Company: ARI
Filing Date: 2025-02-10
Form Type: 10-K
Source: 0000950170-25-017122
Chunk: 135

Company: Apollo Commercial Real Estate Finance, Inc.
Filing Date: 2025-02-10
Form: 10-K
Item: Item 8
Chunk 135
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 December 31, 2023.Cleveland MultifamilyIn May 2021, we originated a first mortgage loan secured by a multifamily property in Cleveland, OH. During the second quarter of 2024, we modified our loan to convert from a floating rate of Secured Overnight Financing Rate ("SOFR") + 3.25% 

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to a 6.0% fixed rate, and to provide a two year term extension. These modified terms are included in the determination of our general CECL reserve for the fourth quarter of 2024. The loan is performing pursuant to its modified contractual terms, and its risk rating remains a three as of December 31, 2024.Manhattan OfficeIn March 2022, we originated a first mortgage loan secured by an office property in Manhattan, NY. During the second quarter of 2024, we modified our loan to convert from a floating rate of SOFR + 3.92% to a 5.0% fixed rate. This modified term is included in the determination of our general CECL reserve for the fourth quarter of 2024. The loan is performing pursuant to its modified contractual terms, and its risk rating remains a three as of December 31, 2024.Manhattan ResidentialDuring 2022, we recorded a total loan Specific CECL Allowance of $66.5 million on a junior mezzanine loan secured by an ultra-luxury residential property in Manhattan, NY ("Junior Mezzanine B Loan"), and downgraded its risk rating to a five. The allowance was recorded as sales velocity on the underlying property lagged behind the borrower's business plan and management's expectations amid broader uncertainty in the ultra-luxury residential property market. At this time, we also held a senior mezzanine loan ("Senior Mezzanine Loan"), an additional junior mezzanine loan ("Junior Mezzanine A Loan"), and a commercial mortgage loan ("Senior Loan"), secured by the same property.During 2023, as property sales continued to trail behind the borrower's business plan, we ceased accruing interest on the Senior Loan and the Senior Mezzanine Loan. We also wrote off the $82.0 million Junior Mezzanine B Loan, as it was deemed to be unrecoverable, and recorded a realized loss of $82.0 million within net realized loss on investments in our consolidated statement of operations. Additionally, we recorded a $126.0 million Specific CECL Allowance on the Junior Mezzanine A Loan