Franklin BSP Realty Trust, Inc.
−Removed: (the “Company”), formerly known as Benefit Street Partners Realty Trust, Inc., is a real estate finance company that primarily originates, acquires and manages a diversified portfolio of commercial real estate debt investments secured by properties located within and outside the United States.
−Removed: The Company is a Maryland corporation and has made tax elections to be treated as a real estate investment trust (a "REIT") for U.S.
+Added: (the “Company”), is a real estate finance company that primarily originates, acquires and manages a diversified portfolio of commercial real estate debt investments secured by properties located within and outside the United States.
+Added: We are a Maryland corporation and have made tax elections to be treated as a real estate investment trust (a "REIT") for U.S.
federal income tax purposes since 2013.
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We are the sole general partner and directly or indirectly hold all of the units of limited partner interests in the OP.
−Removed: In addition, the Company, through one or more subsidiaries which are each treated as a taxable REIT subsidiary (a “TRS”), is indirectly subject to U.S.
+Added: One or more of our wholly-owned subsidiaries are treated as taxable REIT subsidiaries (each a “TRS”), and are subject to U.S.
federal, state and local income taxes.
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Benefit Street Partners L.L.C.
−Removed: serves as our advisor ("Advisor") pursuant to an advisory agreement, as amended on August 18, 2021 (the "Advisory Agreement").
−Removed: The Advisor, an investment adviser registered with the SEC, is a credit-focused alternative asset management firm.
−Removed: Established in 2008, our Advisor's credit platform manages funds for institutions and high-net-worth investors across various credit funds and complementary strategies including high yield, levered loans, private/opportunistic debt, liquid credit, structured credit and commercial real estate debt.
+Added: serves as our advisor ("Advisor") pursuant to an advisory agreement (the "Advisory Agreement").
+Added: The Advisor, an investment adviser registered with the SEC, is a credit-focused alternative asset management firm that was established in 2008.
+Added: Our Advisor's credit platform manages funds for institutions and high-net-worth investors across various credit funds and complementary strategies including high yield, levered loans, private/opportunistic debt, liquid credit, structured credit and commercial real estate debt.
These strategies complement each other as they all leverage the sourcing, analytical, compliance, and operational capabilities that encompass the platform.
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The advisor is a wholly-owned subsidiary of Franklin Resources, Inc., which together with its various subsidiaries operates as "Franklin Templeton”.
−Removed: The Company primarily invests in commercial real estate debt investments, which may include first mortgage loans, subordinated mortgage loans, mezzanine loans and participations in such loans.
+Added: The Company invests in commercial real estate debt investments, which may include first mortgage loans, subordinated mortgage loans, mezzanine loans and participations in such loans.
The Company also originates conduit loans which the Company intends to sell through its TRS into commercial mortgage-backed securities ("CMBS") securitization transactions.
−Removed: The Company also invests in commercial real estate securities.
−Removed: Real estate securities may include CMBS, senior unsecured debt of publicly traded REITs, debt or equity securities of other publicly traded real estate companies and collateralized debt obligations ("CDOs").
−Removed: The Company also owns real estate acquired by the Company through foreclosure and deed in lieu of foreclosure, and purchased for investment, typically subject to triple net leases.
−Removed: On October 19, 2021, the Company completed a merger with Capstead Mortgage Corporation (“Capstead”) pursuant to which Capstead merged into a wholly-owned subsidiary of the Company, and the Company’s common stock commenced trading on the New York Stock Exchange ("NYSE") under the ticker “FBRT”.
−Removed: The Capstead assets acquired in the merger consist primarily of cash and residential adjustable-rate mortgage pass-through securities issued and guaranteed by government-sponsored enterprises or by an agency of the federal government.
−Removed: The Company intends to reinvest the cash and proceeds from dividends, interest, repayments and sales of the assets acquired in the merger into its own investment strategies.
