I'd like to remind everyone that today's call and webcast are being recorded. Please note that they are the property of Apollo Commercial Real Estate Finance, Inc., and that any unauthorized broadcast in any form is strictly prohibited. Information about the audio replay of this call is available in our earnings press release. I'd also like to call your attention to the customary safe harbor disclosure in our press release regarding forward-looking statements. Today's conference call and webcast may include forward-looking statements and projections and we ask that you refer to our most recent filings with the SEC for important factors that could cause actual results to differ materially from these statements and projections. In addition, we will be discussing certain non-GAAP measures on this call which management believes are relevant to assessing the company's financial performance. These measures are reconciled to GAAP figures in our earnings presentation which is available on the shareholder section of our website. We do not undertake any obligation to update our forward-looking statements or projections unless required by law. To obtain copies of our latest SEC filings, please visit our website at www.apolloreit.com or call us at 212-515-3200. At this time, I'd like to turn the call over to the company's Chief Executive Officer, Stuart Rothstein. Thank you, operator. Good morning, and thank you all for joining us on the Apollo Commercial Real Estate Finance Year-End 2021 Earnings Call. I am joined today, as usual by Scott Wiener, our Chief Investment Officer. ARI delivered strong operational and financial results in 2021 and I am extremely proud of the effort and performance of our team. We committed to $3.2 billion of new mortgages on behalf of ARI and grew its mortgage portfolio to $7.9 billion at year-end, a 20% annual increase. Apollo continued to invest in talent, growing the commercial real estate credit team to 40 investment professionals in the U.S. and Europe, broadening both originations and asset management capabilities. We fortified the balance sheet through the addition of $800 million of term leverage throughout the year, extending maturities at an attractive cost and increasing the pool of unencumbered assets to $1.9 billion at year-end. Most importantly, our efforts resulted in a well-covered dividend to ARI shareholders. 2021 was a record year for real estate transaction volume, leading to a record year for commercial real estate loan originations. As discussed throughout the year, there was robust competition in the lending market and a variety of financing options available to borrowers from CMBS, banks and insurance companies, debt funds and mortgage REITs. In this market environment, relationships, reputation and track record are critical components of success, and we believe ARI's strong performance is reflective of the core advantages that Apollo's commercial real estate credit platform continues to provide the company. Across commercial real estate credit, Apollo completed $13 billion of transactions in 2021 and strengthened its position as a leading global provider of commercial real estate financing. There are a few themes from our originations activity in 2021 worth mentioning. First, the scale and expertise of Apollo's commercial real estate credit platform enabled ARI to participate in several larger transactions that were co-originated alongside other Apollo funds, which led to meaningful deployment on behalf of ARI. Next, I again want to highlight the success we achieved in Europe. Over 60% of ARI's 2021 origination volume was for transactions in Western Europe as our well-established European commercial real estate credit team continues to do an excellent job disintermediating traditional financial institutions and capturing market share. The types of transactions, quality of equity sponsorship and deal structures for ARI's European loans are very similar to the transactions we complete in the United States and we expect to remain active in Europe in 2022. Lastly, I want to highlight that 60% of our 2021 deals were with repeat borrowers, many of whom are top-tier global sponsors. ARI also closed transactions with eight new borrower relationships totalling $1.3 billion and we are very focused on converting those new borrowers into repeat clients. Importantly, our investment momentum has carried into 2022. To date, we have already closed approximately $275 million in new loan commitments and I anticipate that we will close approximately another $2 billion of commitments prior to the end of the first quarter. While ARI's pace of originations and deployment is benefiting from the strength of the real estate capital markets, that strength is also reflected in the significant amount of repayment activity in ARI's portfolio. During 2021, ARI received $1.9 billion of repayments with over 40% of the total occurring in the fourth quarter. Notably, ARI received repayments from over $300 million of hotel loans, approximately $560 million of loans collateralized by for-sale residential products, projects and over $850 million from loan exposures across a variety of property types in New York City. As a result, our overall net exposure to New York City was reduced to 25% as compared to 36% at the end of 2020. Pivoting to the portfolio, we remain focused on proactive asset management. Our loan portfolio