Cuộc họp báo cáo kết quả kinh doanh Q3 2026 của KREF: Thanh khoản tăng khi các khoản hoàn trả nợ giúp giảm đòn bẩy

Điểm tin chính

• KKR Real Estate Finance Trust (KREF) đã báo cáo khoản lỗ ròng GAAP quý 3/2026 là 6 triệu USD, tương đương 0,11 USD mỗi cổ phiếu, với giá trị sổ sách đạt 10,14 USD mỗi cổ phiếu tính đến ngày 30 tháng 9.
• Lỗ có thể phân phối là 152 triệu USD, tương đương 2,64 USD mỗi cổ phiếu. Nếu không tính các khoản lỗ đã thực hiện và chi phí đánh giá chiến lược, lợi nhuận có thể phân phối đạt 5 triệu USD, tương đương 0,09 USD mỗi cổ phiếu.
• Khoản thu hồi nợ từ đầu năm đến nay đạt 2,4 tỷ USD, vượt mức kỳ vọng 2 tỷ USD cho cả năm của ban quản lý. Tổng khoản thu hồi nợ trong quý 3 đạt 1,2 tỷ USD, trong đó hơn 80% khoản thu hồi nợ của năm 2026 đến từ các khoản vay phát hành trong năm 2021 và 2022.
• Thanh khoản cuối quý tăng lên khoảng 853 triệu USD, trong khi tỷ lệ nợ trên vốn chủ sở hữu giảm từ 2,6 lần xuống 2,2 lần và tổng đòn bẩy giảm từ 4,3 lần xuống 3,1 lần.
• Ban quản lý cảnh báo rằng lãi suất cao hơn, tiền thu từ tái cấp vốn thấp hơn và thị trường bất động sản kém thanh khoản có thể kéo dài thời gian xử lý và dẫn đến các khoản dự phòng bổ sung trong ngắn hạn.
• Quá trình đánh giá chiến lược của ủy ban hội đồng quản trị độc lập vẫn đang diễn ra. Việc mua lại cổ phiếu đã chậm lại sau khi đánh giá được thông báo do phân bổ vốn, bao gồm cả việc mua lại cổ phiếu, là một phần của quá trình này.

Dữ liệu tài chính chính

Hoạt động kinh doanh và vận hành

KREF tiếp tục chuyển hướng khỏi các khoản vay cũ được phát hành trong môi trường thị trường năm 2021 và 2022. Các khoản vay này chiếm hơn 80% số tiền thu hồi nợ từ đầu năm đến nay. Công ty cũng đã xử lý thêm ba khoản vay trong danh sách theo dõi trong quý.

Tổng giá trị các khoản cho vay mới đạt 157 triệu USD. Các khoản đầu tư bao gồm danh mục nhà ở cao cấp cho người cao tuổi Hạng A được đảm bảo bởi bốn bất động sản trên khắp Hoa Kỳ và một bất động sản văn phòng Hạng A ở Texas. Ban quản lý cho biết việc giải ngân sẽ tiếp tục ở mức thận trọng do KREF ưu tiên tính linh hoạt của bảng cân đối kế toán hơn là thay thế khoản thu hồi nợ theo tỷ lệ tương đương từng đồng.

Công ty đã thực hiện quyền chuộc lại tự nguyện đối với hai CLO bất động sản thương mại còn lại, hoàn tất việc tất toán cả hai giao dịch. Ban quản lý cho biết các khoản thu hồi nợ gốc đảm bảo lớn đã khiến các cấu trúc này kém hiệu quả hơn so với các phương án tài trợ vốn không tính theo giá thị trường khác.

KREF kết thúc quý với thanh khoản khoảng 853 triệu USD, một trong những mức cao nhất trong lịch sử và cao hơn mức trung bình lịch sử đã công bố là khoảng 600 triệu USD. Tổng số này bao gồm 166 triệu USD tiền mặt, 53 triệu USD khoản thu hồi nợ do đơn vị dịch vụ quản lý giữ sau khi tất toán khoản vay vào cuối quý, và 600 triệu USD hạn mức tín dụng quay vòng doanh nghiệp chưa rút.

