption of OP Units for common stock — 20 4,627 — — 4,647 — ( 4,647 ) —

Equity awards issued, net of forfeitures — 66 51,224 — — 51,290 2,841 3,898 58,029

Shares canceled for tax withholding on vested equity awards — ( 29 ) ( 19,331 ) — — ( 19,360 ) — — ( 19,360 )

Redemption of OP Units for class A common stock — 4 337 — — 341 — ( 341 ) —

Equity-based compensation — 63 39,933 — — 39,996 12,834 2,498 55,328

Shares canceled for tax withholdings on vested equity awards — ( 27 ) ( 18,212 ) — — ( 18,239 ) — — ( 18,239 )

Issuance of OP Units in connection with business combinations — — — — — — — — —

Acquisition from noncontrolling interests — — — — — — ( 32,076 ) — ( 32,076 )

Contributions from noncontrolling interests — — — — — — 2,613,962 — 2,613,962

1 unchanged sentence

Preferred stock dividends — — — ( 61,401 ) — ( 61,401 ) — — ( 61,401 )

Common stock dividends declared ($ 0.02 per share)

— — — ( 3,235 ) — ( 3,235 ) — — ( 3,235 )

Reallocation of equity (Notes 2 and 9)

1 unchanged sentence

Balance at December 31, 2022

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

$ 800,355 $ 6,397 $ 7,818,068 $ ( 6,962,613 ) $ ( 1,509 ) $ 1,660,698 $ 2,743,896 $ 64,895 $ 4,469,489

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

DigitalBridge Group, Inc.

3 unchanged sentences

Balance at December 31, 2022

Net loss — — — ( 321,797 ) — ( 321,797 ) ( 189,053 ) ( 32,369 ) ( 543,219 )

Other comprehensive loss — — — — ( 44,021 ) ( 44,021 ) ( 14,072 ) ( 3,747 ) ( 61,840 )

Stock repurchases ( 53,877 ) ( 168 ) ( 53,740 ) — — ( 107,785 ) — — ( 107,785 )

Cost of DataBank recapitalization — — ( 13,122 ) — — ( 13,122 ) ( 21,247 ) — ( 34,369 )

DataBank recapitalization (Note 10)

$ 800,355 $ 6,397 $ 7,818,068 $ ( 6,962,613 ) $ ( 1,509 ) $ 1,660,698 $ 2,743,896 $ 64,895 $ 4,469,489

Exchange of notes for common stock (Note 8)

— 256 177,562 — — 177,818 — — 177,818

Adjustment of redeemable noncontrolling interest and warrants to fair value (Note 10)

Net income (loss) — — — 185,280 — 185,280 ( 155,756 ) 9,138 38,662

Other comprehensive income (loss) — — — — 1,954 1,954 416 227 2,597

Stock repurchases (Note 8)

( 5,685 ) — 927 — — ( 4,758 ) — — ( 4,758 )

Shares issued for redemption of redeemable noncontrolling interest (Note 10)

Change in common stock par value (Note 8)

— ( 4,862 ) 4,862 — — — — — —

Transaction costs incurred in connection with redemption of redeemable noncontrolling interest — — ( 7,137 ) — — ( 7,137 ) — — ( 7,137 )

Reclassification of carried interest allocated to redeemable noncontrolling interest to noncontrolling interest in investment entities (Note 10)

DataBank recapitalization (Note 9)

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

Assumption of deferred tax asset resulting from redemption of redeemable noncontrolling interest (Note 10)

Vantage SDC expansion capacity funded through equity, net of liability settlement (Note 9)

— — 12,255 — — 12,255 97,307 — 109,562

3 unchanged sentences

Equity-based compensation — 122 53,343 — — 53,465 14,010 164 67,639

Shares canceled for tax withholding on vested stock awards — ( 27 ) ( 18,212 ) — — ( 18,239 ) — — ( 18,239 )

Acquisition of noncontrolling interest — — — — — — ( 32,076 ) — ( 32,076 )

Shares canceled for tax withholdings on vested stock awards — ( 26 ) ( 18,654 ) — — ( 18,680 ) — — ( 18,680 )

Contributions from noncontrolling interests — — — — — — 115,781 — 115,781

3 unchanged sentences

— — — ( 6,513 ) — ( 6,513 ) — — ( 6,513 )

Reallocation of equity (Notes 2 and 10)

Reallocation of equity (Note 2 and Note 9)

— — ( 1,149 ) — 1 ( 1,148 ) ( 844 ) 1,992 —

Balance at December 31, 2023

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

794,670 1,634 7,855,842 ( 6,842,502 ) 1,411 1,811,055 605,311 74,935 2,491,301

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

DigitalBridge Group, Inc.

4 unchanged sentences

Cash Flows from Operating Activities

Net loss $ ( 569,997 ) $ ( 816,911 ) $ ( 3,790,410 )

Adjustments to reconcile net loss to net cash provided by operating activities:

Net income (loss) $ 45,165 $ ( 569,997 ) $ ( 816,911 )

Adjustments to reconcile net income (loss) to net cash provided by (used in) operating activities:

Amortization of discount and net origination fees on loans receivable and debt securities — — —

Paid-in-kind interest added to loan principal, net of interest received ( 7,144 ) 8,398 ( 38,398 )

Paid-in-kind interest added to loan principal ( 948 ) ( 7,144 ) 8,398

Straight-line rent income ( 10,286 ) ( 25,488 ) 2,778

1 unchanged sentence

Amortization of deferred financing costs and debt discount and premium, net 21,119 106,410 65,129

Equity method (earnings) losses ( 389,584 ) 7,248 463,866

Unrealized carried interest allocation ( 334,672 ) ( 253,447 ) ( 100,800 )

Unrealized principal investment income ( 145,448 ) ( 56,731 ) ( 86,023 )

Other equity method (earnings) losses 15,188 45,489 194,071

Distributions of income from equity method investments 3,776 2,992 3,054

Impairment of real estate and intangible assets — 35,985 319,263

Allowance for doubtful accounts — — 3,294

Impairment of real estate and related intangibles and right-of-use asset 35,985 319,263 1,987,130

Goodwill impairment — — 594,000

Depreciation and amortization 485,551 579,250 636,555

Equity-based compensation 67,639 54,710 59,416

Unrealized settlement loss — — 3,890

Gain on sales of real estate, net — — ( 49,429 )

Deferred income tax (benefit) expense ( 69 ) 11,572 ( 68,454 )

Loss on extinguishment of exchangeable notes 133,173 25,088 —

Other loss, net 22,245 60,231 211,967

(Increase) decrease in other assets and due from affiliates 35,372 ( 72,700 ) 14,392

Increase in accrued and other liabilities and due to affiliates 148,980 67,719 16,763

(Gain) Loss on debt extinguishment — 133,173 ( 29,099 )

Other (gain) loss, net ( 101,209 ) 22,245 114,418

Other adjustments, net 162 ( 997 ) ( 7,484 )

Net cash provided by operating activities 262,582 248,237 89,893

(Increase) decrease in other assets and due from affiliates ( 7,058 ) 35,372 ( 72,700 )

Increase (decrease) in accrued and other liabilities and due to affiliates 193,063 148,980 67,719

Net cash provided by (used in) operating activities 233,637 262,582 248,237

Cash Flows from Investing Activities

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Return of capital from equity method investments 79,229 59,248 90,205

Proceeds from sale of equity investments 695,683 522,337 564,025

Acquisition of loans receivable and debt securities — ( 164,815 ) ( 147,498 )

Proceeds from paydown and maturity of debt securities — 573 1,261

Net disbursements on originated loans — ( 215,918 ) ( 33,272 )

Repayments of loans receivable 6,804 23,956 485,613

Proceeds from sales of loans receivable and debt securities, including transfers of warehoused loans 401,002 146,004 46,272

Proceeds from sales of loans receivable and debt securities — 401,002 146,004

Acquisition of and additions to real estate, related intangibles and leasing commissions ( 653,470 ) ( 2,141,237 ) ( 828,361 )

Proceeds from sales of real estate, including transfers of warehoused assets, net of property level cash transferred to buyer 162,268 408,391 431,198

Proceeds from paydown and maturity of debt securities 573 1,261 5,721

Proceeds from sale of equity investments 522,337 564,025 287,899

Proceeds from sales of real estate investment holding entities — 162,268 408,391

Investment deposits ( 4,140 ) 630 ( 21,418 )

Proceeds from sale of corporate fixed assets — 14,946 —

Net receipts on settlement of derivatives 9,352 17,123 27,097

Acquisition of DBH, net of cash acquired, and payment of deferred purchase price

Net receipt (payment) on settlement of derivatives 3,401 9,352 17,123

Acquisition of InfraBridge, net of cash acquired (Note 3)

( 314,266 ) — —

Proceeds from sale of fixed assets — — 14,946

Cash and restricted cash derecognized in deconsolidation of investment entities

( 229,183 ) — —

Proceeds from DataBank recapitalization, net of carried interest distribution

Other investing activities, net — ( 769 ) ( 833 )

Net cash (used in) provided by investing activities ( 1,913,408 ) 146,565 ( 1,931,980 )

Net cash provided by (used in) investing activities ( 979,044 ) ( 1,913,408 ) 146,565

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

DigitalBridge Group, Inc.

