UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q (Mark One) ☒ QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 Table of Contents For the quarterly period ended March 31, 2025 OR ☐ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from to Commission File No. 001-15371 Safehold Inc. (Exact name of registrant as specified in its charter) | Maryland | 95-6881527 | | --- | --- ...

Financial Data and Key Metrics Changes - For Q1 2025, GAAP revenue was $97.7 million, net income was $29.4 million, and earnings per share (EPS) was $0.41, reflecting a decline in GAAP earnings year over year primarily due to a nonrecurring $1.9 million loss on a preferred equity investment [11][12] - Excluding the one-time loss, Q1 EPS increased slightly year over year, driven by higher net earnings on investment fundings and percentage rent [12] - The portfolio currently earns a 3.7% cash yield and a 5.4% annualized yield, with an economic yield of 5.8% [12][13] Business Line Data and Key Metrics Changes - The total portfolio at quarter end was $6.8 billion, with an estimated GLTV of 52% and rent coverage of 3.5 times [9][15] - The company funded a total of $20 million in Q1, consisting of $16 million in ground lease fundings and $4 million related to leasehold loans [10] - The ground lease portfolio has grown 20 times by both book value and estimated unrealized capital appreciation since the IPO, with 85 multifamily ground leases now comprising 58% of the portfolio [10] Market Data and Key Metrics Changes - The company has nonbinding LOIs totaling approximately $386 million for potential commitments across 11 ground leases and four loans, with six of the ground leases focused on affordable housing [7][9] - The portfolio GLTV increased from 49% to 52% quarter over quarter, reflecting the largest office revaluation quarter [14][15] Company Strategy and Development Direction - The company aims to reach a scale that unlocks the full value of the business for shareholders while expanding the customer base that can benefit from long-term lower-cost capital [4][5] - The management is focused on capital recycling and evaluating opportunities to address the public versus private valuation disconnect [35][21] Management's Comments on Operating Environment and Future Outlook - The management noted that while the market remains volatile, there are signs of stabilization, and they are optimistic about the pipeline of deals [6][19] - The management expressed confidence in the ability to close the majority of the deals in the pipeline within the year, despite the challenges posed by market conditions [31][61] Other Important Information - The company ended the quarter with approximately $1.3 billion of liquidity, supported by potential available capacity in joint ventures [9][17] - The company has a weighted average debt maturity of approximately 19 years and no corporate maturities due until 2027 [17] Q&A Session Summary Question: Can you provide more details on the sponsors and markets related to the nonbinding LOIs? - The pipeline includes a robust mix of multifamily deals, with diverse locations across the West Coast, Southeast, Northeast, and Midwest [25][26] Question: What are the benefits of ground leases versus leasehold loans? - Leasehold loans provide more certainty in volatile markets and can help kickstart transactions that are stalled [27] Question: Can you quantify the closed deals from the LOIs? - The majority of the deals in the pipeline are expected to close this year, with timing varying based on construction versus recap deals [31] Question: What is the company's strategy regarding joint ventures? - The company is exploring opportunities for joint ventures to unlock value from the existing portfolio while focusing on larger scale deals with current partners [65][66] Question: How does the company view the current market volatility? - The management acknowledged ongoing volatility but noted that it has tightened, allowing sponsors to make clearer long-term capital decisions [44][61] Question: What is the outlook for S&P ratings? - The company is in dialogue with S&P and aims to achieve a third single A rating through prudent capital management and continued deal origination [82]

