I'm not really familiar with REITs, so I'm just curious if this is normal. If a stock I normally trade had this much debt I'd avoid it like the plague. I can only assume it has something to do with morgages and how they are financed.
Simply put, a company borrows a bunch of money at a lower rate, and buy (in this case) government backstopped MBS with higher rates (and hedge the interest rate risks). They make their money based on the spread between their borrowing costs and the income generated from the MBS (or appreciation of the MBS).