It's silly to treat that as a prediction or to take it too seriously. First, it wasn't a prediction. It was a statement of the queue of signed offer letters and projected closing dates. Second, there are two parties to every loan transaction, and either may back out of the loan all the way up to the closing date, and if RAS backs out, its probably because they discovered something while doing due diligence that made the loan too risky. I don't want RAS to take bad loans just to make a number that will make needo happy. That's why, knowing the numbers for the 4Q conference call, I said that I'd be happy to see RAS close over $200 million. If they close the whole $261 million, that will be great (and put them on a path to doing a billion in loans this year). If they only make $200 million, they should still be well positioned to make that number.
It's not the number of loans. It's that all the loans are high quality loans that RAS will make money from.
Yeah, it wasn't a prediction: it was just a case of him making a "a statement about what will happen or might happen in the future"...oops! that's kind of the precise definition of a prediction, once you take your head out of your RAS...
Here are a few things that are likely. They save $1 million on hedging costs. They get an extra $2.5 million of interest as they originated about $200 million of bridge loans (securitized in April) and held onto the conduit until they needed to recycle the cash. They used cash rather than credit lines to keep on the balance sheet in order to optimize interest.
Wonder how the extra 4 properties they took over in the first quarter work out? For the first full quarter ras's third mortgage securitization was fully stuffed with bridge loans. That's about $60 million x .065 improvement. Probably almost no repayments of loans.
What day in January did RAS issue the 10 million of new shares? This plays a roll in evaluating how well they did in the quarter.