INVESTOR RELATIONS

IR Menu

ESG

Our commitment to sound governance, environmental stewardship, and social responsibility within our teams and communities is at the heart of our corporate mission, business strategy, and ESG focus areas.

“At Ladder, we look beyond the hallways we pass through every day, and we strive to succeed, not just financially, but also in being positive corporate citizens.” – Brian Harris, CEO

Our ESG Strategy and 2021 Highlights -

Ladder Capital Corp (Ladder or the Company) believes that the proactive development and oversight of the environmental, social, and governance (ESG) factors that matter most to our business are essential to long-term value creation for our shareholders, employees, clients, communities, and other stakeholders.

We evaluate our business operations and investment portfolio on an ongoing basis, guided by our commitment to execute the strategic ESG focus areas critical to our long-term business success. In 2021, we continued our progress in each area, as noted below:

Our ESG Strategy	2021 Highlights
Our Governance Principles
Accountability Integrity Risk Management	Appointed Head of ESG and expanded ESG disclosure based on data as of December 31, 2021 Executive Team and Board fully aligned with shareholder interests, collectively owning over $150 million in LADR stock (over 10% of the market capitalization) 100% of employees completed legal and compliance, anti-discrimination, and cybersecurity training requirements Over 99% collection rate of loan portfolio interest payments and tenant rents across our loan and real estate investments, illustrating our credit risk management Proven track record with < 0.1% in losses across all investments originated since inception Achieved an upgrade from S&P on our senior unsecured bonds and removed from negative watch by all three rating agencies in June 2021
Our People
Diversity, Equity, and Inclusion Talent Recruitment, Development, and Advancement Collaborative Culture Competitive Compensation and Benefits Employee Health and Safety	40% of our Executive Team is comprised of women, more than 20% of employees identify as female, and 50% of those are currently at Director+ level, including our President who also serves on our board 26% of employees were promoted in 2021 Hosted company-wide town halls and fireside chats and sponsored outdoor and virtual employee events to preserve culture of collaboration and togetherness during another pandemic year January 2022 employee survey had an 89% participation rate; 95% of respondents were enthusiastic about working at Ladder Ladder reimburses employees for up to 90% of medical premiums and fully covers dental, vision and other premiums Remote and hybrid work options during COVID-19 pandemic
Our Communities
Community Development Access and Affordability Property Improvements	Formalized affordability metrics for our multifamily, manufactured housing, and mobile home (collectively, “multifamily”) investments With an average loan size of $23 million, we provide mortgage loans to fit the needs of smaller enterprises and local property owners We have 58 multifamily investments. Using HUD’s income categories, by loan count, 48% of these investments include affordable housing for low-income families, with over half (26%) for very low-income families By property count, 91% of the properties in our real estate portfolio are leased to necessity-based businesses such as pharmacies and grocery stores that remained open throughout the COVID-19 pandemic The vast majority (89% by loan count) of Ladder’s balance sheet loans have provided necessary capital to enhance and upgrade properties
Our Planet
Environmental Investment Risk Management Resiliency Responsible Consumption	Environmental risk assessment completed for all new loans and real estate investments, reviewed by specialized environmental counsel Helped office campus tenant facilitate a $150 million tenant-funded retrofit to meet LEED Gold’s energy standards and Fitwel certifications Our geographic diversity helped limit the impact of 2021 named storms and natural disasters on our real estate and loan collateral properties Per January 2022 employee survey, 93% of respondents indicated they commute via public or alternative transportation (walking or biking)

ESG Oversight

While the full Board of Directors (Board) has ultimate responsibility for ESG matters that impact our business, the Nominating and Corporate Governance Committee (NCGC) exercises primary Board oversight of ESG risk management, strategy, initiatives, and policies, in accordance with its charter. Our ESG Committee of cross-functional leaders, including our newly-appointed Head of ESG, drives our ESG strategy development and implementation. It is led by our Chief Administrative Officer and General Counsel (CAO), who has primary responsibility for Ladder's corporate governance, capital markets activities, public relations, legal and compliance work, human resources (HR), and risk management. The ESG Committee provides periodic updates to the Board, NCGC, and Executive Team to keep them informed of, and to collaborate on, initiatives and progress within our ESG focus areas.

About This Disclosure

Our ESG Committee developed, and the Nominating and Corporate Governance Committee of the Board approved, our corporate ESG strategy. The core focus areas of our ESG strategy were informed by, and selected to align our disclosures with, the Sustainability Accounting Standards Board (SASB) framework and the United Nations Sustainable Development Goals (SDGs). For more information, please see Frameworks and Standards below.

Our Governance Principles +

Accountability

Shareholder Alignment

Ladder distinguishes itself from its peers by our high insider ownership and internally managed structure. Our Executive Team and Board collectively own over $150 million in LADR stock (over 10% of the market capitalization) as of December 31, 2021. In addition, Ladder's portfolio is managed internally by its employees. This framework enables us to avoid conflicts of interest and align our priorities and day-to-day decision-making with the best interests and priorities of our long-term shareholders.

Integrity

Business Ethics and Compliance

Our Code of Ethics (Code) establishes the importance of exercising sound, ethical judgment and provides our employees with a framework for making ethical business decisions. Each employee must conduct business with integrity, in compliance with all applicable laws, and in a manner that excludes consideration of personal advantage. The Code requires that our business-related conduct both inside and outside the Company is guided by the following values:

Promote and maintain integrity in all dealings
Create long-term shareholder value
Respect people and create a positive culture for teamwork
Encourage responsible, results-oriented performance
Recognize and respect our fiduciary obligation to our shareholders
Consider environmental, social, and governance best practices

Our Chief Compliance Officer, Senior Regulatory Counsel and Head of ESG (CCO) are responsible for ensuring that our Compliance Program adequately addresses applicable risks and identifies and addresses violations. Our CCO annually evaluates our Compliance Program and recommends changes for approval by our Audit Committee. We have also adopted a Code of Ethics for Senior Financial Officers that relates primarily to ethical accounting and financial reporting matters and is also reviewed and attested to annually by senior financial officers along with the Code. For more information, please see the Governance Library.

