Real Estate Securities, Available for Sale Borrowings

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Continued Unaudited 22

5. Investments in Private Equity Funds

The following is a description of investments in private equity funds that own PE Investments through direct investments, or “PE Investment I” and “PE Investment II”, which are recorded as an investment in private equity funds at fair value on the consolidated balance sheets. The Company elected the fair value option for both PE Investments. As a result, the Company records equity in earnings losses based on the change in fair value for its share of the projected future cash flow from one period to another. The Company evaluates whether disclosure of summarized financial statement information is required for any individually significant investment. The Company determined there were no significant investments with respect to PE Investments as of March 31, 2016. The following tables summarize the Company’s PE Investments as of March 31, 2016 dollars in thousands: PE Investment Initial Closing Date NAV Reference Date 1 Number of Funds Purchase Price Expected Future Contributions 2 PE Investment I March 20, 2015 September 30, 2014 6 45,045 919 PE Investment II 3 August 4, 2015 December 31, 2014 3 27,788 — Total 9 72,833 919 ________________________________________________________ 1 Represents the net asset value, “NAV” date on which the Company agreed to acquire the PE Investment. 2 Represents the estimated amount of expected future contributions to funds as of March 31, 2016. 3 At the time of closing, the Company paid 9.4 million to acquire PE Investment II, or 50 of the purchase price, adjusted for subsequent contributions and distributions, and will pay the remaining 13.9 million the “Deferred Amount” on the one year anniversary of the closing date. Carrying Value Three Months Ended March 31, 2016 Three Months Ended March 31, 2015 1 PE Investment March 31, 2016 Unaudited December 31, 2015 Equity in Earnings Distributions Contributions 2 Equity in Earnings Distributions Contributions 2 PE Investment I 35,977 39,646 1,055 4,723 — 133 6,787 45,371 PE Investment II 15,541 15,219 238 — — — — — Total 51,518 54,865 1,293 4,723 — 133 6,787 45,371 _________________________________________________________ 1 The initial closing date for PE Investment I and PE Investment II was March 20, 2015 and August 4, 2015, respectively. 2 Includes initial investments and subsequent contributions.

6. Real Estate Securities, Available for Sale

CRE securities are comprised of CMBS backed by a pool of CRE loans which are typically well-diversified by type and geography. The following table presents CMBS investments dollars in thousands: Weighted Average Principal Amount Amortized Cost Cumulative Unrealized on Investments Fair Value Unleveraged Current Yield As of Date: Count Gain Loss Coupon March 31, 2016 Unaudited 1 4 73,738 45,690 1,803 — 47,493 3.75 12.31 December 31, 2015 3 25,500 18,386 — 443 17,943 3.29 7.40 ___________________________________________________ 1 Includes a CRE security with an underlying loan that was non-performing at acquisition. The CRE security was purchased for 26.9 million, net of a 21.3 million discount, which includes a non-accretable amount of 4.3 million related to the non-performing loan. The Company recorded an unrealized gain in OCI for the three months ended March 31, 2016 of 2.2 million. As of March 31, 2015, the Company was not invested in real estate securities. As of March 31, 2016, the Company did not hold any securities which were in an unrealized loss position for a period of greater than 12 months. Based on management’s quarterly evaluation, no OTTI was identified related to these securities. The Company does not intend to sell these securities and it is more likely than not that the Company will not be required to sell these securities prior to recovery of its amortized cost basis, which may be at maturity. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Continued Unaudited 23 As of March 31, 2016, the weighted average contractual maturity of CRE securities was 30.3 years with an expected maturity of 6.7 years. Refer to Note 14. “Subsequent Events” for additional CRE securities activity.

