Interest expense includes costs related to $2.3 billion of non-recourse long-term notes issued by the three CDOs that are consolidated on the Company’s balance sheet. Interest expense was $19.7 million for the three months ended September 30, 2012, compared to $20.2 million for the three months ended June 30, 2012.Management, general and administrative expenses were $17.1 million for the three months ended September 30, 2012, as compared to $11.9 million in the prior quarter. The increase in management, general and administrative expenses is primarily attributable a $5.4 million reserve recorded for estimated litigation contingencies. Management, general and administrative expenses also includes one-time increases in salaries and benefits expense of approximately $1.3 million which include payments to former executives pursuant to the expiration of employment contracts and the payment of signing bonuses for a new management team effective July 1, 2012. In addition, management, general and administrative expense includes approximately $1.9 million of protective advances related to loan and other lending investments within our CDOs, and additional professional fees and other loan enforcement costs for the pending foreclosure of the LVH Hotel and Casino by the Company’s CDOs. Loan enforcement costs for assets financed in our CDOs are typically advanced by the Company and reimbursed as servicing advances once the loan is resolved. The amount owed from the CDOs to the Company for such advances is approximately $10.2 million as of September 30, 2012.
Gramercy Capital Corp. Reports Third Quarter 2012 Financial Results
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