Compliance Program and Employee Certifications

Upon hire and annually thereafter, all employees must listen to, participate in, and attest to annual training and must acknowledge that they have received, read, understood, and agree to comply with the corporate policies and procedures. Our Compliance Program includes, but is not limited to, the following ethics topics, corporate policies, and procedures:

Code of Ethics and Personal Trading Policy (and Code of Ethics for senior financial officers, as applicable)
Insider Trading Policy
Information Technology (IT) Policies and Procedures
Anti-Bribery and Anti-Corruption Policies
Anti-Money Laundering Policy and Office of Foreign Asset Control (OFAC) Program
Political contributions, political activities, and public positions
Gifts and entertainment

As a registered investment adviser, all employees must also complete quarterly brokerage account holdings and transaction certifications.

In 2021, 100% of our employees completed the required training, certifications, and attestations.

Transparency and Fair Dealing

We endeavor to be transparent, clear, and fair in our pricing practices and processes. Our Origination Team aims to cultivate long-term relationships with key direct clients and leading mortgage and investment-sales brokers nationwide. In 2021, approximately 30% of our loan originations were made to repeat Ladder clients, reflecting the value of our franchise and the strength of our client relationships. Our Asset Management Team maintains regular, direct dialogue with our clients and partners, aiming to ensure responsible and fair treatment of all parties while also managing for timely completion of business plans and full required payments. Our Head of Asset Management, a co-founder and member of the Executive Team, demonstrates our commitment to ensure and emphasizes the importance of the fair treatment of clients and partners and our dedication to the highest level of risk management.

In addition, Ladder is committed to being open and informative with our shareholders and bondholders. Our CEO, President, Investor Relations Team, and Board regularly engage with our shareholders and bondholders throughout the year via email, quarterly earnings calls, financial reports, one-on-one meetings and phone calls, debt and equity investor conferences, our Investor Relations website, and our annual shareholder meeting. Among other informational items, our Investor Relations website includes an introductory overview presentation as well as presentations that provide detailed supplemental earnings data in an easy-to-read format. Our CCO reviews and approves all marketing materials and the CAO, CCO, and, as applicable, external counsel review all investor relations disclosures.

Whistleblower Protection Policy

We maintain a Whistleblower Protection Policy that includes procedures for receiving and investigating complaints by the CCO and Audit Committee as well as assuring the confidentiality and protection of whistleblowers. We have an anonymous phone line and web-based reporting system that permits employees to report in good faith any potential unethical business practices or misconduct, including questionable accounting or audit matters, without fear of retaliation. For more information, please see the Governance Library page of our Investor Relations website.

Government Relations and Advocacy

We maintain policies regarding political contributions as well as gifts and entertainment intended to prevent any actual or perceived conflict of interest or pay-to-play practices with political contributions to state and local officials who may have influence over the awarding of government and public business to financial services providers. Ladder does not make political contributions as a company. As one of our subsidiaries is a registered investment adviser, employee political contributions are limited to pre-cleared federal contributions while state and local political contributions are prohibited. The Executive Team did not make any political contributions in 2021. Annual training on these policies is part of our Compliance Program, and we also send regular email reminders to all employees.

Risk Management

Board Oversight and Risk Management

One of the key functions of the Board is informed oversight of our risk management process. The Chairperson and non-executive members of the Board work together to provide strong, independent oversight of the Company's management and affairs through its standing committees and sessions of the independent directors. Our Executive Team attends Board meetings and is available to address any questions or concerns raised by the Board on risk management and any other matters. In particular, the Board is responsible for monitoring and assessing strategic risk exposure, and our Audit Committee considers and discusses our major financial risk exposures and the steps our Executive Team has taken to monitor and control these exposures. Our Risk and Underwriting Committee assesses and monitors our risk management strategies including, but not limited to, those designed to mitigate credit, interest rate, liquidity, and counterparty risk and investments of material size. The Risk and Underwriting Committee reviews quarterly reports regarding topics such as interest rate risk, counterparty risk, and corporate covenant compliance. Each Board committee's charter outlines its responsibilities related to our risk management process.

Credit Risk Management

We operate a multicylinder platform with a core competency in commercial real estate credit underwriting and invest in three complementary, synergistic products – commercial real estate loans, properties, and securities. Our multicylinder model enables us to pivot and quickly adjust our product mix to target the most favorable risk-adjusted return according to market conditions.

At Ladder, every employee is responsible for mitigating risk. Our risk management processes encompass the active involvement of the Executive Team and department heads, supported by our underlying policies and procedures. We hold regular meetings on the loan origination pipeline, financing, liquidity, and quarterly asset management. We have a proven track record with less than 0.1% in losses across all investments originated since inception in 2008.

Ladder employs a system of checks and balances throughout our investment and risk management process by maintaining separate Origination, Credit/Underwriting, Transaction Management, Investment Committee, and Asset Management teams and functions:

Our Comprehensive Investment and Risk Management

Origination. Our rigorous investment process begins with the filtering and selecting of potential investments by the Origination Team, with a preference for senior secured mortgage loans to finance new acquisitions that have recent valuations and newly capitalized business plans with additional funds from the sponsor. Originator compensation, which at increasing levels of seniority includes increasing proportions of restricted stock, is linked to investment performance, aligning our interests with those of our shareholders. The Origination Team conducts an initial due diligence review prior to proposing an investment to members of our Investment Committee for application and further diligence.