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Repurchases of common stock — ( 55,006 ) —

Debt borrowings 1,162,726 2,439,722 2,907,833

Debt repayments ( 514,505 ) ( 1,720,402 ) ( 2,654,999 )

Payment of deferred financing costs ( 18,688 ) ( 48,127 ) ( 54,750 )

Borrowings on corporate debt — 290,000 345,000

Repayments of corporate debt, including senior notes ( 200,000 ) ( 304,237 ) ( 76,502 )

Borrowings from investment level debt

1,722,443 872,726 2,094,722

Repayments of investment level debt

( 1,199,865 ) ( 210,268 ) ( 1,643,900 )

Payment of deferred financing costs and prepayment penalties on investment level debt ( 38,029 ) ( 18,688 ) ( 48,127 )

Contributions from noncontrolling interests 116,081 2,625,612 232,144

Distributions to and redemptions of noncontrolling interests ( 163,802 ) ( 2,109,229 ) ( 249,083 )

Contribution from Wafra

Redemptions/repurchases of preferred stock ( 52,779 ) ( 150,250 ) ( 402,855 )

Payment of contingent consideration to Wafra

( 90,000 ) — —

Repurchases of preferred stock ( 4,758 ) ( 52,779 ) ( 150,250 )

Shares canceled for tax withholdings on vested equity awards ( 18,680 ) ( 18,239 ) ( 19,360 )

Acquisition of noncontrolling interest — ( 32,076 ) —

Other financing activities, net — — ( 3,382 )

Net cash provided by financing activities 923,785 411,260 1,373,027

Net cash provided by (used in) financing activities 58,152 923,785 411,260

Effect of exchange rates on cash, cash equivalents and restricted cash 766 ( 2,465 ) ( 2,825 )

Net (decrease) increase in cash, cash equivalents and restricted cash ( 729,506 ) 803,237 ( 461,690 )

Net increase (decrease) in cash, cash equivalents and restricted cash ( 686,489 ) ( 729,506 ) 803,237

Cash, cash equivalents and restricted cash—beginning of period

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2023 2022 2021

Beginning of the period

Beginning of period

Cash and cash equivalents $ 855,564 $ 1,226,897 $ 703,544

Restricted cash 4,854 7,511 67,772

Restricted cash included in assets held for disposition 65,022 191,692 218,834

Assets of discontinued operations—cash and cash equivalents

62,690 375,205 —

Assets of discontinued operations—restricted cash

113,631 156,632 191,692

Total cash, cash equivalents and restricted cash—beginning of period

End of the period

$ 1,036,739 $ 1,766,245 $ 963,008

End of period

Cash and cash equivalents $ 345,335 $ 855,564 $ 1,226,897

Restricted cash 4,915 4,854 7,511

Restricted cash included in assets held for disposition — 65,022 191,692

Assets of discontinued operations—cash and cash equivalents

— 62,690 375,205

Assets of discontinued operations—restricted cash

— 113,631 156,632

Total cash, cash equivalents and restricted cash—end of period

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

$ 350,250 $ 1,036,739 $ 1,766,245

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

Supplemental Disclosure of Cash Flow Information

Year Ended December 31,

(In thousands) 2023 2022 2021

Supplemental Disclosure of Cash Flow Information

Cash paid for interest, net of amounts capitalized of $ 5,433 , $ 3,206 and $ 1,567

$ 179,071 $ 219,851 $ 444,365

Cash received (paid) for income taxes 57 11,747 5,927

Operating lease payments for corporate offices

9,096 9,651 10,358

Operating lease payments for TowerCo

Supplemental Disclosure of Cash Flows from Discontinued Operations

Net cash provided by (used in) operating activities of discontinued operations $ 233,903 $ 300,482 $ 375,250

Net cash provided by (used in) investing activities of discontinued operations ( 600,050 ) ( 1,377,005 ) 336,102

Supplemental Disclosure of Noncash Investing and Financing Activities

Dividends and distributions payable $ 16,477 $ 16,491 $ 15,759

Receivables from asset sales 662 16,824 14,045

Contingent consideration for acquisition of InfraBridge 10,874 — —

Redemption of OP Units for common stock 984 341 4,647

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

Exchange of notes into shares of Class A common stock — 60,317 161,261

Debt assumed by buyer in sale of real estate — — 44,148

Seller note received in sale of NRF Holdco equity (Note 2)

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

Vantage SDC capacity funded through equity, net of liability settlement (Note 9)

Operating lease ROU assets and lease liabilities established for corporate offices

15,314 5,837 421

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

8,659,140 4,689,188 5,614,465

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

5,941,332 3,948,016 4,291,557

Assets of investment entities deconsolidated (1)

Liabilities of investment entities deconsolidated (1)

Noncontrolling interests of investment entities disposed of in sale of equity and/or deconsolidated (1)

2,398,693 415,098 1,080,134

(1) Represents deconsolidation of Vantage SDC and DataBank in 2023, sale of Wellness Infrastructure business in 2022, and sale of non-digital investment portfolio and hospitality business in 2021 (Notes 9 and 2)

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

DigitalBridge Group, Inc.

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Business and Organization

DigitalBridge Group, Inc., or DBRG, (together with its consolidated subsidiaries, the "Company") is a leading global digital infrastructure investment manager.

DigitalBridge Group, Inc.

("DBRG," and together with its consolidated subsidiaries, the "Company") is a leading global digital infrastructure investment manager.

The Company deploys and manages capital on behalf of its investors and shareholders across the digital infrastructure ecosystem, including data centers, cell towers, fiber networks, small cells, and edge infrastructure.

The Company's investment management platform is anchored by its flagship value-add digital infrastructure equity offerings, and has expanded to include offerings in core equity, credit and liquid securities.

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

On December 31, 2023, t he Operating segment was discontinued following full deconsolidation of the portfolio companies in the Operating segment , as discussed in Note 9, at which time, the activities thereof qualified as discontinued operations (Note 2).

All prior periods presented have been reclassified to conform to current period presentation as discontinued operations.

The Company operates as a taxable C Corporation commencing with the taxable year ended December 31, 2022.

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") .

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The remaining 7 % is owned primarily by certain current and former employees of the Company as noncontrolling interests.

Transition to Taxable C Corporation

Following the completion of the Company's business transformation in the first quarter of 2022 (as described below) and due to the pace of growth of its investment management business and other strategic transactions that it may pursue, the Company’s Board of Directors and management agreed to discontinue actions necessary to maintain qualification as a real estate investment trust ("REIT") for 2022.

Commencing with the taxable year ended December 31, 2022, all of the Company’s taxable income, except for income generated by subsidiaries that have elected or anticipate electing REIT status, is subject to U.S.

federal and state income tax at the applicable corporate tax rate.

Dividends paid to stockholders are no longer tax deductible.

The Company is also no longer subject to the REIT requirement for distributions to stockholders when the Company has taxable income.

The Company anticipates that operating as a taxable C Corporation will provide the Company with flexibility to execute various strategic initiatives without the constraints of complying with REIT requirements.

This includes retaining and reinvesting earnings in other new initiatives in the investment management business.

The Company’s transition to a taxable C Corporation is not expected to result in significant incremental current income tax expense in the near term due to the availability of significant capital loss and net operating loss (“NOL”) carryforwards.

Furthermore, earnings from the Company's investment management business, which is conducted through its previously designated taxable REIT subsidiaries ("TRS"), remain the primary source of income subject to U.S.

federal and state income tax.

See Note 17 for additional information.

Business Transformation

In February 2022, the Company completed the disposition of substantially all of its non-digital assets.

This marked the completion of the Company's transformation from a REIT and investment manager in traditional real estate into an investment manager focused primarily on digital infrastructure.

