Blackstone Mortgage Trust, Inc. · NYSE:BXMT
Blackstone Mortgage Trust — Capital Trust — Investor Presentation (November 2006)
29 slides from Blackstone Mortgage Trust's investor presentation, Nov 3, 2006
Slide 1: Company Presentation November 2006
Company Presentation November 2006
Slide 2: Disclaimer
Disclaimer Except for historical information contained herein, the statements in this presentation regarding the Company's business, strategy, portfolio management and results of operations are forward-looking statements that are dependent upon certain risks and uncertainties, including those relate
Slide 3: Table of Contents
I. Overview II. Investment Strategy III. Financial Information TABLE OF CONTENTS
Slide 4: Capital Trust
o CAPITALTRUST
Slide 5: Capital Trust
Capital Trust Largest dedicated commercial real estate subordinate debt investor in the US Founded by Sam Zell and John Klopp in 1997 Originated $7.2 billion of investments since inception Unparalleled track record Less than 1.0% loss experience on the entire portfolio Fully integrated internal mana
Slide 6: Unique Business Model
OVERVIEW I - 2 CT Investment Management Co., LLC (TRS) 100% CT Mezzanine Partners II LP Unique Business Model Balance Sheet Net Interest Margin Investment Management Fee Income + Capital Trust, Inc. (NYSE: “CT”) (Management Contracts) Investment Manager CDO Collateral Manager Special Servicer CT Mez
Slide 7: Recent Highlights
Recent Highlights Equity Investment / Investment Management Closed founding equity investment in Bracor, a newly formed net lease commercial real estate company located and operated in Brazil Closed CT Large Loan 2006, Inc. with $325 million of equity commitments Capital Raising Closed public equity
Slide 8: Share Price (Close)
NYSE: CT Share Price (Close) Current (11/1/06) $44.78 High (10/26/06) $46.90 Low (11/16/05) $28.98 Valuation Metrics CT Peers (1) Price/Book 1.8x 1.7x P/E TTM 12.6x 13.1x Div. Yield 6.7% 8.4% Daily Volume Average (8/1/06-11/1/06) 86,286 Trailing 12-Month Performance Note: (1) Peer group includes iSt
Slide 9: Growth Strategy
OVERVIEW I - 5 Growth Strategy Continue to grow balance sheet assets Continue to grow investment management business through the sponsorship of additional vehicles Create the most efficient capital structure through the use of CDOs and other structured products Expand our franchise Incubate and/or a
Slide 10: Seasoned Management Team
Lending/Investing Asset Management Administration Finance/Accounting Capital Markets CEO, John Klopp Board of Directors Sam Zell Thomas Dobrowski Martin Edelman Craig Hatkoff Edward Hyman John Klopp Henry Nassau Joshua Polan Lynne Sagalyn OVERVIEW I - 6 41 Professionals CFO, Geoffrey Jervis COO, Ste
Slide 11: Investment Strategy
Investment Strategy
Slide 12: A Large and Dynamic Market
II - 1 Note: (1) Source: Federal Reserve Data. INVESTMENT STRATEGY A Large and Dynamic Market CMBS has taken a larger share of a growing market Market Growth 3x CMBS Growth 9x
Slide 13: Growth of Securitization
II - 2 INVESTMENT STRATEGY Growth of Securitization Record issuance of $169 billion in 2005 (1)
Slide 14: Evolving Capital Structure
Equity 1 st Mortgage A Note Equity Equity IG CMBS Equity Traditional Early Stage Mezzanine Current Multiple Tranches of Subordinate CMBS, B Notes, Mezzanine Loans and Preferred Equity Evolving Capital Structure INVESTMENT STRATEGY II - 3
Slide 15: Relative Value
Equity AAA to A CMBS BBB AAA to A CMBS BBB Equity II - 4 Senior B Note Junior B Note Junior Mezzanine Senior Mezzanine L + 100 to 150 bps L + 150 to 225 bps L + 225 to 300 bps L + 300 to 1000+ bps INVESTMENT STRATEGY Relative Value B BB NR XXXXX Gross Unleveraged Returns Gross Unleveraged Returns L
Slide 16: Collateralized Debt Obligation Model
Investment Grade CDO Notes CDO Equity Sold to 3 rd Parties Retained by Capital Trust II - 5 Below IG CDO Notes INVESTMENT STRATEGY Collateralized Debt Obligation Model Mezzanine Loans B Notes Subordinate CMBS CDO I $324 million / Reinvesting CDO II $338 million / Reinvesting CDO III $341 million / S