Credit/Underwriting. Once the Investment Committee approves the further processing of an investment, it undergoes a comprehensive legal and independent underwriting process. An underwriter who is independent from the Origination Team leads the due diligence and credit review using a checklist-based approach. Our systematic credit evaluation includes stress analyses, a site tour for each property (almost exclusively conducted by Ladder personnel), and third-party due diligence (including appraisal, environmental, and engineering reports) for each prospective loan and/or real estate investment.

Transaction Management. Our highly experienced, independent team of Transaction Management attorneys leads legal diligence review, legal document negotiation, and closings.

Investment Committee. The process culminates in the delivery of a comprehensive investment memorandum to our Investment Committee, which includes our CEO, President, Chief Credit Officer, and Head of Underwriting, who meet to approve or disapprove each prospective investment. Investment Committee members all have significant stock in the Company and are well aligned with the long-term interests of our shareholders in their decision-making. Every loan and real estate investment undergoes the same Investment Committee process and memorandum delivery regardless of size. Each meeting generally has at least one representative from each of the Origination, Underwriting, Transaction Management, Asset Management, and Finance teams. Approval from the Board's Risk and Underwriting Committee is required for proposed investments of a material size or outside the Company's ordinary course of business.

Asset Management. Our in-house Asset Management Team, led by the Head of Asset Management who is also a co-founder and member of the Executive Team, proactively manages the Company's investment portfolio, demonstrating our company-wide emphasis on principal preservation and asset performance. The Asset Management Team, together with our Underwriting Team, retains all decision-making on, and monitors the credit performance of, our investment portfolio in concert with our third-party servicers and property managers. Collectively, they work closely with clients and/or joint-venture partners to manage all of our positions; monitor the financial performance of our assets and collateral assets, including the timely execution of business plans; monitor daily activities within our portfolio; and provide real-time responses to weather-related events affecting properties. Ladder performs detailed asset reviews, endeavors to perform periodic site inspections on every investment, and provides comprehensive internal asset-level performance reporting. For more information, please see our latest Form 10-K on the Annual Reports page of our Investor Relations website.

Financing Risk Management

We remain committed to a conservative financial management approach that provides a sustainable capital structure for our business and minimizes liquidity risks. Unsecured bonds and non-recourse, non-mark-to-market funding sources continue to be cornerstones of our capital structure, and our 2021 offerings in both markets have further solidified and lengthened our liability structure while reducing our usage of mark-to-market financing. We have staggered our debt maturities to reduce refinancing risk, adopted a conservative dividend policy, and maintain low overall leverage.

We selectively utilize secured financing from a diverse set of trusted counterparties with whom we have longstanding relationships. All lending counterparties are rated no less than A- (or equivalent) from a nationally recognized credit rating service or are approved by the CEO. We are committed to being transparent with our lending counterparties and provide asset-level and corporate-level reporting on a regular basis.

In 2021, we achieved an upgrade from S&P on our senior unsecured bond rating and were removed from negative watch by all three rating agencies.

Data Security and Customer Privacy

We maintain a best practices, risk-based approach to cybersecurity with oversight by our Cybersecurity Team including the CAO, CCO, Chief Financial Officer, Head of Asset Management, Ladder's dedicated on-site IT consultant, and senior leaders from our outsourced IT firm. The Cybersecurity Team monitors technology trends and developments to inform improvements and adjustments to Ladder's technology, oversees the Company's various cybersecurity training initiatives, and, at least annually, performs a formal evaluation of the Company's cyber risks and mitigants. The Cybersecurity Team is in regular dialogue with the Audit Committee, which oversees cybersecurity on behalf of our Board.

At hire and annually thereafter, all employees participate in cybersecurity training and certify to our comprehensive IT policies and procedures. In 2021, 100% of our employees completed the required training and certifications.

We maintain a broad assortment of cybersecurity protocols, including:

Multifactor authentication
Managed security service monitoring
Annual penetration testing by a rotating third-party vendor
Quarterly vulnerability scans
Quarterly phishing exercises
Annual tabletop exercises
Annual vendor cybersecurity diligence
Cyber insurance and other relevant insurance policies

As a commercial real estate lender, we do not offer, and personally identifiable information (PII) is not obtained in connection with, financial products or services used primarily for personal, family, or household purposes. We have implemented and enforce our privacy procedures to protect PII in order to safeguard any PII that is provided for other purposes (e.g., employee onboarding or commercial real estate loan due diligence) and to comply with state privacy laws such as the California Consumer Privacy Act (CCPA). Such procedures include, but are not limited to, document removal and destruction.

We have not had a cybersecurity breach or loss of PII in our eight years as a public company.

Business Continuity

We maintain a Business Continuity and Disaster Recovery Plan, Pandemic Preparedness Plan, Model Airborne Infectious Disease Exposure Prevention Plan (under the NY HERO Act), and Security Incident Response Plan — together, our Business Continuity Plan (BCP) — to provide an appropriate response to emergency situations, protect our employees, minimize disruptions to client services, and protect Company and investor assets. We internally audit, test, analyze, and modify our BCP every year.

