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iStar Financial Announces 14th Consecutive Quarterly Increase in Adjusted EPS
NEW YORK, Oct. 19 /PRNewswire/ -- iStar Financial Inc. (NYSE: SFI) reported its fourteenth consecutive quarterly increase in adjusted earnings for the quarter ended September 30, 2001 to $0.73 per diluted common share, up from $0.68 per diluted share for the quarter ended September 30, 2000. Adjusted earnings for third quarter 2001 increased 10.2% to $64.9 million on a diluted basis, from $58.9 million for third quarter 2000. Adjusted earnings represent GAAP net income before depreciation and amortization.
Net income allocable to common shareholders for the third quarter grew to $48.3 million, or $0.54 per diluted common share, compared with $46.4 million, or $0.54 per diluted share, in third quarter 2000. Third quarter 2001 total revenue increased to $120.8 million from $120.7 million for the third quarter 2000.
In the third quarter of 2001, iStar Financial achieved returns on average book assets and average common book equity of 7.2% and 17.9%, respectively, while leverage increased slightly to 1.3x book equity. Net investment income for the quarter ended September 30, 2001 increased to $67.9 million, from $66.7 million for the third quarter of 2000. Net investment income represents interest and operating lease revenue less interest expense and operating costs for corporate tenant lease assets.
Adjusted earnings for the nine months ended September 30, 2001 were $190.2 million, or $2.15 per diluted share, compared to $170.7 million, or $1.98 per diluted share for the same period in 2000. Net income allocable to common shareholders for the nine months ended September 30, 2001 was $143.5 million, or $1.63 per diluted share, compared to $133.7 million, or $1.55 per diluted share for the same period in 2000. Net investment income and total revenue increased to $203.3 million and $364.3 million for the nine months ended September 30, 2001, respectively, from $200.3 million and $349.5 million, respectively, for the 2000 period.
During the third quarter of 2001, iStar Financial closed ten new financing commitments totaling $207.9 million, of which $160.2 million was funded during the quarter. In addition, the Company funded $20.7 million under four pre-existing commitments and received $13.2 million in principal repayments. The Company's recent transactions continue to reflect its core business strategy of originating value-added, structured financing transactions for owners of high-quality commercial real estate assets and leading corporations across the United States.
Jay Sugarman, iStar Financial's chairman and chief executive officer, stated, "In the face of uncertain times for our nation and our economy, we are extremely pleased to announce iStar Financial's fourteenth consecutive quarterly increase in earnings, to a record $0.73 per share. Return on equity also reached a record 17.9% this quarter, despite our running at just 1.3x leverage."
Mr. Sugarman continued, "Those of you who have followed our Company know that we have been quite bearish on the domestic economy for over a year. This conservatism underscored our investment underwriting, funding strategy and risk management tactics prior to the events of September 11, and serves us well following the tragedy. We expect the risk-return dynamics in commercial real estate financing to move solidly in the lender's favor over the coming quarters. However, until we can clearly assess the incremental downside risk in the economy and real estate markets, we have erred on the side of caution."
Selected Income Statement Data (In thousands, except per share amounts) (unaudited) Three Months Ended Nine Months Ended September 30, September 30, 2001 2000 2001 2000 Net investment income $67,914 $66,721 $203,258 $200,320 Other income 8,529 4,208 22,389 12,568 Non-interest expense (17,070) (16,883) (52,816) (53,598) Net income before minority interest $59,373 $54,046 $172,831 $159,290 Minority interest (41) (41) (177) (123) Gain (loss) on sale of corporate tenant lease assets (1,196) 1,974 403 2,948 One-time effect of a change in accounting principle -- -- (282) --
of debt (583) (388) (1,620) (705) Preferred dividends (9,227) (9,227) (27,681) (27,681) Net income allocable to common shareholders $48,326 $46,364 $143,474 $133,729 Per basic share $0.56 $0.54 $1.67 $1.57 Per diluted share $0.54 $0.54 $1.63 $1.55 Adjusted earnings allocable to common shareholders(a) $64,928 $58,909 $190,156 $170,685 Per basic share $0.75 $0.68 $2.20 $1.99 Per diluted share $0.73 $0.68 $2.15 $1.98 Dividends $0.6125 $0.6000 $1.225 $1.200
(a) Adjusted earnings represent GAAP net income to common shareholders
before depreciation and amortization, and exclude gain (loss) on sale of corporate tenant lease assets, one-time effect of change in accounting principles and extraordinary loss on early extinguishment of debt.