+Added: Historically this business has focused primarily on CMBS, commercial real estate collateralized loan obligation bonds ("CRE CLO bonds"), collateralized debt obligations ("CDOs") and other securities.
+Added: As a result of the October 2021 acquisition of Capstead Mortgage Corporation ("Capstead"), the Company acquired a portfolio of residential mortgage backed securities (“RMBS”) in the form of residential adjustable-rate mortgage pass-through securities ("ARM Agency Securities" or "ARMs") issued and guaranteed by government-sponsored enterprises or by an agency of the federal government.
+Added: Although the Company continues to hold a small portion of this portfolio it does not intend to do so long-term and intends to reinvest proceeds from the remaining portion of the portfolio in its other businesses.
+Added: The Company also owns real estate that was either acquired by the Company through foreclosure or deed in lieu of foreclosure, or that was purchased for investment, typically subject to triple net leases.
Investment Objectives
−Removed: We plan to implement policies and strategies to provide our common shareholders attractive, risk-adjusted returns through a stable divided and capital growth.
+Added: Our objective is to provide our common shareholders attractive, risk-adjusted returns through a stable dividend and capital growth.
Investment Strategies and Policies
We have four investment strategies.
−Removed: One strategy is to originate, acquire and manage a diversified portfolio of commercial real estate debt, including first mortgage loans, subordinate loans, mezzanine loans and participations in such loans.
+Added: Our first and primary strategy is to originate, acquire and manage a diversified portfolio of commercial real estate debt, including first mortgage loans, subordinate loans, mezzanine loans and participations in such loans.
We expect that our portfolio of debt investments will be secured by real estate located within and outside the United States and diversified by property type and geographic location.
−Removed: The second strategy is to invest in commercial real estate securities, such as CMBS, senior unsecured debt of publicly-traded REITs and CDO notes.
−Removed: The third strategy is to originate conduit loans and sell them through our TRS business into CMBS securitization transactions.
−Removed: The fourth strategy represents real estate acquired by the Company through foreclosure and deed in lieu of foreclosure, and purchases of real estate that generally are, or will be, subject to a triple net lease.
−Removed: As noted above, we also acquired a significant portfolio of residential adjustable-rate mortgage pass-through securities issued and guaranteed by government-sponsored enterprises or by an agency of the federal government in our merger with Capstead.
−Removed: We intend to reinvest the cash and proceeds from dividends, interest, repayments and sales of these assets into our four investment strategies.
+Added: Our second strategy is to invest in real estate securities, such as CMBS, CRE CLO Bonds, senior unsecured debt of publicly-traded REITs and CDO notes.
+Added: Our third strategy is to originate conduit loans and sell them through our TRS business into CMBS securitization transactions.
+Added: Our fourth strategy is to maximize cash flows from real estate acquired by the Company through foreclosure and deed in lieu of foreclosure, and purchases of real estate that generally are, or will be, subject to a triple net lease.
Commercial Real Estate Debt
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We expect to generate additional revenues from these equity participations as a result of excess cash flows being distributed or as appreciated properties are sold or refinanced.
−Removed: Commercial Real Estate Securities
−Removed: In addition to our focus on origination of and investments in commercial real estate debt, we may also acquire commercial real estate securities, such as CMBS, RMBS, unsecured REIT debt, CDO notes, and equity investments in entities that own commercial real estate.
−Removed: CMBS are securities that are collateralized by, or evidence ownership interests in, a single commercial mortgage loan or a partial or entire pool of mortgage loans secured by commercial properties.
−Removed: CMBS are generally pass-through certificates that represent beneficial ownership interests in common law trusts whose assets consist of defined portfolios of one or more commercial mortgage loans.
+Added: Real Estate Securities
+Added: In addition to our focus on origination of and investments in commercial real estate debt, we may also acquire real estate securities, such as CMBS, CRE CLO Bonds, RMBS, CDO notes, and equity investments in entities that own commercial real estate.
