Seeking Alpha
We cover over 5K calls/quarter
Profile| Send Message|
( followers)

Blackstone Mortgage Trust Inc. (NYSE:BXMT)

Q1 2014 Earnings Conference Call

April 30, 2014 10:00 AM ET

Executives

Weston M. Tucker – Managing Director and Head-Investor Relations

Stephen D. Plavin – President, Chief Executive Officer and Director

Michael B. Nash – Executive Chairman

Paul D. Quinlan – Chief Financial Officer and Assistant Secretary

Douglas N. Armer – Treasurer and Head-Investor Relations

Anthony F. Marone – Chief Accounting Officer

Analysts

Steve C. DeLaney – JMP Securities LLC

Stephen A. Laws – Deutsche Bank Securities, Inc.

Donald Fandetti – Citigroup Global Markets Inc. (Broker)

Jade J. Rahmani – Keefe, Bruyette & Woods, Inc.

Daniel K. Altscher – FBR Capital Markets & Co.

Operator

Good day, ladies and gentlemen. Welcome to Blackstone Mortgage Trust’s First Quarter 2014 Earnings Conference Call.

At this time, I would like to turn the call over to Mr. Weston Tucker, Head of Investor Relations. Please proceed.

Weston M. Tucker

Great, thanks Gary [ph]. Good morning and welcome to Blackstone Mortgage Trust’s first quarter 2014 conference call. I’m joined today by Steve Plavin, President and CEO; Mike Nash, Executive Chairman; Paul Quinlan, CFO; Doug Armer, Treasurer and Head of Capital Markets; and Tony Marone, Principal Accounting Officer. Last night, we filed our 10-Q report and issued a press release with a presentation of our 4Q results, which hopefully you’ve all had some time to review.

I would like to remind everyone that today’s call may include forward-looking statements which by their nature, are uncertain and outside of the Company’s control. Actual results may differ materially. For a discussion of some of the risks that could affect the Company’s results, please see the "Risk Factors" section of our Form 10-Q. We do not undertake any duty to update any forward-looking statements.

We will refer to non-GAAP measures on this call. For reconciliations to GAAP measures you should refer to the press release and to our Form 10-Q filing. This audio-cast is copyrighted material of Blackstone Mortgage Trust and may not be duplicated without consent.

So a quick recap of our results, before I turn things over to Steve: We reported core earnings per share of $0.43 for the first quarter, which is up from $0.41 in the fourth quarter, with continued strong growth in our loan origination portfolio partly offset by the additional shares outstanding from our January equity offering. A few weeks ago we paid a dividend of $0.48 per share with respect to the first quarter. If you have any additional questions following today's call, you can reach out to me or dial directly.

With that, I’ll now turn the call over to Steve.

Stephen D. Plavin

Thank you, Weston and good morning everyone. We’ve had a terrific start to the year. Since our re-launch last May and the commencement of our origination business, we’ve maintained a strong pace of loan growth, which continues into the first quarter. We closed 10 floating-rate senior loans in the quarter, representing total commitments of $892 million.

Since quarter end, we’ve closed another $161 million of loans and have an additional $662 million with agreed terms in the underwriting and closing process. We experienced our cumulative total to $4.2 billion including the loans in closing. As the origination environment looking forward, in the U.S. there continues to be high level of commercial real estate related transaction activity, the ideal market backdrop for our business as this activity address borrower demand for our financing.

In Europe the environment remains opportunistic, yet market activities increasing and excellent combination of our origination efforts. Transaction volume is particularly strong in the major markets that we target; in these markets we are best able to asset competitive advantages of our Blackstone affiliation.

Blackstone managed funds on $130 billion of real estate and related operating company platforms. And continue to pursue large scale new acquisition. We have loan originators alongside our real estate equity investors in New York, Los Angles and London and our best origination opportunities always seem to emanate from these markets.

At quarter end, 65% of the properties securing our loans were located in New York, California and the U.K., our market position is very strong, but we do see heightened competition in certain segments to the market, most notably from the reemergence of multi-borrower floating-rate CMBS. The impact of this new competition is limited however as the CMBS originators are narrowly focused on stabilized proprieties undergoing little to know transition, which represents a small component of our business.

