Exhibit 10.3


            FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT

             This First Amendment to Amended and Restated Credit Agreement (this
"Amendment"), dated as of June 22, 1998, is made by and between Capital Trust, a
California business trust having an office at 605 Third Avenue, 26th Floor, New
York, New York 10016, as borrower (the "Borrower"), and German American Capital
Corporation, a Maryland corporation having an office at 31 West 52nd Street, New
York, New York 10019, as lender (the "Lender").

                                 R E C I T A L S

             WHEREAS, the parties hereto are party to that certain Amended and
Restated Credit Agreement, dated as of January 1, 1998 (the "Credit Agreement";
terms used but not defined herein shall have the respective meanings ascribed to
such terms in the Credit Agreement), pursuant to which the Lender agreed,
subject to the terms and conditions set forth in the Credit Agreement, to make a
loan to Borrower as provided in the Credit Agreement; and

             WHEREAS, the maximum principal amount of the Loan immediately
preceding the execution and delivery of this Amendment is $250,000,000; and

             WHEREAS, Borrower and Lender desire to increase the maximum
principal amount of the Loan from $250,000,000 to $300,000,000; and

             WHEREAS, Borrower and Lender desire to amend the Credit Agreement
to reflect such increase of the maximum principal amount of the Loan;

             NOW, THEREFORE, in consideration of Ten Dollars ($10.00) and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto agree as follows, effective as of the date
hereof:

         1.  Commitment.

             1.1 The first paragraph of the Recitals on page 1 of the Credit
Agreement is hereby deleted in its entirety and replaced by the following
paragraph:

             WHEREAS, Borrower desires to obtain a series of loan advances
             (each, an "Advance" and collectively, the "Loan") from Lender (as
             defined below) in an aggregate amount at any time outstanding of up
             to $300,000,000 to provide warehouse funding for a portion of the
             principal amount of the Collateral Loans and other Collateral (each
             as hereinafter defined) that Borrower or its Acquisition Entities
             originates or acquires, as the case may be; and

             1.2 The paragraph in which the term "Commitment" is defined in
Section 1.1 of the Credit Agreement is hereby deleted in its entirety and
replaced by the following paragraph:



<PAGE>


             "Commitment" means the sum of Three Hundred Million Dollars
($300,000,000).

         2.  Loan Fee.

             2.1 The definition of the term "Loan Fee" in Section 1.1 of the
Credit Agreement is hereby deleted in its entirety and replaced by the
following:

             "Loan Fee" means the fee set forth below. Borrower shall pay the
             Loan Fee to Lender as follows:

             -------------------------------------------------------------------
             Installment Amount of Loan     Borrower Shall Pay The Referenced
             Fee:                           Installment the First Time Lender
                                            Makes any Advance that Causes the
                                            Principal Balance of the Loan to
                                            Exceed:
             -------------------------------------------------------------------
             $750,000                       $1
             -------------------------------------------------------------------
             $750,000                       $75,000,000
             -------------------------------------------------------------------
             $500,000                       $150,000,000
             -------------------------------------------------------------------
             $250,000                       $250,000,000
             -------------------------------------------------------------------

             NOTE: Borrower has paid to Lender all installments of the Loan Fee.

         3.  Definition of Liabilities.

             3.1  Section 6.1(c) of the Credit Agreement is hereby added, as
             follows:

                  (c) For purposes of applying Section 6.1(a), Borrower's net
             worth and the components thereof shall be determined in accordance
             with GAAP as reflected in the financial statements certified by
             Borrower's outside auditors and as set forth in the following
             sentence. "Liabilities" shall consist of: (a) all items treated as
             "liabilities" under GAAP; (b) any liabilities of other Persons that
             are secured by a Lien on any asset of Borrower (whether or not such
             liabilities have been assumed by Borrower); and, to the extent not
             otherwise included, (c) Borrower's guaranty of any indebtedness of
             any other Person. Notwithstanding anything to the contrary in this
             paragraph or elsewhere in this Credit Agreement, the parties
             acknowledge that "Liabilities" shall not include Borrower's "Trust
             Preferred Securities," provided that such "Trust Preferred
             Securities" are either approved by Lender in


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<PAGE>


             all respects or are: (i) issued by any wholly owned special purpose
             statutory business trust of Borrower, where (x) the sole asset of
             such business trust consists of bonds, debentures, or similar debt
             obligations of Borrower with a principal amount in excess of the
             total liquidation value of such preferred securities, and (y) the
             distributions, redemption payments, and liquidation payments with
             respect to such preferred securities are unconditionally and
             irrevocably guarantied by Borrower; and (ii) accounted for on the
             balance sheet of Borrower, prepared by Borrower's outside auditors,
             in a separate line located between total liabilities and
             shareholders equity in accordance with GAAP.