totalled $7.9 billion at year-end and there were no material changes to the credit quality of the portfolio or to our credit outlook since our last call. Notably, subsequent to quarter end, the Oxford Circus retail property collateralizing one of ARI's largest outstanding loans was sold for an amount well in excess of basis, resulting in full repayment of principal plus all accrued contractual and default interest. Shifting to financial performance, ARI reported distributable earnings per share for the year of $1.48 per share resulting in a dividend coverage ratio of 106% for the $1.40 common stock dividend. As I have discussed previously, the board of directors looks at multiple factors when setting the dividend including asset level returns and the return on equity from new originations, factoring in financing costs and the appropriate leverage level for the company. The board also seeks to take a longer-term view on achievable distributable earnings and seeks to limit the impact of quarterly fluctuations. Our goal is to provide a stable dividend without deploying capital into loans with a higher risk profile or using excessive leverage. At present, we anticipate the annual dividend for 2022 will be consistent with the existing dividend run rate subject to the board's approval. As is customary, our first quarter dividend for 2022 will be announced in March. I also want to highlight some of our capital market achievements in 2021. Throughout the year, we acted opportunistically to strengthen ARI's balance sheet and term out leverage when economically feasible. We added $800 million of term leverage during the year with successful issuances of both a term loan B and secured notes. ARI ended the year with $1.9 billion of unencumbered assets which we believe is one of the highest levels amongst our peer set. Importantly, we remain conservative with respect to leverage with the company's debt-to-equity ratio at 2.4 x at year-end, consistent with the ongoing portfolio shift into first mortgages. Finally, we announced the appointment of Anastasia Mironova, a seasoned mortgage REIT professional, to the position of Chief Financial Officer of ARI, and she will join us early in the second quarter. I want to thank the team at Apollo dedicated to ARI for all of their hard work this past year, and I look forward to reporting on ARI's achievements as we progress into 2022. With that, we will open the call up for questions. Operator? As a reminder, to ask a question, you will need to press star one on your telephone. To withdraw your question, press the pound key. Please stand by while we compile the Q&A roster. Our first question comes from the line of Doug Harter from Credit Suisse. Your line is now open. Thanks. Just on the repayment of the U.K. retail loan, will that create any kind of catch-up income in the first quarter with the repayments? No. We were accruing the default interest along the way, Doug, as we were highly confident that we were going to get it paid back. Great. Thank you, Stuart. Just any update you can give us around some of the other, you know, watchlist assets and where you might be as being able to free up some of that capital for redeployment. Yeah. Obviously nothing's happened yet of a material nature, otherwise I probably would have included it in my comments. I would say anecdotally at a high level. In Brooklyn on the Fulton Street asset where we've articulated our strategy to go forward with the development of a multifamily asset there, we are effectively approaching the market now for a construction loan. We are also exploring, though having committed to the possibility of bringing in a partner on the equity side that would free up some of the capital that ARI has invested into the transaction, in order to deploy at least a portion of that capital productively in the short term. I think other near-term possibilities for freeing up some of the non-performing capital today are around our hotel asset in Washington, D.C., which I think you know we are exploring options for selling that asset. Those are probably the two nearest-term paths towards freeing up some of the non-performing capital. On the other you know non-core assets, continuing to explore you know different possibilities on the Miami asset and you know grinding through the asset management on the Liberty Center asset in Ohio. I would say with respect to the Steinway project here in New York, certainly better foot traffic, definitely more interest from potential buyers. A few additional contracts have been signed but definitely more work to be done in terms of finishing construction and then progress on the sales side. Thank you. Our next question comes from the line of Tim Hayes from BTIG. Your line is now open. Hey, good morning, Stuart. Sure. I appreciate the comments around the dividend in your prepared remarks. Just wanna maybe touch on that a little bit more, given you know obviously not earning it this quarter, that there was. I saw there to be net contraction so far in the first quarter but it sounds like the pipeline is very robust and you know, I don't know what payments are gonna look like but maybe you get back to net growth before the end of the quarter. You know as I think about where the portfolio is today, funding costs have also shifted a little bit higher as you've brought on more corporate debt. You know, what gives you the confidence that