A big benefit for our origination efforts is our superior ability to source and evaluate properties that are intended to be improved through renovation, additionally single or other repositioning and the custom Kraft [ph] alone was a significant equity cushion to match its sponsors asset plan. These loans are best suited for our client base and typically do not work well and as the CMBS or the bank markets.

Our approach and reputation for closing as agreed, have positioned us favorably with our clients. 20 of our 38 loans closed to-date our sponsors have borrowed two of more times from BXMT. Even with the substantial growth, our loan portfolio remains secured by high quality mix of primarily office, multi-family and hotel assets in strong markets with top sponsors in the U.S. and Europe.

The overriding mandate for us is to maintain the risk profile of our investments within what we consider to be traditional senior mortgage risk as evidenced by our portfolio wide LTV of 63% as of quarter end. To fund the growth in our loan portfolio, we continue to expand our debt capitalization. We’ve closed two new credit facilities in the quarter and our total debt capacity exceeds $2.7 billion as of quarter end.

One of these new facilities was £250 million multi-currency revolver which will support greater levels of activity in Europe and we’re working on additional dollar, euro and pound denominated credits. We believe that our liability structure and economics remain market leading and our key competitive advantages in generating sustainable core earnings and dividend growth.

Our active management of the debt capitalization of our business ensures that we are always addressing the competitive environment from a funding costs standpoint as well. We expect to reduce our incremental cost of borrowing in order to position us to more aggressively compete while maintaining our net spreads. We also continually analyze the floating-rate CLO in term loan markets, in order to be best positioned to tap them, when they can deliver the more efficient financing for our balance sheet assets.

Our shareholder have responded favorably to our disciplined growth strategy, we’ve have executed to well received accretive offering so far this year, generating over $500 million of net proceeds to support further growth in our loan origination business, while increasing book value. Our increased size creates greater liquidity for share holders, economies scale, with our cost structure and a stronger and more diversified balance sheet and loan portfolio.

We approach the first anniversary of our re-launch; I’m pleased with our accomplishments to-date, but remain focused on the road ahead. We are committed to our strategy of creating shareholder value by originating senior mortgage loans and producing a low volatility dividend that’s essentially indexed to LIBOR.

And with that, I’ll turn the call over to Paul to review our financial results.

Paul D. Quinlan

Thank you, Steve and good morning everyone. BXMT’s first quarter results reflected strong growth in our loan portfolio as all key financial metrics were up more than 30% on an absolute basis versus the fourth quarter. Our loan portfolio grew to $2.7 billion as of quarter end up 33%.

The weighted average yield on our senior loan portfolio is LIBOR plus 4.8%, and weighted average cost of debt is LIBOR plus 2.4%. These levels are consistent with those we achieved in the fourth quarter, notwithstanding the growth in the portfolio. As a result, net interest margin in our loan origination segment is up 32%.

Q1 core earnings was $16 million up 36%, and our book value was nearly $1 billion at the end of Q1, a 35% increase. The growth in our loan portfolio drove the increase in earnings, as base interest rates remained flat in the period. BXMT earnings would benefit from increasing rates, 100 basis points increase in LIBOR at quarter end would resulted in an annual earnings increase of $9.6 million or $0.25 per share, including the impact of LIBOR floors currently in place.

BXMTs first quarter per share metrics will also up from the previous quarter, despite the impact of January’s equity rates. Core earnings per share was $0.43 up from $0.41 and book value per share was $24.63, up from $24.25. Despite strong demand, we sized our January offering with an eye towards maintaining the upward sloping trend in core earnings, reinforcing our disciplined approach to raising capital.

We took the same disciplined approach to our recent $255 million equity raise in April. This offering added $0.58 to book value per share, resulting in a pro forma book value of $25.21 post offering. Our activity in the equity capital markets reflects the confidence in the strength of our loan origination platform that Steve spoke about. The capital we raised BXMT the liquidity necessary to move quickly when providing funding’s to sponsors with certainty and in scale.

