Newcastle Investment Corp.

Real Estate Debtprint

We actively manage CDOs and other real estate investments. Our investments are primarily secured by or related to commercial real estate. To enhance our returns, we seek to execute on strategies such as collapsing our CDOs or opportunistically investing within our CDOs.

At year-end, our real estate debt portfolio consists of $1.1 billion face amount, or $0.9 billion fair value, of assets as detailed below:

  1. $0.76 billion face amount of assets (value of 82% of par) in CDOs financed with $0.4 billion of debt; total direct holdings of $0.4 billion

  2. $0.10 billion face amount of assets (value of 50% of par) in Other Debt financed with $0.23 billion of debt; total direct holdings of $0.78 billion

Fair Value of Legacy Real Estate Debt Portfolio

($mm) Face Amount

4Q '14 Fair Value

Price ($) Price (%)
CMBS $214 $179 83.5
Commercial Loans 154 125 81.6
Bank Loans 174 121 69.5
ABS 76 45 59.3
CDO Securities 14 8 55.2
Other(4) 40 32 78.9
Non-Agency Subtotal $672 $510 78.5
Agency Securities 391 408 104.3
Total Assets $1,063 $918 86.3

4) Includes six residential loans, three operating real estate properties and an equity investment in real estate owned property.

More detailed information about our business is included in our reports filed with the Securities and Exchange Commission (SEC). These reports describe, among other things, certain risks that could have a material adverse impact on our ability to achieve our business objectives, realize our expected investment returns, and pay dividends. We urge you to review these risks and the other information in our SEC reports.