+Added: CMBS & CRE CLO Bonds
+Added: CMBS and CRE CLO Bonds are securities that are collateralized by, or evidence ownership interests in, a single commercial mortgage loan or a partial or entire pool of mortgage loans secured by commercial properties.
+Added: CMBS and CRE CLO Bonds are generally pass-through certificates that represent beneficial ownership interests in common law trusts whose assets consist of defined portfolios of one or more commercial mortgage loans.
They are typically issued in multiple tranches whereby the more senior classes are entitled to priority distributions of specified principal and interest payments from the trust’s underlying assets.
The senior classes are often securities which, if rated, would have ratings ranging from low investment grade “BBB-” to higher investment grades “A,” “AA” or “AAA.” The junior, subordinated classes typically would include one or more non-investment grade classes which, if rated, would have ratings below investment grade “BBB.” Losses and other shortfalls from expected amounts to be received on the mortgage pool are borne first by the most subordinate classes, which receive payments only after the more senior classes have received all principal and/or interest to which they are entitled.
−Removed: We may invest in senior or subordinated, investment grade or non-investment grade CMBS, as well as unrated CMBS.
+Added: We may invest in senior or subordinated, investment grade or non-investment grade CMBS and CRE CLO Bonds, as well as unrated CMBS and CRE CLO Bonds.
Unsecured Publicly-Traded REIT Debt Securities
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Corporate bonds issued by these types of REITs are usually rated investment grade and benefit from strong covenant protection.
−Removed: CDOs are multiple class debt notes, secured by pools of assets, such as CMBS, mezzanine loans, and unsecured REIT debt.
+Added: CDOs are multiple class debt notes, secured by pools of assets, such as CMBS and mezzanine loans.
Like typical securitization structures, in a CDO, the assets are pledged to a trustee for the benefit of the holders of the bonds.
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Our Advisor has the authority to make all the decisions regarding our investments consistent with the investment guidelines and borrowing policies approved by our board of directors and subject to the direction and oversight of our board of directors.
−Removed: With respect to investments in commercial real estate debt, our board of directors has adopted investment guidelines that our Advisor must follow when acquiring such assets on our behalf without the approval of our board of directors.
−Removed: We will not, however, purchase assets in which our Advisor, any of our directors or any of their affiliates has an interest without a determination by a majority of our directors (including a majority of the independent directors) not otherwise interested in the transaction that such transaction is fair and reasonable to us and at a price to us no greater than the cost of the asset to the affiliated seller, unless there is substantial justification for the excess amount and such excess is reasonable.
+Added: With respect to investments in commercial real estate debt, our board of directors has adopted investment guidelines that our Advisor must follow when acquiring such assets on our behalf .
+Added: We will not purchase assets in which our Advisor, any of our directors or any of their affiliates has an interest without a determination by a majority of our directors (including a majority of the independent directors) not otherwise interested in the transaction that such transaction is fair and reasonable to us and at a price to us no greater than the cost of the asset to the affiliated seller, unless there is substantial justification for the excess amount and such excess is reasonable.
Our investment guidelines and borrowing policies may be altered by a majority of our directors without approval of our stockholders.
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We believe that careful use of leverage will help us to achieve our diversification goals and potentially enhance the returns on our investments.
−Removed: Our board of directors reviews our aggregate borrowings at least quarterly.
+Added: Our board of directors oversees our aggregate borrowing levels.
We elected to be taxed as a REIT under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the "Internal Revenue Code") commencing with the taxable year ended December 31, 2013.
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We electronically file annual reports on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K, and all amendments to those reports, and proxy statements, with the SEC.
−Removed: We also filed with the SEC a registration statement in connection with our dividend reinvestment plan ("DRIP") securities offerings.
The SEC maintains an internet address at www.sec.gov that contains reports, proxy statements and information statements, and other information, which may be obtained free of charge.
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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.