New York Mortgage Trust acquires remaining stake in Constructive Loans

NEW YORK - New York Mortgage Trust, Inc. (NASDAQ:NYMT), a $600 million market cap company with a notable 11.9% dividend yield, announced Tuesday it has acquired the remaining 50% ownership interest in Constructive Loans, LLC in an all-cash transaction. According to InvestingPro analysis, NYMT maintains strong liquidity with a current ratio of 24.28, suggesting robust financial flexibility for such strategic moves.

The acquisition, completed through a wholly owned subsidiary, follows NYMT’s initial strategic investment in Constructive made in 2021. Constructive, a business purpose loan originator for residential real estate investors, will operate as an independent subsidiary with its existing leadership team remaining in place. InvestingPro data reveals NYMT has maintained dividend payments for 22 consecutive years, demonstrating long-term financial stability.

Over the twelve months ended June 30, 2025, Constructive originated more than $1.7 billion of business purpose loans. Founded in 2017, the company operates in 48 states and Washington D.C., with 165 employees at its Oakbrook Terrace, Illinois headquarters. While NYMT shows slight overvaluation based on InvestingPro Fair Value metrics, analysts have revised earnings expectations upward for the upcoming period.

"This transaction appreciably expands NYMT’s presence within the residential credit markets and supports our core strategy of investing in business purpose loans," said Jason Serrano, CEO of New York Mortgage Trust, in the press release statement.

Ben Fertig, President of Constructive, stated the company is "thrilled to join NYMT with their residential mortgage credit expertise and deep capital market presence."

BTIG, LLC served as exclusive financial advisor for the transaction, while Mayer Brown LLP served as M&A counsel, and Vinson & Elkins LLP acted as tax and employment counsel to NYMT.

The financial terms of the transaction were not disclosed in the announcement.

In other recent news, New York Mortgage Trust reported strong financial results for the first quarter of 2025. Earnings available for distribution per share increased to $0.20, up from $0.16 in the previous quarter, while quarterly earnings per share rose by 11% quarter-over-quarter to $0.40. The company also highlighted significant investments, purchasing $1.5 billion in Agency RMBS, which contributed to the robust earnings report. Additionally, New York Mortgage Trust announced an $85 million senior notes offering, with proceeds intended for general corporate purposes and acquiring mortgage-related assets. The offering is expected to close in July 2025, with several major financial institutions serving as joint book-running managers. Analysts from B. Riley Securities and UBS have shown interest in the company’s capital allocation strategy, particularly in Agency RMBS and business purpose loans. The company maintained its dividend of $0.20 per share for the sixth consecutive quarter, reflecting its stable financial performance. As New York Mortgage Trust navigates market volatility, its strategic focus remains on optimizing portfolio growth and maintaining liquidity.

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