Granite Point Mortgage Trust Inc. (GPMT): PESTLE Analysis [Nov-2025 Updated]

You're looking for a clear, actionable breakdown of the forces shaping Granite Point Mortgage Trust Inc. (GPMT) right now, and honestly, the near-term picture is complex but clear: the Federal Reserve's sustained high interest rate policy is the single biggest headwind, driving commercial real estate (CRE) valuation risk and refinancing pressure. We've mapped the entire external landscape-Political, Economic, Sociological, Technological, Legal, and Environmental-to give you a defintely actionable view of the risks and opportunities shaping GPMT's loan book as we head into 2026.

Granite Point Mortgage Trust Inc. (GPMT) - PESTLE Analysis: Political factors

Shifting US fiscal policy impacting government spending and debt

You need to understand that the sheer scale of US government debt is now a primary political risk that directly affects Granite Point Mortgage Trust Inc.'s (GPMT) core business. Honestly, the government's borrowing is competing with you for capital. As of mid-2025, the U.S. national debt stands at approximately $36.5 trillion, which is about 130% of GDP. This huge debt load forces the Treasury to issue more securities, which in turn pushes up yields to attract investors.

The Congressional Budget Office (CBO) projects the federal budget deficit for fiscal year 2025 at $1.9 trillion, or 6.2% of GDP. This fiscal reality means the government's interest payments have now surpassed defense spending, a critical shift. For GPMT, this translates to persistently higher benchmark interest rates, which directly impact the cost of capital and, crucially, lead to cap rate expansion in commercial real estate. That expansion compresses property valuations, making your senior loan portfolio's collateral less valuable. It's a direct link: more government debt means more pressure on your commercial real estate assets.

Potential changes to the tax treatment of REIT dividends

The political landscape has recently provided some clarity and stability for Real Estate Investment Trusts (REITs) like GPMT. On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was signed into law, a major win for the sector. This legislation made the Section 199A deduction, also known as the Qualified Business Income (QBI) deduction, a permanent feature for REIT shareholders. This move locks in a maximum effective top federal tax rate of 29.6% on ordinary REIT dividends for individual investors. That certainty is defintely a positive for investor demand.

Also, the new law increases the limit on assets a REIT can hold through a Taxable REIT Subsidiary (TRS) from 20% to 25%, effective for 2026 and future tax years. This gives GPMT more flexibility to manage certain non-real estate-related services and assets without risking its REIT status. It's a structural benefit that eases compliance and allows for greater operational scope.

Geopolitical instability affecting global capital flows into US real estate

Geopolitical instability is a major headwind, but the US remains a safe haven for global capital, which is a good thing for GPMT. While the political environment is causing some investors to pause, the data shows a cautious rebound. Global direct real estate transaction volume surged 34% year-on-year in the first quarter of 2025, with cross-border investment jumping 57%-the highest Q1 level since 2022. Still, the political risks are real.

The uncertainty is causing a divergence in investor sentiment and action:

• 44% of foreign investors plan to increase their U.S. real estate allocations in 2025.
• But, 63% of the same group express a negative outlook on cross-border investments.

For GPMT, geopolitical tensions, such as strained US-Canada relations, have led to a 'pause' in acquisitions by Canadian investors, who have historically been the largest foreign buyers, pouring roughly $184 billion into U.S. commercial property assets over the past decade. This hesitation means less liquidity and fewer high-quality deal opportunities in the commercial real estate market, which can slow down GPMT's loan origination and repayment activity.

Regulatory scrutiny on non-bank financial institutions (shadow banking)

GPMT operates in the non-bank financial intermediation (NBFI) space, often called 'shadow banking,' a sector that has grown to hold financial assets more than 2.5 times that of banks in the United States. Regulators are increasingly focused on this sector due to its size and interconnectedness with the traditional banking system. The concern is that non-banks, which are less regulated, could pose systemic risks, specifically around liquidity and concentration risk.