Selected Balance Sheet Data (In thousands) As of As of September 30, December 31, 2001 2000 (unaudited) Loans and other lending investments, net $2,392,605 $2,225,183 Real estate subject to operating leases, net 1,659,637 1,670,169 Total assets 4,196,553 4,034,775 Debt obligations 2,291,774 2,131,967 Total liabilities 2,372,477 2,240,666 Total shareholders' equity 1,821,426 1,787,885
In the third quarter of 2001, iStar Financial generated $207.9 million in new financing commitments in ten separate transactions. The Company also funded an additional $20.7 million under four pre-existing financing commitments and received $13.2 million in loan repayments. Mr. Sugarman stated, "As we noted in prior earnings releases, we expected the pace of loan prepayments to fall in the second half of this year and into 2002. The majority of the drop in long-term interest rates over the past two years occurred in 2000 and early 2001, providing borrowers with an incentive to prepay higher-cost financing despite the presence of prepayment penalties. Many of the borrowers who were able to take advantage of those lower rates appear to have done so by the first half of this year."
During the third quarter of 2001, the weighted average first dollar and last dollar loan-to-value ratio on new loan commitments and follow-on fundings was 12.0% and 67.2%, respectively. This ratio represents the average beginning and ending points for the Company's lending exposure in the aggregate capitalization of the underlying properties or companies it finances.
Mr. Sugarman commented, "Given our cautious outlook, over the past year we have focused on originating first mortgages, corporate tenant leases to investment-grade customers, and corporate loans backed by broadly diversified real estate portfolios with going-concern value and liquidity beyond our collateral. These types of transactions accounted for 74% of our investment volume since the third quarter of 2000."
"Because of this discipline, the Company's overall asset quality remains very strong," Mr. Sugarman said. "While our investment pipeline is robust, the 'bar' for new investments is very high."
During the third quarter of 2001, iStar Financial issued $350.0 million of 8.75% Senior Notes due in 2008. The Notes are unsecured senior obligations of iStar Financial. The Company used the net proceeds to repay outstanding borrowings under secured credit facilities. In addition, the Company completed a new $300.0 million corporate credit facility during the quarter, replacing two separate facilities which were scheduled to mature in 2002. The new facility bears interest at LIBOR plus 2.125% based on the Company's current credit ratings and matures in July 2004, including a one-year extension at the Company's option. Also during the third quarter of 2001, the Company match funded its recent structured finance investment in The Mills Corporation under iStar Financial's debt facility for corporate finance investments.
Spencer B. Haber, iStar Financial's president and chief financial officer, stated, "Our balance sheet, financial flexibility and liquidity position are very strong. We have no material debt maturities until 2003 and maintain a large pool of unencumbered assets. In August, we completed a $350 million long-term unsecured bond offering, and used the proceeds to pay down our secured credit facilities. Based upon the level of demand, we upsized the offering from $200 million and priced the bonds at the tight end of our expected range. We also saw very meaningful participation from investment-grade bond investors on the strength of our credit story."
At September 30, 2001, the Company had $693 million outstanding under $2.2 billion of total credit facilities. Mr. Haber continued, "With market conditions unsettled, our excess liquidity positions us to capitalize on investment opportunities as they arise and allows us to concentrate on risk management, as opposed to capital raising. While there is clearly a short-term earnings cost for raising this level of excess liquidity, we decided it was the prudent thing to do."