Supply Chain Management

Our vendors are primarily in the financial services and real estate industries. In accordance with our Anti-Money Laundering Policy and OFAC Program, Ladder seeks to conduct due diligence prior to engaging any vendor. Ladder conducts further due diligence prior to retaining third-party service providers that have access to PII or are otherwise critical to Ladder's business operations and annually thereafter. These due diligence questionnaires are reviewed by Ladder's outsourced IT firm and by specialized IT counsel as needed. Ladder maintains all documentation associated with this due diligence process and includes customized cybersecurity contract requirements based on the vendor's access to Ladder's confidential and/or personal non-public information. Key vendors with access to such information are required to provide their insider trading policies to our CCO for review and to certify compliance with such policies annually.

Furthermore, Ladder has policies in place led by the CCO to prevent conflicts of interest in vendor selection, further maintaining alignment with our shareholders' interests.

Throughout the COVID-19 pandemic, Ladder has remained in regular contact with our key vendors to ensure continuity of service.

Borrower Due Diligence

Ladder performs comprehensive due diligence on borrowers and certain related parties, including sponsors and guarantors. This diligence typically includes searches of court records; Uniform Commercial Code filings; state and federal tax liens; past and present litigation and judgments, bankruptcies, and foreclosures; OFAC records; criminal records; and news searches.

We expect this diligence to identify, in the jurisdictions we search, past and present claims of illegal activities and adverse human rights impacts such as claims of discrimination or harassment, wage or labor violations, or the illegal or unethical treatment of tenants (including through improper property maintenance). If such items are found, we typically require the searched party to explain the circumstances and remediation before proceeding with the loan. In this way, Ladder strives to mitigate adverse human rights impacts that are directly linked to our business operations through a business relationship, even if Ladder does not directly contribute to those impacts.

Ladder also performs a detailed tenant analysis and lease review on every investment, enabling us to identify tenants whose activities may pose a legal or reputational risk to the Company.

Our People +

Our tone at the top promotes a culture of transparency, accountability, and ethical behavior. As a firm with just 65 employees as of December 31, 2021, Ladder's flat management structure and open-door policy provide all employees with daily access to our Executive Team. We strive to create an environment where employees are comfortable asking questions and raising concerns. With our casual attire policy, we also believe that when employees are physically comfortable, they may be more relaxed in interactions with one another, leading to better teamwork, increased productivity, improved morale, and less stress.

The Board maintains oversight of human capital management and corporate culture and gains insight at regular Board and committee meetings about specific human resources (HR) initiatives, including talent engagement, attraction, and retention.

Diversity, Equity, and Inclusion

A diverse workplace benefits from a variety of experiences and points of view. We are committed to creating a workspace that incorporates diversity, equity, and inclusion (DEI) and ensures that all individuals are treated with mutual respect and dignity. All levels of personnel are held accountable for contributing to a professional atmosphere that promotes equal opportunity and nondiscriminatory practices. Our DEI efforts are overseen by HR, which reports to our CAO.

We are an equal opportunity employer and do not discriminate against any candidate or employee on the basis of race, national origin, marital status, gender or sexual orientation, age, disability, religion, or veteran status. We do not tolerate harassment, discriminatory behavior, or any kind of retaliation for reporting suspected misconduct. In keeping with this commitment, we maintain an anti-discrimination, harassment, and retaliation policy that is reviewed and updated at least annually by HR, our CCO, and our CAO. We conduct annual anti-discrimination and anti-harassment employee training.100% of our employees completed our 2021 training. In our January 2022 anonymous employee survey, 100% of respondents agreed that discrimination is not tolerated at Ladder. The survey had an 89% participation rate.

Workforce Diversity

We assess diversity information as part of a broader effort to identify areas of continuous improvement to ensure that we are building and retaining a diverse workforce. We analyze this data to determine how best to attract and develop a pipeline of diverse and qualified candidates and promote an inclusive, anti-discriminatory environment of belonging that ensures equal access to opportunities.

With two female co-founders, gender diversity and equality have always been important to Ladder. As of December 31, 2021, 40% of our Executive Team is comprised of females. Over 20% of employees identify as females, and 50% of female employees are currently at the Director+ level, including our President, CAO, CCO, Controller, and Tax Director. One of our employees at the Director+ level identifies as LGBTQ+.

As of December 31, 2021, 63% of Ladder's employees identified as white, 8% indicated they are non-white, and 29% declined to disclose their race. We are in the process of evaluating how best to gather additional information to assess current and developing ethnic diversity metrics.

Ladder seeks employees who want to grow and learn with us. Over the last few years, we have gradually increased the diversity of our workforce with younger talent while maintaining a seasoned bench. As of December 31, 2021, one-third of our employees are under age 30, one-third are ages 30–39, and one-third are age 40 and over.

Talent Recruitment, Development, and Advancement

Attracting Talent

Our broad recruitment strategy is not limited to a pre-defined set of educational or work experiences. As stated above, we seek employees who want to grow and learn with us. We develop employees internally and seek internal candidates for promotions prior to hiring from the outside.

Our paid summer internship program provides our interns with exposure to all parts of our loan origination and closing process, with biweekly rotations through our Origination, Credit/Underwriting, Transaction Management, and Asset Management Teams. Previous interns have provided very positive feedback about the program, and several are now full-time employees. We also partner with St. John's University School of Law, providing chosen externs per semester with the opportunity to earn school credit via training experiences with our Legal and Compliance and Transaction Management Teams.

Contemporaneous Feedback

Ladder believes that our most important asset is our employees. We encourage an open dialogue and feedback between managers and other employees to allow for continued success. Our corporate culture encourages contemporaneous feedback to enable employees to refine their skills and expertise with each project. We believe that it is in the best interest of our employees to receive real-time feedback from their managers and direct guidance for professional development. All managers are trained on how to deliver effective and candid feedback to employees.

