Ladder Capital Corp Achieves Strong Q3 2026 Results, Positions Itself for Rising Rates
Ladder Capital Corp, a leading commercial mortgage REIT, recently released its financial results for the third quarter of 2026. The company had a strong quarter, generating distributable earnings of $44.7 million, or $0.35 per share, with modest adjusted leverage of 2.5x.
One notable highlight from the quarter was the sale of Ladder's largest net lease asset and office campus in Jacksonville, Florida, which resulted in a $31 million gain. This sale demonstrates the company's ability to unlock value above its cost basis in the real estate portfolio, showcasing its strategic investment approach.
Ladder's President, Pamela McCormack, highlighted three key areas that support the company's future earnings: book value increased, the loan portfolio is predominantly new vintage with limited legacy loans, and the company is well-positioned for rising rates. The undepreciated book value per share rose to $13.50 from $13.44, driven primarily by the gain on sale of the Jacksonville office campus.
The company's loan portfolio is comprised of approximately 90% new vintage loans, which were underwritten in a higher rate environment at conservative loan-to-values on reset bases. This positions the portfolio well for today's rates and gives Ladder room to keep growing it.
With over 50% of its debt fixed-rate, Ladder's income is expected to rise as floating-rate assets reset higher, while the cost of that debt stays the same. The company's model is cycle-tested, having been in business for 18 years, public for 13, and a bond issuer for 14.
Ladder's investment activity during the third quarter was selective, with $703 million of new investments made, including $481 million of predominantly AAA-rated securities at attractive yields. The company also originated seven new balance sheet loans totaling $222 million, resulting in a combined loan and securities portfolio growth of approximately $570 million.
Year-to-date, Ladder has originated $1.4 billion in new loans, matching its 2025 volume, and the loan portfolio has grown over 50% in the trailing 12 months. The company's goal is to continue growing the share of balance sheet loans in its total assets while remaining flexible and prioritizing credit quality.
With ample liquidity and expected light payoff sales in coming quarters, Ladder is well-positioned to keep growing its loan portfolio without compromising on credit. The company's continued ability to generate strong earnings and execute its strategic investment plan makes it an attractive option for investors looking for a stable and growth-oriented commercial mortgage REIT."