The Financial Stability Board (FSB) is actively working on policy recommendations to address systemic risk from NBFI leverage, with a consultation report expected in 2025. This means GPMT and its peers should anticipate new rules, likely focusing on counterparty risk management and greater transparency, especially in less visible markets like private finance. Given GPMT's portfolio of $1.8 billion in total loan commitments as of Q3 2025, any new rules on leverage or capital requirements could directly impact its funding costs and operational flexibility.

Political/Regulatory Factor (2025)	Key Data/Value	Direct Impact on Granite Point Mortgage Trust Inc. (GPMT)
US National Debt (Mid-2025)	Approx. $36.5 trillion (130% of GDP)	Increases federal borrowing, which puts upward pressure on Treasury yields and commercial real estate financing costs.
Federal Deficit (FY 2025 Projection)	$1.9 trillion (6.2% of GDP)	Contributes to high interest rates, leading to cap rate expansion and lower commercial property valuations.
REIT Dividend Tax Treatment (OBBBA Law, Jul 2025)	Permanent 199A deduction, preserving 29.6% max tax rate.	Provides long-term tax certainty for investors, supporting demand for GPMT common stock and dividends.
Taxable REIT Subsidiary (TRS) Asset Limit	Increases from 20% to 25% (effective 2026).	Grants GPMT greater operational and structuring flexibility for non-real estate-related services.
Geopolitical Capital Flows (Q1 2025)	Cross-border CRE investment jumped 57% Y-o-Y.	Signals a rebound in foreign capital seeking US safe-haven assets, potentially increasing liquidity for CRE.
Shadow Banking Regulatory Focus	NBFI assets are more than 2.5 times US bank assets.	Anticipated new policy recommendations from the FSB will likely increase regulatory burden and scrutiny on GPMT as a non-bank commercial real estate lender.

Granite Point Mortgage Trust Inc. (GPMT) - PESTLE Analysis: Economic factors

You're looking at Granite Point Mortgage Trust Inc. (GPMT) and trying to figure out if the worst of the credit cycle is over. My take is that while GPMT has done a solid job de-risking its portfolio in 2025, the wider economic headwinds-specifically the high cost of debt and the looming maturity wall-mean the pressure on their borrowers is defintely not finished.

Here's the quick math: GPMT's core business benefits from floating rates, but its borrowers face a massive refinancing hurdle that will keep credit losses a near-term reality.

Federal Reserve's sustained high interest rate policy increasing borrower debt service

The biggest economic factor for GPMT is the cost of money. As a commercial mortgage real estate investment trust (mREIT), GPMT carries a loan portfolio that is 97% floating-rate. This means their realized loan portfolio yield was a healthy 7.5% in Q3 2025. That's the good news for GPMT's income statement.

But here's the rub: that high yield is the borrower's high cost. Although the Federal Reserve has begun easing, cutting the federal funds target to a range of 4.00%-4.25% in September 2025, the cost of debt is still historically high for properties underwritten years ago. This interest rate shock is the primary cause of borrower stress, forcing a cleanup of the loan book. It's a classic case where the REIT benefits from the rate, but its clients are struggling to service it.

Commercial real estate (CRE) property value corrections, especially in office and retail

The correction in Commercial Real Estate (CRE) values directly impacts GPMT's collateral, especially in the troubled office and retail sectors. Moody's Analytics projects that office real estate values will plunge by 26% by the end of 2025 from their peak. This massive drop erodes the equity cushion protecting GPMT's first-mortgage loans.

The structural shift to remote work is driving this, pushing the national office vacancy rate toward 23% in 2025. Retail is also under pressure, with prices expected to decline by 8% over five quarters. GPMT is actively managing this risk, notably resolving a troubled Chicago office/retail loan in Q3 2025 by selling the office portion and retaining the cleaner, 100% retail collateral.