you believe you can cover the dividend on an annual basis and where do you think it,- Kind of, that coverage comes from? Is it growth and a little bit higher leverage or you know, is some of it dependent on the expectations for higher rates this year? Any comments on that would be helpful. Yeah, look. Let me start where you ended and then work through the question. Sure. W e certainly run a version of the model internally that reflects some of what people are expecting on the short end of the curve which would clearly be beneficial from an earnings perspective and obviously saw the piece you put out recently which alludes to the potential pickup across the sector if short-term rates rose. Mm-hmm. I would say my comment with respect to covering the dividend is not dependent on, call it the expectations of the short end of the curve. It's really just, you know, I think a lot of what took place in the fourth quarter was really timing between when repayments occurred and sort of the closing of deals and I've spoken for years on the, you know, the challenges of committing capital to deals that we know are ours b ut at the end of the day, these are privately negotiated transactions and we oftentimes are not in control of timing when it comes to forcing things to close. I would say just given the pace of the pipeline, what I think we can earn on the pipeline on a ROE basis, given returns at the asset level, and then really not doing anything unexpected with respect to leverage which is to say we typically, to the extent we're using asset-specific leverage, you know, typically financing things at roughly 70% on a secured borrowing facility. Mm-hmm. Not changing the overall corporate leverage as it exists today. Recognize we have some of that corporate leverage that matures later on this year in the form of a convertible note and we will certainly focus on getting that repaid and replaced. I don't envision increasing corporate leverage. It's really, you know, from our perspective, the ROEs we're generating at the asset level on new deployment work. I think we are obviously very focused on being as efficient as from a capital deployment perspective as we can be vis-a-vis timing and trying to line up, you know, repayments and new deployments as best as we can. There might be some leakage and I think my comments were meant to indicate that if there is a quarter where things didn't line up as best as we would have hoped from a timing perspective and it indicates we're a penny light here or there, that's not gonna impact- Mm-hmm. Dividend policy at the end of the day. you know, to reference back, you know, to Doug's question, you know, if we are successful in turning some of the non-earning capital into capital that can be deployed and achieve our typical ROEs, I think there's pickup in earnings from that as well that, you know, we're sort of taking a cautious view on, but are certainly optimistic that we'll succeed on some of that this year as well. Right. No, that's super helpful, kind of breakdown of how you're thinking about it, so thank you for that. Sure. Just, you know, a good segue since you brought up the convert this year, and I just wanted to kind of touch on liquidity because, you know, it looks like you extended some of your credit facilities but it looks like maybe the total commitments from some counterparties also came in a bit. Not as much to draw there as you had in the last quarter. It sounds like you're, you might be expecting some growth this quarter but you also have that maturity coming up. Just how do you balance? How do you think about your liquidity position? How do you balance growth with kind of these capital needs? Yeah, look, I think we separate them in some respects, which is to say, you know, to me, what we decide to do on the convertible ties into the access to capital we've created for the company in a variety of, call it corporate level debt markets, i.e., term loans, convertible notes, secured notes. We'll explore all of those as we think about how to address the convertible notes. We'll, you know, focus on the best combination of cost and duration. I think, you know, given what we've done in those markets previously, absent any, you know, significant upheaval in the markets, I think we'll have an ability to access there. Away from those markets, constant dialogue with banks around our secured lending relationships. I would say there's been some movement in terms of banks and who we are increasing our relationships with and sort of reducing some other relationships but also active dialogue on bringing in some new relationships as well. And obviously very cognizant of the interplay between what we do on an asset level and what we do at the corporate level. I would say net-net of all of that is, you know, we have a version of our model internally that, you know, if for whatever reason the corporate style financing markets break down, we have a path to addressing the converts with existing available asset leverage to the extent we need it. Very helpful. Thanks for the comment, Stuart. Sure. Thank you. Our next question comes from the line of Stephen Laws from Raymond James. Your line is now open. Hi. Good morning. Morning, Stephen. Morning, Stuart. You touched a little bit on your comment especially, on the loan sales, you know, New York now 25%. You know, U.K. is up pretty substantially and international is