Định hướng của ban quản lý

Ban quản lý dự kiến tổng đòn bẩy sẽ tiếp tục duy trì dưới mức mục tiêu lịch sử của KREF trong quý 4/2026. Tốc độ cho vay mới cũng dự kiến sẽ ở mức thận trọng khi công ty bảo toàn thanh khoản và đánh giá các cơ hội sau sự điều chỉnh của giá trị bất động sản.

Một số vụ xử lý tài sản dự kiến trước đó vào cuối năm nay hiện có khả năng sẽ kéo dài sang nửa đầu năm 2027. Ban quản lý cho biết họ sẽ tiếp tục thực hiện việc thu hồi vốn đồng thời tìm cách tối đa hóa giá trị thu hồi.

Chi phí đánh giá chiến lược, chủ yếu là phí tư vấn tài chính và pháp lý, tập trung vào cuối quý 3. Giám đốc Tài chính (CFO) Kendra Decious cho biết các chi phí này dự kiến sẽ tăng trong quý 4 tính trên cơ sở trọn quý.

Rủi ro và các lĩnh vực cần theo dõi

• Khả năng tăng dự phòng: Ban quản lý cho biết các khoản dự phòng có thể tăng lên khi tiến trình xử lý tài sản tiến triển cũng như thanh khoản và định giá thị trường thay đổi.
• Rủi ro tái cấp vốn bất động sản căn hộ cho thuê: KREF đang theo dõi chặt chẽ các khoản vay bất động sản căn hộ cho thuê năm 2021 và 2022. Lợi suất nợ trung bình nằm trong khoảng hơn 6%, nhưng các khoản vay ở mức thấp hơn phải đối mặt với áp lực tái cấp vốn lớn hơn.
• Chi phí đi vay cao hơn: Các đợt tăng lãi suất gần đây đang làm tăng chi phí trả nợ và làm giảm tiền thu từ tái cấp vốn, đặc biệt là đối với các bất động sản được tài trợ vốn ở mức định giá đỉnh.
• Trì hoãn xử lý: Thị trường kém thanh khoản và định giá không chắc chắn khiến thời điểm và giá trị thu hồi cuối cùng của các tài sản còn lại trong danh sách theo dõi trở nên khó xác định.
• Lợi ích lợi nhuận hạn chế từ lãi suất cao hơn: Dư nợ lãi suất thả nổi có quy mô tương đối gần với danh mục cho vay lãi suất thả nổi, trong khi các tài sản REO không tạo ra thu nhập lãi.
• Tính không chắc chắn từ việc đánh giá chiến lược: Ủy ban hội đồng quản trị tiếp tục đánh giá các phương án chiến lược thay thế và ban quản lý từ chối cung cấp thêm chi tiết khi quá trình này vẫn đang diễn ra.

Tóm tắt phiên Hỏi & Đáp với chuyên gia phân tích

Ban quản lý cho biết các khoản dự phòng CECL hiện tại phản ánh thông tin thị trường sẵn có, nhưng thị trường thiếu minh bạch và kém thanh khoản ngăn cản KREF đưa ra kết quả dứt điểm cho mọi vụ xử lý tài sản. Mức dự phòng sẽ được điều chỉnh khi các giao dịch tiến triển và điều kiện thị trường thay đổi.

Đối với các khoản vay bất động sản căn hộ cho thuê có lợi suất nợ khoảng 5,5% đến 6%, kết quả tái cấp vốn sẽ phụ thuộc vào sự tăng trưởng ở cấp độ thị trường, tỷ lệ vốn hóa và thanh khoản của nhà tài trợ. Ban quản lý lưu ý rằng lợi suất nợ ở các thị trường tăng trưởng cao hơn có thể mang ý nghĩa khác so với mức lợi suất tương tự ở các thị trường vẫn đang hấp thụ nguồn cung mới.

KREF có thể tiếp quản quyền sở hữu đối với một số bất động sản căn hộ cho thuê được chọn lọc khi việc nắm giữ và ổn định tài sản có thể cải thiện khả năng thu hồi vốn. Tuy nhiên, ban quản lý hiện không nhận thấy một làn sóng diện rộng các tài sản căn hộ cho thuê cần tiếp cận theo hướng này.