From the financial standpoint these offerings have a temporary diluted impact on result in the period capital as raised specifically constraining core earnings per share. We experience this impacting Q1 due to the January offering and expect a similar impact in the second quarter related to the April offering. The increased equity has temporary deleveraging impact on our balance sheet as we revolve down debt to manage liquidity pending the deployment of the new capital.

Our debt-to-equity ratio at quarter end was 1.8 times despite our target leverage at the asset level of between 3 times and 4 times. We think is our business continues to mature we’re stabilize at higher leverage ratios. We are taking active steps to maximize the efficiency of our capital raising activity.

During the first quarter, we implemented our DRIP and DSP programs to raise small amounts of equity capital in the future via dividend reinvestment and direct stock purchases. And we will continue to consider options in the credit markets to achieve higher leverage at the corporate level.

Finally, as BXMT grows the impact of episodic capital raises will diminish as working capital needs will remain relatively constant in absolute terms against a larger equity base. We paid a dividend of $0.48 in Q1 up from $0.45 in Q4 representing a 7.8% yield on book value. As we think about the sizing of the dividend, we do so with reference to core earnings as well as other factors, including the stabilized earnings of BXMT’s core loan origination business and the impact of the legacy segment.

It is interesting to note that our Q1 core earnings, over our pre-January offering share count would have been $0.55 per share. In terms of the legacy segment, we expect a positive contribution during 2014, despite $1 million loss in the quarter driven by net markdowns in our CT Legacy portfolio investments.

The anticipated legacy contribution is driven by CTOPI promote revenue that we expect to begin to realize in the second half of the year. The net value of the CTOPI promotes to the $18.5 million on an unrealized basis at quarter end. In closing our financial performance to kick off 2014 reflects the Blackstone Mortgage Trust business plan to support senior floating-rate loan originations with superior execution in the credit and capital markets.

And with that, I will ask Derrick to open the call to questions.

Question-and-Answer Session

Operator

(Operator Instructions) And our first quarter will come from the line of Steve DeLaney, JMP Securities. Please proceed.

Steve C. DeLaney – JMP Securities LLC

Hey good morning everyone thanks for taking my question. Stephen, you commented on the floating-rate CMBS market as a source of competition or an increase – new source of competition. Are you guys getting any closer to seen looking at that market as a potential source of financing for yourself? I know in the past you’ve said that your bank term facilities were so attractive that you really weren’t in a hurry to do that? I was just curious how you see that market today?

Douglas N. Armer

Hi Steve, its Dough here. CLO financing is an interesting option. I would say, I think you had the nail on the head. We have ample leverage capacity with our credit facilities now and they provide some distinct advantages for us, particularly in terms of our ability to revolve debt balances down and price our borrowings efficiently and those are very important in our current stage of growth.

But as we continue to grow, we will look to supplement those credit facilities from other sources, including unit sales and indeed CLO financing. During 2013, that market wasn’t very attracted to us particularly in terms of structure and pricing, but in recent weeks that’s begun to change. We’ve seen some interesting executions in the second quarter and as Steve mentioned, I think you know we are very well positioned to push the envelope in that market when the time is right.

Steve C. DeLaney – JMP Securities LLC

Okay, I appreciate that. Yes we saw two smaller deals this week from two of the commercial mortgage REITs.

Douglas N. Armer

Yes.

Steve C. DeLaney – JMP Securities LLC

On the deferred carried interest in CTOPI keeps moving up a little bit and I think I calculated, it was like $0.38, we’ve been adjusting that into book value and looking at it is money good. Is there any event pending that would allow you or – so what is the trigger or flashpoint at which time you would consider recognizing that in your book value?

Stephen D. Plavin

We’ll recognize the book value when the cash is actually distributed; if there are capitals that will occur in the fund in the second half of this year which we believe will sort of trigger the initiation of those cash distributions. And so we continue to feel good about the performance, the investments and the vehicle and that timing.

