Starwood’s Barry Sternlicht optimistic about rising interest rates: “We’re going to make a lot of money”

Starwood reported slightly lower Q3 earnings due to high acquisition costs

Miami /
Nov.November 09, 2018 03:15 PM

Barry Sternlicht and Miami Beach (Credit: Max Pixel)

Starwood Property Trust’s Barry Sternlicht isn’t worried about rising interest rates. In fact, it’s the opposite. “We’re going to make a lot of money,” he told analysts during a conference call on Friday.

The Miami Beach-based real estate investment trust, an affiliate of Starwood Capital, reported slightly lower third quarter earnings due to high acquisition costs, yet its results met analysts’ expectations.  The company said Moody’s revised its ratings outlook to positive from stable.

Sternlicht, the company’s chairman and CEO, was optimistic during the call. “I’m really excited about rising [interest] rates, which help our earnings per share.” He called himself “one of the few people cheering” for rising rates.

For the quarter, Starwood reported $285.7 million in revenue, up 26 percent from $226.8 million in the third quarter of 2017. Its third quarter net income of $84.5 million or 33 cents per share, was down 4.4 percent compared to the same period of previous year. The decline is due to the company closing on its $2.5 billion acquisition of a GE energy-finance business in September. It included $9.9 million.

Meanwhile, the company’s commercial and residential lending businesses reached record levels, with assets of $16 billion and commercial loans of $7.5 billion. The commercial and residential lending segment reported total revenue of $158.6 million.

Sternlicht’s mother called him twice while he was on the conference call. “My mother is calling,” he told analysts, joking that perhaps she had a question on earnings.

He said he was “really not excited about our stock price, but scale in this business should help our credit status.” Starwood’s stock was up 1 percent at 3 p.m. to $21.92 per share.


Related Articles

arrow_forward_ios
Grover Corlew principal Mark Corlew with Bank of America Tower in Boca Raton (Grover Corlew)
Grover Corlew buys Bank of America Tower in Boca Raton for $45M
Grover Corlew buys Bank of America Tower in Boca Raton for $45M
The partially collapsed 12-story Champlain Towers South condo building (Getty)
Inside the tug-of-war over the Surfside condo site’s future
Inside the tug-of-war over the Surfside condo site’s future
Moishe Mana and the downtown parking lot he purchased (Google Maps, Getty)
Moishe Mana expands downtown Miami assemblage with $12M purchase
Moishe Mana expands downtown Miami assemblage with $12M purchase
Don Peebles, Jorge Perez and Barry Sternlicht with the Clevelander hotel (Getty, iStock)
Alcohol rollback on Ocean Drive pits developers against business owners
Alcohol rollback on Ocean Drive pits developers against business owners
(Photos courtesy of Miami Historic Preservation, Smith Aerials, Colliers)
Development site near MiamiCentral hits the market
Development site near MiamiCentral hits the market
Alliance Residential Company CEO Bruce Ward and 6595 Morikami Park Road (Google Maps)
Alliance Residential buys site, scores $46M construction loan for senior apartments in Delray Beach
Alliance Residential buys site, scores $46M construction loan for senior apartments in Delray Beach
Arbor Management Acquisition Company heads Ivan Kaufman and Maurice Kaufman with a rendering of Aventura Park (Anillo Toledo Lopez, iStock)
Arbor Management buys multifamily dev site near Aventura for $10M
Arbor Management buys multifamily dev site near Aventura for $10M
(iStock)
South Florida resi construction starts soar in March
South Florida resi construction starts soar in March
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...