Nonperforming Loans Cause iStar's Revenue to Decline

An increase in nonperforming loans in its portfolio helped cause iStar Financial to see a drop in its third-quarter revenue. Revenue for the New York-based commercial real estate finance company was $210.2 million for the third quarter of 2009, compared to the $337.3 million for the same period the year prior. According to iStar, the year-over-year decrease is primarily due to a reduction of interest income resulting from an increase in nonperforming loans, an overall smaller asset base and lower interest rates. At Sept. 30, first mortgages, participations in first mortgages, senior loans and corporate tenant lease investments collectively comprised 87% of iStar's asset base vs. 91% in the prior quarter. The company's loan portfolio consisted of 78.3% floating rate loans and 21.7% fixed-rate loans, with a weighted average maturity of two years.