Company: KW
Filing Date: 2025-05-08
Form Type: 10-Q
Source: 0001408100-25-000115
Chunk: 149

Company: Kennedy-Wilson Holdings, Inc.
Filing Date: 2025-05-08
Form: 10-Q
Item: Part I, Item 1
Chunk 149
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 fair value increases from non-cash fair value gains relating to the completion of a merger by the entity that holds the Company's ownership interest in Zonda. Zonda is a technology based real estate business that offers residential construction data providing insights and solutions for leaders in the home building industry. This fair value gain was offset by non-cash fair value losses on: (i) office properties in Western United States, Ireland and United Kingdom due to cap rate expansion and (ii) non-cash fair value losses on mortgage debt as previous non-cash fair value gains unwind as loans move closer to their respective maturity dates.

During the three months ended March 31, 2024, we recorded a $16.4 million decrease in the accrual for carried interests primarily related to the fair value decreases that we recorded with respect to one of our Western United States commingled funds in which the Company is in the 50/50 catch up in the carried interest waterfall.

50

Segment Expenses

Co-Investment Portfolio expenses increased to $14.6 million for the three months ended March 31, 2025 as compared to $10.8 million during the prior period. The increase compared to the prior period was primarily due to higher allocation of corporate expenses due to the growth of the real estate credit business as well as a lower reversal of previously recognized carried interest expense allocations. We also had a $0.5 million and $5.5 million the three months ended March 31, 2025 and 2024, respectively of general reserves that we recorded in other income on our loan portfolio relating to our bridge loan portfolio as market conditions indicate that there could be potential credit losses due to the current interest rate environment and general market conditions.

    Non-Segment Items

Compensation and related expenses, corporate decreased to $9.5 million for the three months ended March 31, 2025 as compared to $9.8 million for the three months ended March 31, 2024 due to lower discretionary and deferred compensation expense which was offset by higher share-based compensation.  

    Non-Segment interest expense was $25.6 million for the three months ended March 31, 2025 as compared to $24.8 million for the same period in 2024 due to higher average outstanding balance on the revolving line of credit in the current period.  Interest expense was offset by $0.3 million and $2.6 million that we received on interest rate derivative contracts