We also support our employees' mental health and aim to create an environment that provides for work-life balance. We encourage employees to be open with their managers about their workload, prioritization of projects, hours, and goals for advancement.

Talent Training, Development, and Advancement

Ladder is a dynamic company distinguished by the talent and dedication of our team. We hire for the long term and invest in professional and personal development, with an organizational structure that drives employee engagement. We reimburse employees for professional licenses, memberships, and subscriptions as well as training programs, conferences, and classes. Employees are encouraged to participate in cross-functional team projects to develop comprehensive business knowledge. We incorporate professional development into our ongoing performance discussions and goal-setting for each employee.

All employees receive at hire, and annually thereafter, training on anti-harassment and anti-discrimination, cybersecurity, and legal and compliance. At hire, employees also receive workplace success training, and we hold regular informational sessions, from market trends to department overviews to better define employee roles and responsibilities.

We seek to promote from within, developing a deep bench of experienced professionals ready to grow into more senior roles. Our department heads average over 10 years of tenure at Ladder, with the majority having been promoted to additional roles with increasing responsibilities over the years.

Our employee promotion process seeks to ensure opportunities for internal advancement and mobility and provides a mechanism whereby employees can be recognized and rewarded for successful performance and professional development. 26% of Ladder employees were promoted in 2021.

Collaborative Culture

At Ladder, we like to collaborate. We work in both formal and ad hoc teams and, to encourage the free flow of thoughts and information, use an open-floor seating plan in the office. We have a flat management structure and an open-door policy and take pride in helping train the Company's future generations of leaders. When people join the Ladder family, we seek to take steps to ensure that new hires understand and feel comfortable in our workforce environment, which is based upon our Four Rs:

Employee Teambuilding

Ladder's CEO and President host town hall and fireside chat meetings to provide a forum for direct engagement with our employees and senior leadership. Ladder also sponsors both formal and informal after-work teambuilding events, ranging from cocktail hours to paintball games to virtual movie nights. At least annually, we distribute corporate gifts such as reusable tumblers, tote bags, and fleeces.

We offer various programs to develop and build field expertise and leadership skills. Our mentoring program pairs junior employees with senior employees in other departments to foster cross-departmental connections and allow junior employees to expand their industry knowledge beyond their respective teams. In addition to being available to answer any questions and provide guidance in the office, mentors are asked to take their mentees to lunch or dinner periodically. HR actively monitors the program and encourages feedback to ensure a valuable experience for all participants.

Unique to the Company is our Ladder Climbers Program enables our junior staff to bond together and develop leadership skills. Managed by the junior employees, participating Climbers engage in after-work activities, on-site learning, and informational sessions.

Retaining Talent

We believe our strong corporate culture, opportunities for advancement, and competitive compensation and benefits make Ladder a desirable place to work. The average tenure for all employees was nearly six years as of December 31, 2021, and that includes our 17 new hires during the year. In fact, over 40% of employees have been with Ladder for more than seven years, and over 20% have been with Ladder for more than 10 years. We provide severance pay for involuntary terminations and conduct exit interviews for every employee departure to understand the reasons and to determine ways we can improve employee retention and our working environment and culture going forward.

We use anonymous employee experience surveys to solicit real-time feedback on topics such as job satisfaction and employee activities. Our January 2022 employee survey had an 89% participation rate. 95% of respondents were enthusiastic about working at Ladder, with 98% agreeing that Ladder provides opportunities for learning and development. 91% of respondents felt comfortable raising issues with their managers. We use the information from these surveys to guide management engagement, decision-making, and strategy.

Competitive Compensation and Benefits

Our compensation program attracts and rewards talented individuals with the skills necessary to support our business objectives and create long-term value for our shareholders. We offer competitive pay at all levels — including base salaries, annual incentive awards, and stock awards — and frequently evaluate industry pay practices, including by the Board’s compensation consultant. The Company does not inquire about applicants’ prior wages, benefits, bonuses, or other compensation (together, the salary history) when determining whether to hire or what amount of compensation to offer.

All employees are compensated based on Ladder’s profitability, and we grant stock awards with both time- and performance-based vesting components to promote employee retention and alignment. The stock awards that vest based on Company performance further align employee interests with long-term shareholder value creation.

We offer a comprehensive benefits package, including corporate payment of up to 90% of the premiums for our standard medical plan and 100% of the premiums for dental, vision, disability and life insurance for full-time employees and their families.

Our benefits program provides the following:

Both in-network and out-of-network medical and prescription coverage
Mental health, gender transition, and fertility services
Critical illness, supplemental long-term disability, and term life insurance
Flexible spending accounts, dependent care accounts, commuter benefits plan, and 401(k) retirement savings plan
Reimbursement for daily employee lunches as well as late-night meals and transportation

Ladder also provides the following paid leave:

Holidays and generous paid time off
Leave for the service of others, including blood, organ, and bone marrow donation leave and military leave
Bereavement leave
Parental leave for all employees and a private lactation room
Sick days and time off to care for family members or get a COVID-19 vaccine

Employee Health and Safety

Health and Wellness Programs

Through our healthcare provider, we offer programs designed to help improve employee health, such as reducing stress and quitting smoking. We provide discounted gym memberships and encourage healthy eating by maintaining low-calorie baked snacks in the office pantry at no cost and further employee health and wellness through in-office flu shots every year.

COVID-19

All employees began working remotely in mid-March 2020, with a limited return to the office during 2021. Ladder is very focused on the health and safety of our employees, and we continue to monitor the fluid COVID-19 situation and react in real time to federal, state, and local laws and guidance regarding remote arrangements. Further, our headquarters building installed a hospital-grade air filtration system, and, when employees began voluntarily returning to the office, we provided masks and hand sanitizer and enforced social distancing, as required.

