Terms

Series

6.50% Series A Cumulative Redeemable Preferred Stock

Liquidation Preference

$25.00

Coupon Rate

6.5%

Rate Type

Fixed

Annual Dividend

$1.62

Payment Frequency

Quarterly

Cumulative

Yes

Perpetual

Yes

Convertible

Yes

Callable

Yes

First Call Date

April 16, 2026

First Call Price

$25.00

Redemption Notice Period

30 days

Capital Stack Ranking

Junior To: All Existing And Future Indebtedness, Any Class Or Series Of Capital Stock Expressly Designated As Ranking Senior To Series A Preferred Stock As To Dividend Rights And Liquidation; Pari Passu With: Any Parity Stock Expressly Designated As Ranking On Parity With Series A Preferred Stock; Senior To: Common Stock, Any Junior Stock Expressly Designated As Ranking Junior To Series A Preferred Stock

Regulatory (Basel III) Call

No

Tax Classification

Reit Passthrough

Qualifies for QDI

No

Qualifies for DRD

No

Prospectus Summary

KKR Real Estate Finance Trust Inc. (NYSE: KREF), a commercial real estate mortgage REIT externally managed by an affiliate of KKR & Co., is offering shares of its 6.50% Series A Cumulative Redeemable Preferred Stock at a $25.00 liquidation preference, paying $1.625 per share annually ($0.40625 per quarter) on or about March 15, June 15, September 15, and December 15. The Series A Preferred Stock is perpetual with no stated maturity date and is callable at par on or after April 16, 2026. Dividends are cumulative — meaning that any unpaid dividends accrue and must be paid in full before any distributions can be made on common or junior stock, providing meaningful downside protection to income investors relative to non-cumulative structures. The Series A Preferred Stock sits above KREF's common stock and any junior equity in the capital stack, but is subordinate to all existing and future debt obligations of the company — including the $350 million Term Loan B due 2027 and any other senior indebtedness. As a holding company issuer without a regulated bank subsidiary, there is no bank-specific structural subordination, but all creditor claims take priority over preferred holders in a liquidation. There is no Tier 1 regulatory capital call provision; however, KREF retains a special optional redemption right to call the preferred within 120 days of a Change of Control at $25.00 per share. If a Change of Control occurs and KREF does not redeem, holders may (beginning April 16, 2022) convert into common stock at the lesser of liquidation value divided by the common stock price or a cap of 2.6427 shares of common per preferred share. At par, the Series A Preferred Stock yields 6.50% annually. Because KREF is a REIT, dividends are generally taxed as ordinary income rather than qualifying for the preferential 15%/20% qualified dividend income (QDI) rate available to most corporate equity dividends; a portion may be characterized as return of capital, which defers taxation but reduces cost basis. Dividends are paid quarterly on or about the 15th of March, June, September, and December, with record dates set by the board between 10 and 90 days prior to each payment date. The dividend stopper provision means that if any Series A cumulative dividend arrearages exist, KREF is prohibited from paying dividends on or repurchasing its common stock or parity preferred, aligning management's incentives to keep preferred dividends current.

Summarized from the SEC prospectus filing.

Distribution History

Conversion Terms

Ranking vs. Other Preferreds

Dividend Stopper Provisions

Dividend Stopper Description

If KREF has not paid all accumulated Series A Preferred dividends, it may not pay dividends on or repurchase common stock or any parity preferred stock, except in limited circumstances such as stock-settled distributions or incentive plan repurchases.

Div Score Breakdown

Reinvesty's multi-factor safety analysis for this preferred, composite score: 36 (Weak)