The disposition of its hotel portfolio (March 2021), Other Equity and Debt ("OED") investments and non-digital investment management ("Other IM") business (December 2021), and Wellness Infrastructure portfolio (February 2022) each represented a strategic shift in the Company's business that had a significant effect on the Company’s operations and financial results, and accordingly, had met the criteria as discontinued operations.

For all current and prior periods presented, the related assets and liabilities, to the extent they have not been disposed at the respective balance sheet dates, are presented as assets and liabilities held for disposition on the consolidated balance sheets (Note 21), and the related operating results are presented as discontinued operations on the consolidated statements of operations (Note 22).

Summary of Significant Accounting Policies

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

Noncontrolling interests represents predominantly the majority ownership held by third party investors in the Company's Operating segment, carried interest allocation to certain senior executives of the Company (Note 16), and membership interests in OP held by certain current and former employees of the Company.

To the extent the Company consolidates a subsidiary that is subject to industry-specific guidance such as investment company accounting applied by the Company's consolidated sponsored funds, the Company retains the industry-specific guidance applied by that subsidiary in its consolidated financial statements.

Noncontrolling interests represents predominantly the majority ownership held by third party investors in the Company's former Operating segment, carried interest allocation to certain senior executives of the Company (Note 16), and membership interests in OP held by certain current and former employees of the Company.

To the extent the Company consolidates a subsidiary that is subject to industry-specific guidance such as investment company accounting applied by the Company's consolidated funds, the Company retains the industry-specific guidance applied by that subsidiary in its consolidated financial statements.

Use of Estimates

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

This assessment may involve subjectivity in the determination of which activities most significantly affect the VIE’s performance, and estimates about current and future fair value of the assets held by the VIE and financial performance of the VIE.

This assessment may involve subjectivity in the determination of which activities most significantly affect the VIE’s performance, and estimates about current and

future fair value of the assets held by the VIE and financial performance of the VIE.

In assessing its interests in the VIE, the Company also considers interests held by its related parties, including de facto agents.

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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.

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.

Noncontrolling Interests

5 unchanged sentences

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

The redeemable noncontrolling interests in the Company's investment management business was redeemed in May 2022 (Note 10).

Noncontrolling Interests in Investment Entities —This represents predominantly the majority ownership held by third party investors in the Company's Operating segment and carried interest allocation to certain senior executives of the Company (Note 16).

Prior to full redemption in May 2022, there was also redeemable noncontrolling interests in the Company's investment management business, as discussed in Note 9.

Noncontrolling Interests in Investment Entities —This represents predominantly carried interest allocation to certain senior executives of the Company (Note 16).

Excluding carried interests, allocation of net income or loss is generally based upon relative ownership interests.

5 unchanged sentences

Assets and liabilities denominated in a foreign currency for which the functional currency is a foreign currency are translated using the exchange rate in effect at the balance sheet date and the corresponding results of operations for such entities are translated using the average exchange rate in effect during the period.

The resulting foreign currency translation adjustments are recorded as a component of accumulated other comprehensive income or loss in stockholders’ equity.

Upon sale, complete or substantially complete liquidation of a foreign subsidiary, or upon partial sale of a foreign equity method investment, the translation adjustment associated with the investment, or a proportionate share related to the portion of equity method investment sold, is reclassified from accumulated other comprehensive income or loss into earnings.

The resulting foreign currency

translation adjustments are recorded as a component of accumulated other comprehensive income or loss in stockholders’ equity.

Upon sale, complete or substantially complete liquidation of a foreign subsidiary, or upon partial sale of a foreign equity method investment, the translation adjustment associated with the foreign subsidiary or investment, or a proportionate share related to the portion of equity method investment sold, is reclassified from accumulated other comprehensive income or loss into earnings.

Financial assets and liabilities denominated in a foreign currency for which the functional currency is the U.S.

16 unchanged sentences

The election is irrevocable unless a new election event occurs.

The Company has elected to account for all of its loans receivable and certain equity method investments at fair value.

The Company has elected fair value option to account for certain equity method investments and loans receivable.

Business Combinations

4 unchanged sentences

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

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

The cost of assets acquired in a group is allocated to individual assets within the group based on their relative fair values and does not give rise to goodwill.

Transaction costs related to acquisition of assets are included in the cost basis of the assets acquired.

Business Combinations —The Company accounts for acquisitions that qualify as business combinations by applying the acquisition method.

1 unchanged sentence

The identifiable assets acquired, liabilities assumed and noncontrolling interests in an acquired entity are recognized and measured at their estimated fair values, except as discussed below.

The excess of the consideration transferred over the value of identifiable assets acquired, liabilities assumed and noncontrolling interests in an acquired entity, net of fair value of any previously held interest in the acquired entity, is recorded as goodwill.

of the consideration transferred over the value of identifiable assets acquired, liabilities assumed and noncontrolling interests in an acquired entity, net of fair value of any previously held interest in the acquired entity, is recorded as goodwill.

Such valuations require management to make significant estimates and assumptions.

1 unchanged sentence

Instead, the Company determines the value of these revenue contracts as if it had originated the acquired contracts by evaluating the associated performance obligations, transaction price and relative stand-alone selling price at the original contract inception date or subsequent modification dates.

The estimated fair values and allocation of consideration are subject to adjustments during the measurement period, not to exceed one year, based upon new information obtained about facts and circumstances that existed at time of acquisition.

Contingent Consideration —Contingent consideration is classified as a liability or equity, as applicable.

Contingent consideration in connection with the acquisition of a business or a VIE is measured at fair value on acquisition date, and unless classified as equity, is remeasured at fair value each reporting period thereafter until the consideration is settled, with changes in fair value included in net income.

Contingent consideration in connection with the acquisition of assets (and that is not a VIE) is generally recognized when the liability is considered both probable and reasonably estimable, as part of the basis of the acquired assets .

Discontinued Operations

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

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

The disposition of (i) NRF Holdco, LLC ("NRF Holdco"), a former subsidiary of the Company that held the Wellness Infrastructure business, in February 2022, (ii) a substantial majority of the OED investments and Other IM business in December 2021, (iii) the hotel business, composed of the Hospitality segment and the THL Hotel Portfolio in March 2021, and (iv) the bulk and light industrial portfolios in December 2020 and December 2019, respectively, all represent strategic shifts that have or are expected to have major effects on the Company’s operations and financial results, and have met the criteria as discontinued operations as of June 2021, March 2021, September 2020, and June 2019, respectively.

Accordingly, for all prior periods presented, the related assets and liabilities are presented as assets and liabilities held for disposition on the consolidated balance sheets (Note 21) and the related operating results are presented as income (loss) from discontinued operations on the consolidated statements of operations (Note 22).

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

Cash and Cash Equivalents

1 unchanged sentence

The Company's cash and cash equivalents are held with major financial institutions and may at times exceed federally insured limits.

Also included are unrestricted cash held by subsidiaries in third party accounts that have the general characteristics of demand deposits.

Restricted Cash

Restricted cash consists primarily of cash reserves maintained pursuant to the governing agreements of the various securitized debt of the Company and its subsidiaries.

Real Estate Assets

Real Estate Acquisitions

Real estate acquisitions are recorded at the fair values of the acquired components at the time of acquisition, allocated among land, building, site and building improvements, infrastructure, equipment, lease-related tangible and intangible assets and liabilities, such as tenant improvements, deferred leasing costs, in-place lease values, above- and below-market lease values, and tenant relationships.

The estimated fair value of acquired land is derived from recent comparable sales of land and listings within the same local region based on available market data.

The estimated fair value of acquired buildings and building improvements is derived from comparable sales, discounted cash flow analysis using market-based assumptions, or replacement cost for a similar property, as appropriate.

The fair value of site and tenant improvements and infrastructure assets are estimated based upon current market replacement costs and other relevant market rate information.

Real Estate Held for Investment

Real estate held for investment are carried at cost less accumulated depreciation.

Costs Capitalized or Expensed— Expenditures for ordinary repairs and maintenance are expensed as incurred, while expenditures for significant renovations that improve or extend the useful life of the asset are capitalized and depreciated over their estimated useful lives.

Depreciation— Real estate held for investment, other than land, are depreciated on a straight-line basis over the estimated useful lives of the assets, as follows:

Real Estate Assets Term

Site improvements 5 to 40 years

Building 5 to 50 years

Building improvements 5 to 40 years

Tenant improvements Lesser of useful life or remaining term of lease

Data center infrastructure 5 to 30 years

Furniture, fixtures and equipment 1 to 8 years

Impairment —The Company evaluates its real estate held for investment for impairment periodically or whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable.