Consistent with the Securities and Exchange Commission's Regulation FD, iStar Financial comments on earnings expectations within the context of its regular earnings press releases. The Company currently expects adjusted EPS of $0.74 - $0.76 (basic) and $0.72 - $0.74 (diluted) for the fourth quarter of 2001. For the calendar 2001, iStar Financial currently expects adjusted EPS of $2.95 - $2.97 (basic) and $2.88 - $2.90 (diluted).
Mr. Haber commented, "Given the tragic events of September 11, we are obviously operating in a very uncertain business environment. As we have stated in our earnings releases during the past year, we already had a very bearish outlook for the U.S. economy prior to September 11, and had adjusted our investment, funding and risk management activities accordingly. This quarter, iStar Financial delivered its fourteenth consecutive quarterly increase in adjusted EPS, and we expect to continue to produce steady growth in earnings for calendar year 2002 and 2003. However, of necessity, our earnings guidance assumes no further economic upheavals arising from our country's campaign against terrorism."
For the calendar year 2002, iStar Financial currently expects adjusted EPS of $3.07 - $3.09 (basic) and $3.00 - $3.02 (diluted). Mr. Haber stated, "We are taking an even more decidedly cautious origination posture than we have over the past year. Although we closed over $200 million of new financing business in the third quarter, we put on hold over $400 million of pending investments for the third and fourth quarters following the events of September 11. Our current gross origination targets for 2002 and 2003 of $1.0 billion and $1.3 billion, respectively, reflect our conservative posture. We do not plan to revisit these targets until the outlook for U.S. economic and real estate market conditions becomes clearer."
iStar Financial's 2002 and 2003 earnings guidance also assumes loan repayments of approximately $290 million and $470 million, respectively. Mr. Haber stated, "Earlier this year, we said that we expected the above-average loan prepayment levels of the first and second quarters to subside in the second half of 2001. Consistent with our expectation, loan repayments fell to just $13 million during the third quarter. While we will continue to proactively seek loan prepayments to lessen our exposure to certain market segments, we believe that the current economic environment and the relatively steep shape of the yield curve should keep prepayments at lower levels throughout 2002 and 2003."
For the calendar year 2003, iStar Financial currently expects adjusted EPS of $3.47 to $3.52 (basic) and $3.38 to $3.43 (diluted). Mr. Haber continued, "While we have also lowered our origination and ancillary revenue forecasts for 2003, we expect to resume our double-digit long-term growth in 2003 as loan repayments return to more normalized levels."
For the third quarter of 2001, iStar Financial declared a common dividend of $0.6125 per share. This dividend represented 81.9% of the Company's basic adjusted earnings per share. Mr. Haber commented, "We have produced a growing dividend stream over the 15 quarters since iStar Financial became a public company. At the same time, we have consistently reduced our dividend payout ratio to provide a larger margin of safety to our shareholders, who count on the security of our dividend. As owners of $160 million of common stock, your Company's management and Board are committed to maintaining an attractive, secure dividend that is strongly supported by the Company's earnings." iStar Financial's Board of Directors reviews the Company's dividend for potential increase in the first quarter of each fiscal year, applicable to such quarter.
Mr. Haber concluded, "In unsettled times, we are pleased to provide shareholders with a stable source of earnings and dividends. Successful risk management remains our highest priority. With significant excess liquidity, no near-term debt maturities and cautious underwriting standards, the Company is well positioned to capitalize on investment opportunities as the macro outlook becomes clearer. Until that time, we are maintaining conservative assumptions for investment originations, ancillary revenue and operating expenses. Under these assumptions, iStar Financial should continue to produce steady growth and income for its shareholders over the coming years. Despite our performance and positive credit ratings momentum, our stock trades at a lower multiple than many other companies in the financial services sector. As more research analysts pick up coverage of the Company, we believe other investors will recognize iStar Financial as a compelling investment."
