Syndicator lender Ready Capital reports massive losses

"Ready Capital reported that 25 percent of its outstanding loans, or $1.3 billion, are not accruing interest. This is up from 6.3 percent, or $526 million, last year. Company executives said the increase in non-accruals was caused by four or five large loans. In these cases borrowers are seeking new lenders or to sell the real estate, instead of a modification or forbearance."

"Ready Capital was once a key lender to multi-family syndicators, such as Tides Equities and GVA. Tides, led by Sean Kia and Ryan Andrade, and GVA, led by Alan Stalcup, have faced foreclosures and lawsuits across their portfolios since the Federal Reserve raised interest rates and deal flow dried up."

"Its net loss of $232 million was still an improvement from its $314 million in the fourth quarter of 2024. Ready Capital is now ditching its bad loans and as a result has taken hit after hit to its bottom line."

Ready Capital is undergoing significant restructuring following substantial losses in its commercial real estate lending business. The company reported a $232 million net loss, representing improvement from a $314 million loss in Q4 2024. Stock price has declined over 60% from above $5 to under $2, and dividends were slashed to $0.01. Non-accruing loans increased dramatically to 25% of outstanding loans ($1.3 billion) from 6.3% ($526 million) the previous year, driven by four or five large loans where borrowers seek alternative lenders or asset sales. Ready Capital plans to sell approximately $1.5 billion in loans to free up $250 million in capital. The company previously financed major multifamily syndicators including Tides Equities and GVA, which have faced foreclosures and lawsuits following Federal Reserve rate increases.

Read at therealdeal.com