Steve C. DeLaney – JMP Securities LLC

Great. So not too far down the road, we should in that item won’t have to be carried over kind of adjustment that we might want to make to get to a more economic measure of book. Okay great. Thanks for the color.

Stephen D. Plavin

You’re welcome.

Operator

Your next question will be from the line of Aaron Bigonovich, Abacor [ph].

Unidentified Analyst

Thanks. Just on competition, there was an article on the journal this morning kind of highlighting the benefits of the non-bank lenders in your space, but there were some discussion about some and at least one insurance company looking to increased exposure into transitional assets. What are you seeing more in terms of competition in your niche of commercial real estate?

Stephen D. Plavin

Yes, I saw the article as well and haven’t really seen any insurance companies able to compete in the space. They generally don’t have the ability to execute or the risk appetite. So I don’t think they will be factor. I do think that there are primary competitors are the ones that were noted in the article, the other mortgage REITs and the private lenders. We are still able to compete very favorably versus those competitors given what we believe is lowest cost to capital in the business.

Unidentified Analyst

And then I guess in regards to the competition broadly. What are you seeing in terms of impacts of spreads re-pricing, it looks like LTVs are still holding pretty firm in that kind of 65 percentage level.

Stephen D. Plavin

You know I think the pressure we are seeing is really relates to the – as I mentioned in my remarks to the assets that are more stabilized, the ones that are suitable for the CMBS market. The floating-rate CMBS market from multiple borrower DSP has been there has been relatively dormant since 2007. And now we are seeing the banks being to aggregate large footing at loans to securitization.

It only impacts a small segment of our business, because those loans typically need to be on stabilized properties have don’t have any significant leasing or renovation plans in the foreseeable future. So for –that small segment of the property of our properties and assets we are seeing that competition, but in general competitive landscape remains pretty favorable for us.

Unidentified Analyst

Great and then lastly I’m sorry I missed the quarter-to-date activity that you mentioned. Could you repeat that for me?

Stephen D. Plavin

We’ve closed $161 million of loans; we have additional $662 million of loans with the agreed terms that are in the closing process.

Unidentified Analyst

Okay thanks a lot.

Stephen D. Plavin

You are welcome.

Operator

Your next question will be from the line of Stephen Laws, Deutsche Bank.

Stephen A. Laws – Deutsche Bank Securities, Inc.

Hi, good morning. Thanks for taking my question. You mentioned in your prepared remarks that you expect similar sequential or similar performance in the second quarter as the first, given the timing of the January and April offering. I mean should we look at that that given deployment pace you guys are comfortable with a slight sequential increase in core EPS is that how we should read your comments?

Douglas N. Armer

Yes, I mean we don’t give guidance. So I wouldn’t be comfortable answering that directly, but I think the broader comment that we were making was, we will experience an impact to our core EPS in the second quarter, obviously from our April capital raise. So we’re mindful of that, it does – there is a lag between when we raise capital and we’re able to deploy it our optimal sort of returns on investment.

Stephen A. Laws – Deutsche Bank Securities, Inc.

Okay, great. And moving over to maybe opportunities in Europe, can you update us on the status I mean you added a pound sterling denominated facility are expanded once. Can you maybe talk about opportunities, where you are in the process that in a euro denominated financing facility to open up maybe other regions in Europe to resource of that much?

Stephen D. Plavin

Sure, our initial efforts in Europe have been focused on net – more narrowly on London and the U.K., but we’re beginning to see opportunities throughout Europe, especially since we have a strong equity team based in London is active throughout Europe. So we are seeing a lot of interesting opportunities. We were able to convert one of our pound denominated -- facility that we have to be able to fund euro as well and we do expect to have plenty of credit capacity for our European business as we go forward.

From an origination standpoint, we’re seeing an increasing flow from our team in London; we’ve a seven person investment team in London. We have a lot of experience in the market, we have a good footprint there. So, it will be come an increasingly large percentage of our businesses as we go forward, five months pretty good today. And I think you will see more as we move through the year.

Stephen A. Laws – Deutsche Bank Securities, Inc.

Great, and you guys feel comfort to have the credit capacity, or able to expand that as you continues to grow in Europe?