Core Insights - Safehold (SAFE) reported revenue of $97.68 million for Q1 2025, marking a year-over-year increase of 4.8% and exceeding the Zacks Consensus Estimate by 1.94% [1] - The company's EPS for the same quarter was $0.44, slightly up from $0.43 a year ago, with an EPS surprise of 2.33% over the consensus estimate [1] Financial Performance Metrics - Operating lease income was reported at $21.38 million, surpassing the average estimate of $20.68 million, reflecting a year-over-year increase of 1.8% [4] - Other income decreased to $4.30 million, below the average estimate of $4.93 million, representing a significant year-over-year decline of 35.2% [4] - Interest income from sales-type leases was $69.66 million, slightly above the average estimate of $69.35 million, with a year-over-year increase of 10.2% [4] - Interest income from related parties was reported at $2.33 million, slightly below the average estimate of $2.40 million, showing a year-over-year decrease of 1% [4] - The diluted net income per share was $0.41, compared to the estimated $0.43, indicating a shortfall against analyst expectations [4] Stock Performance - Over the past month, Safehold's shares have returned -6%, contrasting with the Zacks S&P 500 composite's increase of 11.5% [3] - The stock currently holds a Zacks Rank 3 (Hold), suggesting it may perform in line with the broader market in the near term [3]

Q1'25 Earnings Results Q1'25 Summary Investment Activity1 | | Non-Binding LOIs | | --- | --- | | | (11 Ground Leases, 4 Leasehold Loans) | | Ground Lease Value | ~$273m | | Leasehold Loan Value | ~$113m | | Markets | 8 | | Sponsors | 11 | | GLTV2a | ~34% | | Rent Coverage3a | ~2.6x | | Economic Yielda | ~7.3% | $6.8b / $8.9b Total Portfolio Aggregate GBV5 / Total Portfolio Estimated UCA Portfolio Metrics4 Capital Sources $1.3bb Cash & Credit Facility Availability 52% / 3.5x GLTV2 / Rent Coverage3 Remaining ...

Exhibit 99.2 Q1'25 Earnings Results Q1'25 Summary afehold Investment Activity1 | | Non-Binding LOIs | | --- | --- | | | (11 Ground Leases, 4 Leasehold Loans) | | Ground Lease Value | ~$273m | | Leasehold Loan Value | -$113m | | Markets | 8 | | Sponsors | 11 | | GLTV2a | ~34% | | Rent Coverage 3a | ~2.6x | | Economic Yieldª | -7.3% | Portfolio Metrics4 $6.8b / $8.9b Total Portfolio Aggregate GBV§ / Total Portfolio Estimated UCA 52% / 3.5x GLTV² / Rent Coverage3 $1.3bb Cash & Credit Facility Capital Sources $ ...

Core Viewpoint - Safehold Inc. will release its financial results for Q1 2025 on May 6, 2025, after market close [1] - An earnings conference call will take place on May 7, 2025, at 9:00 a.m. ET to discuss these results [2] Company Overview - Safehold Inc. is transforming real estate ownership by offering a new method for owners to unlock land value beneath their buildings [2] - The company established the modern ground lease industry in 2017 and continues to assist owners of various property types in generating higher returns with reduced risk [2] - As a real estate investment trust (REIT), Safehold aims to provide safe, growing income and long-term capital appreciation to its shareholders [2]

Core Points - Safehold Inc. has declared a common stock dividend of $0.177 per share for Q1 2025, which annualizes to $0.708 per share, payable on April 15, 2025, to shareholders of record on March 31, 2025 [1] Company Overview - Safehold Inc. is transforming real estate ownership by offering a new method for property owners to unlock the value of the land beneath their buildings [2] - The company established the modern ground lease industry in 2017 and continues to assist owners of various property types, including multifamily, office, industrial, hospitality, student housing, life science, and mixed-use properties, in generating higher returns with reduced risk [2] - As a real estate investment trust (REIT), Safehold aims to provide safe, growing income and long-term capital appreciation to its shareholders [2]