Increased refinancing risk for loans maturing in 2025 and 2026

We are squarely in the middle of a massive CRE debt maturity wave, which is the single biggest near-term risk. Loans originated in the low-rate environment of 2015-2020 are now coming due, and refinancing is nearly impossible at the old loan-to-value (LTV) ratios due to higher rates and lower property values.

Across the entire CRE market, the volume of loans facing this refinancing risk is staggering. This is a critical factor for GPMT's borrowers who need to find new capital to pay off their maturing debt.

Year	Estimated Total CRE Loan Maturities (US$)	Source/Commentary
2025	Nearly $1 trillion (or $957 billion)	Represents nearly triple the 20-year average.
2026	Up to $936 billion (or $539 billion)	The peak of the maturity wall, due to extensions from 2024/2025.

Inflationary pressures on operating expenses for underlying properties

Even with cooling inflation, property-level operating expenses (OpEx) continue to rise, squeezing the Net Operating Income (NOI) of the underlying assets. This is a quiet killer of property value.

For example, multifamily operating expenses grew at a 4.15% Compound Annual Growth Rate (CAGR) from 2015-2024. The most severe pressure points are:

• Property Insurance: Premiums surged 11.77% annually over the last decade.
• Construction Costs: Building materials have skyrocketed 35.6% since the pandemic began.
• General Inflation: The Consumer Price Index (CPI) climbed 3.4% year-over-year in May 2025.

If a borrower's lease structure doesn't allow for full pass-through of these costs, the NOI drops, which directly reduces the property's valuation and increases the risk of default on GPMT's loan.

Near-term loan loss reserves expected to remain elevated

GPMT's management is focused on de-risking, not growth, through the first half of 2026. This means they expect to continue taking realized losses on legacy credit issues. As of Q3 2025, their total Current Expected Credit Losses (CECL) reserve was $133.6 million, or 7.4% of total loan commitments.

Honestly, the key metric to watch is the coverage on their riskiest loans. GPMT had $196 million in principal balance on three non-accrual loans in Q3 2025. They have already set aside $86.5 million in specific CECL reserves against these loans, representing a robust 44% coverage ratio. This high reserve level is a clear signal that management expects to absorb significant losses on these specific assets, but it also provides a substantial buffer against future realized write-offs.

Granite Point Mortgage Trust Inc. (GPMT) - PESTLE Analysis: Social factors

Permanent changes in work-from-home models reducing office space demand.

The shift to hybrid and remote work is no longer a temporary blip; it's a permanent structural change impacting Granite Point Mortgage Trust Inc.'s (GPMT) largest portfolio segment. As of September 30, 2025, GPMT's loan portfolio is heavily weighted toward Office properties at 41.9% of total commitments, making this social trend a primary risk factor.

The national office vacancy rate hit 18.6% in October 2025, a stark contrast to pre-pandemic levels, and it's being driven by two-thirds of US companies offering some form of flexibility. This underutilization is not uniform; prime, Class A buildings are still attracting tenants (the flight-to-quality trend), but older, lower-quality assets face severe pressure. For example, in October 2025, while Manhattan's vacancy was roughly 13%, Seattle's surged to 27.4%. This means GPMT's risk is concentrated in the quality and location of its underlying office collateral.

Demographic shifts driving demand for specific property types like multifamily and industrial.

Demographics are a clear tailwind for two other key segments of GPMT's portfolio: Multifamily and Industrial. The massive Gen Z and Millennial cohorts are entering peak renting ages, plus you have aging Baby Boomers downsizing and returning to the rental market. This strong renter demand makes Multifamily the most preferred asset class for commercial real estate investors in 2025.

We see this in the fundamentals: the average multifamily vacancy rate is expected to end 2025 at 4.9%, even with a large supply wave. Industrial properties, which account for 7.2% of GPMT's portfolio, also remain resilient, driven by the social shift toward e-commerce and the associated need for logistics and manufacturing space. This is a defintely good sign for GPMT's diversification strategy, helping to counterbalance the office exposure.