Liên quan đến khoản vay lĩnh vực khoa học đời sống tại Boston, KREF đã chuyển giao lại tài sản cho bên cho vay tài trợ không truy thu sau khi giá trị thay đổi. Công ty đã ghi nhận khoản lỗ cho phần vay của mình, hiện khoản vay này đã được đưa ra khỏi danh mục đầu tư.

Ban quản lý xác nhận KREF vẫn hoạt động tích cực trên thị trường cho vay mặc dù đòn bẩy thấp hơn và thanh khoản ở mức cao. Ban quản lý đưa ra lý do cho tốc độ giải ngân thận trọng là do khoản thu hồi nợ lớn vào cuối quý, mục tiêu giảm đòn bẩy trước đó và giá trị của việc bảo toàn tính linh hoạt.

Toàn văn Biên bản cuộc họp kết quả kinh doanh

Toàn văn cuộc gọi công bố kết quả kinh doanh

Phần trình bày của ban lãnh đạo

Operator

Good morning, and welcome to the KKR Real Estate Finance Trust, Inc. Third Quarter 2026 Financial Results Conference Call. [Operator Instructions] Please note this event is being recorded.

I would now like to turn the conference over to Jack Switala. Please go ahead.

Jack Switala

Thanks, operator, and welcome to the KKR Real Estate Finance Trust earnings call for the third quarter of 2026. As the operator mentioned, this is Jack Switala. This morning, I am joined on the call by our CEO, Matt Salem; our President and COO, Patrick Mattson; and our CFO, Kendra Decious.

I would like to remind everyone that we will refer to certain non-GAAP financial measures on the call, which are reconciled to GAAP figures in our earnings release and in the supplementary presentation, both of which are available on the investor relations portion of our website. This call will also contain certain forward-looking statements, which do not guarantee future events or performance. Please refer to our most recently filed 10-Q for cautionary factors related to these statements.

Before I turn the call over to Matt, I will go through our results. For the third quarter of 2026, we reported GAAP net loss of $6 million, or negative $0.11 per share. Book value as of September 30th was $10.14 per share. We reported a distributable loss of $152 million, or negative $2.64 per share. Distributable earnings before realized losses and strategic review expenses were $5 million, or $0.09 per share. Lastly, we paid a $0.10 cash dividend with respect to the third quarter.

With that, I now like to turn the call over to Matt.

Matthew Salem

Thanks, Jack. Good morning, everyone, and thank you for joining us today. Let me begin with a brief update on the strategic review process. As we announced in July, KREF's Board established a strategic review committee composed solely of independent directors to evaluate potential strategic alternatives. Since that announcement, the committee has retained a financial advisor and legal counsel and continues to evaluate the company's strategic alternatives. Given the review is ongoing, we will not be providing any further commentary on the process during today's call.

Turning to the broader commercial real estate market, the recent increase in interest rates has created renewed pressure on property values, presenting both opportunities and challenges for real estate lenders. Existing borrowers will be impacted by higher debt service costs and lower refinancing proceeds, particularly for assets financed at peak valuations in 2021 and early 2022. We expect this environment to extend resolution timelines, and in some cases, result in additional credit losses. At the same time, these dynamics should drive increased demand for refinancing and recapitalization capital as borrowers work through upcoming maturities.

Importantly, underlying property fundamentals remain generally constructive across most sectors, supported by tenant demand and a meaningful slowdown in new construction activity. As we continue to reposition KREF's portfolio, we believe this environment provides an attractive opportunity to redeploy capital into new loans with compelling credit characteristics and risk-adjusted returns. Portfolio repayment activity has been particularly strong, with $2.4 billion of repayments year-to-date, surpassing our $2 billion expectation for the year. This quarter, repayments totaled $1.2 billion. This quarter's repayments nearly matched our annual repayments for each of 2024 and 2025.