Work-Related Hazards and Responses

We maintain internal emergency procedures for circumstances that require medical attention and/or building evacuation. Any employee with emergency training is encouraged to inform the CCO or HR and to participate in assisting in an emergency. Employees are also required to participate in any fire or other emergency drills conducted by the buildings in which their offices are located and to know where all emergency exits are located.

Our Communities +

Community Development

We facilitate community development by providing flexible and cost-effective mortgage loan financing to support the renovation, repositioning, leasing, and development of multifamily and commercial real estate throughout the country, including in low- to moderate-income communities that are typically underserved by the financing community at large. With an average loan size of $23 million as of December 31, 2021, these mortgage loans are structured to fit the needs and business plans of smaller enterprises and local property owners. In providing this financing, we seek to contribute to improvements in the quality of life for community residents, improve access to and affordability of housing, create job opportunities, and lead by example for others to consider investing in community development in the future.

Ladder ensures that all of our lending programs comply with all applicable federal and state anti-discrimination laws including the Fair Housing Act, the Equal Credit Opportunity Act, and the New York State Human Rights Law.

Access and Affordability

Housing costs continue to be a significant portion of the typical household budget, with the general rule of thumb of spending up to 30% of take-home income on housing-related expenses. Maintaining that ratio can be difficult for low-income families and especially difficult for very low-income families, which according to the Department of Housing and Urban Development's (HUD) Section 8 program are families whose incomes do not exceed 80% and 50%, respectively, of the average median income (AMI) for an area.

As of December 31, 2021, Ladder's loan portfolio was comprised 31% of multifamily, mobile home, and manufactured housing (including mixed-use properties with a multifamily component of at least 40% by square footage or income), which emphasizes access to affordable housing in secondary and tertiary markets.

We had 58 manufactured housing, mobile home, and multifamily investments in our portfolio as of December 31, 2021. Using HUD's income categorizations, by loan count, 48% of these investments include affordable housing for low-income families¹, over half (26%) of which include affordable housing for very low-income families², totaling $424.7 million and $219.8 million of carrying value of loans, respectively. 6,728 units qualify as affordable for low-income families, of which 4,616 qualify for very-low-income families.

As stabilized rent does not exceed the rent allocation (30%) for households earning 80% of AMI
As stabilized rent does not exceed the rent allocation (30%) for households earning 50% of AMI

Ladder is also aware of the potential barriers to access for necessities like food, prescriptions, and other resources caused by the COVID-19 pandemic. By property count, 155 of 170, or 91%, of our real estate portfolio are leased to necessity-based businesses such as pharmacies, dollar stores, grocery stores, and wholesale clubs and have remained open for business with stable operations throughout the COVID-19 pandemic. These properties account for $383.3 million, or 43%, of our $890.8 million real estate portfolio as of December 31, 2021.

Property Improvements

A significant portion (138 total loans; 89% by loan count) of Ladder's balance sheet loans as of December 31, 2021 have provided necessary capital to enhance and upgrade properties.

In addition, borrowers are required by their loan documents to complete certain immediate repairs and deferred maintenance to keep tenants, their visitors, and the general public safe. As part of Ladder's loan due diligence, every property undergoes a Property Condition Assessment by a licensed engineer, which includes fire and life safety systems; moisture and microbial growth; Americans with Disabilities Act (ADA) compliance; ventilation systems; property security; walkways; landscaping; and earthquake, flood, wind, and hurricane risk evaluations. Inquiries are made to the municipality regarding outstanding fire code, building code, and zoning violations.

To further ensure compliance, Ladder may require the borrower to set aside funds in a loan reserve. Certain loans also have future funding components where borrowers must complete certain requirements and/or achieve certain milestones in order for Ladder to advance up to the full loan amount for payment of the costs of those property enhancements and/or renovations.

In our loan portfolio as of December 31, 2021, we identified 26 instances where we required property owners to complete property repairs and/or enhancements to comply with the ADA, 28 instances where the sponsor was required to cure building code violations, and 168 fire and safety improvements and violation cures.

Further, buildings of a certain age are likely to house asbestos-containing materials (ACMs) and/or lead-based paint (LBP). In those instances, Ladder requires the borrower to follow an applicable Operations and Maintenance (O&M) plan of training, cleaning, work practices, and surveillance to maintain the ACM or LBP within the building in good condition until it is safely removed due to a scheduled renovation or demolition or its condition warrants removal.

Our Planet +

ENVIRONMENTAL INVESTMENT RISK MANAGEMENT

We maintain an Environmental Policy (Policy) that applies to our owned real estate and all real estate collateral securing our loans. The Policy outlines the required environmental due diligence of site assessments and environmental considerations for our owned and collateral real estate properties.

Each loan and real estate investment undergoes an environmental risk assessment by an independent environmental professional (as defined in §312.10 of 40 CFR §312 of the Environmental Protection Agency regulations), the results of which are reviewed and approved by specialized outside environmental counsel and our Credit/Underwriting Team. We select third-party environmental professionals based on their experience with conducting environmental site assessments; national recognition; and a consistent track record of providing a high-quality product that is generally well received by Ladder, other market lenders, rating agencies, and investors that rely on these reports. We maintain a list of approved consultants and a standardized template for consistent review and reporting. The environmental risk assessment includes:

Phase I Environmental Assessment and Geotechnical Report evaluates the property and its immediate surrounding area to identify any adverse environmental conditions. This evaluation includes a property site visit, review of government records, and interviews regarding past and present uses of the property to identify such potential environmental hazards as ground water pollution, polychlorinated biphenyls (PCBs), lead paint, asbestos, drinking water contaminants, and radon gas.
Phase II Environmental Assessment is required if there are any areas of concern and consists of detailed inspections and lab tests to determine compliance with local, state, and federal regulatory guidelines and recommend additional review and/or remediation.