GPMT Portfolio Exposure (Q3 2025)	Social Factor Trend	2025 Market Metric
Office (41.9%)	Permanent Work-From-Home/Hybrid Models	National Office Vacancy: 18.6% (Oct 2025)
Multifamily (33.2%)	Gen Z/Millennial Cohort Renting & Affordability Gap	Forecasted Multifamily Vacancy: 4.9% (Year-End 2025)
Industrial (7.2%)	E-commerce Growth & Supply Chain Reshoring	Industrial Vacancy: 7.1% (Q2 2025)

Growing investor focus on social impact of lending practices.

The 'S' in Environmental, Social, and Governance (ESG) is becoming a core part of commercial real estate lending, not just a marketing exercise. Investors, including large institutional funds, are increasingly integrating ESG factors into their due diligence, pushing companies like GPMT to demonstrate the social impact of lending practices.

This scrutiny focuses on things like:

• Supporting affordable housing initiatives.
• Ensuring fair labor practices in property management.
• Promoting community development through real estate projects.

The global impact investing market is projected to reach $7.78 trillion by 2033, so ignoring this trend means risking a shrinking pool of capital. GPMT must clearly articulate how its underwriting process considers these social factors, especially in its large Multifamily segment, to attract this growing capital base.

Consumer confidence levels influencing retail and hospitality sector performance.

Consumer confidence is the direct social thermometer for GPMT's Retail (8.7%) and Hotel (6.5%) exposure. The Conference Board Consumer Confidence Index® inched down to 94.6 in October 2025, and the Expectations Index remains low at 71.5-a level that has historically signaled a recession ahead since February 2025.

The impact is bifurcated: Retail is showing resilience, but it's uneven. Foot traffic is up for value-oriented sectors like fitness and entertainment, but discretionary and big-ticket retailers are seeing weaker visits. The Hotel sector is recovering, with leisure travel plans up in October 2025, but a full recovery hinges on business travel returning to pre-pandemic levels, which it hasn't yet. For GPMT, this means the loans secured by grocery-anchored retail or select-service hotels are performing better than those tied to high-end, discretionary retail or large convention hotels.

Granite Point Mortgage Trust Inc. (GPMT) - PESTLE Analysis: Technological factors

Increased use of Artificial Intelligence (AI) in underwriting and due diligence.

You need to see AI (Artificial Intelligence) not as a future tool, but as a current necessity for managing credit risk. For a commercial mortgage REIT like Granite Point Mortgage Trust Inc., the core business is risk selection, and AI is dramatically improving that process. Industry forecasts for 2025 suggest that AI could automate up to 37% of tasks in commercial real estate, specifically in valuation and underwriting.

Granite Point Mortgage Trust Inc.'s stated strategy of 'rigorous credit underwriting' is only feasible at scale by adopting these tools. Here's the quick math: a portfolio with $1.8 billion in total commitments, as reported in Q3 2025, requires real-time, deep-dive analysis that human teams alone cannot manage. The firm's recent improvement in its weighted average risk rating to 2.8 year-over-year suggests a successful focus on disciplined underwriting, which is defintely supported by technology that flags early warning indicators faster than traditional models.

Digital platforms streamlining loan servicing and asset management.

The operational efficiency of managing a large, floating-rate commercial loan portfolio depends entirely on digital platforms. Loan servicing involves complex calculations for a portfolio that is over 97% floating-rate, requiring immediate processing of rate changes and borrower communications. Using a streamlined digital platform cuts down on errors and speeds up the time-to-action on problem loans, which is critical when you have $196 million of principal balance on just three nonaccrual loans, as reported in Q3 2025.

The right platform helps the firm manage its collateral more proactively, translating to better outcomes in asset resolutions. It's simple: faster data equals better decisions on a loan-by-loan basis.

Cybersecurity risks demanding higher investment in data protection.

