Ares Commercial Real Estate Corp

Listed Company

ACRECIK 0001529377NYSEAcceleratedReal Estate Investment TrustsMaryland

Period

FY 2025

Revenue

$54.83M

Net Income

$-902.0K

Total Assets

$1.62B

Equity

$509.57M

Shares Out

55.37M

Op. Cash Flow

$21.35M

Business

Ares Commercial Real Estate Corp is a specialty finance company that originates and invests directly in commercial real estate loans and related debt and equity investments. It offers senior mortgage loans, subordinated debt (including B‑Notes and C‑Notes), mezzanine loans, preferred equity, commercial mortgage‑backed securities and other CRE investments, and structures securitizations and financing arrangements. The company is externally managed by Ares Commercial Real Estate Management LLC (a subsidiary of Ares Management) which provides origination and portfolio management. It operates a national direct origination platform across the United States and finances and distributes investments through secured lending facilities, securitizations and public or private capital markets.

Summary from filing dated 2025-02-12

Financials

Consolidated Statement of Income

Year Ended · In millions, except per-share amounts

Concept	FY 2025 2025-12-31	FY 2024 2024-12-31	FY 2023 2023-12-31	FY 2022 2022-12-31	FY 2021 2021-12-31
Interest income	98	158	199	170	134
Interest expense	−65	−106	−110	−66	−50
Net interest margin	32	52	89	104	84
Revenue from real estate owned	22	18	4	3	—
Total revenue	55	70	93	107	102
Management and incentive fees to affiliate	10	11	12	15	12
Professional fees	3	3	3	3	2
General and administrative expenses	7	8	7	6	5
General and administrative expenses reimbursed to affiliate	4	4	3	4	3
Expenses from real estate owned	18	13	3	4	19
Total expenses	41	38	29	33	41
(Provision for) reversal of current expected credit losses, net	18	18	−92	46	10,000
Realized losses on loans	−35	−84	−10	0	0
Change in unrealized losses on loans held for sale	0	995,000	−995,000	0	0
Realized gain (loss) on sale of real estate owned	3	−2	0	−2	0
Income (loss) before income taxes	−617,000	−35	−39	30	61
Income tax expense (benefit), including excise tax	285,000	−18,000	−39,000	472,000	722,000
Net income (loss) attributable to common stockholders	−902,000	−35	−39	30	60
Basic earnings (loss) per common share (in dollars per share)	−0.02	−0.64	−0.72	0.58	1.43
Diluted earnings (loss) per common share (in dollars per share)	−0.02	−0.64	−0.72	0.57	1.42
Basic weighted average shares of common stock outstanding (in shares)	55	54	54	52	42
Diluted weighted average shares of common stock outstanding (in shares)	55	54	54	52	43

Consolidated Balance Sheet

As of · In millions, except per-share amounts

Concept	FY 2025 2025-12-31	FY 2024 2024-12-31	FY 2023 2023-12-31	FY 2022 2022-12-31	FY 2021 2021-12-31
Cash and cash equivalents	29	64	110	141	51
Restricted cash ($1,108 and $2,495 related to consolidated VIEs, respectively)	38	2	0	0	—
Loans held for investment ($138,950 and $551,955 related to consolidated VIEs, respectively)	1,529	1,657	2,127	2,264	2,414
Current expected credit loss reserve	−126	−136	−160	−66	−24
Loans held for investment, net of current expected credit loss reserve	1,403	1,520	1,967	2,198	2,390
Investment in available-for-sale debt securities, at fair value	0	9	28	28	0
Real estate owned held for investment, net ($52,634 and $58,844 related to consolidated VIEs, respectively)	130	139	83	—	—
Other assets ($76 and $1,991 of interest receivable related to consolidated VIEs, respectively)	18	17	52	156	154
Total assets	1,618	1,751	2,280	2,523	2,632
Secured funding agreements	858	588	640	705	840
Secured term loan	89	128	149	149	149
Collateralized loan obligation securitization debt (consolidated VIEs)	100	456	723	778	861
Due to affiliate	4	4	4	6	—
Dividends payable	8	14	18	19	17
Other liabilities ($257 and $1,309 of interest payable related to consolidated VIEs, respectively)	49	21	15	14	9
Total liabilities	1,109	1,211	1,654	1,775	1,953
Commitments and contingencies (Note 8)	—	—	—	—	—
Common stock, par value $0.01 per share, 450,000,000 shares authorized at December 31, 2025 and 2024 and 55,026,453 and 54,542,178 shares issued and outstanding at December 31, 2025 and 2024, respectively	532,000	532,000	532,000	537,000	465,000
Additional paid-in capital	821	817	812	813	704
Accumulated other comprehensive income (loss)	0	37,000	153,000	8	3
Accumulated earnings (deficit)	−312	−277	−187	−73	−29
Total stockholders' equity	510	540	626	748	679
Total liabilities and stockholders' equity	1,618	1,751	2,280	2,523	2,632

Consolidated Statement of Cash Flows

Year Ended · In millions, except per-share amounts

Concept	FY 2025 2025-12-31	FY 2024 2024-12-31	FY 2023 2023-12-31	FY 2022 2022-12-31	FY 2021 2021-12-31
Amortization of deferred financing costs	5	5	4	7	10
Accretion of discounts, deferred loan origination fees and costs	−4	−5	−6	−10	−8
Stock-based compensation	4	5	4	3	2
Depreciation and amortization of real estate owned	9	5	1	0	825,000
Provision for (reversal of) current expected credit losses, net	−18	−18	92	46	—
Realized losses on loans	35	84	10	0	0
Change in unrealized losses on loans held for sale	0	−995,000	995,000	0	0
Amortization of derivative financial instruments	0	0	−921,000	−1	0
Other assets	−2	−2	−20	−18	−19
Due to affiliate	271,000	−345,000	−1	1	1
Other liabilities	−3	−4	2	1	1
Net cash provided by (used in) operating activities	21	36	47	57	48
Issuance of and fundings on loans held for investment	−489	−44	−200	−653	−1,242
Principal collections and cost-recovery proceeds on loans held for investment	582	395	289	825	535
Proceeds from sale of loans held for sale	0	39	37	—	—
Receipt of origination and other loan fees	7	3	1	9	8
Principal repayment of available-for-sale debt securities	9	19	0	0	—
Purchases of capitalized additions to real estate owned	−2	−358,000	0	—	—
Proceeds from sale of real estate owned	5	13	0	38	0
Restricted cash assumed from acquisition of real estate owned	0	4	0	0	—
Receipt (disbursement) of escrows and reserves for loans held for investment, net	37	0	0	—	—
Net cash provided by (used in) investing activities	148	428	127	193	−700
Repayments of notes payable	0	−105	0	−51	−28
Payment of secured funding costs	−3	−4	−4	−4	−13
Repayments of debt of consolidated VIEs	−356	−268	−55	−86	−121
Dividends paid	−39	−60	−76	−72	−58
Repurchase of common stock	0	0	−5	0	0
Net cash provided by (used in) financing activities	−169	−508	−205	−160	627
Change in cash, cash equivalents and restricted cash	863,000	−44	−31	91	−24
Interest paid during the period	61	103	104	58	40
Income taxes paid during the period	0	0	375,000	250,000	1
Dividends declared, but not yet paid	8	14	18	19	17
Other receivables related to consolidated VIEs	0	0	32	129	129
Assumption of real estate owned	0	75	84	0	0
Assumption of other assets related to real estate owned	0	397,000	353,000	0	0
Assumption of other liabilities related to real estate owned	0	4	2	0	0
Transfer of senior mortgage loans to real estate owned	0	97	83	0	0

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