Importantly, much of this activity has been concentrated in our older vintage loans, accelerating the natural rotation of the portfolio and reducing our exposure to loans originated during the 2021 and 2022 market environment. Those vintages accounted for over 80% of the repayments this year. We continue to make substantial progress executing the portfolio action plan we outlined at the beginning of the year. Our priorities have been to accelerate the resolution of watchlist and legacy office exposure, address our life science portfolio, and reposition the portfolio toward newer vintage loans with more attractive credit characteristics.

During the quarter, we resolved 3 additional watchlist loans. While the pace of resolutions has been encouraging, the timing and ultimate valuations of remaining assets is challenging. We continue to actively pursue monetization strategies for these assets, although some transactions previously anticipated to close before year-end are now likely to extend into the first half of 2027. We remain focused on advancing these resolutions while maintaining a disciplined approach to maximizing recovery. Given the more challenging liquidity and valuation environment, we could see an increase in reserves in the near term as resolution processes advance and market conditions continue to evolve.

With that, I'll turn the call over to Patrick.

W. Mattson

Thanks, Matt. Good morning, everyone. I'll begin with origination activity. During the quarter, we originated $157 million of loans, including a Class A senior housing portfolio secured by 4 properties across the U.S. and a Class A Texas office property. From a broader market perspective, conditions for new investments remained constructive. Credit spreads have been relatively stable. Financing for loans remains readily available, and liquidity across markets remains healthy. We expect our pace of originations to remain measured. Given our focus on maintaining balance sheet flexibility, we have been deliberate in deploying capital rather than seeking to replace repayments with new loans on a dollar-for-dollar basis.

Turning next to balance sheet and liquidity. The combination of significant repayment activity and our disciplined approach to capital management has meaningfully strengthened KREF's financial position throughout the year. At quarter end, liquidity increased to approximately $853 million, including $166 million of cash, $53 million of loan principal repayments held by a servicer following a repayment on the last day of the quarter, and $600 million of undrawn capacity on our corporate revolver. This represents one of the highest liquidity positions for KREF's history, well above the historical average of approximately $600 million.

Importantly, this liquidity provides us with significant flexibility as we continue to execute our portfolio strategy. We also continue to further optimize our financing structure. During the quarter, we exercised optional redemptions on our 2 remaining CRE CLOs, completing the retirement of both transactions. Given the substantial repayment activity and reduction in the underlying collateral pools, these transactions have become less efficient financing structures relative to other non-mark-to-market financing alternatives available to KREF.

Strong repayment activity during the quarter also drove a meaningful reduction in leverage, with our debt-to-equity ratio declining from 2.6x to 2.2x, and total leverage declining from 4.3x to 3.1x below our historical target range, and we expect leverage to remain below the historical range for the fourth quarter. In summary, the third quarter represented another important step in executing the priorities established at the beginning of the year. We materially reduced the watchlist, advanced the resolution of legacy exposures, exceeded our full year repayment expectations ahead of schedule, and further strengthened our liquidity position.

With that, we are happy to take your questions.

Operator

[Operator Instructions] Your first question comes from Tom Catherwood with BTIG.

Phần hỏi đáp

William Catherwood

Matt, I want to go back to something you said in your prepared remarks about that you could see or we could see more reserves in the near term as the resolution process advances. So the question that pops in my head is what is holding you back from getting ahead of that and taking worst-case scenario type marks right now? Is it that you don't have the market comps because transactions are slow, or is it something else that is holding you up from kind of getting ahead of that and kind of creating a worst-case baseline?

Matthew Salem

Tom, thanks for the question. I think if you think about what is on kind of the watchlist now and the kind of processes we are in, a lot of that is just a function of a little bit of opaqueness, and some of these markets are relatively illiquid. We obviously are marking even have CECL reserves appropriate for what we are seeing in the market today. But as we have seen over time, number one, markets can change, and number two, just given how the liquidity in some of these markets, we do not know exactly where these processes can end up. As we kind of continue to work through those, we will obviously adjust it in real time for what we are seeing. But just understanding kind of where the overall market is today, we wanted to obviously highlight that as we continue to work through the resolutions here.

