UPDATE 1-Blackstone Mortgage Trust declares quarterly dividend
By Ilaina Jonas
NEW YORK, Sept 10 (Reuters) - Blackstone Mortgage Trust Inc , the commercial real estate mortgage lending company, on Tuesday declared its first quarterly dividend, about a year after Blackstone Group LP, the world's largest real estate private equity firm, began assembling the company.
The company, which primarily originates and buys floating-rate senior mortgages on commercial real estate in the United States and Europe, declared a third-quarter dividend of 27 cents per share payable on Oct. 15 to shareholders of record as of the close on Sept. 30.
The dividend is likely to increase in the fourth quarter and next year as the mortgage real estate investment trust (REIT) deploys more of the capital it raised earlier this year.
The company is rare among mortgage REITs as its loans are floating rate, meaning the interest rates, which are tied to LIBOR (London Interbank Offered Rate), change or "float", unlike typical fixed-rate mortgages whose interest rates are set against longer-term indicators.
The company is managed by BXMT Advisors LLC, a subsidiary of Blackstone, which has more than $64 billion of assets under management.
Blackstone Mortgage Trust's chairman is Michael Nash, chief investment officer of Blackstone Real Estate Debt Strategies. Its board members include John Schreiber, co-founder of Blackstone Real Estate Advisors. Jonathan Gray, the global head of Real Estate at Blackstone, is a member of its Investment Committee.
"Our biggest single competitive advantage that we have is being part of Blackstone," Stephen Plavin, chief executive officer of Blackstone Mortgage Trust, said. "Blackstone's real estate footprint is unequalled. Culturally, it's an environment of information sharing. We have more information about real estate in the markets that we're active in than anyone else."
The mortgage REIT's typical customer is a private equity buyer who plans on fixing up or improving the property and then selling it, a similar strategy of the much larger Blackstone. The term of the average loan is about five years or less. The REIT funds its loans with the equity it has raised as well as with about 50 percent to 80 percent it borrows.
Plavin said the affiliation with Blackstone enables the REIT to borrow at attractive rates.
"Because of the significant banking relationships that we maintain throughout Blackstone, we tend to get the very best terms," he said, and the lower capital cost makes the REIT "highly competitive in terms of succeeding in attracting the loans that we target."
Shares of Blackstone Mortgage Trust closed at $25.61, up 16 cents, or 0.6 percent, before the announcement of its dividend. Shares were inactive after hours.
- Cortege departs to take Mandela's body to lie in state |
- U.S. Mega Millions lottery up to $344 million, fourth biggest in its history
- Uruguay becomes first country to legalize marijuana trade
- UPDATE 1-U.S. Mega Millions lottery up to $344 million, fourth biggest in its history
- Ukrainian riot police clash with protesters in Kiev square