Ares Commercial Real Estate

Cash generation is inherently cyclical and credit‑event driven. Q2 2025 featured realized losses and negative distributable earnings; Q3 and Q4 2025 improved; Q1 2026 slipped again with realized losses and CECL build.

Three loans totaling roughly 285 million dollars remain on non‑accrual, and two large risk‑rated loans (Chicago office and Brooklyn residential/condo) dominate tail outcomes. Portfolio mix is improving toward multifamily, industrial and self‑storage, but office and REO dispositions introduce volatility.