The Company evaluates real estate for impairment generally on an individual property basis.

If an impairment indicator exists, the Company evaluates the undiscounted future net cash flows that are expected to be generated by the property, including any estimated proceeds from the eventual disposition of the property.

If multiple outcomes are under consideration, the Company may apply either a probability-weighted cash flows approach or the single-most-likely estimate of cash flows approach, whichever is more appropriate under the circumstances.

Based upon the analysis, if the carrying value of a property exceeds its undiscounted future net cash flows, an impairment loss is recognized for the excess of the carrying value of the property over the estimated fair value of the property.

In evaluating and/or measuring impairment, the Company considers, among other things, current and estimated future cash flows associated with each property for the duration of the estimated hold period of each property, market information for each sub-market, including, where applicable, competition levels, foreclosure levels, leasing trends, occupancy trends, lease or room rates, and the market prices of similar properties recently sold or currently being offered for sale, expected capitalization rates at exit, and other quantitative and qualitative factors.

Another key consideration in this assessment is the Company's assumptions about the highest and best use of its real estate investments and its intent and ability to hold them for a reasonable period that would allow for the recovery of their carrying values.

If such assumptions change and the Company shortens its expected hold period, this may result in the recognition of impairment losses.

Real Estate Held for Disposition

Real estate is classified as held for disposition in the period when (i) management approves a plan to sell the asset, (ii) the asset is available for immediate sale in its present condition, subject only to usual and customary terms, (iii) a program is initiated to locate a buyer and actively market the asset for sale at a reasonable price, and (iv) completion of the sale is probable within one year.

Real estate held for disposition is stated at the lower of its carrying amount or estimated fair value less disposal cost, with any write-down to fair value less disposal cost recorded as an impairment loss.

For any increase in fair value less disposal cost subsequent to classification as held for disposition, the impairment loss may be reversed, but only up to the amount of cumulative loss previously recognized.

Depreciation is not recorded on assets classified as held for disposition.

At the time a sale is consummated, the excess, if any, of sale price less selling costs over carrying value of the real estate is recognized as a gain.

If circumstances arise that were previously considered unlikely and, as a result, the Company decides not to sell the real estate asset previously classified as held for disposition, the real estate asset is reclassified as held for investment.

Upon reclassification, the real estate asset is measured at the lower of (i) its carrying amount prior to classification as held for disposition, adjusted for depreciation expense that would have been recognized had the real estate been continuously classified as held for investment, or (ii) its estimated fair value at the time the Company decides not to sell.

Foreclosed Properties

The Company may receive foreclosed properties in full or partial settlement of loans receivable by taking legal title or physical possession of the properties.

Foreclosed properties are generally recognized at the time the real estate is received at foreclosure sale or upon execution of a deed in lieu of foreclosure.

Foreclosed properties are initially measured at fair value.

If the fair value of the property is lower than the carrying value of the loan, the difference is recognized as provision for loan loss and the cumulative loss allowance on the loan is charged off.

The Company periodically evaluates foreclosed properties for subsequent decrease in fair value which is recorded as additional impairment loss.

Fair value of foreclosed properties is generally based on third party appraisals, broker price opinions, comparable sales or a combination thereof.

Restricted cash consists primarily of cash reserves maintained pursuant to the governing agreement of the securitized debt of the Company and prior to December 31, 2023, securitized debt of portfolio companies in the Operating segment.

Equity Investments

6 unchanged sentences

Dividend income is recognized on the ex-dividend date and is included in other income.

Fair value changes of equity method investments under the fair value option are recorded in earnings (losses) from equity method investments.

The Company's share of earnings (losses) from equity method investments in its sponsored funds and fair value changes of equity method investments under the fair value option are recorded in principal investment income (loss).

Fair value changes of other equity investments, including adjustments for observable price changes under the measurement alternative, are recorded in other gain (loss).

Equity Method Investments

The Company accounts for investments under the equity method of accounting if it has the ability to exercise significant influence over the operating and financial policies of an entity, but does not have a controlling financial interest.

Equity Method Investments —The Company accounts for investments under the equity method of accounting if it has the ability to exercise significant influence over the operating and financial policies of an entity, but does not have a controlling financial interest.

The equity method investment is initially recorded at cost and adjusted each period for capital contributions, distributions and the Company's share of the entity’s net income or loss as well as other comprehensive income or loss.

The Company's share of net income or loss may differ from the stated ownership percentage interest in an entity if the governing documents prescribe a substantive non-proportionate earnings allocation formula or a preferred return to certain investors.

For certain equity method investments, the Company records its proportionate share of income on a one to three month lag.

For certain equity method investments, the Company may record its proportionate share of income (loss) on a one to three month lag.

Distributions of operating profits from equity method investments are reported as operating activities, while distributions in excess of operating profits are reported as investing activities in the statement of cash flows under the cumulative earnings approach.

1 unchanged sentence

The Company recognizes earnings based on its proportionate share of results from these investment vehicles and a disproportionate allocation of returns based on the extent to which cumulative performance exceeds minimum return hurdles pursuant to terms of their respective governing agreements (“carried interests”).

Carried interest generally arises when appreciation in value of the underlying investments of the fund exceeds the minimum return hurdles, after factoring in a return of invested capital and a return of certain costs of the fund pursuant to terms of the governing documents of the fund.

The amount of carried interest recognized is based upon the cumulative performance of the fund if it were liquidated as of the reporting date.

Unrealized carried interest is driven primarily by changes in fair value of the underlying investments of the fund, which could be affected by various factors, including but not limited to the financial performance of the portfolio company, economic conditions, foreign exchange rates, comparable transactions in the market, and equity prices for publicly traded securities.

Unrealized carried interest may be subject to reversal until such time it is realized.

Realization of carried interest occurs upon disposition of all underlying investments of the fund, or in part with each disposition.

Generally, carried interest is distributed upon profitable disposition of an investment if at the time of distribution, cumulative returns of the fund exceed minimum return hurdles.

Depending on the final realized value of all investments at the end of the life of a fund (and, with respect to certain funds, periodically during the life of the fund), if it is determined that cumulative carried interest distributions have exceeded the final carried interest amount earned (or amount earned as of the calculation date), the Company is obligated to return the excess carried interest received.

Therefore, carried interest distributions may be subject to clawback if decline in investment values results in cumulative performance of the fund falling below minimum return hurdles in the interim period.

If it is determined that the Company has a clawback obligation, a liability would be established based upon a hypothetical liquidation of the net assets of the fund at reporting date.

The actual determination and required payment of any clawback obligation would generally occur after final disposition of the investments of the fund or otherwise as set forth in the governing documents of the fund.

Evaluation of impairment applies to equity method investments and equity investments under the measurement alternative.

Carried interest is discussed further in Note 4.

Impairment —Evaluation of impairment applies to equity method investments for which fair value option has not been elected and equity investments under the measurement alternative.

If indicators of impairment exist, the Company will first estimate the fair value of its investment.

In assessing fair value, the Company generally considers, among others, the estimated enterprise value of the investee or fair value of the investee's underlying net assets, including net cash flows to be generated by the investee as applicable, and for equity

method investees with publicly traded equity, the traded price of the equity securities in an active market.

For investments under the measurement alternative, if carrying value of the investment exceeds its fair value, an impairment is deemed to have occurred.

For equity method investments, further consideration is made if a decrease in value of the investment is other-than-temporary to determine if impairment loss should be recognized.

Assessment of other-than-temporary impairment ("OTTI") involves management judgment, including, but not limited to, consideration of the investee’s financial condition, operating results, business prospects and creditworthiness, the Company's ability and intent to hold the investment until recovery of its carrying value, or a significant and prolonged decline in traded price of the investee’s equity security.

Assessment of other-than-temporary impairment involves management judgment, including, but not limited to, consideration of the investee’s financial condition, operating results, business prospects and creditworthiness, the Company's ability and intent to hold the investment until recovery of its carrying value, or a significant and prolonged decline in traded price of the investee’s equity security.

If management is unable to reasonably assert that an impairment is temporary or believes that the Company may not fully recover the carrying value of its investment, then the impairment is considered to be other-than-temporary.

1 unchanged sentence

Impairment loss is recorded in equity method earnings for equity method investments and in other gain (loss) for investments under the measurement alternative.

Loans Receivable

Loans that the Company has the intent and ability to hold for the foreseeable future are classified as held for investment.

Loans that the Company intends to sell or liquidate in the foreseeable future are classified as held for disposition.