Cybersecurity is no longer an IT cost; it is a material business risk that demands significant capital allocation. The financial sector is a prime target, and the global average cost of a data breach reached $4.9 million in 2024, which is a number that should keep any executive up at night.

Granite Point Mortgage Trust Inc. is mitigating this with a clear, mandatory program, including quarterly cybersecurity training for all officers, employees, and directors, and the use of external experts for risk assessments. This is a necessary expense, especially since a PwC survey shows that investment in AI is the top cybersecurity budget priority (36%) for organizations in 2025, a trend the firm must follow to stay ahead of increasingly sophisticated threats.

Technological Risk/Opportunity	2025 Industry Metric	Impact on Granite Point Mortgage Trust Inc.
AI in Underwriting & Due Diligence	Up to 37% of CRE tasks automatable.	Enables 'rigorous credit underwriting' strategy; supports the Q3 2025 risk rating improvement to 2.8.
Cybersecurity Investment Priority	AI is the top cyber budget priority (36%).	Mandatory quarterly training and third-party risk assessments are critical defense for the $1.8 billion portfolio.
PropTech Market Growth	Global market size expected to reach $47.08 billion in 2025.	Creates a competitive pressure to monitor collateral performance using smart building data and digital property management systems.

PropTech innovations making property management more efficient, but requiring capital.

While Granite Point Mortgage Trust Inc. is a lender, not a property owner, the efficiency of its collateral-the commercial properties-directly impacts loan performance. The global PropTech (Property Technology) market is a massive external force, projected to reach $47.08 billion in 2025, growing at a 16% CAGR. This growth means that the underlying assets securing the firm's loans are increasingly managed by technology.

The opportunity is that PropTech can boost a property's Net Operating Income (NOI) via predictive maintenance and energy optimization, which strengthens the firm's loan collateral. The risk, however, is that if a borrower's property management lags technologically, that asset will underperform. The firm must be prepared to invest capital, or require its borrowers to invest, in PropTech solutions to protect the value of its Real Estate Owned (REO) properties, such as the two properties with an aggregate carrying value of $105.5 million reported in Q3 2025.

• Monitor borrower PropTech adoption to assess collateral quality.
• Allocate capital to upgrade REO properties for maximum value extraction.
• Use digital platforms for efficient loan resolution, like the $3.4 million partial paydown on a Chicago loan in Q3 2025.

Granite Point Mortgage Trust Inc. (GPMT) - PESTLE Analysis: Legal factors

You're navigating a commercial real estate (CRE) market where the legal landscape is shifting from a focus on systemic risk to one of borrower and tenant protection. For Granite Point Mortgage Trust Inc. (GPMT), this means every loan modification, foreclosure, and potential securitization is now a more complex legal and compliance exercise. The legal environment in 2025 is characterized by a strict regulatory baseline and a patchwork of new state-level laws that directly impact your portfolio's value and workout timelines.

Stricter enforcement of Dodd-Frank Act provisions on risk retention.

The Dodd-Frank Act's credit risk retention rules (Regulation 15G) remain a high-cost compliance hurdle for any future Commercial Mortgage-Backed Securities (CMBS) issuance. If GPMT were to securitize a portion of its $1.8 billion loan portfolio, the sponsor would be required to retain at least 5% of the credit risk. This is the government's way of ensuring you keep 'skin in the game' to align your interests with bondholders.

This 5% retention requirement significantly limits your capital flexibility. It forces you to tie up capital in the riskiest (horizontal slice) or a pro-rata share (vertical slice) of the deal for a minimum of five years, which is a major balance sheet consideration for a REIT. Honestly, this rule is why big banks have an edge; they can more easily absorb the vertical risk retention on their balance sheet.

Potential for new state-level tenant protection laws affecting multifamily assets.

