ACRES Commercial Realty : Earnings Presentation First Quarter 2024

FIRST QUARTER 2024 EARNINGS PRESENTATION

May 1, 2024

DISCLAIMER

Forward-Looking Statements

This presentation contains forward-looking statements within the meaning of federal securities laws. These forward-looking statements are not historical facts but rather are based on ACRES Commercial Realty Corp.'s ("ACR's" or the "Company's") current beliefs, assumptions and expectations. These beliefs, assumptions and expectations can change as a result of many possible events or factors, not all of which are known to ACR or are within its control. If a change occurs, its business, financial condition, liquidity and results of operations may vary materially from those expressed in the forward-looking statements. You should not place undue reliance on these forward-looking statements, which reflect ACR's view only as of the date of this presentation. ACR uses words such as "anticipate," "expect," "intend," "plan," "believe," "seek," "estimate," "target," and variations of these words and similar expressions to identify forward-looking statements. Forward-looking statements are subject to various risks and uncertainties that could cause actual results to vary from its forward-looking statements, including, but not limited to:

• Changes in the industry, interest rates, the debt securities markets, real estate markets or the general economy;
• Increased rates of default and/or decreased recovery rates on its investments;
• The performance and financial condition of its borrowers;
• The cost and availability of its financings, which depend in part on its asset quality, the nature of its relationships with its lenders and other capital providers, its business prospects and outlook and general market conditions;
• The availability and attractiveness of terms of additional debt repurchases;
• Availability, terms and deployment of short-term and long-term capital;
• Availability of, and ability to retain, qualified personnel;
• Changes in its business strategy;
• Availability of investment opportunities in commercial real estate-related and commercial finance assets;
• The degree and nature of its competition;
• The resolution of its non-performing and sub-performing assets;
• The long-term macroeconomic effects of the novel coronavirus, COVID-19;
• The Company's ability to comply with financial covenants in its debt instruments;

• The adequacy of its cash reserves and working capital;
• The timing of cash flows, if any, from its investments;
• Unanticipated increases in financial and other costs, including a rise in interest rates;
• Its ability to maintain compliance with over-collateralization and interest coverage tests in its collateralized debt obligations ("CDOs") and/or collateralized loan obligations ("CLOs");
• Its dependence on ACRES Capital, LLC, its "manager", and ability to find a suitable replacement in a timely manner, or at all, if its manager or the Company were to terminate the management agreement;
• Environmental and/or safety requirements;
• Its ability to satisfy complex rules in order for ACR to qualify as a real estate investment trust ("REIT"), for federal income tax purposes and qualify for its exemption under the investment company act of 1940, as amended, and its ability and the ability of its subsidiaries to operate effectively within the limitations imposed by these rules;
• Legislative and regulatory changes (including changes to laws governing the taxation of REITs or the exemptions from registration as an investment company); and
• Other factors discussed under item IA. Risk factors in its annual report on form 10-K for the year ended December 31, 2023 and those factors that may be contained in any subsequent filing ACR makes with the Securities and Exchange Commission.

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DISCLAIMER

Forward-Looking Statements (continued)

In light of these risks and uncertainties, the forward-looking events and circumstances discussed in this presentation might not occur and actual results, performance or achievement could differ materially from those anticipated or implied in the forward-looking statements. The Company undertakes no obligation, and specifically disclaims any obligation, to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by law.

Past Performance

Past performance is not indicative of future results. There is no guarantee that any investment strategy referenced herein will work under all market conditions. Prior to making any investment decision, you should evaluate your ability to invest for the long-term, especially during periods of downturns in the market. You alone assume the responsibility of evaluating the merits and risks associated with any potential investment or investment strategy referenced herein.

Notes on Presentation

This presentation contains information regarding financial results that is calculated and presented on the basis of methodologies other than in accordance with accounting principles generally accepted in the United States ("GAAP"), which management believes is relevant to assessing ACR's financial performance. Please refer to page 16 for the reconciliation of Net Income (Loss), a GAAP financial measure, to Earnings Available for Distribution ("EAD"), a non-GAAP financial measure. Unless otherwise indicated, information included in this presentation is at or for the period ended March 31, 2024.