Interest income is recognized based upon contractual interest rate and unpaid principal balance of the loans.

Loans that are past due 90 days or more as to principal or interest, or where reasonable doubt exists as to timely collection, are generally considered nonperforming, with reversal of interest income and suspension of interest income recognition.

Recognition of interest income may be restored when all principal and interest are current and full repayment of the remaining contractual principal and interest are reasonably assured.

The Company has elected the fair value option for all loans receivable.

Loan fair values are generally determined either:

by comparing the current yield to the estimated yield of newly originated loans with similar credit risk or the market yield at which a third party might expect to purchase such investment;

or based upon discounted cash flow projections of principal and interest expected to be collected, which projections include, but are not limited to, consideration of the financial standing of the borrower or sponsor as well as operating results and/or value of the underlying collateral.

For loans that are nonperforming where recognition of interest income is suspended, any interest subsequently collected is recognized on a cash basis by crediting income when received.

Origination and other fees charged to the borrower are recognized immediately as interest income when earned.

Costs to originate or purchase loans are expensed as incurred.

Debt Securities

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Upon disposition of AFS debt securities, the cumulative gains or losses in other comprehensive income (loss) that are realized are recognized in other gain (loss), net, on the statement of operations based on specific identification.

Interest Income —Interest income from debt securities, including stated coupon interest payments and amortization of purchase premiums or discounts, is recognized using the effective interest method over the expected lives of the debt securities.

For beneficial interests in debt securities that are not of high credit quality (generally credit rating below AA) or that can be contractually settled such that the Company would not recover substantially all of its recorded investment, interest income is recognized as the accretable yield over the life of the securities using the effective yield method.

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In assessing impairment and estimating future expected cash flows, factors considered include, but are not limited to, credit rating of the security, financial condition of the issuer, defaults for similar securities, performance and value of assets underlying an asset-backed security.

Loans Receivable

Loans that the Company has the intent and ability to hold for the foreseeable future are classified as held for investment.

Loans that the Company intends to sell or liquidate in the foreseeable future are classified as held for disposition.

Interest income is recognized based upon contractual interest rate and unpaid principal balance of the loans.

Recognition of interest income may be restored when all principal and interest are current and full repayment of the remaining contractual principal and interest are reasonably assured.

The Company had elected the fair value option for all loans receivable.

Loan fair values are generally determined either:

by comparing the current yield to the estimated yield of newly originated loans with similar credit risk or the market yield at which a third party might expect to purchase such investment;

For loans that are nonperforming where recognition of interest income is suspended, any interest subsequently collected is recognized on a cash basis by crediting income when received.

Origination and other fees charged to the borrower are recognized immediately as interest income when earned.

Costs to originate or purchase loans are expensed as incurred.

Goodwill is an unidentifiable intangible asset and is recognized as a residual, generally measured as the excess of consideration transferred in a business combination over the identifiable assets acquired, liabilities assumed and noncontrolling interests in the acquiree.

Goodwill is assigned to reporting units that are expected to benefit from the synergies of the business combination.

Goodwill is tested for impairment at the reporting units to which it is assigned at least on an annual basis in the fourth quarter of each year, or more frequently if events or changes in circumstances occur that would more likely than not reduce the fair value of a reporting unit below its carrying value, including goodwill.

The assessment of goodwill for impairment may initially be performed based on qualitative factors to determine if it is more likely than not that the fair value of the reporting unit to which the goodwill is assigned is less than its carrying value, including goodwill.

If so, a quantitative assessment is performed to identify both the existence of impairment and the amount of impairment loss.

The Company may bypass the qualitative assessment and proceed directly to performing a quantitative assessment to compare the fair value of a reporting unit with its carrying value, including goodwill.

Impairment is measured as the excess of carrying value over fair value of the reporting unit, with the loss recognized limited to the amount of goodwill assigned to that reporting unit.

An impairment establishes a new basis for goodwill and any impairment loss recognized is not subject to subsequent reversal.

Goodwill impairment tests require judgment, including identification of reporting units, assignment of assets and liabilities to reporting units, assignment of goodwill to reporting units, and determination of the fair value of each reporting unit.

Identifiable Intangibles

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The Company's identifiable intangible assets are generally valued under the income approach, using an estimate of future net cash flows, discounted based upon risk-adjusted returns for similar underlying assets.

Lease-Related Intangibles —Identifiable intangibles recognized in acquisitions of operating real estate include in-place leases, deferred leasing costs, above- or below-market leases, and tenant relationships.

In-place leases generate value over and above the tangible real estate because a property that is occupied with leased space is typically worth more than a vacant building without a lease contract in place.

Acquired in-place leases are valued as the forgone rental income had the property been acquired in an as if vacant state, using market data on comparable and recently signed leases.

Deferred leasing costs represent leasing commissions and legal fees that would otherwise have been incurred if a lease was not in-place.

Acquired in-place leases and deferred leasing costs are amortized on a straight-line basis to depreciation and amortization expense over the remaining term of the applicable leases.

If an in-place lease is terminated, the unamortized portion is charged to depreciation and amortization expense.

The value of the above- or below-market component of acquired leases represents the difference between contractual rents of acquired leases and market rents at the time of the acquisition for the remaining lease term.

Above- or below-market operating lease values are amortized on a straight-line basis as a decrease or increase to rental income, respectively, over the applicable lease terms.

This includes fixed rate renewal options in acquired leases that are assumed to be renewed if below market, which are amortized to increase rental income over the renewal period.

Tenant relationships represent the estimated net cash flows attributable to the likelihood of lease renewal by an existing tenant relative to the cost of obtaining a new lease, taking into consideration the time it would take to execute a new lease or backfill a vacant space.

Tenant relationships are amortized on a straight-line basis to depreciation and amortization expense over its estimated useful life.

Investment Management Intangibles —Identifiable intangibles recognized in acquisition of an investment management business generally include management contracts, which represent contractual rights to future fee income from in-place management contracts that is amortized based upon expected cash flows over the remaining term of the contracts;

and investor relationships, which represent potential fee income generated from future reinvestment by existing investors that is amortized on a straight-line basis over its estimated useful life.

Other Intangible Assets —In addition to leasing activities, data center operators provide various data center services to their customers, largely in the colocation business, which give rise to customer service contract and customer relationship intangible assets in an acquisition of operating data centers.

Customer service contracts are valued based upon an estimate of net cash flows from providing data center services that would have been forgone if these service contracts were not in place, taking into consideration the time it would take to execute a new contract.

Customer service contracts are amortized on a straight-line basis over the remaining term of the respective contracts, and if the service contract is terminated, the remaining unamortized balance is charged off.

Customer relationships represent incremental

net cash flows to the business that is attributable to these in-place relationships, and is amortized on a straight-line basis over its estimated useful life.

Trade names are recognized as a separate identifiable intangible asset to the extent the Company intends to continue using the trade name post-acquisition.

Identifiable intangibles recognized in acquisition of an investment management business generally include management contracts, which represent contractual rights to future fee revenue from in-place management contracts that

are amortized based upon expected cash flows over the remaining term of the contracts;

and investor relationships, which represent potential fee revenue generated from future reinvestment by existing investors that is amortized on a straight-line basis over its estimated useful life.

Other intangible assets include trade names, which are recognized as a separate identifiable intangible asset to the extent the Company intends to continue using the trade name post-acquisition.

Trade names are valued as the savings from royalty fees that would have otherwise been incurred.

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An impairment establishes a new basis for the intangible asset and any impairment loss recognized is not subject to subsequent reversal.

Impairment analysis on lease intangible assets is performed in connection with the impairment assessment of the related real estate.

In evaluating investment management intangibles for impairment, such as management contracts and investor relationships, the Company considers various factors that may affect future fee income, including but not limited to, changes in fee basis, amendments to contractual fee terms, and projected capital raising for future investment vehicles.

In evaluating investment management intangibles for impairment, such as management contracts and investor relationships, the Company considers various factors that may affect future fee revenue, including but not limited to, changes in fee basis, amendments to contractual fee terms, and projected capital raising for future investment vehicles.

Indefinite life trade names are impaired if the Company determines that it no longer intends to use the trade name.

Goodwill is assigned to reporting units that are expected to benefit from the synergies of the business combination.

If so, a quantitative assessment is performed to identify both the existence of impairment and the amount of impairment loss.

Impairment is measured as the excess of carrying value over fair value of the reporting unit, with the loss recognized limited to the amount of goodwill assigned to that reporting unit.

An impairment establishes a new basis for goodwill and any impairment loss recognized is not subject to subsequent reversal.

