Company: ADAMM
Filing Date: 2025-11-04
Form Type: 10-Q
Source: 0001273685-25-000088
Chunk: 399

Company: ADAMAS TRUST, INC.
Filing Date: 2025-11-04
Form: 10-Q
Item: Part I, Item 8
Chunk 399
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 recorded at the lower of the net carrying amount of the assets or the estimated fair value, net of selling costs.  Fair value for real estate, net was based upon either negotiated sale prices less anticipated selling costs or a discounted cash flow analysis using property financial information and assumptions regarding market rent, revenue and expense growth, capitalization rates and equity return rates. During the nine months ended September 30, 2025, the Company recognized net impairment losses of $7.2 million for real estate, net in the disposal group held for sale. During the three and nine months ended September 30, 2024, the Company recognized net impairment losses of $3.8 million and $25.8 million, inclusive of losses recognized upon transfer into disposal group held for sale, for real estate, net in the disposal group held for sale, respectively. See Note 17 for descriptions of valuation methodologies utilized for financial instruments included in assets and liabilities of disposal group held for sale.The following table presents the pretax losses of the disposal group held for sale as of September 30, 2025 for the three and nine months ended September 30, 2025 and 2024, respectively (dollar amounts in thousands):For the Three Months Ended September 30,For the Nine Months Ended September 30,2025202420252024Pretax income (loss) of disposal group held for sale$155 $(1,588)$(6,886)$(62,120)Pretax (income) loss of disposal group attributable to non-controlling interest in Consolidated VIEs(80)273 479 6,411 Pretax income (loss) of disposal group attributable to Company's common stockholders$75 $(1,315)$(6,407)$(55,709)

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10.      Derivative InstrumentsThe Company is exposed to certain risks arising from both its business operations and economic conditions.  The Company enters into derivative financial instruments in connection with its risk management activities. These derivative instruments may include interest rate swaps, interest rate caps, TBAs, credit default swaps, futures and options contracts such as options on credit default swap indices, equity index options, swaptions and options on futures. The Company may also purchase options on U.S. Treasury futures or invest in other types of mortgage derivative securities. Additionally, Constructive may enter into IRLCs related to the origination of business purpose loans. The Company elected not to apply hedge accounting for its derivative instruments