now, I believe, 45% of the portfolio. A nd you talked about your team there b ut can you maybe go into a little bit more about Europe and why you find that attractive? Y ou certainly have the highest mix of exposure relative to the peer group. Yeah. I mean, I think. Let me approach it differently than I've done in the past because I think our team in Europe is probably tired of me referring to it as a less competitive market because it makes their job seem easier than it really is. You know, I think a couple things going on from a dynamic perspective and I do want to. You know, I think it's important to reiterate this notion that what we do in Europe is a mirror image of what we do in the U.S. in terms of type of sponsorship, type of transaction and most importantly, as a lender as we think about the markets we're active in in Europe. You know, we're very comfortable that, you know, from a legal system perspective, we are as well protected as a lender there as we are in the U.S. That is why I think we approach much of our pipeline from a somewhat agnostic perspective in that, you know, if a deal works and it's in Europe, it's no different than a deal working here in the U.S., particularly, you know, the ability to finance in local currency and then, you know, hedge whatever residual is there, back to US dollars. I think it's fair to say in Europe, while there's a CMBS market, it is not as robust a market as exists here in the U.S., so affords us a little bit more opportunity to get things done there. I think we have also found in some respects, larger deals in the U.S. actually trade tighter often particularly, due to the depth of the single asset, single borrower CMBS market here. A somewhat different dynamic in Europe where there's less who are willing to do really large deals in Europe, and you'll often find a lot of what we do of size in Europe ends up being deals where we partner with others either other Apollo Capital or oftentimes partnering with firms that would be perceived as competitors. I think we've created a very nice niche for ourselves there. Economically, it's not the driver of doing things but as you think about hedging from Euro back to USD due to interest rate differentials, there actually is an economic benefit to doing deals in Euros and then hedging back to USD, which again, it's not the reason to do a deal but economically, it makes those deals look pretty attractive. The last thing I'd say is, you know, one of the reasons our real estate credit business benefits so much in Europe is that, you know, Apollo as a firm has a very active real estate equity business in Europe and it provides a lot of data, relationships, and connectivity for the real estate credit team over there which is based in London. I think as a result, it has definitely helped in terms of underwriting capability but also using relationships to source transactions. I think we've executed really well in Europe. As I look at the pipeline, it continues to be a mix of Europe and the U.S. I 'm not gonna predict percentages but is Europe gonna continue to be a meaningful part of the portfolio? Certainly sitting here today, that would be the case. Great. Appreciate all the comments on the international exposure. Thanks, Stuart. Sure. Thank you. Our next question comes from the line of Jade Rahmani from KBW. Your line is now open. Thank you very much. One of your peers acquired a loan portfolio from a bank and it seemed that this was the first such acquisition in some time. I know from our bank analyst that the stress test recently increased assumed loss rates on commercial real estate which could have a negative impact on bank allocation of capital towards CRE lending. Wondering if you see that as an opportunity in the space and perhaps is some reduction in bank originations partly explaining the surge in originations that the mortgage REITs have evidenced. Great question. Let me comment on both parts of it because I think there were two parts of it. I think with respect to the first part, you know, I would say clearly one of the benefits of sitting inside a place like Apollo is there's broadly a lot of connectivity with banks generally speaking and always looking for ways to, you know, transact with each other. That being said, you know, I would put the concept of buying portfolios in the banks at least from our perspective, as potential that something episodically happens but certainly not viewed as a primary driver of deployment for us as we look forward in 2022. I would say our activities will still be very much deal-specific originations. To your first question. I think to the second part of your question, you know, I would still say that the primary source of activity, you know, for the mortgage rates these days is the combination of, you know, the amount of dry powder available in value add and opportunistic funds that has been getting deployed from, you know, the fall of 2020 continuing into this year, creating opportunities for us and our peers to lend in situations where, you know, assets are not stabilized. There is a business story around what somebody wants to do with the asset. I would say this notion of, you know, borrowers in transitional assets wanting to borrow from institutions where they're dealing principal to principal and to the extent things don't go according to business plan or things go better than business plan, there's