Operator: Thank you. Our next question comes from the line of Don Fandetti with Wells Fargo. Please proceed with your question.
Don Fandetti: Hi. Can you talk a little bit about how you are balancing a willingness to work with a borrower as their rate cap expires or whatever the other event is versus just kind of playing hardball and saying, you know what, we wouldn’t mind owning this asset because we think this is temporary, the Fed will cut outside of office. Like how are you thinking about that sort of those two scenarios?
Jeff DiModica: I will turn it to Barry, but it depends a lot on how we have it financed and how our senior partner, whether it’s a bank or a CLO, what they want us to do or require us to do, whether they are forcing us to have a new rate cap bought in, what strike that new rate capacity brought in, they are very expensive, as you know, or whether they will allow us to take interest reserves or other guarantees towards that. So, with our premier borrowers, we are certainly open to talking about the different potential solutions in a very difficult rate cap environment. But a lot of times, it’s set by where our senior lender requires us to do, and we will hold the line to what the senior lenders do. Our senior lenders are tremendously important to the success of the business. Barry, anything to add to that?
Barry Sternlicht: Not really.
Don Fandetti: Yes. And I guess my follow-up is on the infrastructure portfolio, are the caps €“ the interest rate cap similar where almost all the loans have them and they are protected. Can you talk a little bit about that relative to CRE loans?
Jeff DiModica: Yes. These are probably syndicated loans that some €“ that do and don’t. But for the most part, they do have very similar €“ I will get you the exact numbers on after this on exactly what percentage do have them. But broadly speaking, it is more protected than not, but I will come back with the exact numbers on rate caps there.
Don Fandetti: Okay. Thanks.
Operator: Our next question comes from the line of Rick Shane with JPMorgan. Please proceed with your question.
Unidentified Analyst: Hey. This is A.J. on for Rick Shane. First, just on the loans that were downgraded, I know there are no specific reserves on those assets today. But if any of those loans don’t work out, would we see additional reserve build or is that already included in your December 31st reserves, and we would just see kind of a shift from general to specifics?
Rina Paniry: So, they are part, A.J., of the general reserve currently. So, it would probably be two-fold. So, if there was further deterioration in the asset, you would have a transfer from a general reserve to a specific reserve and it would be increased at that point.
Unidentified Analyst: Okay, great. That’s helpful. Thank you. And then you said there were sponsor fund-related reasons for the office downgrades. I mean is there anything you can share with us what are the reasons sponsors going to want to support the assets?
Jeff DiModica: It’s a fully invested fund in a few cases. And in a case, there is a large fund that is leaving commercial real estate, and they are not putting more money in. So, it’s different in each one. But I think you are seeing a similar trend where a lot of people either don’t have the cash available today or unwilling to. These are more scenarios where they don’t have the cash available in the specific funds that the assets are owned in to be able to continue to support the project. So, those are opportunities where if we do step in, tend to be more accretive to us where we do have the capital to be able to continue.
Unidentified Analyst: Great. Thank you.
Operator: Thank you. Ladies and gentlemen, this concludes our question-and-answer session. Mr. Sternlicht, I will turn the floor back to you for any final comments.
Barry Sternlicht: Thank you, operator. Thank you everyone. Thanks for your questions and we obviously are here to be transparent and welcome your questions and the team is available. So, thank you and have a great first quarter. Stay warm. Bye.
Operator: Thank you. This concludes today’s conference. You may disconnect your lines at this time. Thank you for your participation.
