Northstar Realty Reports Improving Performance in 1Q15
Northstar Realty Finance Expands Investments in 1Q15
Misses the estimate
Northstar Realty Finance Corporation (NRF) reported its 1Q15 earnings on May 8. The company missed the Wall Street analysts’ EPS (earnings per share) estimates of $0.47, and its loss per share stood at $0.10. The company reported cash available for distribution (or CAD) of $136.5 million, or $0.44 per share.
The net loss for 1Q15 stood at $31.6 million, or $0.10 per diluted share. For 1Q14, Northstar Realty posted a net loss of $135.0 million, or $0.84 per diluted share. The first quarter losses were significantly impacted by unrealized investment losses in its property holdings. Northstar Realty has 84% of its investments in directly or indirectly owned commercial real estate.
In a May 8 company press release, Northstar Realty CEO David T. Hamamoto II noted, “NorthStar Realty is off to a strong start in 2015, including completing the acquisition of approximately $2 billion of high quality, pan-European predominantly office properties. The proposed spin-off of our European real estate business into a separate publicly traded REIT remains on track for completion during the second half of 2015.”
Diversified investment company
Northstar Realty is a commercial real estate investment company that has 84% of its total assets invested in real estate. Of those assets, 77% are deployed in direct real estate investments. The company invests in multiple asset classes across commercial real estate (or CRE), which can generate attractive risk-adjusted returns.
Northstar Realty is also involved in originating or acquiring senior or subordinate loans, as well as pursuing opportunistic CRE investments, both in the United States and internationally. The company currently focuses more on acquiring assets or making investments in Europe. Since June 30, 2014, an affiliate of NorthStar Asset Management Group (or NSAM) has served as Northstar Realty’s external manager and adviser.
Among Northstar Realty’s peers in real estate investment management, Resource Capital Corporation (RSO) registered -38% revenue growth, Apollo Commercial Real Estate (ARI) posted revenue growth of 95%, and Redwood Trust (RWT) witnessed 17% revenue growth when compared with the previous year. Together, these companies form 0.88% of the iShares US Real Estate ETF (IYR).
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