Credit Risk Management
At September 30, 2001, first mortgages, corporate tenant leases and corporate financing transactions collectively comprised 78.6% of the Company's asset base. The weighted average first and last dollar loan-to-value ratio for all structured finance assets (senior and junior loans) was 30.5% and 70.9%, respectively.
Timothy J. O'Connor, iStar Financial's chief operating officer, stated, "Because we approach corporate tenant leasing as a financing business, not as a real estate equity business, our primary focus has been on lengthening lease terms. By proactively extending leases prior to their stated maturities, we have minimized our lease expiration exposure in the intermediate term. In addition, we have disposed of the bulk of the non-core assets purchased as part of the TriNet acquisition, and our CTL portfolio is essentially full." As of September 30, 2001, the weighted average lease term of the Company's corporate tenant leasing portfolio was 8.4 years, and the portfolio was 99.2% leased. Remaining lease expirations for 2001 and 2002 represent just 0.7% and 2.1% of annualized total GAAP revenue, respectively.
The Company establishes loss reserves based on a quarterly bottom-up review of each of its assets, as well as using top-down guidance from industry-wide loss data and market trends. On a quarterly basis, the Company conducts a comprehensive credit review, resulting in an individual risk rating assigned to each asset. Attendance at the quarterly review sessions is mandatory for each of the Company's professional employees. These quarterly meetings are designed to enable management to evaluate and proactively manage asset-specific credit issues and identify credit trends on a portfolio-wide basis as an "early warning system."
During the risk ratings review, each asset is assigned a risk rating from "one" to "five," with a "one" indicating superior credit quality, a "two" signifying better than average credit quality, "three" as an average rating, a "four" indicating that management time and attention is required, and a "five" denoting a problem asset with potential principal risk to the Company. In addition to the ratings system, the Company maintains a "watch list" of assets which require highly proactive asset management to preserve their current ratings. Each newly-originated asset is typically assigned an initial rating of "three" (or average).
Mr. O'Connor continued, "Risk management has always been our highest Firmwide priority. While no one anticipated the events of September 11, we had been operating for over a year under the assumption that the economy was performing very poorly. With over 50 iStar Financial professionals focused on risk management, this discipline remains a key strength of the Company."
Based upon the Company's third quarter 2001 review, the weighted average risk rating of the Company's structured finance assets was 2.82, higher than last quarter's rating of 2.68. The weighted average risk rating for corporate tenant lease assets at the end of the third quarter was 2.92, higher than the prior quarter rating of 2.79.
The Company currently has three loans and one corporate tenant lease asset on its watch list, with a combined book value of $141.0 million as of September 30, 2001. None of the Company's investment assets was directly impacted by the events of September 11. The two loans added to the Company's watch list this quarter are secured by mortgages on two New York City hotels whose operating performance suffered in mid-September as a result of the attacks. However, the performance of both assets has significantly recovered since late September. The Company is currently comfortable that it has adequate collateral to support the book value for each of the four watch list assets.
At quarter end, accumulated loan loss reserves and corporate tenant lease depreciation represented approximately 2.20% of the gross book value of the Company's investments (loans and operating leases).
Mr. O'Connor commented, "While we have seen a deterioration in the credit quality in our hotel lending business, it represents only 13% of our portfolio at September 30, 2001 based on gross book values. As a result, our overall risk ratings continue to reflect the solid credit quality of our asset base."
The Company's 12 hotel loans are backed by broadly diversified assets, with 110 individual hotel properties in over 75 geographic markets. All of these loans have "lock boxes" through which the Company, as lender, controls operating cash flow. In addition, ten of the 12 loans have "cash trap" mechanisms that allow iStar Financial to keep cash flow after debt service as excess collateral if debt service coverages fall below pre-specified levels. None of the Company's hotel loans is backed by a resort property.
Mr. O'Connor added, "Our lending philosophy has always focused on cross collateralized portfolios of broadly diversified assets. We typically only make single-asset loans on large, institutional-quality properties in major metropolitan markets that can hold their long-term value across market cycles. This philosophy has served us well during the current downturn."