Stephen D. Plavin

Yes, we a have a lot of activity interest in expanding our credit capacity in Europe.

Stephen A. Laws – Deutsche Bank Securities, Inc.

Great, and then, I guess one follow-up question on Europe and I’ll drop off, but could you maybe talk about the differences or similarities on the return of investments there versus in the U.S. and then on the competitive environment in Europe versus in the U.S? Thanks for taking my questions.

Stephen D. Plavin

The return profile of the investments has been relatively similar, we’ve only closed our first few loans, but the pipeline I would say is similar to that in the U.S. tends to do more transitional assets. We are looking at a couple of larger deals that are less transitional and more opportunistic from our standpoint. The environment overall is less sufficient, so we’re able to find more things off the run with less competition as more fragmented there is much transaction activity there is you don’t see as much regular lay activity. But we’re seeing plenty of opportunities to invest then we do expect to percentage of assets year April growth through the year.

Operator

Your next question will be from the line of Donald Fandetti, Citigroup.

Donald Fandetti – Citigroup Global Markets Inc. (Broker)

Yes, Steve, talking about the CLO market clearly if that integers in terms of reducing financing risk, but I am just wonder, purpose increased competition from specialty lenders if you think about that pre-crisis the borrowers not that high for XT versus CLO so that can bring in more companies like to sell. And then secondarily it seems like the Blackstone effective giving you access to slightly lower cost of debt and accessing versus some your peers into that get neutralized from CLO’s or do you expect some type of premium for Blackstone CLO?

Stephen D. Plavin

I think it’s a great question Don. I do think that will be although maintain our reputation venture economic condition we have to market relative to our competitors. The challenge is differentiating ourselves in the ratings process, but in the actual marketing and pricing process we will be able to as sort of competitive advantage. These investors will as they look more favorably on our sponsorship in the CLO than others. We also have given the scale of our business, we produce more collateral so we should be able to produce better transactions greater diversity which should price better than what our competitors should able to put together in their efforts.

Paul D. Quinlan

I think from our point of view CLO’s will be one arrow in the [indiscernible] I think some of the entrance that you are talking about and more potential CLO issuers in the mode from the previous cycle would be reliant on the CLO market exclusively. And so they wouldn’t be able alternatively use it as efficiently as we will be to in combination with our other funding sources.

Stephen D. Plavin

One last thing I would add as it in the last cycle most of the deals that were in the CLO market were so that with purchase when you was purchase origination though interest in loans apart from the package securitize us by the street. It will be very difficult for anyone who is not in the business with the meaningful footprint did all the origination business try to feed a CLO business that happens whatever the securitization market opportunity might create. So I think the dynamic are different this time in the last cycle.

Donald Fandetti – Citigroup Global Markets Inc. (Broker)

Got it, thanks.

Operator

Your next question is from the line of Jade Rahmani, KBW.

Jade J. Rahmani – Keefe, Bruyette & Woods, Inc.

Thanks for taking the questions. Your presentation noted approximately 90% of the portfolio is first mortgages. Do you expect to increase the allocation to B Notes and or mezzanine loans and within the subordinate mortgage space, do you have particular views on which structures are preferable. For example, just wondering if you can give a sense of whether you prefer an A, B Note structure to mezzanine and if you prefer mezzanine to subordinate mortgage debt? Also want to get a sense of what you might do to maintain or increase return should yield on transitional first mortgages compressed.

Stephen D. Plavin

Well, I think the first part of your question relating to subordinate interest in loans, I think that even in the assets where we have – where we end up with the mezzanine loan or B Note position, we are still essentially retaining traditional hold on our senior mortgage risk and rather financing the senior portion of loan, it gets sold into the market. So when we sell an A Note or a senior mortgage component of a financing. We will do that if we think that it’s a superior execution what we are able to do with our credit facility borrowings. So it’s more of a – it relates more to balance sheet management than maximizing the return on our retained equity in anyone investment.