Accounts Receivable and Related Allowance

Property Operating Income Receivables (excluding lease income receivables) —The Company periodically evaluates aged receivables and considers the collectability of unbilled receivables.

The Company estimates allowance for doubtful accounts for specific accounts receivable balances based upon historical collection trends, age of outstanding accounts receivables and existing economic conditions associated with the receivables.

Cost Reimbursements and Recoverable Expenses —The Company is entitled to reimbursements and/or recovers certain costs paid on behalf of investment vehicles sponsored by the Company, which include:

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and (iii) direct and indirect operating costs associated with managing the operations of certain investment vehicles.

Indirect operating costs are recorded as expenses of the Company when incurred and amounts allocated and reimbursable are recorded as other income in the consolidated statements of operations.

Indirect operating costs are recorded as expenses of the Company when incurred and amounts allocated and reimbursable are recorded as other income in the consolidated statements of operations on a gross basis to the extent the Company determines that it acts in the capacity of a principal in the incurrence of such costs.

The Company facilitates the payments of organization and offering costs, due diligence costs to the extent the related investments are consummated and direct operating costs, all of which are recorded as due from affiliates on the consolidated balance sheets, until such amounts are repaid.

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Depreciation and amortization is recognized on a straight-line basis over the estimated useful life of the assets, which range between 3 and 7 years for furniture, fixtures, equipment and capitalized software, and over the shorter of the lease term or useful life for leasehold improvements.

Transfers of Financial Assets

Sale accounting for transfers of financial assets is limited to the transfer of an entire financial asset, a group of financial assets in its entirety, or a component of a financial asset which meets the definition of a participating interest with characteristics that are similar to the original financial asset.

Transfers of financial assets are accounted for as sales when control over the assets has been surrendered.

If the Company has any continuing involvement, rights or obligations with the transferred financial asset (outside of standard representations and warranties), sale accounting requires that the transfer meets the following conditions:

(1) the transferred asset has been legally isolated;

(2) the transferee has the right (free of conditions that constrain it from taking advantage of that right) to pledge or exchange the transferred asset;

and (3) the Company does not maintain effective control over the transferred asset through an agreement that provides for (a) both an entitlement and an obligation by the Company to repurchase or redeem the asset before its maturity, (b) the unilateral ability by the Company to reclaim the asset and a more than trivial benefit attributable to that ability, or (c) the transferee requiring the Company to repurchase the asset at a price so favorable to the transferee that it is probable the repurchase will occur.

If the criteria for sale accounting are met, the transferred financial asset is removed from the balance sheet and a net gain or loss is recognized upon sale, taking into account any retained interests.

Transfers of financial assets that do not meet the criteria for sale are accounted for as financing transactions.

Derivative Instruments and Hedging Activities

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The Company also made the accounting policy election to treat lease and nonlease components in a lease contract as a single component.

The Company's leasing arrangements are composed primarily of finance and operating leases for data centers, operating ground leases for other investment properties, and operating leases for its corporate offices.

The Company's leasing arrangements are composed primarily of operating ground leases for investment properties, operating leases for its corporate offices and, prior to the deconsolidation of the subsidiaries in the Operating Segment, finance and operating leases for data centers.

Short-term leases are not recorded on the balance sheet, with lease payments expensed on a straight-line basis over the lease term.

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The combination of periodic interest expense and amortization expense on the ROU lease asset effectively reflects installment purchases on the financed leased asset, and results in a front-loaded expense recognition.

Higher interest expense is recorded in the early periods as a constant interest rate is applied to the finance lease liability and the liability decreases over the lease term as cash payments are made.

Higher interest expense is recorded in the early periods as a constant interest rate is applied to the finance

lease liability and the liability decreases over the lease term as cash payments are made.

For operating leases, fixed lease expense is recognized over the lease term on a straight-line basis and variable lease expense is recognized in the period incurred.

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Costs incurred in connection with revolving credit arrangements are recorded as deferred financing costs in other assets, and amortized on a straight-line basis over the expected term of the credit facility.

Property Operating Income

Property operating income includes the following:

The Company's lease income is composed of (i) fixed lease income for rents, and for interconnection services and a committed amount of power related to contracted data center leased space;

and (ii) variable lease income for tenant reimbursements, installation services of Company-owned data center equipment and additional metered power reimbursements based upon usage by data center tenants at prevailing rates.

As lessor, the classification of a lease as a sales-type lease is similar to the criteria for a finance lease as lessee (discussed above).

If none of the criteria are met, a lease may be classified as a direct financing lease if there is a residual value guarantee from an unrelated third party.

Otherwise, all other leases are classified as operating, including leases with variable lease payments that are not based upon a rate or index where classification as sales-type or direct financing lease would result in a loss to the Company at lease commencement.

The Company's lease contracts contain lease components, such as leased data center space and equipment, and nonlease components, such as tenant reimbursements for net leases, interconnection services, installation services of Company-owned data center equipment and payments for power by data center tenants.

As lessor, the Company made the accounting policy election to account for the lease components and nonlease components in its lease contracts as a single component in instances where the lease component is predominant, the timing and pattern of transfer for the lease and nonlease components are the same (i.e., provided on a consistent basis over the same time period), and the lease component, if accounted for separately, would be classified as an operating lease.

Rental Income and Tenant Reimbursements

Rental income is recognized on a straight-line basis over the noncancelable term of the related lease which includes the effects of minimum rent increases and rent abatements under the lease.

Rents received in advance are deferred.

In net lease arrangements, the tenant is generally responsible for operating expenses relating to the property, including real estate taxes, property insurance, maintenance, repairs and improvements.

Costs reimbursable from tenants and other recoverable costs are recognized as revenue in the period the recoverable costs are incurred.

When the Company is the primary obligor with respect to purchasing goods and services for property operations and has discretion in selecting the supplier and retains credit risk, tenant reimbursement revenue and property operating expenses are presented on a gross basis in the statements of operations.

For net leases where the lessee self-manages the property, hires its own service providers and retains credit risk for routine maintenance contracts, no reimbursement revenue and expense are recognized.

For property taxes and insurance, amounts paid directly by lessees to third parties on behalf of the Company are not recognized in the statement of operations, while amounts paid by the Company and reimbursed by lessees are presented gross as property operating income and expenses.

Also, sales and similar taxes assessed by a governmental authority that is imposed on specific lease income producing transactions are netted against related collections from lessees.

When it is determined that the Company is the owner of tenant improvements, the cost to construct the tenant improvements, including costs paid for or reimbursed from the tenants, is capitalized.

For Company-owned tenant improvements, the amounts funded by or reimbursed from the tenants are recorded as deferred revenue, which is amortized on a straight-line basis as additional rental income over the term of the related lease.

Rental income recognition commences when the leased space is substantially ready for its intended use and the tenant takes possession of the leased space.

When it is determined that the tenant is the owner of tenant improvements, the Company's contribution towards those improvements is recorded as a lease incentive, included in deferred leasing costs and intangible assets on the balance sheet, and amortized as a reduction to rental income on a straight-line basis over the term of the lease.

Rental income recognition commences when the tenant takes possession of the lease space.

Collectability —The Company evaluates collectability of lease payments based upon the creditworthiness of the lessee and recognizes lease income only to the extent collection of all amounts due over the life of the lease is determined to be probable.

If collection is subsequently determined to no longer be probable, any previously accrued lease income that has not been collected is subject to reversal.

If collection is subsequently determined to be probable, lease income and corresponding receivable would be reestablished to an amount that would have been recognized if collection had always been deemed to be probable.

Costs to Execute Lease —Only incremental costs of obtaining a lease, such as leasing commissions, qualify as initial direct leasing costs to be capitalized.

Indirect costs such as allocated overhead, certain legal fees and negotiation costs are expensed as incurred.

Resident Fee Income

Resident fee income, presented within discontinued operations, was earned from senior housing operating facilities that operate through management agreements with independent third-party operators.

Resident fee income related to independent living and assisted living facilities was recorded when services were rendered based on terms of their respective lease agreements.

The Company's healthcare business was sold in February 2022.

Data Center Service Revenue

The Company earns data center service revenue, primarily composed of cloud services, data storage, data protection, network services, software licensing, other services related to installation of customer equipment, and other related information technology services, which are recognized as services are provided to data center customers.

Hotel Operating Income

Hotel operating income, presented within discontinued operations, included room revenue, food and beverage sales and other ancillary services.

Revenue was recognized upon occupancy of rooms, consummation of sales and provision of services.