Definitions

Refer to page 19 for a description of certain terms not otherwise defined or footnoted, including EAD, Benchmark Rate,

Book Value, and other key terms.

No Offer or Sale of Securities

This presentation is for informational purposes only and does not constitute an offer to sell or the solicitation of any offer to buy any securities of ACR or any other entity. Any offering of securities would be made pursuant to separate documentation and any such securities would not be offered or sold in the United States absent registration or an applicable exemption from registration requirements.

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HIGHLIGHTS

Manager is focused on delivering shareholder value through EAD1 growth and share repurchases

Earnings and capital gains can be retained through tax assets to increase book value

Percentage of Multifamily-focused CRE in Loan Portfolio

79%

Total Liquidity at March 31, 2024

$92.1M

Per Share-Diluted GAAP Net Income / EAD

$0.07 / $0.16

1Q24 Net CRE Loan Repayments

$69.4M

Percentage of CRE loan portfolio current on payments

92%

Book Value Per Share at March 31, 2024

$27.25

1 Refer to page 16 for the reconciliation of Net Income (Loss), a GAAP financial measure, to EAD, a non-GAAP financial measure

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FIRST QUARTER RESULTS

Financial ResultsBook Value

$0.07		$27.25
GAAP net income per share-diluted	Book value
Includes $(0.61) due to $4.9M provision for CECL	up from $26.65 in 4Q23 and up from $24.51 in 1Q23
reserves offset by $0.73 due to a $5.8M gain on
conversion of real estate from a completed deed-
in-lieu
$0.16		14.4%
EAD1 for 1Q24	annual increase since ACRES
		acquisition in 3Q20

1 Refer to page 16 for the reconciliation of Net Income (Loss), a GAAP financial measure, to EAD, a non-GAAP financial measure

CRE Loan Activity & CRE Portfolio

$1.8B Comprising 66 loans with a weighted average LTV of 77%

CRE loan portfolio at par value

$69.4M

of net loan repayments

17%

of the par value of the CRE loan portfolio is rated 4 or 5

92%

of the par value of the CRE loan portfolio is current on payments

$162.9M

of net investments in real estate and properties held for sale

Capitalization & Liquidity

80%

of asset-specific borrowings were composed of non-recourse,non-mark-to-market CLO financings

$92.1M

Total liquidity at March 31, 2024

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BALANCE SHEET OVERVIEW

1Q24 Balance Sheet Overview

Summary of Changes to Book Value per Share 1,2

Total Assets ($B)	$2.1
Total Liquidity ($M)	$92.1
CRE Whole Loans, at par ($B)	$1.8
WA Spread	3.78%
CECL Reserve - General ($M)	$29.0
Per BV Share / Basis Points	$3.78/1.63%

$26.65

$0.41	$0.07	$27.25

$0.05

$0.07

CECL Reserve - Specific ($M)	$4.7
Per BV Share / Basis Points	$0.61/0.26%
Investments in Real Estate and	$162.9
Properties Held for Sale, net3 ($M)
Number of Investments	6

Book Value	Net Income	Other Comprehensive	Stock Repurchases	Equity Compensation and	Book Value
Dec `23		Income		Vested Shares	Mar `24

Capitalization

Total Borrowings ($B)	$1.6
Leverage Ratio	3.7x
Asset Specific Borrowings ($B)	$1.4
WA Spread	1.96%
Corporate Debt ($M)	$201.5
WA Coupon	6.72%
Preferred and Common Equity4 ($M)	$224.0/$219.2
Dividend %: WA Preferred / Common	8.26% / NA

$2.1B		21%
		8%
Total Capitalization		3%
		3%

10%

55%

Stockholders' equity

Term warehouse financing facilities (limited recourse)

Senior secured financing facility (limited recourse)

Mortgage Payable (limited recourse)