So and it is not our intention to initiate any kind of a direct mezzanine loan strategy to augment our yields, that’s not our business, our business is the senior mortgage – it’s a senior mortgage origination business. As it relates to structure, it really – it varies a lot from jurisdiction-to-jurisdiction, in markets where it’s difficult to foreclose a mortgage like New York, or markets with high mortgage recording tax also like New York and Florida. Then it maybe more beneficial for us to retain a junior interest at the mezzanine and rather than as a B Note and a mortgage.

In markets where you can foreclose more easily the difference is left significant. And so it also varies in terms of when we originate loans whether we have the ability to originate the loans and split them into two loans or just maintain a single loan. So a lot of it is sort of situation specific, but for us all around optimizing our equity and our equity returns in terms of how we – of what we retain and how we create a senior interest to sell or to finance.

Jade J. Rahmani – Keefe, Bruyette & Woods, Inc.

And with respect to the portfolio concentration or portfolio mix, do you expect that to migrate more towards A, B Note financings or mezz subordinate interest.

Stephen D. Plavin

I think that it will depend upon the – how the [indiscernible] market looks compared to our credit facility options and potentially CLO and term loan options down the road. So when we originate a whole loan, you know we have – Doug mentioned the multiple arrows in the clover it terms of how we finance something. We have a lot of alternatives in terms of how we look at an asset and how we derive our returns.

So we really individually capitalized every loan that we originate to try and minimize its risk and maximize its return. So those factors in dynamics change and change over time. We are very comfortable retaining our risk positioned in a whole loan or in a B Note participation or in mezzanine loan and we can structure our loans to preserve all the control that we need to the extent that something ever goes ROI [ph], but in general for us today its really more a strategy around maximizing our returns based upon the most efficient means of financing our originate loans.

Jade J. Rahmani – Keefe, Bruyette & Woods, Inc.

Thanks and follow up on the CLO question. I mean beyond pricing and leverage securitization, what do you see as the major drawbacks to issuing a CLO or even CMBS structure.

Douglas N. Armer

I think what’s important for us is that we are able to maintain the leverage in CLO structures, so that it’s accretive financing over good period of time. So the sequential pay structures are problematic in terms of maintaining our ROI to support our dividend. And another issue is that the – when you do go out three, four, five years you are taking some pricing risk and the flexibility that we have on our credit facilities to adjust pricing to move with the market is an important advantage for us that we wouldn’t see in a CLO market.

Jade J. Rahmani – Keefe, Bruyette & Woods, Inc.

And regarding the sequential pay structures, can you just elaborate a bit on the deleveraging effect, I mean is that – as retaining the subordinate interest, you wouldn’t be receiving principle pay downs pari passu. So you wouldn’t able to reinvest those proceeds in timing with the cash flows and that’s what makes the dividend support difficult. Is that correct?

Stephen D. Plavin

I think that substantially correct.

Jade J. Rahmani – Keefe, Bruyette & Woods, Inc.

Great thanks for taking the questions.

Operator

Your final question will come from the line of Daniel Altscher, FBR.

Daniel K. Altscher – FBR Capital Markets & Co.

Thanks appreciate you taking my call this morning. And I want to maybe ask a little bit about a different question. CT Legacy has also been declining for the portfolio in time part of the story which I think is probably good overall, but you know it seems like to me you guys have been pretty successful of managing the portfolio down and fundamentals have been good there. Is there any opportunity now to find sort off market or disposal transaction to just make it a clean break at this point and just [indiscernible].

Stephen D. Plavin

Well, I think in general we’re managing at least especially the CT Opportunity Partners vehicle, I don’t know – it’s not necessarily to accelerate yen, but the yen is inside and we are looking at selling assets in some cases an advance that other might repay in the ordinary course. See think we are motivated to follow-up trying to accelerate the movement of cash from the legacy portfolio into the origination business, but in the ordinary course we’re going to make a lot of progress toward that end in 2014. So, I think how we roll into next year, it’s going to be very, very small component of the overall picture.

Daniel K. Altscher – FBR Capital Markets & Co.