Financial Performance - Total revenues for 2024 increased to $365.7 million, up 3.1% from $352.6 million in 2023 [296]. - Interest income from sales-type leases rose to $264.3 million, a 12.2% increase compared to $235.5 million in 2023 [296]. - Net income attributable to Safehold Inc. common shareholders was $105.8 million in 2024, compared to a net loss of $55.0 million in 2023 [296]. - Comprehensive income attributable to Safehold Inc. was $156.1 million in 2024, compared to a comprehensive loss of $59.6 million in 2023 [300]. - Net income for the year ended December 31, 2023, was reported at $107,191,000, compared to a net loss of $54,565,000 in 2022, indicating a significant turnaround [303]. - Net income for 2024 was $106.615 million, a significant recovery from a net loss of $54.565 million in 2023 [307]. - Cash flows from operating activities increased to $37.855 million in 2024, compared to $15.391 million in 2023 [307]. Assets and Liabilities - Total assets as of December 31, 2024, reached $6.9 billion, an increase of 5.3% from $6.5 billion in 2023 [293]. - Total liabilities increased to $4.5 billion in 2024, up from $4.3 billion in 2023, reflecting a rise of 6.4% [293]. - As of December 31, 2024, the company had approximately $4.4 billion in outstanding indebtedness, including $100 million of trust preferred securities [123]. - The company had $3.6 billion in fixed-rate debt and $789 million in floating-rate debt outstanding as of December 31, 2024 [268]. - The carrying value of net investment in sales-type leases is $3,455 million, with a fair value of $3,680 million, compared to a carrying value of $3,255 million and a fair value of $3,118 million as of December 31, 2023 [374]. Cash Flow and Dividends - Cash and cash equivalents decreased to $8.3 million in 2024, down from $18.8 million in 2023 [293]. - The company paid dividends of $50.589 million to common shareholders in 2024, compared to $46.039 million in 2023 [307]. - Future distributions to shareholders will depend on various factors, including actual or anticipated results of operations and cash flows [139]. - The company’s cash flow may be insufficient to meet required principal and interest payments, exposing it to default risks [123]. Risks and Challenges - The company faces risks associated with tenant bankruptcies, which could adversely affect income and property ownership [96]. - The company relies on Property NOI reported by tenants, which may not be independently verified, potentially affecting underwriting decisions [86]. - Ground Leases with developers expose the company to risks related to property development and financing, which could materially affect operations [92]. - Future growth prospects may be adversely affected by health crises, as seen during the COVID-19 pandemic, which impacted tenant financial conditions and operational capabilities [102]. - The company may face risks related to joint venture investments, including lack of sole decision-making authority and reliance on partners' financial positions [127]. Shareholder Relations and Equity - Star Holdings owns approximately 18.9% of the outstanding shares of the company's common stock, which could influence shareholder decisions [112]. - The company’s organizational documents limit shareholder recourse and access to judicial forums, which may inhibit changes in control [135]. - The company may issue new Caret units or sell outstanding units without requiring approval from common stockholders, potentially diluting their interests [142]. - The absence of a drag-along right after a liquidity transaction could deter acquisition interest and affect the market price of common stock [156]. Management and Governance - The company has a management agreement with Star Holdings, which includes an annual management fee of $25 million for the term ended March 31, 2024, declining to $15 million for the term ended March 31, 2025 [109]. - The company faces potential conflicts of interest in its relationship with Star Holdings, which could result in decisions not aligned with shareholder interests [117]. - The Company recognized management fee income of $25.0 million for the term ended March 31, 2024, which will decline to $15.0 million for the term ended March 31, 2025 [358]. Taxation and Compliance - The company must distribute at least 90% of its REIT taxable income annually to qualify as a REIT, or it may incur U.S. federal income tax at regular corporate rates [165]. - The total current income tax expense for the year ended December 31, 2024, was $1.048 million, a decrease from $3.045 million in 2023 [365]. - The Company has a valuation allowance of $(2.052) million against its deferred tax assets as of December 31, 2024, compared to $(2.704) million in 2023 [369]. Market and Competitive Landscape - The company faces competition from various entities including commercial developers, other REITs, and financial institutions, which may adversely affect its ability to acquire and originate investments [98]. - The market price of the company's common stock may not reflect the value of the UCA in the owned residual portfolio, which is difficult to estimate [91]. Cybersecurity and Internal Controls - The company has implemented processes and internal controls to mitigate cybersecurity risks, but there is no assurance that these measures will be fully effective [101]. - The company maintained effective internal control over financial reporting as of December 31, 2024, according to the independent auditor's opinion [285].