William Catherwood

You mentioned resolutions on the watchlist. I assume, though, this applies to kind of the remaining legacy loans. Obviously, that amount came down in 3Q with the repayments, but are you expecting more modifications? Are you expecting more things that you think could have reserves or more migrations out of that legacy, but 3-rated or better portfolio?

Matthew Salem

I think everybody, including ourselves, is looking at their portfolios in a new light now, clearly with adjusted values and the interest rate that we are living in today. And I think where we are seeing potential noise, I would say, is certainly on some of the multifamily. That feels like it has been the most impacted in the rate hike environment in those vintages we called out on the call in terms of the 2021 and 2022 vintages. So that is probably the area we are watching closely.

We have got a lot of repayments and a lot of those loans, like we said, this was a huge repayment quarter for us, equaling almost all of last year and the year before. 80% of that, as we highlighted, was in those vintages. So we are seeing real velocity there. But values are down a little bit and some of those loans are close to the line, and so we will have to continue to monitor those as they come up for refinance.

William Catherwood

Just quick follow-up on that one, Matt. Just do you have a sense of -- for those legacy multifamily loans you mentioned, do you have a sense of where those debt yields sit right now?

Matthew Salem

Obviously, there's a huge range. I think on average, we're well into the 6s. But it's the stuff at the lower end of that range that is going to be the most acute and have the most problems, obviously, refinancing. So those are the ones we're really focused on. But we'll continue to see how the market evolves from a value perspective. I think it's changing, I'd say, on a day-to-day basis as the market resets expectations around not only cap rates, but just growth profile as well.

Operator

Your next question comes from Jade Rahmani with KBW.

Jade Rahmani

Can you give any color on the Boston Life Science resolution? I didn't see clearly in the 10-Q what happened to that loan. Was that sold or acquired? Any color would be helpful.

W. Mattson

Jade. It's Patrick. Happy to take that. So on that loan, we had financing on that. That was non-recourse financing. As values have changed on that asset, we assigned that loan back to the lender. What you see reflected in this quarter was the loss on our portion of that loan, and it is obviously removed from the portfolio at this point.

Jade Rahmani

Okay. That is helpful. On the multifamily portfolio, can you comment as to what percentage is pre-2023 vintage and what the in-place debt yields are on that? Also, can you further comment if there is a property that has, say, a 5.5% to 6% debt yield, would that require KREF to absorb a loss because that would imply close to 100% LTV, so not necessarily a loss, but it depends on the friction points and what happens in such a situation?

Matthew Salem

Yes, I do not have the exact percentage of the 2021 and 2022 multifamily in front of me, so we can follow up on that. On the second part of your question, the 5.5% to 6% debt yield area, I think certainly we would be watching those very closely. It really comes down to 2 things. It is number one, what is the embedded growth in the market? Because the 5.5% in New York City or San Francisco or some of these markets that are experiencing real growth is very different than some of the Sun Belt markets that are still absorbing supply, as you well know. So there is going to be a range of cap rates depending on the market.

The second thing is really around sponsor. Number one, what is their liquidity level? What else is in their portfolio that they're dealing with, and what's their willingness to continue to play forward and try to continue to grow cash flows over time to enhance their outcomes on their equity? These are all in play, and we've seen it across the board. I certainly think having a portfolio outside of KREF as well, that we're seeing marginally more capitulation in the multifamily sector from borrowers, just given this latest rate hike. That speaks a little bit to the second point. I'm making that I think you are seeing a little bit more velocity, whereas before we were getting a lot more pay downs and playing it forward. I think there's been slightly more capitulation in the market today around some of that. But that corridor is certainly the ones that we're focused on in terms of their ability to refinance.

Jade Rahmani

A follow-up would be with multifamily as a more liquid asset class and fundamentals potentially nearing a trough. Could you devise an alternative strategy to fund REO with leverage and hold some of these assets more so than you've done with, say, office? Does that make any sense, or do you think the better outcome is to just work these out, share in some of the value reduction, and take hits to book value?

Matthew Salem

Well, I think similar to every time we have an issue in the portfolio, we're going to look at all the options available to us and how do we optimize the outcome and maximize recovery for the balance sheet. You think about what we did in Raleigh, North Carolina, on that multifamily deal. We felt like we could go in and stabilize cash flow and operations there and then sell it into kind of a better environment. I think we're proving that out on the operations side for sure, and we feel very good about the occupancy there and where we are on a cash flow basis.