The Company's hotel business was sold in March 2021, with one remaining portfolio that was in receivership sold by the lender in September 2021.

Fee income consists primarily of the following:

Fee revenue consists primarily of the following:

Management Fees —The Company earns management fees for providing investment management services to its sponsored private funds and other investment vehicles, portfolio companies and managed accounts, which constitute a series of distinct services satisfied over time.

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Accordingly, the elimination of these fees does not affect net income (loss) attributable to DBRG.

Recurring other income includes primarily the following:

Other income includes primarily the following:

Cost Reimbursements from Affiliates —For various services provided to certain affiliates, including managed investment vehicles, the Company is entitled to receive reimbursements of expenses incurred, generally based on expenses that are directly attributable to providing those services and/or a portion of overhead costs.

The Company acts in the capacity of a principal under these arrangements.

Accordingly, the Company records the expenses and corresponding reimbursement income on a gross basis in the period the services are rendered and costs are incurred.

Equity Awards Granted by Managed Companies —These were equity awards granted to the Company to be granted

to its employees or granted directly to its employees by BrightSpire Capital, Inc.

("BRSP"), a publicly-traded REIT previously managed by the Company (prior to termination of its management agreement in April 2021).

The initial grant was recorded as an other asset and deferred income liability on the balance sheet.

The liability was amortized on a straight-line basis to other income over the initial vesting period of the award and equity-based compensation expense was recognized as the award vested to the recipient employee.

Compensation expense related to equity awards granted by managed companies is presented within discontinued operations.

To the extent the Company determines that it acts in the capacity of a principal in the incurrence of such costs on behalf of the managed investment vehicle, the cost reimbursement is presented on a gross basis in other income and the expense in either investment-related expense or administrative expense in the consolidated statements of operations in the period the costs are incurred.

To the extent the Company determines that it acts in the capacity of an agent, the cost reimbursement is presented on a net basis in the consolidated statements of operations.

Property Operating Income —2022 included lease income from a tower portfolio, acquired in June 2022 as a warehoused investment and transferred to a core equity fund in December 2022.

Compensation comprises salaries, bonus including discretionary awards and contractual amounts for certain senior executives, benefits, severance payments, and equity-based compensation.

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A valuation allowance for deferred tax assets is established if the Company believes it is more likely than not that all or some portion of the deferred tax assets will not be realized based upon the weight of all available positive and negative evidence.

Realization of deferred tax assets is dependent upon the adequacy of future expected taxable income from all

sources, including reversal of taxable temporary differences, forecasted earnings and prudent and feasible tax planning strategies.

Realization of deferred tax assets is dependent upon the adequacy of future expected taxable income from all sources, including reversal of taxable temporary differences, forecasted earnings and prudent and feasible tax planning strategies.

An established valuation allowance may be reversed in a future period if the Company subsequently determines it is more likely than not that all or some portion of the deferred tax asset will become realizable.

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Income tax benefits are recognized for uncertain tax positions that are more likely than not to be sustained based solely on their technical merits.

Such uncertain tax positions are measured as the largest amount of benefit that is more likely than not to be realized upon settlement.

Such uncertain tax positions are measured as the largest amount of benefit that is more

likely than not to be realized upon settlement.

The difference between the benefit recognized and the tax benefit claimed on a tax return results in an unrecognized tax benefit.

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EPS is calculated by dividing earnings allocated to common shareholders by the weighted-average number of common shares outstanding during the period.

Diluted EPS is based on the weighted-average number of common shares and the effect of potentially dilutive common share equivalents outstanding during the period.

Potentially dilutive common share equivalents include shares to be issued upon the assumed conversion of the Company's outstanding convertible notes, which are included under the if-converted method when dilutive.

The earnings allocated to common shareholders is adjusted to add back the after-tax amount of interest expense associated with the convertible notes, except when doing so would be antidilutive.

Diluted EPS is based upon the weighted-average number of common shares and the effect of potentially dilutive common share equivalents outstanding during the period.

Potentially dilutive common share equivalents represent the assumed issuance of common shares in settlement of certain arrangements if determined to be dilutive, generally based upon the more dilutive of the two-class method or the treasury stock method, or based upon the if-converted method for the assumed conversion of the Company's outstanding convertible notes.

The earnings allocated to common shareholders is adjusted to add back the income or loss associated with the potentially dilutive instruments that are assumed to result in the issuance of common shares if determined to be dilutive, such as interest expense on the Company's convertible notes.

In circumstances where discontinued operations are reported, income from continuing operations is used as the benchmark to determine whether including potential common shares in diluted EPS computation would be antidilutive.

Accordingly, if there is a loss from continuing operations and potential common shares would be antidilutive due to the loss, but there is net income after adjusting for discontinued operations, the potential common shares would be excluded from diluted EPS computation even though the effect on net income would be dilutive, because income from continuing operations is used as the benchmark.

Discontinued Operations

The Company's discontinued operations in the periods presented herein represent:

(i) the operations of digital infrastructure portfolio companies previously consolidated in the Company's former Operating segment;

and (ii) the Company's former real estate investment and operations as a Real Estate Investment Trust ("REIT"), along with an adjacent investment management business, which have since been disposed as part of the Company's transformation into an investment manager with a digital infrastructure focus.

These former businesses comprised the following.

• The full deconsolidation of both portfolio companies in the former Operating segment on December 31, 2023 (as discussed in Note 9) represented a strategic shift that has major effect on the Company’s operations and financial results, meeting the criteria as discontinued operations as of December 31, 2023.

The Operating segment previously composed of balance sheet equity interests in two digital infrastructure portfolio companies, Vantage SDC and DataBank, a stabilized hyperscale and an edge colocation data center business, respectively.

These portfolio companies directly held and operated data centers, earning rental income from providing use of data center space and/or capacity through leases, services and other tenant arrangements.

Prior to deconsolidation and reclassification as discontinued operations, the assets, liabilities and operating results of DataBank and Vantage SDC were included in the Company's consolidated financial statements at historical cost in the former Operating

segment, with the portion of operating results attributable to third party investors presented as noncontrolling interests in investment entities.

• The Company's equity method investment in BrightSpire Capital, Inc.

BRSP) was sold in March 2023 for net proceeds totaling $ 201.6 million.

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

A $ 9.7 million impairment of the BRSP shares was recorded in 2023 prior to its disposition.

• The Wellness Infrastructure business was disposed in February 2022, along with other non-core assets held by a subsidiary, NRF Holdco, LLC ("NRF Holdco").

The equity of NRF Holdco was sold for $ 281 million, in a combination of cash and a $ 155 million unsecured promissory note.

The promissory note was fully written down in March 2023, as discussed in Note 11.

The disposition of NRF Holdco resulted in a write-off of unamortized deferred financing costs on the Wellness Infrastructure debt assumed by the buyer of $ 92.1 million and additional impairment loss based upon final carrying value of the Wellness Infrastructure net assets in 2022, with $ 251.7 million of impairment loss having already been recorded in 2021 based upon the selling price.

• The Company's equity interests in its non-digital investment portfolio, which included real estate, real estate-related equity and debt investments, along with an adjacent investment management business, was substantively disposed in a bulk sale in December 2021, with a write-down in the value of the assets based upon the selling price recorded in 2021 prior to disposition.

A small number of investments excluded from this bulk sale continue to be disposed over time.

• The Hospitality business was disposed in March 2021.

Additionally, a hotel portfolio that was in receivership was sold by the lender in September 2021 which had resulted in a $ 54.2 million gain on debt extinguishment.

Income (Loss) from discontinued operations is summarized as follows.

Year Ended December 31,

(In thousands) 2023 2022 2021

Property operating income $ 774,226 $ 953,727 $ 1,500,032

Other income 8,895 21,559 106,826

Total revenues 783,121 975,286 1,606,858

Property operating expense 329,762 412,924 779,074

Interest expense 174,722 268,519 380,272

Depreciation and amortization 448,900 534,979 592,202

Compensation and other expenses 136,097 203,669 277,730

Impairment loss — 35,985 317,405

Equity method earnings (losses) ( 15,188 ) ( 45,489 ) ( 192,478 )

Other gain (loss), net 2,671 13,682 120,753

Income (Loss) from discontinued operations before income taxes ( 318,877 ) ( 512,597 ) ( 811,550 )

Income tax benefit (expense) ( 1,581 ) 2,413 29,175

Income (Loss) from discontinued operations ( 320,458 ) ( 510,184 ) ( 782,375 )

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

Investment entities ( 260,120 ) ( 302,072 ) ( 528,125 )

Operating Company ( 4,339 ) ( 15,893 ) ( 24,465 )

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

$ ( 55,999 ) $ ( 192,219 ) $ ( 229,785 )

Assets and Liabilities of Discontinued Operations

Assets of the former Operating segment were not held for disposition prior to their deconsolidation and qualification as discontinued operations on December 31, 2023.

