Ladder Capital (NYSE:LADR) executives used the company’s fourth-quarter 2025 earnings call to highlight a year they characterized as a turning point, marked by the attainment of investment-grade credit ratings and a renewed emphasis on growing the loan portfolio and earnings in 2026.
Fourth-quarter and full-year results
For the fourth quarter, Ladder reported distributable earnings of $21.4 million, or $0.17 per share. Management said that excluding a $5 million realized loan loss that had been previously reserved for, fourth-quarter distributable earnings would have been $26.4 million, or $0.21 per share.
Ladder declared a $0.23 per share dividend for the fourth quarter, paid on January 15, 2026. Management said full-year dividend coverage was 96% excluding the loan write-off, while also allowing the loan portfolio to grow following what it described as a record year of paydowns in 2024.
Investment-grade milestone and funding strategy
President Pamela McCormack and executives Paul and Brian emphasized that Ladder became the only investment grade-rated commercial mortgage REIT during 2025. Management said Moody’s upgraded Ladder to Baa3 and Fitch upgraded it to BBB-, with S&P upgrading Ladder to BB+ in January 2026, subsequent to year-end.
Management said the ratings enhanced access to deeper capital markets, lowered the company’s cost of funds, and strengthened liquidity. Executives pointed to the company’s predominantly unsecured capital structure as a differentiator, noting that as of year-end 71% of debt was unsecured and 81% of assets were unencumbered.
In July 2025, Ladder issued $500 million of senior unsecured notes due 2030 at a 5.5% coupon, which management said priced at a 167 basis point spread over Treasuries and was oversubscribed by more than 5.5x with orders exceeding $3.5 billion. Executives said the bonds later tightened in the secondary market, at times trading around 100 basis points over Treasuries.
McCormack also detailed the company’s $850 million unsecured revolving credit facility, which includes an accordion feature to expand to $1.25 billion. She said Ladder had recently secured $400 million of additional commitments to exercise the accordion, with closing anticipated later in the quarter.
Portfolio activity: loans, securities, and real estate
Management described 2025 as a strong year for originations. Ladder originated $1.4 billion of new loans in 2025, its highest annual volume since 2021, with nearly $950 million originated in the second half of the year. In the fourth quarter, Ladder made over $870 million in new investments, including:
- Over $430 million in new loans at a weighted average spread of 340 basis points
- Over $400 million in securities purchases
- A $25.8 million equity investment
At year-end, the loan portfolio totaled $2.2 billion (about 42% of total assets) with a weighted average yield of 7.8%, according to management.
Executives said Ladder’s lending strategy remained focused on stable, income-producing collateral, primarily multifamily and industrial properties, and emphasized “no drift” on credit quality. Management also noted that office loan exposure declined from 14% to 11% of total assets by year-end, though the company has selectively pursued office opportunities. In 2025, Ladder made three new office loans totaling $68 million, and it made a $25.8 million investment for a 20% non-controlling interest alongside an operating partner to acquire a 667,000-square-foot Manhattan office property located less than a block from Grand Central Terminal.
Momentum continued into 2026, with management stating the company had already closed over $250 million in new loans and had more than $450 million under application and in closing.
In securities, Ladder acquired $413 million of primarily AAA-rated commercial real estate securities during the fourth quarter. The securities portfolio totaled $2.1 billion at year-end (about 39% of total assets) with a weighted average yield of 5.3%. Management said 99% of the securities portfolio was investment-grade rated and 97% was AAA rated, and that about $1.4 billion (approximately 66%) of the securities portfolio was unencumbered.
On the real estate segment, management said the $966 million real estate portfolio generated $14.8 million of net operating income in the fourth quarter and $57.3 million for the full year. The portfolio includes 149 net lease properties and has an average lease term of 6.7 years.
Credit and reserves
As of December 31, 2025, Ladder had four loans totaling $129.7 million, or 2.5% of total assets, on nonaccrual. Management said one loan added during the fourth quarter was collateralized by an office property in Portland, Oregon (the Weatherly Building) and had a carrying value of $5.8 million, net of the $5 million loan loss reserve realized in the quarter.
Subsequent to year-end, management said the company resolved one nonaccrual loan with a $61 million carrying value through foreclosure. The loan was collateralized by a three-property, 158-unit multifamily portfolio in Harlem in New York City, and management said the properties were 87% occupied and generating “healthy” net operating income.
The company’s CECL reserve was described as steady at $47 million, or $0.37 per share. Management said undepreciated book value per share at year-end was $13.69, net of the CECL reserve.
2026 outlook: “on offense” with loan growth
In the Q&A session, CEO Brian Harris said Ladder was not planning to change strategy despite early-2026 volatility and tightening commercial real estate loan spreads. He added that Ladder is “not a fan of data centers” as real estate assets.
Harris said Ladder plans to grow its real estate equity portfolio selectively and indicated a target of 9% to 10% achievable ROE, while noting returns could move higher depending on factors such as a resurgence of conduit markets and potential one-time gains from real estate assets.
He also said he expected the company’s assets to reach “a little over $6 billion” by year-end, while emphasizing flexibility in how the company reaches that level. Harris and management reiterated their plan to fund a growing origination pipeline using liquidity from the balance sheet, including proceeds from securities paydowns and access to unsecured capital.
Executives also discussed loan underwriting lessons from the broader commercial mortgage REIT sector, citing the combination of low cap rates during the zero-rate era and rapidly rising interest rates as key drivers of industry losses. Harris said Ladder would remain cautious around certain large cities and around refinancing “competitor bridge loans,” arguing that if a loan were attractive, the prior lender might keep it.
Closing the call, Harris said the company had laid the groundwork to operate with investment-grade financing and predominantly unsecured debt, and that Ladder was “completely on offense now,” focused on lending, selective real estate ownership, and securitization activity to drive earnings and, over time, book value.
About Ladder Capital (NYSE:LADR)
Ladder Capital Corp (NYSE: LADR) is a publicly traded commercial real estate finance company structured as a real estate investment trust. The firm specializes in originating, acquiring and managing a diversified portfolio of commercial mortgage loans, subordinate financings such as mezzanine loans and B-notes, and equity investments. In addition to direct lending activities, Ladder Capital invests in and manages commercial mortgage‐backed securities (CMBS) and commercial real estate collateralized loan obligations (CRE CLOs), providing financing across a range of property types including office, retail, multifamily, industrial and hospitality assets.
Since its inception in 2008, Ladder Capital has developed a platform that supports both balance-sheet lending and structured securitization.
