Ares Commercial Real Estate Corporation reported a GAAP net loss of $(5.9) million, or $(0.11) per diluted common share, for the third quarter of 2024. Distributable Earnings for the quarter were $3.7 million, or $0.07 per diluted common share, indicating a shortfall in earnings relative to the declared dividend.
Total revenue for the third quarter decreased to $16.653 million from $23.883 million in the prior year period, primarily driven by a lower net interest margin, which fell to $11.944 million from $23.074 million. The company also reported $5.766 million in realized losses on loans during this period.
Despite the financial losses, Ares Commercial Real Estate made progress on its strategic objective to strengthen its balance sheet and resolve higher-risk assets. Risk-rated 4 and 5 loans declined by 33%, and the outstanding debt balance decreased by an additional 8%. The Board of Directors declared a regular cash dividend of $0.25 per common share for the fourth quarter of 2024.
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