Slide 17: Competitive Advantages
II - 6 INVESTMENT STRATEGY Competitive Advantages Investment Origination Broad Network/Established Relationships Structural Creativity and Flexibility Quick Turnaround/Certainty of Closing Transaction Execution Credit Underwriting Expertise Financial Structuring Experience Proven Process Capital Acc
Slide 18: Senior Debt Provided by Lenders
Senior Debt Provided by Morgan Stanley Town & Country Portfolio Nationwide $1 Billion Senior Debt Led by Calyon The Carlyle Hotel New York, NY $125 Million Senior Debt Led by Merrill Lynch Trizec Office Portfolio Nationwide $6 Billion Senior Debt Provided by IXIS Real Estate Capital Wyvernood Apartm
Slide 19: Investment Process
Origination Asset Mgmt. Approval Underwriting II - 8 Originators Due Diligence Senior Lenders Borrowers Brokers Deal Team Business Credit Team Finance/Capital Markets Team Legal Structure Investment Committee Board of Directors Credit Providers Partners Asset Mgmt. Team Credit Team Finance/Capital M
Slide 20: Risk Management Principles
II - 9 INVESTMENT STRATEGY Risk Management Principles Create diversified portfolios Asset category, property type and geographic market Prudently employ leverage Enhance returns Increase the size and diversity of the portfolios Manage a matched book Control asset/liability mix (index & duration) Use
Slide 21: Financial Information
Financial Information
Slide 22: Capital Trust, Inc. Structure and Balance Sheets
Capital Trust, Inc. 9/30/06 Assets $2,270 Liabilities $1,922 Equity $348 CT Investment Management Co., LLC (TRS) (100% owned) (Management Contracts) CT Mezzanine Partners II LP 9/30/06 Assets $48 Liabilities $20 Equity $28 (0.0% owned) (5.9% owned) III - 1 Net Interest Margin Base and Incentive Mana
Slide 23: Assets ($000s)
FINANCIAL INFORMATION Assets ($000s) Assets Cash Loans CMBS Equity Investments Total Return Swaps Interest Rate Hedges (Swaps) Other Total Assets Liabilities Secured Debt CDO Debt Junior Sub. Debentures Participations Sold Other Total Liabilities Common Equity 9/30/06 $34,930 1,334,014 845,452 11,18
Slide 24: Portfolio Breakdown
III - 3 FINANCIAL INFORMATION Portfolio Breakdown Notes: (1) Capital Trust portfolio as of 9/30/06.
Slide 25: Liabilities and Equity ($000s)
Assets Cash Loans CMBS Equity Investments Total Return Swaps Interest Rate Hedges (Swaps) Other Total Assets Liabilities Secured Debt CDO Debt Junior Sub. Debentures Participations Sold Other Total Liabilities Common Equity 9/30/06 $34,930 1,334,014 845,452 11,185 3,000 40,125 $2,269,665 $351,433 1,
Slide 26: Pro Forma Financial Information ($000s)
Pro Forma Financial Information ($000s) III - 5 FINANCIAL INFORMATION Assets Cash Loans CMBS Equity Investments Total Return Swaps Interest Rate Hedges (Swaps) Other Total Assets Liabilities Secured Debt CDO Debt Junior Sub. Debentures Participations Sold Other Total Liabilities Common Equity Dilute
Slide 27: Investment Management
CT Investment Management Co., LLC (TRS) CT Mezzanine Partners II LP 9/30/06 Assets $48 Liabilities $20 Equity $28 III - 6 FINANCIAL INFORMATION Investment Management $1.2 billion of investments Investment period expired 1.3% mgmt. fee per annum 20% of profits after 10% pref. return and 100% return o
Slide 28: Portfolio Net Interest Margin
Portfolio Net Interest Margin Interest Income Interest Expense Net Interest Margin Other Revenue Fund Management Fees Fund Investment Income Other Subtotal Other Expenses G&A D&A Subtotal Income Taxes Net Income Net Income per share (diluted) Dividends per share 9/30/06 $46,011 28,838 17,173 1,516 5
Slide 29: Conclusion
FINANCIAL INFORMATION III - 8 Conclusion Dominant franchise in an attractive/growing market niche Organic growth through: Balance sheet investments – net interest margin Assets under management – base and incentive management fees Stable capital structure through the use of CDOs and other structured
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