The rise of tenant-friendly legislation at the state level is a direct legal risk to GPMT's 33.2% exposure in multifamily assets. These new laws increase the operational burden on your borrowers and can extend the time it takes to resolve issues, ultimately pressuring property cash flows and valuation.

In key markets, you are seeing specific, costly changes. For example, in California, new laws effective in 2025 require landlords with 15 or more units to offer tenants the option to report positive rental payment history to a credit bureau. Plus, new Illinois laws, like the Landlord Retaliation Act, create a rebuttable presumption of retaliation if a landlord takes an adverse action within one year of a tenant's complaint. This extends the legal timeline for evictions and disputes.

Here's a quick look at how new state laws impact your multifamily assets:

Jurisdiction	2025 Legal Change	Impact on GPMT's Multifamily Assets
California (AB 2801)	Stricter security deposit rules, including mandatory photos (before/after tenancy and repairs) starting July 1, 2025.	Increases property manager compliance costs and raises the legal bar for deposit deductions, potentially reducing net recoveries.
California (AB 2347)	Extends the defendant's response time in unlawful detainer (eviction) cases from 5 to 10 business days.	Significantly lengthens the eviction process, increasing lost rental income and legal fees for the borrower.
Illinois (Public Act 103-0831)	Landlord Retaliation Act establishes a one-year rebuttable presumption of retaliation.	Heightens the risk of litigation and increases the complexity of non-renewal and rent increase decisions.

Evolving foreclosure and workout regulations in various jurisdictions.

The current CRE debt cycle, marked by a massive maturity wall-with over $950 billion in commercial loans maturing in 2025-is driving a surge in loan modifications and workouts. Regulators are responding by scrutinizing these processes for fairness, especially as more loans, like GPMT's $196 million in nonaccrual loans, require resolution.

The trend is towards mandated mediation and enhanced borrower protection, making the foreclosure process a last resort and a longer, more expensive path. You must anticipate that any resolution of a non-performing loan will require more creative restructuring solutions and a longer timeline than in the past, increasing the legal and administrative costs per workout.

Clarity needed on new accounting standards for troubled debt restructurings.

The clarity you sought on Troubled Debt Restructurings (TDRs) has largely been provided by the Financial Accounting Standards Board (FASB). With the adoption of the Current Expected Credit Losses (CECL) model, FASB Accounting Standards Update (ASU) 2022-02 eliminated the TDR recognition and measurement guidance for creditors.

What this means is the old, complex TDR accounting is gone. But, it's replaced with something else: enhanced, detailed disclosure requirements for loan modifications made to financially distressed borrowers. This is a shift from complex measurement to transparent reporting. GPMT, which reported a total CECL reserve of $133.6 million (or 7.4% of total loan commitments) as of Q3 2025, must now focus its legal and accounting teams on providing granular detail on these modifications in its financial statements.

The new legal and accounting focus areas are:

• Disclosing the types of modifications granted (e.g., interest rate concessions, term extensions).
• Reporting the volume of modified loans and their post-modification performance.
• Providing vintage disclosures (gross write-offs by year of origination) for public business entities.

The new rules don't reduce the need for legal review; they just change the compliance focus to disclosure. Finance: draft a new disclosure template for distressed loan modifications by the end of Q4 2025.

Granite Point Mortgage Trust Inc. (GPMT) - PESTLE Analysis: Environmental factors

Growing pressure from investors for GPMT to report on portfolio-wide carbon emissions.

You are defintely seeing the shift from investors demanding simple Environmental, Social, and Governance (ESG) talk to requiring hard, auditable data, especially on financed emissions. For a commercial real estate finance company like Granite Point Mortgage Trust Inc., the pressure is on reporting Scope 3 emissions-the carbon footprint of the properties in your $1.8 billion loan portfolio-not just your office operations.