Mr. O'Connor stated, "At current interest rates, our hotel loan portfolio went into September 11 with an average of over 1.7x debt service coverage. In addition, our borrowers have substantial cash equity invested junior to iStar Financial's loans. This cash flow coverage and cash equity create room for declining cash flow performance before iStar Financial is impacted. This quarter, we added two hotel loans to our risk management 'watch list,' and expect that these loans will perform below expectations for the next six months. However, we are highly confident that the current operating environment for hotel properties will not have a material impact on iStar Financial's overall credit quality, earnings or liquidity."
On October 1, 2001, iStar Financial declared a regular quarterly cash dividend of $0.6125 per common share for the quarter ended September 30, 2001. The third quarter 2001 dividend, which will be paid on October 29, 2001 to holders of record as of October 15, 2001, represents approximately 81.9% of basic adjusted earnings per share for the third quarter.
iStar Financial is the largest publicly traded finance company focused exclusively on the commercial real estate industry. The Company provides structured financing to private and corporate owners of real estate nationwide, including senior and junior mortgage debt, corporate mezzanine and subordinated capital, and corporate net lease financing. The Company, which is taxed as a real estate investment trust, seeks to deliver superior risk-adjusted returns on equity to shareholders by providing innovative and value-added financing solutions to its customers.
iStar Financial will hold a quarterly earnings conference call at 10:00 a.m. Eastern time today, October 19, 2001. This conference call will be broadcast live over the Internet and can be accessed by all interested parties through iStar Financial's Web site, www.istarfinancial.com, under the "investor relations" section. To listen to the live call, please go to the Web site's "investor relations" section at least 15 minutes prior to the start of the call to register, download and install any necessary audio software. For those who are not available to listen to the live broadcast, a replay will be available shortly after the call on the iStar Financial Web site and will remain available for the next 30 days.
(Note: Statements in this press release which are not historical fact may be deemed forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although iStar Financial Inc. believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, the Company can give no assurance that its expectations will be attained. Factors that could cause actual results to differ materially from iStar Financial Inc.'s expectations include completion of pending investments, continued ability to originate new investments, the availability and cost of capital for future investments, competition within the finance and real estate industries, economic conditions, and other risks detailed from time to time in iStar Financial Inc.'s SEC reports.)
iStar Financial Inc. Consolidated Income Statements (In thousands, except per share amounts) (unaudited)
Three Months Ended Nine Months Ended September 30, September 30, 2001 2000 2001 2000 Revenue: Interest income $62,389 $70,148 $193,205 $197,095 Operating lease income 49,912 46,327 148,678 139,822 Other income 8,529 4,208 22,389 12,568 Total revenue 120,830 120,683 364,272 349,485 Costs and expenses: Interest expense 41,177 46,470 128,905 127,029