a direct dialogue with someone who can pick up the phone and react as needed to adjust the financing to what's going on at the asset. I think that's been the primary driver of why you've seen continued percentage growth in terms of the mortgage REIT part of the lending sector. You know, we still see the banks being, you know, on par, pretty active here in the U.S. I don't think any pullback from the banks yet has been reflected in terms of a lack of competition from that sector as we see it overall. Thank you very much. Credit, you know, historically, ARI has veered toward, you know, I don't know how you want to characterize it but within the mortgage REIT space probably, at the higher end of the credit risk spectrum, partly due to structure rather than basis, you know, Mezzanine construction loans, et cetera. How do you see credit on new originations versus prior? If it is a lower credit risk product, you know, what would you say is the primary reason for that? I mean, I think what you've seen shift in our portfolio actually started pre-pandemic. If you go back to some of my comments from, you know, even early 2019, you know, at that point, as we had gotten larger as a company and also as the real estate cycle had at that point was, you know, 10 years into recovery, we had clearly shifted more of what we were doing to senior loans from a structural perspective though I would say at that point we were still, you know, comfortable taking more, you know, putting ourselves in more situations where more was being done to the real estate whether it was construction, heavy redevelopment, renovation, et cetera. I think coming out of the other side, you know, of the pandemic, I would say structurally everything we are doing at this point is a senior loan. I don't see that changing meaningfully. Episodically, we look at mezz transactions from time to time, but really, don't expect much to happen there. Structurally, I would expect to see us continue to remain in first mortgages. In terms of, you know, what is being done to the real estate, you know, I would put construction now more in the episodic bucket as opposed to something that we were a little bit more focused on in the 2017, 2018, 2019 timeframe. I think we're really focused on those situations where, you know, assets are being upgraded, things are being renovated, you know. Maybe taking the asset-level risk down a bit, but I still think generally speaking, we're probably gonna be in more situations where, you know, something is being done to the real estate as opposed to just a, you know, lease-up play, for lack of a better phrase. Just on those two, you know, changing attributes, you know, structural as well as execution, is it a function of lessons learned? Is it a function of you feel that maybe the real estate correction didn't really happen, falling out from COVID because of the way the market reacted and all the government support o r is it really just a relative value calculus where you feel, you know, what you're doing now, first mortgages but less construction is where the best relative value is? I mean, I think it's a little bit of a few things. I think from a risk-adjusted return perspective, I think to the extent we can generate ROEs that work without taking ground up construction risk, I think it's the prudent way to think about deployment for the vehicle. I also think, you know, to where you started the question, you know, there was a one quarter hiccup in the real estate market. I realize there are still certain property types that might be more challenged than others. You know, what occurred during the pandemic at least to date, was really not about real estate and there was really no, you know, cleansing downturn, whatever you wanna call it, in real estate. I do think, you know, one of the other things that certainly influenced our thinking though is one of the impacts of the pandemic was it certainly did delay delivery of things that were in construction during the pandemic, either due to, you know, shutdowns, due to safety mandates, delivery of materials, challenges with labor, et cetera. So a lot of what was in the development pipeline is being delivered later which means you're getting that development supply delivered later. I would say it causes us to take a more conservative view with respect to newly created product now because you still need to absorb what is being delivered later. Ultimately, the answer is where I started which is, you know, to the extent we can generate the ROEs we wanna generate without having to take that asset level risk, we think it's the right way to think about deployment. Thank you for taking the questions. Of course. Thank you. Our next question comes from the line of Steve DeLaney from JMP Securities. Your line is now open. Thanks. Good morning, Stuart. Good morning. Jade touched on the, we noticed the mezzanine payoffs too and that's always positive. It's a good sign of the market. I wanted to touch on hotel because, you know, at the end of last year, it was 24% of the portfolio. And in terms of new commitments in the first quarter, it looks like between urban at 18 and leisure 21, almost 40% of commitments. Can you just comment briefly, one and specifically are those U.S.