Granite Point Mortgage Trust Inc. already reports its modest operational footprint: 2024 estimated Scope 1 emissions were 0 metric tons of CO2 equivalents and Scope 2 emissions were just 70.3 metric tons of CO2 equivalents. But what the market is asking for now is the carbon intensity per square foot of the collateral securing your loans. This data is critical for large institutional investors like BlackRock who are increasingly mandated to align their holdings with net-zero targets.

The lack of portfolio-wide data creates a perception of unmanaged transition risk, which can lead to a higher cost of capital. You need to start modeling this now. It's not about being green; it's about managing risk exposure across your loan book.

Increased insurance costs for properties in climate-vulnerable areas.

The physical risk from climate change is no longer a long-term problem; it's a near-term cost on your borrowers' operating statements, directly impacting their debt service coverage ratio (DSCR). The U.S. alone saw $126 billion in economic losses from natural catastrophes in the first half of 2025, a costly record.

Across the U.S., commercial real estate premiums have soared 88% over the last five years, and this is accelerating in high-risk zones. Deloitte projects the average monthly cost of insurance for a commercial building will jump from US$2,726 in 2023 to US$4,890 by 2030, an 8.7% Compound Annual Growth Rate (CAGR). This is a massive, unexpected expense for borrowers, increasing the likelihood of loan default and collateral value impairment for Granite Point Mortgage Trust Inc.

Here is the projected cost pressure on your collateral, which directly affects the loan-to-value (LTV) ratio of your $1.8 billion portfolio:

Metric	2023 Average Monthly Cost	2030 Projected Monthly Cost (National Avg.)	2030 Projected Monthly Cost (High-Risk States)
Commercial Building Insurance	US$2,726	US$4,890 (8.7% CAGR)	US$6,062 (10.2% CAGR)

Need for capital expenditure to upgrade properties to meet new energy efficiency standards.

New municipal and state energy efficiency standards, like New York City's Local Law 97, are forcing building owners-your borrowers-to undertake significant capital expenditure (CapEx) or face heavy fines. This CapEx requirement is a hidden risk to your loan collateral. The utility sector's planned CapEx in the US is projected to hit $202 billion in 2025, a clear signal of the scale of infrastructure upgrades required, which will trickle down to property owners.

For a borrower, this mandatory CapEx can strain liquidity and reduce the property's net operating income (NOI) in the near term, which is the cash flow that services your debt. Granite Point Mortgage Trust Inc. notes that many of its financed properties' business plans include renovations with a focus on climate and energy usage. This is a double-edged sword: it improves the asset long-term but raises the immediate execution risk on the loan.

• Mandatory CapEx lowers borrower cash flow.
• Unfunded CapEx risks large regulatory fines.
• Fines or CapEx directly impair collateral value.

Focus on Green Bond issuance as a new funding opportunity.

While Granite Point Mortgage Trust Inc. has not yet issued a Green Bond in 2025, the market opportunity is significant and growing, offering a potential lower cost of funds (the 'greenium'). The global Green Bond market size is estimated at between US$526.8 billion and US$673.12 billion in 2025.

For a mortgage REIT, the most relevant segment is the rise in asset-backed issuance, such as green mortgage-backed securities, which directly aligns with your senior floating-rate commercial mortgage loan portfolio. Issuing a Green Bond would allow you to tap into dedicated pools of ESG capital, which are less sensitive to general market volatility.

To be fair, the U.S. share of global Green Bond issuance has seen a decline to 8.5%, with year-to-date USD-denominated issuance slowing to $60.6 billion through July 2025, but the underlying demand for high-quality, green collateral remains strong. This is a strategic opportunity to diversify your funding mix beyond secured credit facilities and repurchase agreements.

What this estimate hides is the specific impact of GPMT's current loan book composition-say, if their office exposure is significantly higher than the industry average. Still, the macro forces are clear. The economic block is the primary driver of near-term risk.

Next step: Finance: Draft a detailed sensitivity analysis on the 2026 loan maturity schedule by Friday, modeling a 100-basis-point increase in the Secured Overnight Financing Rate (SOFR).