lease assets 3,210 3,284 9,720 9,568 Depreciation and amortization 8,669 8,705 26,255 26,575 General and administrative 6,131 5,859 18,731 20,570 Provision for possible credit losses 1,750 1,750 5,250 4,750 Stock-based compensation expense 520 569 2,580 1,703 Total costs and expenses 61,457 66,637 191,441 190,195 Net income before minority interest 59,373 54,046 172,831 159,290 Minority interest (41) (41) (177) (123) Gain (loss) on sale of corporate tenant lease assets (1,196) 1,974 403 2,948 One-time effect of a change in accounting principle -- -- (282) --
of debt (583) (388) (1,620) (705) Net income $57,553 $55,591 $171,155 $161,410 Preferred dividends (9,227) (9,227) (27,681) (27,681) Net income allocable to common shareholders $48,326 $46,364 $143,474 $133,729 Net income per common share: Basic $0.56 $0.54 $1.67 $1.57 Diluted $0.54 $0.54 $1.63 $1.55 Weighted average common shares outstanding: Basic 86,470 85,662 86,130 85,345 Diluted 88,824 86,644 87,999 86,021 iStar Financial Inc. Consolidated Income Statements (In thousands, except per share amounts) (unaudited)
Three Months Ended Nine Months Ended September 30, September 30, 2001 2000 2001 2000 ADJUSTED EARNINGS PER SHARE: Net income $57,553 $55,591 $171,155 $161,410 Add: Depreciation 8,669 8,705 26,255 26,575 Add: Joint venture depreciation 960 1,148 2,828 2,590 One-time effect of a change in accounting principle -- -- 282 -- Add: Amortization 4,959 4,042 15,391 9,330 Less: Preferred dividends (9,227) (9,227) (27,681) (27,681) Less: (Gain) loss on sale of corporate tenant lease assets 1,196 (1,974) (403) (2,948)
Add: Extraordinary loss
of debt 583 388 1,620 705 Adjusted earnings allocable to common shareholders: Basic $64,693 $58,673 $189,447 $169,981 Diluted $64,928 $58,909 $190,156 $170,685 Adjusted earnings per common share: Basic $0.75 $0.68 $2.20 $1.99 Diluted $0.73 $0.68 $2.15 $1.98 Weighted average common shares outstanding: Basic 86,470 85,662 86,130 85,345 Diluted 89,197 87,017 88,372 86,393 iStar Financial Inc. Consolidated Balance Sheets (In thousands)
As of As of September 30, December 31, 2001 2000 (unaudited) ASSETS Loans and other lending investments, net $2,392,605 $2,225,183 Real estate subject to operating leases, net 1,659,637 1,670,169 Cash and cash equivalents 15,155 22,752 Restricted cash 10,853 20,441 Marketable securities 41 41 Accrued interest and operating lease income receivable 20,843 20,167 Deferred operating lease income receivable 17,632 10,236 Other assets 79,787 65,786 Total assets $4,196,553 $4,034,775 LIABILITIES AND SHAREHOLDERS' EQUITY Accounts payable and other liabilities $75,478 $52,038 Dividends payable 5,225 56,661 Debt obligations: Unsecured senior notes 608,336 356,510 Unsecured revolving credit facilities -- 173,450 Secured revolving credit facilities 692,596 592,349 Secured term loans 509,728 349,060 iStar Asset Receivables secured notes 464,426 588,335 Other debt obligations 16,688 72,263 Total liabilities $2,372,477 $2,240,666 Minority interest 2,650 6,224 Shareholders' equity 1,821,426 1,787,885 Total liabilities and shareholders' equity $4,196,553 $4,034,775 iStar Financial Inc. Supplemental Information (In thousands) (unaudited)