         4.  Notices.

             Section 9.1 of the Credit Agreement is hereby amended by adding the
following before the sentence beginning "All Notices and other communications":

             and a copy to:

                   BancOne Mortgage Capital Markets, LLC
                   1717 Main Street, Suite 1400
                   Dallas, Texas  75201
                   Attention:  Martin Stadler
                   Telephone:  (214) 290-3349
                   Telecopier:  (214) 290-2664

         5.  Global Note.

             5.1  On or before the date hereof, Borrower shall execute and
deliver to Lender an amendment to the Global Note in the form attached hereto as
Exhibit A (the "Note Amendment"). All references to the Global Note in the
Security Documents shall mean and refer to the Global Note as modified and
amended by the Note Amendment.

         6.  Principal Balance of Loan.

             6.1 Borrower acknowledges that, as of June 22, 1998, the
outstanding principal balance of the Loan was $220,392,785.

         7.  Covenants, Representations and Warranties of Borrower.

             7.1 Borrower hereby reaffirms all terms, covenants, representations
and warranties made in the Security Documents as amended hereby.


                                       3

<PAGE>

             7.2 Borrower hereby represents and warrants to the Lender that (a)
it has the legal power and authority to enter into this Amendment without
consent or approval by any third party and this Amendment constitutes the legal,
valid and binding obligation of Borrower, enforceable against Borrower in
accordance with its terms and (b) the execution and delivery by Borrower of this
Amendment has been duly authorized by all requisite action on the part of
Borrower and will not violate any provision of Borrower's organizational
documents.

             7.3 Borrower hereby represents and warrants to the Lender that, as
of the date hereof, (a) no Default or Event of Default has occurred and is
continuing; (b) no Default or Event of Default will occur as a result of the
execution, delivery and performance by Borrower of this Amendment; (c) Borrower
has not given any notice of any uncured Default to Lender and (d) there are no
legal proceedings commenced or threatened against Lender by Borrower.

             7.4 Borrower hereby confirms and acknowledges that Borrower has no
offsets, defenses, claims, counterclaims, setoffs, or other basis for reduction
with respect to any portion of the Indebtedness.

             7.5 Borrower hereby agrees that a breach of any of the
representations and warranties made herein shall constitute an Event of Default
under Section 8.1 of the Credit Agreement, subject to the notice and cure
provisions provided therein.

         8.  Lender's Acknowledgment.

             8.1 Lender acknowledges to Borrower that, as of the date hereof,
both before and after giving effect to this Amendment, to the best of Lender's
knowledge, Borrower is not in default with respect to its obligations under the
Credit Agreement and the Collateral Security Instruments.

         9.  Effect Upon Security Documents; Trustee Exculpation.

             9.1 Except as specifically set forth herein, the Security Documents
shall remain in full force and effect and are hereby ratified and confirmed. The
parties hereto acknowledge and agree that the Credit Agreement, as hereby
amended, is in full force and effect in accordance with its terms and has not
been supplemented, modified or otherwise amended, canceled, terminated or
surrendered, except pursuant to this Amendment. The Credit Agreement is binding
and enforceable as against the parties hereto in accordance with its terms. Any
inconsistency between this Amendment and the Credit Agreement (as it existed
before this Amendment) shall be resolved in favor of this Amendment, whether or
not this Amendment specifically modifies the particular provision(s) in the
Credit Agreement inconsistent with this Amendment. All references to the "Credit
Agreement" in the Security Documents and to the "Agreement" in the Credit
Agreement shall mean and refer to the Credit Agreement as modified and amended
hereby.


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<PAGE>


             9.2 The execution, delivery and effectiveness of this Amendment
shall not operate as a waiver of any right, power or remedy of the Lender under
the Security Documents (except to the extent expressly set forth herein), or any
other document, instrument or agreement executed and/or delivered in connection
therewith.

             9.3 The provisions of this Amendment shall be subject to the
provisions of Section 9.13 of the Credit Agreement, which provisions are
incorporated by reference as if herein set forth in full.

         10.  Governing Law.

             10.1 THIS AMENDMENT SHALL BE CONSTRUED, INTERPRETED AND GOVERNED BY
THE LAW OF THE STATE OF NEW YORK, WITHOUT REFERENCE TO ITS CONFLICT OF LAWS
PRINCIPLES.

         11.  Counterparts.

             11.1 This Amendment may be executed in any number of counterparts,
and all such counterparts shall together constitute the same agreement.






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<PAGE>



             IN WITNESS WHEREOF, the parties hereto have caused this Amendment
to be executed as of the day and year first above written.

                              BORROWER:
                              --------

                              CAPITAL TRUST,
                              a California business trust


                              By:  /s/ Edward L. Shugrue III
                                   ---------------------------------------------
                                   Name:  Edward L. Shugrue III
                                   Title: Managing Director and Chief 
                                          Financial Officer


                              LENDER:
                              ------

                              GERMAN AMERICAN CAPITAL 
                              CORPORATION,
                              a Maryland corporation


                              By:  /s/ Kenneth Gilison
                                   ---------------------------------------------
                                   Name:  Kenneth Gilison
                                   Title: Vice President


                              By:  Jon Vaccaro
                                   ---------------------------------------------
                                   Name:  Jon Vaccaro
                                   Title: Vice President


Exhibit A         Note Amendment