Arbor Realty Trust, a nationwide lender on apartment buildings and single-family rental portfolios, has suspended its common stock dividend after reporting a third-quarter net loss of $85.4 million. The Uniondale, N.Y., real estate investment trust disclosed both on Oct. 30, 2026, in its third-quarter earnings release filed with the Securities and Exchange Commission. Problem loans in its bridge-lending book rose sharply during the quarter.
The loss came to $0.51 per diluted share. A year earlier Arbor earned $38.5 million, or $0.20 a share. Distributable earnings, the non-GAAP measure mortgage REITs use to set their payouts, swung to a loss of $6.9 million, or $0.04 a share, from $72.9 million, or $0.35 a share, in the third quarter of 2025. Arbor said that excluding $21.7 million of net realized losses from resolving “certain legacy assets,” distributable earnings would have been $0.08 a share.
Why Arbor suspended the dividend
The board’s decision takes effect immediately. In the release, Arbor said the move reflects its “continued focus on preserving capital and maintaining financial flexibility to address upcoming debt maturities and support the resolution of legacy assets.” The company added that it will keep evaluating its dividend policy “based upon market conditions and the Company’s performance, capital needs, and REIT distribution requirements.”
Three months earlier, Arbor’s second-quarter release declared a common dividend of $0.17 a share. The suspension applies to the common stock. Arbor follows Blackstone Mortgage Trust, which cut its dividend to $0.30 after a third-quarter loss.
Non-performing loans climb past $600 million
Arbor’s structured business consists mainly of short-term bridge loans, with nearly two-thirds of the balance on multifamily properties. That book showed the most strain. At Sept. 30, the company had 32 non-performing loans with an unpaid principal balance of $647.6 million, compared with 19 loans totaling $428.8 million at June 30. Two more loans totaling $95.9 million were on non-accrual status despite being less than 60 days past due.
Arbor recorded a $53.0 million net provision for loan losses under the CECL (current expected credit loss) accounting standard. That brought its total allowance to $210.1 million. It also took $34.1 million of impairments on six real estate owned properties, meaning buildings it has taken back from borrowers. During the quarter it modified six loans with a combined balance of $192.1 million for borrowers in financial difficulty. Arbor said most of those borrowers put in additional capital to recapitalize their deals. It foreclosed on one $13.2 million loan and sold five previously repossessed properties for $39.0 million.
The weighted average yield on the portfolio fell to 6.84% from 7.21% in the second quarter. Arbor attributed the decline primarily to “additional delinquencies and rate modifications.” Its average cost of borrowing rose to 6.66% from 6.56%.
The structured portfolio ended September at $12.00 billion, down from $12.11 billion in June. Of that, multifamily bridge loans made up $7.68 billion and single-family rental bridge loans $3.46 billion. New originations slowed to $459.2 million from $689.0 million in the prior quarter, and runoff reached $574.0 million.
The agency business is steadier
Arbor’s agency business originates and services apartment loans sold to Fannie Mae and Freddie Mac and insured by the FHA. It held up better. Its fee-based servicing portfolio grew slightly to $36.80 billion. Agency originations fell to $907.0 million from $1.08 billion in the second quarter. Freddie Mac volume dropped to $185.7 million from $428.3 million, while FHA lending rose to $129.5 million from $8.1 million.
Credit costs are building here too. On Fannie Mae loans, Arbor shares in the losses. It recorded a $12.4 million provision for those loss-sharing obligations, lifting that reserve to $87.3 million, or 0.36% of its Fannie Mae servicing portfolio. Fannie Mae itself reported this week that it more than doubled its credit provision as apartment loans weakened.
Raising liquidity and shrinking the share count
During the quarter Arbor closed an $825.0 million collateralized securitization. The company said the deal generated about $50 million of additional liquidity. It also sold an upsized $375.0 million of 6.25% convertible senior notes due 2029. Arbor used the proceeds to redeem $270.0 million of 4.50% senior notes and to buy back about 21 million shares in two transactions totaling $125.9 million.
The second-quarter release put the larger of those buybacks at $5.42 a share, or 49% of book value. In other words, the shares were already trading at about half of book value before this quarter’s losses were reported. Common shares outstanding fell to about 186.4 million at Sept. 30 from 195.5 million at the end of 2025.
On our reading, the quarter puts Arbor’s stress squarely in its bridge book rather than its agency platform: the balance of non-performing loans rose about 51% in three months, while the servicing portfolio edged higher. Arbor’s release says the dividend will be revisited as conditions allow. It gives no timeline. More coverage of lenders and landlords is on our commercial real estate page.