-based loans or were they Europe? R egardless of geography, how are you feeling about the hotel sector at this time and exactly kinda what specific kinds of hotel situations are you finding attractive? Thank you. Yeah. I appreciate the question, Steve. Look, we obviously, as part of the pandemic we started breaking things out between, you know, call it urban and leisure or destination and urban. Look, I think the performance of things that fall in the category of leisure or destination has been remarkably strong. We're very comfortable with the existing portfolio and would certainly seek to add, you know, additional of those types of hotels to the portfolio because I think one of the things that's been proven as a result of the pandemic is, you know, you lock people up with their families for long enough and they definitely wanna get on vacation and go somewhere. Absolutely. I think the urban is a bit more mixed. We were actually seeing, you know, a nice pickup in performance across the existing portfolio pretty much through the fall. Omicron hit, which obviously was a bit of a hiccup for everyone. That being said, despite some choppiness on the operating performance side, there's actually been a pretty robust market in terms of just purchase and sale activities on urban hotels. Yes Which does tie back to my earlier comment on, you know, perhaps something happening this year with our Washington, D.C. hotel. You know, certainly a much more cautious view with respect to deploying additional capital into hotels that we would define as urban at this point b ut we like the hotel space in general. We think it is poised to, you know, recover pretty strongly once we get to the other side of this pandemic. We will continue to look for those opportunities where we think we're getting paid for the risk. Great. That's a good color. When you commented earlier about, you know, real estate funds, dry powder and a lot of it with an opportunistic [bent]. Hotels are so specialized. In terms of those particular, you know, real estate investors, are there pools of money that you've run into potential borrowers that are specifically targeting hotels as an asset class, whether that's here in the U.S. or abroad? Are you seeing the flow of opportunistic money and the creation of the purchase and sale activity, is some of that specifically focused on the hotel industry? Yes. I couldn't give you an exact percentage but I could tell you that there were definitely vehicles formed during the pandemic to target. Yes Hospitality opportunities specifically. There have definitely been, you know, ventures formed between capital and managers as well as capital and those who seek to, you know, pick off assets through CMBS, et cetera. There's definitely hotel-focused capital looking at what took place as a very opportunistic scenario. Excellent. That's very helpful. Thanks so much, Stuart. You got it. Thank you. Our next question comes from the line of Rick Shane from JP Morgan. Your line is now open. Hey, everybody. Thanks for taking my questions this morning. Talk a little bit about the trajectory and run rate. When we look at distributable earnings prior to realized losses, continued to be under pressure. You have commented on your confidence in the ability to retain the dividend or expectations to retain the dividend into 2022. I'm curious when we think about the fourth quarter, how we should put into context the timing of everything that happened. You mentioned, for example, that a lot of the repayments were late in the quarter. What does that imply for an NII run rate? And where do you need to get to in order to start covering the dividend out of distributable earnings? Yeah, I'd say a couple things. First of all, I think as you think about the fourth quarter, Rick, there was definitely a pickup in G&A for the fourth quarter, which was probably about $0.01 of impact which was due to some things we did on our term loan to effectively change the amendments on the term loan. There's probably $0.01 of impact there in the fourth quarter. Then I think, you know, I think what I did say in my comments was, I think what actually took place to some extent in the fourth quarter was that you had the repayments taking place sooner than some of the redeployments. We knew the capital was coming back. We knew we had deals that spoke for a lot of the redeployment but it sort of happened a little quicker on the repayment side than the redeployment side of things. I think from a run rate perspective, as you think about, you know, net interest income, I think we expect to be pretty close to run rate in the first quarter. It might lag a little bit between the first and second quarter but ultimately you're getting to a net interest income that, you know, is in the, you know, high 50, low 60 million-dollar range from a run rate perspective as we present call it net interest income. We think about it after the preferred dividend as well. Stuart, two things. First of all, I clearly misunderstood the timing. I reversed it, so that's helpful. Thank you for the clarity in terms of the NII. Sure. That helps us set expectations appropriately. We really appreciate both. Sure. Thank you. At this time, I'm showing no further questions. I would like to turn the call back over to Stuart Rothstein for closing remarks. Thank you, operator and thanks to everybody who participated this morning. We will speak to you in another couple of months. Thanks, all. This concludes today's conference call. Thank you for participating. You may now disconnect.