Jay McCanless: Okay. Any just sense around what type of nominal rate for some of these projects right now?
Ivan Kaufman: I mean our borrowing rates will be between, I would say, average between 450 and 600 over. That’s kind of where the [indiscernible]. So your unlevered returns are 11 — my estimation 11.5% unlevered without fees and without the benefit of adding multiple products to what we’re doing.
Operator: [Operator Instructions]. And our next question comes from with Jade Rahmani with KBW.
Jade Rahmani: I was definitely impressed by the very moderate increase in, I would say, the category of substandard and doubtful accounts, a very slight uptick. But overall, I wanted to ask, do you have a sense for what percentage of the balance sheet loans have been modified in recent quarters, problems dealt with? And what percentage in your view is remaining to go through some kind of modification?
Ivan Kaufman: I don’t have those numbers. I don’t have those numbers ahead of me, but I will tell you this has been a process that began 2 years ago. We got out ahead of it. We started managing loans that we thought would be requiring adjustments and changes. It’s an ongoing process. We resolved a few. We modified a few. We got a few new ones to come in. I see this trend continuing over the next 3 to 4 quarters in this elevated interest rate environment. So whether it ticks up a little bit, it should tick up a little bit, but it’s been pretty consistent.
Paul Elenio: Yes Jade, it’s Paul. I mean, it’s been fairly nominal. We’ve been pleasantly surprised the last few quarters, as Ivan said, we’re expecting continued stress. And we think over the next 2 quarters, we’ll continue to have those conversations with borrowers, but during the quarter, we only had one material modification, which we disclosed, which was that $70 million loan I mentioned in my commentary. That was a defaulted loan last quarter that we were able to restructure and get to a performing loan. That was the only material modification we had in the quarter. So as a percentage, that’s a pretty low percentage. And we’ve been fairly fortunate that those numbers have been quite low over the last few quarters. Nothing comes to mind that with a significant modification other than that item over the last few quarters, but that obviously could change in the next few quarters.
Jade Rahmani: And cumulatively reviewing CLO surveillance performance, it does seem that the percentage would be in the 15% to 20% range over not just the last 2 quarters, but maybe, say, 18 months. Does that number strike you as too high or reasonable?
Paul Elenio: I think that number is high. I have to look back. I mean, we did, as I said…
Ivan Kaufman: I think what you’re referring to is loans that may be more credit risk under the terms of the business of it not loans that are being modified two different categories in two different times.
Paul Elenio: Yes, there’s a difference.
Jade Rahmani: Okay. Turning to cash flow performance. I understand that when we look at the cash flow statement, there’s timing of loan originations for Fannie and Freddie and then the loan sales, which take place 30 to 60 days after that. So adjusting for that, were there any items that drove negative working capital? There is a category called other assets and liabilities, that working capital account. I think in the quarter was negative $200 million, which doesn’t usually occur. I wanted to see if you could provide any color on that.
Paul Elenio: Yes. I have to look at what items you’re talking about, a lot of things get netted into the cash flow. I’ll take a look at the details, Jade, and I can call you after because there’s a lot of things netted in there. But the cash flows were, I think, pretty stable compared to last quarter, but I’ll get back to you on that item.
