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ACRES Commercial Realty Corp reported a net loss of $732,000, a 33% discount to book value, and a decrease in GAAP book value per share. However, the company closed a new commitment of $72 million, increasing the loan portfolio by $60.5 million, and repurchased 272,000 common shares. Net interest income rose by $3 million, and net real estate operations improved by $1.9 million. The company aims to grow the portfolio by $300 million to $500 million through the end of the year.

ACRES Commercial Realty Corp (NYSE: ACR) reported its Q2 2025 earnings on July 31, 2025, with a net loss of $732,000, a 33% discount to book value, and a decrease in GAAP book value per share from $28.50 to $27.93. Despite these financial challenges, the company closed a new commitment of $72 million, increasing its loan portfolio by $60.5 million. Additionally, ACR repurchased 272,000 common shares at a 33% discount to book value, indicating confidence in its valuation [1].

The company's net interest income rose by $3 million over the prior quarter, driven by lower financing costs. Net real estate operations improved by $1.9 million, largely due to better performance of owned hotels. ACRES Commercial Realty Corp is actively managing its portfolio and expects to monetize real estate investments at gains in the future.

During the earnings call, Mark Vogel, President and CEO, stated that the company aims to grow its portfolio by $300 million to $500 million through the end of the year, funded by loan payoffs and the sale of some REO properties. Vogel also mentioned that the company is focusing on assets outside heavily targeted areas to achieve its target return on equity (ROE) [1].

The weighted average risk rating of the loan portfolio remained at 2.9%, with an increase in loans rated 4 or 5 from 11 to 13, indicating some deterioration in credit quality. The company's debt to equity leverage ratio increased slightly to 3 times, suggesting higher leverage. There is no specific timeline for reinstating the dividend, as it depends on monetizing assets and achieving target earnings available for distribution [1].

Andrew Fentres, during the earnings call, mentioned that the company plans to execute another CLO in the back half of the year, with the specific timing uncertain. It could be in Q4 or Q1 of next year. The decision to reinstate the dividend is driven by monetizing assets and ramping up the portfolio to the target size [1].

References:
[1] https://finance.yahoo.com/news/acres-commercial-realty-corp-acr-072333278.html