All other assets of discontinued operations were held for disposition prior to their sale.

The Company initially measures assets classified as held for disposition at the lower of their carrying amounts or fair value less disposal costs.

For bulk sale transactions, the unit of account is the disposal group, with any excess of the aggregate carrying value over estimated fair value less costs to sell allocated to the individual assets within the group.

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

Cash and cash equivalents $ — $ 62,690

Restricted cash — 113,631

Real estate — 5,921,298

Investments 1,342 280,019

Goodwill — 463,120

Intangible assets — 1,006,469

Other assets 356 573,368

Total assets of discontinued operations $ 1,698 $ 8,420,595

Debt $ — $ 4,586,765

Lease intangibles and other liabilities 153 755,377

Total liabilities of discontinued operations $ 153 $ 5,342,142

Reclassifications

Certain prior period amounts disclosed within the notes to the consolidated financial statements have been reclassified to conform to current period presentation.

These reclassifications did not affect the Company's financial position, results of operations or cash flows.

Adjustments to Beginning Equity

On January 1, 2020, upon adoption of Accounting Standards Update ("ASU") No.

2016-13, Financial Instruments—

Credit Losses , the Company recorded a $ 5.1 million decrease to beginning equity, composed of:

(i) an $ 8.4 million decrease to beginning equity, representing the Company's share of the cumulative effect adjustment of adopting the lifetime current expected credit loss ("CECL") model by its equity method investee, BRSP;

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

As discussed in "— Discontinued Operations ," the Company's investment in BRSP and the portfolio companies previously consolidated in the Company's former Operating segment qualified as discontinued operations in March 2023 and December 2023, respectively.

For all prior periods presented:

(i) on the December 31, 2022 consolidated balance sheets, the equity method investment in BRSP (2022:

$ 218.0 million previously included in equity and debt investments) and the assets of the portfolio companies previously consolidated in the former Operating segment totaling $ 8.1 billion have been reclassified to assets of discontinued operations, while the liabilities of the portfolio companies previously consolidated in the former Operating segment totaling $ 5.3 billion have been reclassified to liabilities of discontinued operations;

and (ii) on the 2022 and 2021 consolidated statements of operations, the loss from BRSP of $ 37.3 million in 2022 and earnings of $ 41.2 million in 2021, previously included in equity method earnings (losses), and the net loss of the portfolio companies previously consolidated in the former Operating segment totaling $ 324.2 million in 2022 and $ 223.5 million in 2021 have been reclassified to income (loss) from discontinued operation.

In 2023, the Company also 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 now presented within total revenues on the consolidated statements of operations, previously presented as equity method earnings (losses) and equity method earnings—carried interest, respectively, both of which are no longer applicable as separate financial statement line items following the changes discussed herein.

Prior periods have been reclassified to conform to current presentation.

Accounting Policies Related to Real Estate

Accounting policies related to real estate are applicable to continuing operations in 2022 and to discontinued operations in all periods presented.

Real Estate Acquisitions

Real estate acquisitions are considered asset acquisitions and are recognized based on their cost to the Company as the acquirer and no gain or loss is recognized.

The cost of assets acquired are allocated among the acquired components based on their relative fair values at the time of acquisition, and does not give rise to goodwill.

Such components include land, building, site and building improvements, infrastructure, equipment, lease-related tangible and intangible assets and liabilities, such as tenant improvements, deferred leasing costs, in-place lease values, above- and below-market lease values, and tenant relationships.

The estimated fair value of acquired land is derived from recent comparable sales of land and listings within the same local region based on available market data.

The fair value of site and tenant improvements and infrastructure assets are estimated based upon current market replacement costs and other relevant market rate information.

Transaction costs related to acquisition of assets are included in the cost basis of the assets acquired.

Previously warehoused investment

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

TNET) for € 740.1 million or $ 791.3 million (including transaction costs) .

In December 2022, the Company's interest in the temporarily warehoused TowerCo investment was transferred to the Company's new core equity fund and TowerCo was deconsolidated.

The TowerCo assets acquired had included owned tower sites, tower sites subject to third party leases that gave rise to ROU lease assets and corresponding lease liabilities, equipment, as well as customer relationships related primarily to a master lease agreement with Telenet as lessee.

The acquisition had been funded through $ 326.1 million of debt, $ 278.1 million of equity from the Company, and $ 213.8 million in third party equity.

In addition to the purchase price, the funds had been used to finance transaction costs, debt issuance costs, working capital and as operating cash.

The following table summarizes the allocation of cash consideration to TowerCo assets acquired and liabilities assumed, including capitalized transaction costs, in 2022.

(In thousands)

Real estate $ 363,121

Intangible assets 673,218

ROU and other assets 234,462

Deferred tax liabilities ( 243,223 )

Lease and other liabilities ( 236,324 )

Fair value of net assets acquired $ 791,254

• Real estate was valued based upon current replacement cost for towers in consideration of their remaining economic life.

Useful lives of towers and related equipment acquired range from 11 to 71 years.

• Lease-related intangibles were composed of the following:

• In-place leases reflect the value of rental income forgone if the towers acquired were not leased, discounted at 6.8 %, with remaining lease terms of 15 years.

• Customer relationships for towers were valued as the estimated future cash flows to be generated over the life of the tenant relationships based upon rental rates, operating costs, expected renewal terms and attrition, discounted at 6.8 %, with estimated useful lives between 19 and 45 years.

• Deferred tax liabilities were recognized for the book-to-tax basis differences associated with the TowerCo acquisition.

• Other assets acquired and liabilities assumed include primarily lease ROU assets associated with leasehold ground space hosting tower communication sites, along with corresponding lease liabilities.

Lease liabilities were measured based upon the present value of future lease payments over the lease term, discounted at the incremental borrowing rate of the acquiree entity.

In 2022, prior to transfer, TowerCo generated lease income of $ 43.0 million, and incurred depreciation expense of $ 8.8 million, and amortization expense of $ 9.9 million, presented within Corporate and Other.

Real Estate Held for Investment

Real estate held for investment are carried at cost less accumulated depreciation.

Depreciation— Real estate held for investment, other than land, are depreciated on a straight-line basis over the estimated useful lives of the assets, generally up to 50 years for buildings, 40 years for site and building improvements, 30 years for data center infrastructure, and 8 years for furniture, fixtures and equipment.

Tenant improvements are amortized over the lesser of the useful life or the remaining term of the lease.

The Company evaluates real estate for impairment generally on an individual property basis.

If multiple outcomes are under consideration, the Company may apply either a probability-weighted cash flows approach or the single-most-likely estimate of cash flows

approach, whichever is more appropriate under the circumstances.

If such assumptions change and the Company shortens its expected hold period, this may result in the recognition of impairment losses.

Real Estate Held for Disposition

Depreciation is not recorded on assets classified as held for disposition.

At the time a sale is consummated, the excess, if any, of sale price less selling costs over carrying value of the real estate is recognized as a gain.

Lease-Related Intangibles

Identifiable intangibles recognized in acquisitions of operating real estate include in-place leases, deferred leasing costs, above- or below-market leases, and tenant relationships.

Acquired in-place leases are valued as the forgone rental income had the property been acquired in an as if vacant state, using market data on comparable and recently signed leases.

Deferred leasing costs represent leasing commissions and legal fees that would otherwise have been incurred if a lease was not in-place.

Acquired in-place leases and deferred leasing costs are amortized on a straight-line basis to depreciation and amortization expense over the remaining term of the applicable leases.

If an in-place lease is terminated, the unamortized portion is charged to depreciation and amortization expense.

Above- or below-market operating lease values are amortized on a straight-line basis as a decrease or increase to rental income, respectively, over the applicable lease terms.

This includes fixed rate renewal options in acquired leases that are assumed to be renewed if below market, which are amortized to increase rental income over the renewal period.

Tenant relationships are amortized on a straight-line basis to depreciation and amortization expense over its estimated useful life.

In addition to leasing activities, data center operators provide various data center services to their customers, largely in the colocation business, which give rise to customer service contract and customer relationship intangible assets in an acquisition of operating data centers.

Customer relationships represent incremental net cash flows to the business that is attributable to these in-place relationships, and is amortized on a straight-line basis over its estimated useful life.