Arbor Realty Trust

good morning ladies and gentlemen and welcome to the third quarter 2021 arbor realty trust earnings conference call at this time all participants are in a listen-only mode after the speaker's presentation there will be a question and answer session to ask a question during this period you will need to press star 1 on your telephone if you want to remove yourself from the queue please press the pound key please be advised that today's conference is being recorded If you need operator assistance, please press star zero. I would now like to turn the call over to your speaker today, Paul Alenio, Chief Financial Officer. Please go ahead.

Okay, thank you, Leo, and good morning, everyone, and welcome to the quarterly earnings call for Arbor Realty Trust. This morning, we'll discuss the results for the quarter ended September 30th, 2021. With me on the call today is Ivan Kaufman, our President and Chief Executive Officer. Before we begin, I need to inform you that statements made in this earnings call may be deemed forward-looking statements that are subject to risk and uncertainties, including information about possible or assumed future results of our business, financial condition, liquidity, results of operations, plans, and objectives. These statements are based on our beliefs, assumptions, and expectations of our future performance, taking into account the information currently available to us. Factors that cause actual results to differ materially from ARBA's expectations in these forward-looking statements are detailed in our SEC reports. Listeners are cautioned not to place undue reliance on these forward-looking statements, which speak only as of today. ARBA undertakes no obligation to publicly update or revise these forward-looking statements to reflect events or circumstances after today or the occurrences of unanticipated events. I'll now turn the call over to ARBA's President and CEO, Ivan Kauffman.

Thank you, Paul, and thanks to everyone for joining us on today's call. As you can see from this morning's press release, we had another outstanding quarter with many significant accomplishments, including exceptional operating results. It is very important for us to continue to emphasize the value of having multiple products with diverse income streams, which has allowed us to consistently grow our earnings and dividends while maintaining a very low dividend payout ratio. We strategically built an annuity-based business model of creating multiple income streams from a single investment. As a result, not only did we generate strong risk-adjusted returns on our capital, which positively affect our current earnings, more importantly, we are also building a much higher quality future earnings and dividend growth story by ensuring that our assets will provide us with multiple other products in the future. And this is one of the major differentiators of our business platform, which is why we strongly believe we should consistently trade at a substantial premium and much lower dividend yield than anyone else in our peer group. Our record results combined with our very positive outlook on the long-term growth of our platform has allowed us to once again increase our dividend to $0.36 a share. This is our sixth consecutive quarterly dividend increase and our tenth increase in the last 13 quarters. all while maintaining the lowest dividend payout ratio in the industry. We built a premium operating platform, which, as I mentioned in the past, is focused on the right asset classes with very stable liability structures. We have a thriving balance sheet, GSE agency, private label, and single-family rental, as well as an industry-leading securitization platform that has allowed us to produce a long track record of exceptional performance with consistent earnings and dividend growth. And as a result, we've been the top performing REIT in our space for five consecutive years now in all the major performance metrics, including earnings and dividend growth, ROE, and total shareholder return. And again, we are very confident in our ability to continue to produce outstanding results in the future. Before we discuss the details of our quarterly I want to highlight some of our more notable recent accomplishments. We had a very active and successful quarter in many areas of our business. We produced tremendous transaction volumes, originating in excess of $4 billion in new loans and investments this quarter, including $2.5 billion in balance sheet loan originations, which is another new record. We have now closed $10 billion in loans through the first nine months of the year, and just as importantly, our pipeline is currently at an all-time high. We are once again in the capital market, successfully raising approximately $615 million of accretive capital to fund this growth. We issued $270 million of five-year 4.5% unsecured debt and $345 million of new 6.25% perpetual preferred equity, which will be extremely accretive to our future earnings and dividends. Every time we raise capital, is to fund our growing balance sheet loan business, which is not only accretive to our current earnings and dividends, but also allows us to build a pipeline for two to three years of new GFC agency and private labor loans that produce additional long-term dated income streams, ensuring the growth of our platform and creating high-quality earnings and dividends for the future. We're also very successful in continuing to access the CLO securitization market in the third quarter, closing our 16th and largest CLO to date, totaling $1.5 billion with very favorable terms and pricing. We have consistently been a leader in the CLO securitization market as financing our high-quality balance sheet portfolio, with the appropriate liability structures continuing to be one of the key business strategies. The utilization of these vehicles has contributed greatly to our success by allowing us to appropriately match funds our assets with non-recourse, non-mark-to-market, long-term debt, and generate attractive levered returns on our capital, and provide us with a rock-solid balance sheet. And in October, we're very pleased to have closed our third private label securitization, totaling $535 million with a very effective execution, which will contribute greatly to our fourth quarter earnings and continues to demonstrate the strength and diversity of our versatile lending platform and tremendous securitization expertise. Turning now to our third quarter performance, as Paul will discuss in more detail, our quarterly financial results were once again remarkable. We produced distributable earnings of 49 cents per share, which is well in excess of our current dividend, representing a payout ratio of around 75%. In our balance sheet business, we are seeing tremendous growth and efficiencies as we continue to scale our platform at a very rapid pace. We are a top balance sheet lender in the industry, which has allowed us to grow our loan book another 24% in the third quarter on record quarterly volume of $2.5 billion. We have already grown our balance sheet 67% this year to $9.2 billion at September 30th, and our pipeline is also at an all-time high, which will allow us to continue to meaningfully grow our loan book going forward. And again, I want to emphasize the significant value of a balance sheet business. which not only generates strong levied returns on our capital, but very importantly, these investments also provide us the future agency and private label transactions with long-dated income streams. We continue to experience strong growth in our GFC agency platform, and we are seeing significant increased momentum in our private label program as well. We originated approximately $1.1 billion in agency loans in the third quarter, and $1.7 billion including our private label business. We also have a robust pipeline, giving us confidence in our ability to produce significant agency and private label volumes for the balance of our year. Our GSE and agency platform continues to offer premium value as it requires limited capital and generates significant returns, long-dated predictable income streams, and produces significant annual cash flow. Additionally, our 26 billion GSE agency servicing portfolio, which has grown 16% in the last year, is mostly prepayment protected and generates approximately $120 million a year and growing in reoccurring cash flow, which is up 19% from $101 million annually last year. This is in addition to the strong gain on sale margins we continue to generate from our originations platform, which combined with new and increasing servicing revenues, will continue to contribute greatly to our earnings and dividends. We're also pleased with the continued growth we experienced in our single-family rental platform. In the third quarter, we committed to another $150 million of product and have produced $500 million of volume for the first nine months of the year. We also have well over $1 billion of additional deals in our pipeline, making us optimistic about the growth opportunities in this segment of our business. We are a leader in the built-to-rent space, which provides us with the opportunity to originate construction, bridge, and permanent loans in the same transaction. And again, similar to our balance sheet business, the platform provides us yet another path to future transactions that will produce additional long-dated income streams. In summary, we had another exceptional quarter and are well-positioned to close out 2021. as another record year. We have developed a unique, multi-tiered, annuity-based operating platform that provides us with future annuity of high-quality, long-dated income streams, making us confident in our ability to continue to grow our earnings and dividends and significantly outperform our peers. I will now turn the call over to Paul to take you through the financial results.