Okay, and it feels like to me that you are pretty close towards maybe achieving your targeted dividend yield on book value targets, you seem to be doing it still at a very under levered balance sheet basis. How do you feel about that, do you think that’s true or do you think there is still substantial way that you need to go in terms of levering the balance sheet before hitting the target?

Douglas N. Armer

I would say, we don’t have necessarily a target level for the balance sheet as a corporate finance matter. We do have a target leverage level of three to four times at the asset level, but that will roll up to the balance sheet differently depending on the structure of the investments and the structure of the financing of those investments. So as you point out, I think we’ve done a good job of ramping earnings and dividend. And I think we’ll continue to manage the debt capitalization of the company as efficiently as possible to support that dividend.

Daniel K. Altscher – FBR Capital Markets & Co.

Okay, I guess my comment was, it feels like you can start to reach the ramped up divided level without the need of any – without the need of substantially more leverage. Does that sound about right?

Douglas N. Armer

You know I mean its – I think that’s correct sort of giving the current status of the portfolio, but that will change overtime as we continue to structure investments and add exposure to the balance sheet. So, it will move around I think the right metric ultimately to look at is our core earnings per share and our dividend per share.

Daniel K. Altscher – FBR Capital Markets & Co.

Okay, and then I just one final one. Is it – I think a very – also a very different direction type of question here, but I clearly the balance sheet is ramping up in size, the equity base probably starts to ramp up again continuing through this year and next year. What point perhaps moving to an internalized structure make more sense or is there more scale or efficiency there or is that just maybe too hard to potentially do with the way the relationship works with Blackstone Big Bear [ph] and Blackstone?

Stephen D. Plavin

Yes. We have no plans to internalize management and one of the great benefits of being part of the Blackstone platform is sitting a long side the other Blackstone professionals were imaging other investors vehicles. So we invest this is business common platform which we would lose that we’re internalized it will be include we will become more CLO and the information sharing and the advantages of being part of the common investment platform or one of the great things about the company.

Daniel K. Altscher – FBR Capital Markets & Co.

Great, thank you.

Operator

That will conclude our Q&A session. We will now turn the call back over to Mr. Weston Tucker for any closing remarks.

Weston Tucker

Great. Thanks everybody for joining us and again if you have any questions please follow up with me directly.

Copyright policy: All transcripts on this site are the copyright of Seeking Alpha. However, we view them as an important resource for bloggers and journalists, and are excited to contribute to the democratization of financial information on the Internet. (Until now investors have had to pay thousands of dollars in subscription fees for transcripts.) So our reproduction policy is as follows: You may quote up to 400 words of any transcript on the condition that you attribute the transcript to Seeking Alpha and either link to the original transcript or to www.SeekingAlpha.com. All other use is prohibited.

THE INFORMATION CONTAINED HERE IS A TEXTUAL REPRESENTATION OF THE APPLICABLE COMPANY'S CONFERENCE CALL, CONFERENCE PRESENTATION OR OTHER AUDIO PRESENTATION, AND WHILE EFFORTS ARE MADE TO PROVIDE AN ACCURATE TRANSCRIPTION, THERE MAY BE MATERIAL ERRORS, OMISSIONS, OR INACCURACIES IN THE REPORTING OF THE SUBSTANCE OF THE AUDIO PRESENTATIONS. IN NO WAY DOES SEEKING ALPHA ASSUME ANY RESPONSIBILITY FOR ANY INVESTMENT OR OTHER DECISIONS MADE BASED UPON THE INFORMATION PROVIDED ON THIS WEB SITE OR IN ANY TRANSCRIPT. USERS ARE ADVISED TO REVIEW THE APPLICABLE COMPANY'S AUDIO PRESENTATION ITSELF AND THE APPLICABLE COMPANY'S SEC FILINGS BEFORE MAKING ANY INVESTMENT OR OTHER DECISIONS.

If you have any additional questions about our online transcripts, please contact us at: transcripts@seekingalpha.com. Thank you!

Source: Blackstone Mortgage Trust's CEO Discusses Q1 2014 Results - Earnings Call Transcript

Check out Seeking Alpha’s new Earnings Center »

This Transcript
All Transcripts