Our transaction process also includes specific documentary provisions, such as environmental representations and warranties, covenants, indemnities, other provisions governing environmental matters in our loan documents, and the potential use of environmental insurance to ensure ongoing sponsor compliance with applicable environmental laws and the completion of any required remediation.Compliance is monitored by our Asset Management Team, and we perform periodic property site visits which include a review of environmental considerations.

Our tenants are generally required by the terms of their leases to comply with all relevant laws, including environmental laws.

RESILIENCY

Flood, Wind, and Earthquake Insurance

We perform a flood, wind, and earthquake analysis on every loan and real estate investment and hold our borrowers and ourselves accountable for proper insurance coverage. As of December 31, 2021, 26 of 155 loans (or 16.8%) are in the 100-year flood plain. By book value, $796 million of $3,553.7 million (or 22.4%) are within the 100-year flood plain.

Weather Event Tracking

Our $23 million average loan size as of December 31, 2021, provides for a granular portfolio and diversity in terms of geography and asset types. Such diversity limits the effect of any single extreme weather, named-storm, or other natural disaster event on our portfolio. Our Asset Management Team, however, is in regular communication with the borrowers, partners, property managers, and servicers of Ladder loans and real estate investments and receives real-time updates on current events that may affect the underlying properties within our investment portfolio. In the event of a severe weather event or other natural disaster, the Asset Management Team will track the event as it develops and contact the property managers for each owned property and the borrowers for each loan during and after the event to understand the possible implementation of precautions and assessment of damage, if any. The effects of severe weather events or other natural disasters on the Ladder investment portfolio, if any, are provided in a comprehensive update to the CEO, President, and Chief Credit Officer.In 2021, the Asset Management Team identified minimal damage to our owned and loan collateral properties affected by Hurricane Ida, Tropical Storm Henri, and Midwest tornadoes.

Tenant Environmental Impact Initiatives

The real estate we acquire consists primarily of properties leased on a triple-net basis. As such, in addition to taxes and insurance, the tenant is responsible for all maintenance and operational property expenses. While that limits our influence on the operation and environmental impact of those properties, many corporate parents of our tenants have publicly stated their commitment to environmental progress.

RESPONSIBLE CONSUMPTION

Our focus on sustainable operations begins with our own offices, which are all leased—or New York City headquarters and two branch offices in Miami, Florida, and Santa Monica, California. Approximately 90% of our employees work from our headquarters. Ladder endeavors to be in full compliance with environmental regulations in all locations where it has offices.

Energy Management

We currently incorporate various eco-friendly practices within our business operation store reduce our electricity usage. Examples include motion sensors for automatic light shut off and office equipment that meets energy management standards such as ENERGY STAR. We encourage our employees to use public or alternative transportation for commuting, including by offering a pre-tax commuter benefits contribution plan. In fact, in our January 2022 employee survey, 93% of respondents indicated that they use public or alternative transportation (walking or biking) in lieu of driving to work.

Waste Management

We use environmentally friendly kitchen reusables and disposables. All toilet paper, hand soap, and paper towels are certified green products, and at our headquarters our cleaning contractor only uses environmentally friendly, green products.

In our drive toward digitalization, we seek to reduce the use of paper, relying to the extent possible on electronic signatures, databases, document retention software, and cloud-based financial software.

We participate in waste recycling programs with clearly marked containers and signage disbursed throughout our New York headquarters. Our building endeavors to ensure that all recyclable material is recycled so that the only item discarded is wet trash. We also recycle broken or obsolete electronics.

Frameworks and Standards +

Our ESG Report has been informed by the accounting standards published by the Sustainability Accounting Standards Board (SASB), and we have also identified the United Nations Sustainable Development Goals (SDGs) that we believe best align with our business activities and key focus areas.

SUSTAINABILITY ACCOUNTING STANDARDS BOARD

This table incorporates accounting standards from the SASB related to Mortgage Finance (FN-MF) and Real Estate (IF-RE). It includes links to sections where specific topics are discussed.