Obviously, they carry a lot easier, to your point, I think is what you might be suggesting, than some of the life science we have, for instance, where you just don't have the tenants there, and so there's a kind of a net cost on an ongoing basis. That certainly will factor into the analysis. Hard to predict the future. Obviously, the market's very dynamic right now. But when I look at our portfolio, I don't see a wave of opportunities to do that, if that's part of the question. I think we could have isolated situations where the loan is closed, and we ultimately have to take some reserves on it. But, I don't think we're looking at it like, wow, this is going to be a big portfolio of multi that we have to make decisions on. That may help you think through it a little bit.

Operator

Your next question comes from Rick Shane with J.P. Morgan.

Richard Shane

Look, you guys, I know you won't comment per se on the strategic review process, but at the same time, you have 2 other things going on. One is resolution of the existing portfolio. And then the real question is, how are you sort of approaching the market in terms of additional investment? You guys did originate loans this quarter, but leverage is now below target ratio. You are sitting on a lot of liquidity. Do you see yourselves as active participants in the market? And more importantly, from sort of a management perspective, how do you sort of motivate employees in the context of this sort of potential uncertainty?

Matthew Salem

Right. Thank you for the question. I guess just to be direct, 100% we are active participants in the market. We originated 2 loans this quarter. I will come back to that piece of the question here in a second. Let me answer your final piece of the question. Keep in mind that the team that invests on behalf of KREF invests for other pools of capital within KKR as well. This is a smaller piece of our overall business, and that business is continuing to grow, and we have lots of different types of capital that we invest there. We invest bank capital, we invest insurance capital, we invest debt fund capital. So there is lots of capital, and we are actively originating loans across our $43 billion of AUM within real estate credit at KKR.

There is lots going on, and so the motivation question you had, I don't think is particularly relevant for our team and our situation. When we just think about how we are positioned in the market, I think you are right to kind of put a few things in there. When I look at this quarter, in particular, let us just understand, last quarter, we were above our target leverage ratio, and we had talked about wanting to bring that down. So we were able to accomplish that.

The second thing which I highlighted earlier was we got a ton of repayments this quarter. You never quite know, especially in a market where the Fed starts hiking again, like, okay, what is going to come through? What is not? Do things get extended? Some of those were actually pretty back-ended in the quarter. So you have this moment in time where certainly that contributed to it, where there is a lot coming through in the quarter, a lot coming through towards the end. We weren't leaning in to originations either because we were trying to bring down leverage and trying to understand kind of where we were in the quarter.

So some of it is just the complexity around that. I would say the last piece of it is creating some more flexibility right now and optionality for ourselves, I do not think is a bad thing either, where we start to look at what is going on in the market. Values are resetting. Perhaps the loan you are going to make tomorrow is better than the loan you could have made 60 days ago. I think there is also a reason to just be prudent as we kind of think about what is going on in the market today. None of those factors are the single determinant of where we snap the line at the end of September, but they are all kind of factoring into it, of how we kind of think about the go forward here. But certainly closed loans in the quarter and are active.

Richard Shane

Look, it's a very fair point, and you linked up something that I didn't that I heard but didn't link up, which is how heavy the repayments were at the very end of the quarter and given the uncertainty that the third quarter events created, the macro events created, and the potential sort of extension of timelines on anything in the meeting of the minds makes sense to sort of be careful until all of that stuff closes. I don't know if you covered this, I apologize, but it looks like the cadence of the buyback really was just in July and then slowed down. Is that related to the strategic review or how should we think about that going forward, particularly given the leverage, et cetera?

Matthew Salem

Yes, I think you're right to call that out. I think we mentioned this on the last call. The buybacks is all. Think about that. Strategic review is one of the key things they're looking at, of course, is capital allocation. And so, share buybacks will be part of that, and that really effectively impacted, if you will, our participation in that investing piece of the business after that announcement.

