The following is a summary of the Ares Commercial Real Estate Corporation (ACRE) Q1 2024 Earnings Call Transcript:

Financial Performance:

• Ares Commercial Real Estate Corporation reported a GAAP net loss of $12.3 million, or $0.23 per common share in Q1 2024.

• Distributable earnings loss for Q1 2024 were $33.5 million, or $0.62 per common share, largely due to a realized loss of $45.7 million.

• Excluding these losses, the company's distributable earnings stood at $12.2 million, or $0.22 per common share.

• Ares' total third-party debt was less than $1.5 billion at March 31, 2024.

• The company declared a cash dividend of $0.25 per common share for Q2 2024.

Business Progress:

• Ares decreased outstanding principal balance of nonaccrual loans by $133 million and its exposure to the commercial office property sector by $70 million in Q1 2024.

• They resolved 4 nonaccrual loans during Q1 2024, which increased distributable earnings by approximately $0.02 per common share.

• The company is focusing on resolving underperforming loans and expects to take a $33 million risk-rated 5 loan, backed by an office building in California, as REO.

• Ares' strategy includes optimizing the balance sheet, maintaining good levels of liquidity, and actively negotiating with lenders to provide more operational flexibility.

• The management pointed towards potential market recovery due to transactions being consummated amid expectations of higher interest rates.

More details: Ares Commercial Real Estate Corp IR

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