7. Borrowings

The following table presents borrowings as of March 31, 2016 and December 31, 2015 dollars in thousands: March 31, 2016 Unaudited December 31, 2015 Capacity Recourse vs. Non- Recourse Final Maturity Contractual Interest Rate Principal Amount 1 Carrying Value 1 Principal Amount 1 Carrying Value 1 Mortgage and other notes payable 2 Industrial Non-recourse Jul-25 4.31 250,000 249,146 250,000 249,123 Multi-tenant office Non-recourse Aug-20 LIBOR + 1.90 84,258 83,158 82,500 81,369 Other notes payable 3 Partial Recourse 4 Dec-20 LIBOR + 2.65 39,868 39,428 39,868 39,386 Subtotal mortgage and other notes payable 374,126 371,732 372,368 369,878 Credit Facilities Loan Facility 1 100,000 Partial Recourse 5 Oct-17 6 2.98 7 98,220 98,220 84,250 84,250 Loan Facility 2 200,000 Partial Recourse 8 Jul-19 9 2.94 7 145,480 145,480 178,061 178,061 Loan Facility 3 200,000 Partial Recourse 4 Jun-18 10 2.84 7 199,457 199,457 199,457 199,457 Subtotal term loan facilities 500,000 443,157 443,157 461,768 461,768 CMBS Facility 2 Non-Recourse FN 11 2.08 7 10,546 10,546 — — Subtotal credit facilities 453,703 453,703 461,768 461,768 Total 12 827,829 825,435 834,136 831,646 _______________________________________________ 1 Difference between principal amount and carrying value of mortgage and other notes payable is attributable to deferred financing costs, net. 2 Mortgage and other notes payable are subject to customary non-recourse carveouts. 3 Relates to financing obtained for a CRE debt investment. 4 Recourse solely with respect to 25.0 of the financed amount. 5 Recourse solely with respect to 25.0 of the financed amount for assets with a lender debt yield equal to or greater than 10.0 at the time of financing plus 100.0 of the financed amount for assets with a lender debt yield less than 10 at the time of financing. 6 The initial maturity of Loan Facility 1 is October 2016, with a one-year extension available at the Company’s option, which may be subject to the satisfaction of certain customary conditions set forth in the governing documents. 7 Represents the weighted average as of March 31, 2016. The contractual interest rate depends upon asset type and characteristics and ranges from one-month LIBOR plus 1.65 to 2.75. 8 Recourse solely with respect to the greater of: i 25.0 of the financed amount of stabilized loans plus the financed amount of transitional loans, as further defined in the governing documents; or ii the lesser of 25.0 million or the aggregate financed amount of all loans. 9 In July 2015, the Company exercised the first of four, one-year extensions available at the Company’s option. These extensions may be subject to the satisfaction of certain customary conditions set forth in the governing documents. 10 The initial maturity of Loan Facility 3 is June 2018, with one-year extensions available at the Company’s option, which are subject to the approval of the global financial institution. 11 The maturity dates on the CMBS Facilities are dependent upon asset type and will typically range from two to three months. 12 Secured by collateral comprised of certain CRE debt and real estate equity investments with a carrying value of 1.1 billion as of March 31, 2016. NOTES TO CONSOLIDATED FINANCIAL STATEMENTS Continued Unaudited 24 The following table presents scheduled principal on borrowings, based on final maturity as of March 31, 2016 dollars in thousands: Total Mortgage and Other Notes Payable Credit Facilities April 1 to December 31, 2016 10,546 — 10,546 Years Ending December 31: 2017 98,220 — 98,220 2018 199,457 — 199,457 2019 145,480 — 145,480 2020 124,126 124,126 — Thereafter 250,000 250,000 — Total 827,829 374,126 453,703 Term Loan Facilities The Company, through subsidiaries, has entered into credit facility agreements with multiple global financial institutions to provide an aggregate principal amount of up to 500.0 million to finance the origination of first mortgage loans and senior loan participations secured by CRE “Term Loan Facilities”. The Company agreed to guaranty certain obligations under the Term Loan Facilities, which contain representations, warranties, covenants, conditions precedent to funding, events of default and indemnities that are customary for agreements of this type. The Term Loan Facilities act as revolving loan facilities that can be paid down as assets are repaid or sold and re-drawn upon for new investments. As of March 31, 2016, the Company was in compliance with all of its financial covenants under the Term Loan Facilities. As of March 31, 2016, the Company had 745.2 million carrying value of CRE debt investments financed with 443.2 million under the Term Loan Facilities. CMBS Facilities In October 2015 and January 2016, the Company entered into master repurchase agreements “CMBS Facility 1” and “CMBS Facility 2”, respectively and collectively the “CMBS Facilities” to finance CMBS investments. The CMBS Facilities are on a non-recourse basis and contain representations, warranties, covenants, conditions precedent to funding, events of default and indemnities that are customary for agreements of this type. As of March 31, 2016, the Company had 17.2 million carrying value of CRE securities financed with 10.5 million under its CMBS Facilities. Refer to Note 14. “Subsequent Events” for additional borrowings activity.

8. Related Party Arrangements