Richard Shane

Got it. Okay. Actually, when I really think about that from a legal perspective, it totally makes sense. Thank you for pointing it out and answering that question timely, but totally. At the end of the day, it doesn't really make sense to be buying back stock when you're doing that, because you've got information. Anyway, I get it.

Matthew Salem

Thank you. Appreciate you joining.

Operator

[Operator Instructions] Your next question comes from Chris Muller with Citizens.

Christopher Muller

Looking at your slide deck, the interest sensitivity slide stands out. Can you just talk through why higher rates are not a more meaningful benefit to the bottom line?

W. Mattson

Chris, it's Patrick. I'll take that. Yes, it's a good sort of highlight. We would expect normally, right, that you would get some benefit from higher rates. A couple of factors here. One, we're at the point where we've got some floors that are effectively pretty close. As we think about going up a little bit higher, it's not changing that much. We're not getting the additional benefit on the asset side.

The other factor is just that if you look at our debt outstanding that's subject to a floating rate and look at our loan assets outstanding that are subject to a floating rate, they're fairly close to each other. We're not obviously levered one to one. We've got a lot of value tied up, for example, in the REO assets. But the REO assets aren't producing income, right? So they're not subject to the benefit of higher interest rates. So it's really the fact that the secured debt outstanding, the term loan B outstanding is fairly close to the loan portfolio size.

Christopher Muller

Got it. That makes sense. And then, looking at the strategic review expenses, I heard you guys mention the legal counsel and financial advisor. Is that all that is going into that bucket there? Is that an ongoing expense or was it more one-time in nature?

Kendra Decious

Chris, it's Kendra. Thanks for the question. So I would say that the strategic review costs predominantly include financial advisors and legal advisors. I would point out that it is ongoing, as you asked, and also consider that the timing of when the strategic review committee was formed. So the expenses were back ended in Q3. So I think you can assume from that in Q4, those expenses will grow on a full quarter basis.

Operator

Your next question comes from Gabe Poggi with Raymond James.

Gabriel Poggi

Matt, Patrick, I've got kind of a top of the house question. What is KKR doing holistically? I mean, Matt, you alluded to all the different buckets of capital that the team works on, right? What's KKR looking at across commercial real estate in this environment? What activity do they find is interesting? I noticed the life science JV with Alexandria that was publicly announced a few days ago. But any color you can provide as to kind of the opportunity to KKR or that you're seeing and doing in other pockets of capital away from the REIT, I think would be helpful.

Matthew Salem

Thank you for the question, Gabe. I guess you could break it down between equity and debt. I'd say on the debt side, we remain active with all of our pools of capital and think it's an attractive lending environment for all the reasons we talk about on this call and for our peers talk about ability to lend on reset basis with supply coming down in a higher interest rate environment. I think it's a good credit story. We're seeing that demand from our insurance company. But also on the private debt fund side, I think there's a lot of capital kind of getting allocated to the sector. I'd say there we're continuing to invest in what you would expect in terms of on-theme assets from a property type, so nothing too new there.

You saw in this quarter we did originate a loan within KREF on senior housing. So that's an area we certainly have a lot of experience and positive experience on the equity side of our business, and have been involved on the debt side. But in terms of new things we're looking at, that's probably one area that we're slightly more active. Otherwise, it continues to be heavily focused on multifamily and industrial lending for the most part. I think when you put the equity hat on, the market's probably opening up a little bit for us in terms of investing kind of the value add opportunistic funds. It's early days, but I think there's going to be a lot of investors, ourselves included, spending time in the multifamily segment of the market.

I think Jade was pointing out the fact that supply's coming down, yet now you have another kind of pressure point on value, and this could be an interesting entry point. Not to call the bottom, but certainly as you think about investing capital, it looks like an attractive place to go, and a lot of capital structures are coming due, like we talked about in our portfolio and in our peers. I think that's an area in particular we'll spend more time on.

Operator

This concludes our question-and-answer session. I would like to turn the conference back over to Jack Switala for any closing remarks.

Jack Switala

Great. Thanks, operator, and thanks, everyone, for joining today. Please reach out to me or the team here if you have any questions. Take care.

Operator

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.