Q4'24 & FY'24 Earnings Results FY'24 Summary Capital Markets Activity | | New 5-year unsecured revolving credit | | --- | --- | | $2.0b Revolver | facility (increased credit availability, lowered cost and extended term versus prior $1.85b | | | aggregate facilities) | | | Issued $400m and $300m 10-year unsecured notes (5.84% w.a. coupon, 5.19% | | $700m Notes | w.a. yield to maturity net of $43m total | | | realized hedge gains) | | $750m | Unsecured funding program put in place as | | Commercial Paper | al ...

Financial Data and Key Metrics Changes - For Q4 2024, GAAP revenue was $91.9 million, net income was $26.0 million, and earnings per share (EPS) was $0.36. The decline in GAAP earnings year over year was primarily due to a one-time $15.2 million derivative hedge gain recognized in Q4 2023. Excluding this, Q4 EPS increased approximately 1% year over year [28][29][70] - For the full year, GAAP revenue was $365.7 million, net income was $105.8 million, and EPS was $1.48. The increase in GAAP earnings year over year was driven by a $145.4 million non-cash impairment of goodwill and $22.1 million of merger and Carrot-related costs taken in 2023 [29][30][71] Business Line Data and Key Metrics Changes - In 2024, new origination activity was $225 million, including ten new ground leases for $193 million and one leasehold loan for $32 million. The total portfolio was $6.8 billion, with an estimated UCA of $9.1 billion, GLTV of 49%, and rent coverage of 3.5 times [20][65][66] - The ground lease portfolio has grown twenty times since the IPO, with 147 assets and 85 multifamily ground leases, increasing exposure from 8% at IPO to 58% today [26][69] Market Data and Key Metrics Changes - The company reported strong activity in the affordable housing sector, with a focus on stable cash flows and high occupancy rates. The economic yield for new 2024 originations was 7.3% [11][20][21] - The portfolio's GLTV increased slightly in Q4, and rent coverage remained unchanged at 3.5 times [35][36] Company Strategy and Development Direction - The company plans to double its efforts in the multifamily market, particularly in the affordable sector, aiming to double last year's affordable volume and expand to at least two new states in 2025 [11][12][54] - A new share buyback authorization of up to $50 million has been approved, with the goal of being leverage neutral and recycling capital from existing portfolio through asset sales or joint ventures [13][14][56] Management's Comments on Operating Environment and Future Outlook - Management noted that while interest rates posed headwinds, they expect rates to come down over time, turning current challenges into future opportunities for more deals and higher cash flow values [10][52] - The company is focused on scaling its business and believes there is significant long-term value in its assets that is currently unrecognized by the market [96][112] Other Important Information - The company ended the quarter with approximately $1.3 billion of liquidity, supported by potential available capacity in joint ventures [24][65] - The credit profile is strong, with ratings of A3 from Moody's, A- from Fitch, and BBB+ with a positive outlook from S&P [62][78] Q&A Session Summary Question: Can you talk about the pipeline and the focus on affordable housing? - Management indicated good activity in the affordable housing sector, with strong momentum in multifamily and conventional markets, particularly in supply-constrained areas [87][90] Question: What are the differences in affordable housing transactions compared to conventional ones? - Management explained that while the cost of capital remains low, affordable housing transactions involve multiple funding sources, making the structure more complex but beneficial for developers [100][102] Question: What is the expected overhead for 2025? - Management expects gross overhead to be in the low $40 million range, with net overhead impacted by management fees [106][108] Question: How does the company view buybacks versus new originations? - Management aims to balance both buybacks and scaling the business, starting with a $50 million buyback authorization while pursuing growth opportunities [112][114] Question: Can you provide more details on opening up Carrot to more investors? - Management is working on enhancing liquidity and expanding the investor base for Carrot, with plans to make progress in 2025 [116][118] Question: Are economic yields for affordable multifamily ground leases higher than traditional ones? - Management confirmed that while yields are similar, affordable multifamily ground leases may offer tighter coverage due to their stability [137]