Arbor Realty Trust Suspends Its Dividend After an $85.4 Million Third-Quarter Loss, and Shares Fall About 27%

Arbor Realty Trust, a New York-based real estate investment trust that lends against apartment buildings and single-family rental portfolios, suspended its quarterly common stock dividend on Friday, October 30, 2026, after reporting a third-quarter net loss of $85.4 million, or 51 cents per diluted share. In the same quarter a year earlier, the company earned $38.5 million, or 20 cents per share.

The stock (NYSE: ABR) traded at about $2.22 shortly after noon ET, down roughly 27% from Thursday's close of $3.02, according to Yahoo Finance market data. Earlier in the session it touched $2.01.

What the company reported

Arbor, based in Uniondale, New York, said its distributable loss, a non-GAAP measure that REITs commonly use to gauge cash available for payouts, was $6.9 million, or 4 cents per diluted share. That compares with distributable earnings of $72.9 million, or 35 cents per share, a year earlier. Excluding $21.7 million of net realized losses from resolving certain legacy assets, the company said distributable earnings would have been 8 cents per share.

Credit quality deteriorated during the quarter. Arbor recorded a $53.0 million net provision for loan losses, bringing its total allowance to $210.1 million at September 30. It had 32 nonperforming loans with an unpaid principal balance of $647.6 million, up from 19 loans totaling $428.8 million at the end of June. The company also took $34.1 million of impairments on six real estate owned properties, which are assets it has taken back from borrowers.

The structured loan portfolio, which is made up mostly of short-term bridge loans, had an unpaid principal balance of $12.00 billion, compared with $12.11 billion at June 30. Its average yield fell to 6.84% from 7.21% in the second quarter, which Arbor attributed primarily to additional delinquencies and rate modifications. At the same time, the weighted average cost of the debt financing that portfolio rose to 6.69% from 6.38%, on a balance of $10.75 billion.

The agency business, which originates and services loans sold to government-sponsored enterprises, generated revenue of $57.5 million, down from $64.5 million in the second quarter. Agency loan originations totaled $907.0 million, and the fee-based servicing portfolio stood at about $36.80 billion. Arbor also recorded a $12.4 million net provision for loss-sharing obligations tied to loans it sold under the Fannie Mae program.

Why the dividend was halted

In its release, Arbor said the board suspended the dividend "effective immediately" and that the decision "reflects the Company's continued focus on preserving capital and maintaining financial flexibility to address upcoming debt maturities and support the resolution of legacy assets." The company said it will continue to evaluate its dividend policy based on market conditions, its performance, capital needs and REIT distribution requirements.

The payout had already been reduced to 17 cents per share over the past year, Bisnow reported. On the company's earnings call, Chief Executive Ivan Kaufman said, "Our primary focus is to preserve and create the appropriate level of liquidity that we pay our short-term debt maturities and execute our business plan," according to Bisnow. He tied the pressure on the legacy loan book to higher debt costs driven largely by the rise in 10-year Treasury yields, saying the shift "has resulted in further reduction in values across the multifamily sector of between 5% to 15%."

Bisnow reported that Arbor plans to raise about $60 million through the dividend suspension, $150 million through sales and loan payoffs, $55 million through leverage on bank lines and $35 million through sales of properties taken from defaulted borrowers. During the quarter, Arbor also closed an $825.0 million collateralized securitization that it said generated roughly $50 million of additional liquidity.

Portfolio exposure

According to Bisnow, multifamily properties account for 71% of Arbor's loan book, with single-family rentals making up nearly all of the rest, and 93% of the debt is bridge loans. Texas, Florida, New York, Arizona and Georgia together represent 66% of the portfolio, and the average loan size is $25.2 million.

Wider real estate backdrop

Other commercial mortgage REITs moved far less on Friday. Shortly after noon ET, Starwood Property Trust was down about 0.8%, Blackstone Mortgage Trust about 0.6% and Ladder Capital about 0.5%, while the iShares Mortgage Real Estate ETF slipped about 0.9%, Yahoo Finance data showed. The 10-year Treasury yield was near 4.95%, down from 4.99% on Thursday.

Financing costs are also weighing on the residential side of the market. Redfin reported on Thursday that the median U.S. home-sale price fell 0.1% year over year to $389,601 in the four weeks ended October 25, the first such decline in more than three years apart from the prior week, while pending sales dropped to the lowest level in its records dating to 2021.