Ivan Kaufman: Yes. So, when he mentioned mezz, I also looked at the same as preferred for us, it’s structural. We always like mezz better, it has better remedies. But I think it’s one and the same for us, whether we talk about preferred mezz. So, we are open to doing both depending on whether it’s Fannie or Freddie or what the structural enhancements are. And we think since we know the assets, we know the borrowers, it’s often very good opportunities and what we are uniquely positioned for. Is it often small pieces, they can run anywhere from $500,000 to $5 million and for them to bring an outside provider. The cost of inefficiencies are really, really, really high. So, with us having full knowledge of the bar and the collateral and being able to implement those in a very cost-effective way, it puts us in a strategic position to be the provider.
Jade Rahmani: Thank you very much. Are you surprised that there hasn’t been more back, or is it that the borrowers are raising prep equity from someone else?
Ivan Kaufman: We thought there would be more, but there isn’t. I think we had forecast, I think in our numbers that we would probably put out between pref and mezz about $10 million a month. That’s what was in our cash projections and we are not hitting those numbers by any means. So, we are well behind what our own views were, how they are getting the capital, where they are getting the capital. I don’t get that involved in. I am just happy with the conversion from the balance sheet into an agency loan that provides us a long-dated income stream and fits our business model. So, I am not always familiar with how they achieve their goal.
Jade Rahmani: Thanks very much. On modifications, is it reasonable to assume that you are doing about 15% – that you will be modifying about 15% of the portfolio?
Ivan Kaufman: I think it’s very fluid. So, there are – it’s just consistently different, and I can’t – I don’t have a particular number at all is just a point in time. So, I don’t have a stat on that.
Jade Rahmani: Thanks. And just last question would be when you think the right time would be to ramp up originations considering the strong liquidity, are you hoarding liquidity just to get through these next two quarters to three quarters in which you think the stress will play out and originate afterwards because clearly, post this, the yields will probably be lower than where they are today.
Ivan Kaufman: So, that’s a great question. And in my comments, we talked about our single-family business in terms of the build-to-rent business. In that business, we are extremely aggressive. We have ramped that up, and we want to continue to grow that. And we like that business, and we all ramped up and we want to dominate that business, and we will be one of the bigger lenders. I think on the multifamily side, I do believe that business will return. We have talked about it. We put together programs. And I do believe the second half of 2024 will be a very, very good year for the multifamily bridge loan business, and we will get aggressive and we will start to get aggressive at the end of the fourth quarter, maybe first quarter.
We have liquidity for it, and we also have the outlook that will come down and that multifamily transactions will start to occur and people will want to borrow our floating rate business. And there will be a great opportunity, and we want to be a leader on that side, too. It’s early right now. I think you are a quarter early for that business. I think fourth quarter will start to pick up. And definitely, in the first quarter, we aim to be extraordinarily aggressive in that business.
Jade Rahmani: Thanks for taking my questions.
Operator: Thank you. We will take our next question from Rick Shane with JPMorgan.
