Lument Finance Trust, Inc.

Good morning, and thank you for joining the Lumen Finance Trust second quarter 2021 earnings call. Today's call is being recorded and will be made available via webcast on the company's website. I would like to turn the call over to Charles Duddy with Investor Relations at Lumen Investment Management. Please go ahead, sir.

Thank you, and good morning, everyone. Thank you for joining our call to discuss Lumen Finance Trust second quarter 2021 financial results. With me on the call today are James Flynn, CEO, Michael Larson, President, James Briggs, CFO, and Priscilla Torres, Head of Real Estate Investment Strategies. On Monday, we filed our 10-2 with the SEC and issued a press release which provided details on our second quarter results. We also provided a supplemental earnings presentation which can be found on our website. Before handing the call over to Jim, I would like to remind everyone that certain statements made during the course of this call are not based on historical information and may constitute 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. When used in this conference, words such as outlook, evaluate, indicate, believes, will, anticipates, expects, intends, and other similar expressions are intended to identify forward-looking statements. Such forward-looking statements are subject to various risks and uncertainties that could cause actual results to differ materially from those contained in the forward-looking statement. These risks and uncertainties are discussed in the company's reports filed with the SEC, including its reports on Form 8-K, 10-Q, and 10-K, and in particular, the risk factors section of our Form 10-K. Additionally, many of these risks and uncertainties are currently amplified by and will continue to be amplified by the COVID-19 pandemic. It is not possible to predict or identify all such risks. Listeners are cautioned not to place undue reliance on these forward-looking statements or speak only to the date hereof. The company undertakes no obligation to update any of these forward-looking statements. Furthermore, certain non-GAAP financial measures will be discussed on this conference call. A presentation of this information is not intended to be considered in isolation nor as a substitute to the financial information presented in accordance with GAAP. Reconciliations of these non-GAAP financial measures to the most preparable measures prepared in accordance with GAAP can be accessed through our filings with the SEC at sec.gov. I will now turn the call over to James Flynn. Please go ahead.

Thank you, Charlie. Good morning, everyone. Welcome to the Lumen Finance Trust earnings call for the second quarter of 2021, and thank you all for joining. This quarter was a busy, important, and successful quarter for Lumen Finance Trust growth and growth strategy. During the quarter, we executed several significant capital transactions that allowed us to grow our capital and institutional investor base. At the same time, we made significant incremental investments, observed continued strong performance in our portfolio, and maintained distributable earnings consistent with our prior quarters. This all accomplished in an environment marked with uncertain economic data, interest rates, unemployment, asset values, as well as health data with respect to COVID-19 and the variants, specifically the Delta variant, now appearing throughout the country and world. The first of our major transactions was the issuance of the perpetual preferred equity that we discussed during our prior call, raising 58 million in net proceeds. Secondly, and as previously announced on June 14th, we successfully closed a $1 billion CRE CLO. In conjunction with this transaction, we redeemed our two prior CLOs. This new CLO provided us with an attractive leverage and pricing on a non-recourse, non-mark-to-market, and match-term basis. Our utilization of the CLO market proved valuable during last year's disruption, and we continue to see this as an attractive way to finance our investment portfolio. In closing of this, our largest CRE CLO represents another significant positive milestone in the progression of our growth plans. Importantly, this transaction allowed us to quickly deploy a portion of the proceeds from our preferred equity offerings while still providing favorable economic and structural features to allow for continued growth. The CLO allowed us to increase LFT's total assets on balance sheet by 85% from 567 million as of 3-31 to 1.04 billion as of June 30. In addition, combining our two prior CLOs into a larger single transaction allowed for increased economies of scale and facilitates greater investment diversification. We believe the strong execution for this CLO, along with our successful preferred equity offering and the increase in our term loan, reflect noteworthy market and investor interest in our company and in our future. In the coming months, we hope to continue discussions with investors and educate market participants about the LFT and the opportunity we provide for investors. Although LFT is relatively small in the commercial mortgage REIT space, our manager and the larger Lumen platform are not. Our manager is one of the nation's largest capital providers in the multifamily and seniors housing space, executing over $16 billion in total transaction volume in 2020, servicing a $47 billion loan portfolio and employing nearly 600 employees in over 25 offices nationwide. The scale of this platform benefits the investors of LFT and provides great support in the execution of our investment strategy. As we have continued to show over the last three years, we are utilizing the strengths of our manager to focus our investments in middle market multifamily floating rate bridge loans that have continued to perform extremely well, even in the very challenging economic environment last year. Although there has been increased competition for these investments with numerous new debt funds entering the space, the breadth of Lumen's platform and the strength in multifamily in particular continues to provide us with compelling investment opportunities. During the last three months since our preferred offering, we have invested over $530 million in new floating rate bridge loans, showing our ability to quickly deploy substantial amounts of newly raised capital. This strong deal flow is driven by the expansive origination capabilities of our manager. In addition, we have seen tremendous transaction activity in the first half of the year as the market responds to the COVID recovery, albeit tempered by the recent increases seen in cases around the country. As we continue to grow, we will also identify other investment opportunities in commercial real estate debt to diversify and invest a portion of our capital into asset classes such as preferred equity, MES loans, and other high-yield debt securities. While we are proud of the capital raising and deployment achievements this quarter, it is important to acknowledge that our focus in multifamily bridge lending and the strength of our credit and asset management platform have allowed us and our portfolio to continue to perform admirably. As of June 30th, our loan portfolio was 100% performing with no loan impairments, no loan defaults, and no loans subject to forbearance. Furthermore, we have not granted a single forbearance nor have we experienced a single loan default during the COVID era. I believe this is a testament to both our rigorous credit standards as well as our proactive asset management efforts. And perhaps most importantly, Our ability to continue to execute our business plan is reflected in our results. Our distributable earnings for the quarter was 11 cents per share, consistent with last quarter. Inclusive of this quarter, we have produced 43 cents per share of distributable earnings over the prior four quarters, representing consistent earnings that provide strong support for our dividend. When this management team took over as manager of Lumen Finance Trust in January of 2018, We were clear on our goal of deploying our capital into commercial real estate debt investments with a focus in multifamily in order to provide stable earnings that support a market return to our shareholders. We also indicated our desire to grow LFT to a larger scale, which we felt would provide value to our shareholders. With the recent CLO refinance and preferred offering, we're continuing to make progress towards these goals, and I am excited about our continued growth as we focus on executing the business plan. With that, I'd like to turn the call over to Jim Briggs, who will provide details on our financial results. Jim?