Mortgage Finance and Real Estate
SASB Topic	Accounting Metric	SASB Code	Section in the Report
Lending Practices	(1) Number and (2) value of residential mortgages of the following types: (a) hybrid or option adjustable-rate mortgages (ARMs), (b) prepayment penalty, (c) higher rate, (d) total, by FICO scores above or below 660	FN-MF-270a.1	Not applicable. Ladder does not make residential mortgage loans.
	(1) Number and (2) value of (a) residential mortgage modifications, (b) foreclosures, and (c) short sales or deeds in lieu of foreclosure, by FICO scores above and below 660	FN-MF-270a.2
	Total amount of monetary losses as a result of legal proceedings associated with communications to customers or remuneration of loan originators	FN-MF-270a.3	$0 for fiscal year ending December 31, 2021.
	Description of remuneration structure of loan originators	FN-MF-270a.4	Our People Our Planet
Discriminatory Lending	(1) Number, (2) value, and (3) weighted average loan-to-value (LTV) ratio of mortgages issued to (a) minority and (b) all other borrowers, by FICO scores above and below 660	FN-MF-270b.1	Not applicable. Ladder's borrowers are companies.
	Total amount of monetary losses as a result of legal proceedings associated with discriminatory mortgage lending	FN-MF-270b.2	$0 for fiscal year ending December 31, 2021.
	Description of policies and procedures for ensuring nondiscriminatory mortgage origination	FN-MF-270b.3	Our Communities
Environmental Risk to Mortgaged Properties	(1) Number and (2) value of mortgage loans in 100-year flood zones	FN-MF-450a.1	Our Planet
	(1) Total expected loss and (2) loss given default (LGD) attributable to mortgage loan default and delinquency due to weather-related natural catastrophes, by geographic region	FN-MF-450a.2	$0 for fiscal year ending December 31, 2021.
	Description of how climate change and other environmental risks are incorporated into mortgage origination and underwriting	FN-MF-450a.3	Our Planet
Energy Management	Energy consumption data coverage as a percentage of total floor area, by property subsector	IF-RE-130a.1	Our Planet
	(1) Total energy consumed by portfolio area with data coverage, (2) percentage grid electricity, and (3) percentage renewable, by property subsector	IF-RE-130a.2
	Like-for-like percentage change in energy consumption for the portfolio area with data coverage, by property subsector	IF-RE-130a.3
	Percentage of eligible portfolio that (1) has an energy rating and (2) is certified to ENERGY STAR, by property subsector	IF-RE-130a.4
	Description of how building energy management considerations are integrated into property investment analysis and operational strategy	IF-RE-130a.5
Water Management	Water withdrawal data coverage as a percentage of (1) total floor area and (2) floor area in regions with high or extremely high baseline water stress, by property subsector	IF-RE-140a.1	Our Planet
	(1) Total water withdrawn by portfolio area with data coverage and (2) percentage in regions with high or extremely high baseline water stress, by property subsector	IF-RE-140a.2
	Like-for-like percentage change in water withdrawn for portfolio area with data coverage, by property subsector	IF-RE-140a.3
	Description of water management risks and discussion of strategies and practices to mitigate those risks	IF-RE-140a.4
Management of Tenant Sustainability Impacts	(1) Percentage of new leases that contain a cost recovery clause for resource efficiency-related capital improvements and (2) associated leased floor area, by property subsector	IF-RE-410a.1	Our Planet
	Percentage of tenants that are separately metered or sub metered for (1) grid electricity consumption and (2) water withdrawals, by property subsector	IF-RE-410a.2
	Discussion of approach to measuring, incentivizing, and improving sustainability impacts of tenants	IF-RE-410a.3
Climate Change Adaptation	Area of properties located in 100-year flood zones, by property subsector	IF-RE-450a.1	Our Planet
Climate Change Adaptation	Description of climate change risk exposure analysis, degree of systematic portfolio exposure, and strategies for mitigating risks	IF-RE-450a.2	Our Planet

UNITED NATIONS SUSTAINABLE DEVELOPMENT GOALS (SDGs)

The United Nations SDGs are a collaborative, global effort to achieve a better and more sustainable future for all. Represented by 17 global goals and 169 targets, the SDGs address challenges of poverty, inequality, climate change, environmental degradation, peace, and justice. We identified the key areas where we have the greatest influence and impact through our business strategy, products, and services.

Good Health and Well-Being

Achieve universal health coverage, including financial risk protection; access to quality essential healthcare services; and access to safe, effective, quality, and affordable essential medicines and vaccines for all

Our People

Gender Equality

Ensure women's full and effective participation and equal opportunities for leadership at all levels of decision-making in political, economic, and public life

Our People

Decent Work and Economic Growth

Promote sustained, inclusive, and sustainable economic growth; full and productive employment; and decent work for all

Our People

Sustainable Cities and Communities

Make cities and human settlements inclusive, safe, resilient, and sustainable

Our Communities

Responsible Consumption and Production

Ensure sustainable consumption and production patterns

Our Planet

Key Disclosures +

FORWARD-LOOKING STATEMENTS

Certain statements on this web page may constitute forward-looking statements. These statements are based on management’s current opinions, expectations, beliefs, plans, objectives, assumptions, or projections regarding future events or future results. These forward-looking statements are only predictions, not historical fact, and involve certain risks and uncertainties as well as assumptions. Actual results, levels of activity, performance, achievements, and events could differ materially from those stated, anticipated, or implied by such forward-looking statements. While Ladder believes that its assumptions are reasonable, it is very difficult to predict the impact of known factors, and, of course, it is impossible to anticipate all factors that could affect actual results, including the impact of the COVID-19 pandemic on the Company’s business. There are a number of risks and uncertainties that could cause actual results to differ materially from forward-looking statements made here in, including, most prominently, the risks discussed under the heading Risk Factors in the Company’s Annual Report on Form 10-K for the year ended December 31, 2021, as well as its consolidated financial statements, related notes, and other financial information appearing therein and its other filings with the U.S. Securities and Exchange Commission. Such forward-looking statements are made only as of the date of this release. Ladder expressly disclaims any obligation or undertaking to release any updates or revisions to any forward-looking statements contained herein to reflect any change in its expectations with regard there to or changes in events, conditions, or circumstances on which any such statement is based.

UNITED NATIONS SUSTAINABLE DEVELOPMENT GOALS

The United Nations SDGs are aspirational in nature. The analysis involved in determining whether and how certain initiatives may contribute to the SDGs is inherently subjective and dependent on a number of factors. There can be no assurance that reasonable parties will agree on a decision as to whether certain projects or investments contribute to a particular SDG. In addition, Ladder does not have full visibility into the operations of its investment portfolio. Accordingly, investors should not place undue reliance on Ladder's application of the SDGs, as such application is subject to change at any time and in Ladder’s sole discretion.

Return to Top