THIRD QUARTER 2001 PERFORMANCE STATISTICS Return on Average Book Assets Three Months Nine Months Ended Ended September 30, September 30, 2001 2001 Adjusted Basic Earnings to Common Shareholders $64,693 $189,447 Plus: Preferred Dividends 9,227 27,681 Adjusted Basic Earnings before Preferred Dividends $73,920 $217,128 Adjusted Basic Earnings before Preferred Dividends -- Annualized (A) $295,680 $289,504 Average Total Book Assets (B) $4,124,951 $4,115,664 Return on Average Book Assets (A)/(B) 7.2% 7.0% Return on Average Common Book Equity Adjusted Basic Earnings to Common Shareholders $64,693 $189,447 Adjusted Basic Earnings to Common -- Annualized (C) $258,772 $252,596 Average Total Book Equity $1,826,276 $1,804,656 Less: Book Value of Preferred Equity (382,000) (382,000) Average Common Book Equity (D) $1,444,276 $1,422,656 Return on Average Common Book Equity (C)/(D) 17.9% 17.8% Efficiency Ratio General & Administrative Expenses $6,131 $18,731 Plus: Stock-Based Compensation Expense 520 2,580 Total Corporate Overhead (E) $6,651 $21,311 Total Revenue (F) $120,830 $364,272 Efficiency Ratio (E)/(F) 5.5% 5.9%
THIRD QUARTER 2001 CREDIT STATISTICS
Book Debt/Equity Book Debt (A) $2,291,774 Total Book Equity (B) $1,821,426 Book Debt/Book Equity (A)/(B) 1.3x Interest Coverage EBITDA (a) (A) $109,219 $327,991 GAAP Interest Expense (B) $41,177 $128,905 EBITDA / GAAP Interest Expense (A)/(B) 2.7x 2.5x Fixed Charge Coverage EBITDA (a) (C) $109,219 $327,991 GAAP Interest Expense $41,177 $128,905 Plus: Preferred Dividends 9,227 27,681 Total Fixed Charges (D) $50,404 $156,586 EBITDA / Fixed Charges (C) / (D) 2.2x 2.1x
THIRD QUARTER FINANCING VOLUME SUMMARY STATISTICS
LOAN ORIGINATIONS Total/ Floating Weighted CORPORATE Fixed Rate Rate Average LEASING Amount Committed $21,398 $155,704 $177,102 $51,583 Weighted Average GAAP Yield 11.22% 8.62% 8.93% 11.42% Weighted Average All-In Spread/Margin (basis points) (b) + 664 + 507 -- + 632 Weighted Average First $ Loan-to-Value Ratio 63.4% 6.0% 12.0% -- Weighted Average Last $ Loan-to-Value Ratio 72.8% 81.6% 67.2% -- UNFUNDED COMMITMENTS Number of Loans with Unfunded Commitments 10 Discretionary Commitments $56,443 Non-Discretionary Commitments 67,761 Total Unfunded Commitments $124,204
Estimated Weighted Average Funding Period Approximately 1.5 years
(a) EBITDA is calculated as total revenue minus the sum of general and
administrative expenses, provision for possible credit losses, stock-based compensation expense and operating costs on corporate tenant lease assets.
(b) Based on average quarterly one-month LIBOR (floating rate loans) and
U.S. Treasury rates (fixed rate loans and corporate leasing transactions) during the quarter. iStar Financial Inc. Supplemental Information (as of and for the three-month period ended September 30, 2001) (In millions) (unaudited)
PORTFOLIO STATISTICS AS OF SEPTEMBER 30, 2001 (a) Security Type $ % First Mortgages $1,118 27.0% Second Mortgages 368 8.9% Corporate/Partnership Loans/Other 872 21.0% Corporate Tenant Leases 1,785 43.1% Total $4,143 100.0% Collateral Type $ % Office $2,037 49.2% Industrial/R&D 410 9.9% Retail 198 4.8% Hotel (Lending) 540 13.0% Hotel (Investment-Grade CTL) 271 6.5% Mixed Use 152 3.7% Apartment/Residential 178 4.3% Homebuilder/Land 42 1.0% Conference/Entertainment 311 7.5% Various 4 0.1% Total $4,143 100.0% Product Line $ % Structured Finance $1,090 26.3% Portfolio Finance 369 8.9% Loan Acquisition 372 9.0% Corporate Finance 527 12.7% Corporate Tenant Leasing 1,785 43.1% Total $4,143 100.0% Collateral Location $ % West $1,276 30.8% Southwest 90 2.1% South 670 16.2% Central 305 7.4% North Central 80 1.9% Northeast 836 20.2% Mid-Atlantic 310 7.5% Southeast 378 9.1% Northwest 186 4.5% Various 12 0.3% Total $4,143 100.0%
(a) Figures presented prior to loan loss reserves and accumulated depreciation.
SOURCE iStar Financial Inc.
CONTACT: Spencer B. Haber, President & Chief Financial Officer, +1-212-930-9400, or Lianne A. Merchant, Vice President, Investor Relations, +1-212-930-9400, or Erin C. Hart, Associate, Investor Relations, +1-212-930-9400, all of iStar Financial Inc./
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