Corporate Debt - TRUPS & 5.75% Notes (no guarantee)

Securitization notes payable (non-recourse)

1. Per share adjustments are calculated based on the share count outstanding of 7,660,620 utilized in the calculation of book value at March 31, 2024
2. At March 31, 2024, $5.6 million remains available under this repurchase program
3. Investments in real estate and properties held for sale are shown net of related financings and real estate related lease obligations
4. Includes $10.4 million of non-controlling interests

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CRE LOAN PORTFOLIO OVERVIEW

CRE Loan Summary 1

Loans held for investment, at amortized cost	$1,775.0
CECL Reserves	($33.7)
CRE whole loans, floating-rate WA	1M BR + 3.78%
WA 1M BR Floor2	0.74%
WA CRE loan portfolio LTV	77%
Total number of CRE loans	66
Average CRE whole loan size, at par	$27.3
WA Risk Rating, at par	2.6

Loan Portfolio Activity, at par 1

Balance by Region 1,3

Pacific

9.6%

Mountain

15.8%

West North Central

2.3%

Southwest

26.7%

Property Type 1

Northeast

8.2%

Mid Atlantic

13.6%

East North Central

2.7%

Southeast

21.1%

$1,863		$81	$98
			$11		$14	$1,780
Total Loan Count
						Total Loan Count
70							66
Loan Portfolio Dec '23	Payoffs and paydowns Future fundings	REO Conversion Loan Portfolio Mar '24

1. All $ amounts are in millions and the percentages for region and property type disclosures are based on total carrying value of the CRE loans
2. At March 31, 2024, all CRE whole loans are now indexed only to SOFR and the WA benchmark rate was 5.36%

3 Texas (26.7%) and Florida (14.9%) were the states with the highest concentrations. Based on regions identified by the National Council of Real Estate Investment Fiduciaries (NCREIF)

79.1%	Multifamily		2.8%	Self-storage
13.5%	Office		0.5%	Retail
4.1%	Hotel

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CRE LOAN PORTFOLIO MATURITY PROFILE

2.6 years

Fully extended weighted average loan maturity 1,2

77%

of the par value of the portfolio has interest rate caps in place at March 31, 2024 3,4

Fully Extended Loan and Interest Rate Cap Maturities ($ in millions at par)

$1,000

$876

$800

$689

$600

$469$456

$400

												$220
$200					$144			$102						$64
			$22															$38		$26
$0	$0									$11	$0	$0
$0
		2Q24		3Q24				4Q24	2025	2026	2027			2028			2029
						Fully Extended Loan Maturities						Interest Rate Cap Maturities

1. Excludes loans in default at March 31, 2024
2. Fully-extendedmaturity basis assumes borrower elects and qualifies for all extensions
3. Interest rate caps are contractually owned by the underlying borrower and supplement the property cash flows that collateralize the floating rate CRE loan portfolio
4. Our current interest rate caps have maturities from April 2024 through January 2027

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CRE LOAN RISK RATINGS AND CECL RESERVES

83%	of ACR's loans have a risk rating of 1, 2 or 3 that are
performing in line with or near underwritten expectations 1

All but five of ACR's 66 loans are current on contractual payments at March 31, 2024

Risk Rating by Collateral Type, $ at par
2.6	2.5	3.2	3.1	2.7	2.9
$1,477M	$1,405M	$257.6M	$246.5M	$71.5M	$71.5M

4Q23 W.A. Risk Rating: 2.7

2.4 2.5

$49.0M $49.0M

1Q24 W.A. Risk Rating: 2.6

5.0 5.0

$8.0M $8.0M

Multifamily

CECL Reserve Overview

$28.8M

Total Reserve

100% Risk Rated 5	$4.7M

$24.1M

40% Risk Rated 4 - 5

60% Risk Rated 2 - 3

Office

Hotel

Self-Storage

Specific CECL Reserve	General CECL Reserve	1Q24 Risk Rating Overview
$33.7M
								Loan Count
Total Reserve					3		30		22
$4.7M	100% Risk Rated 5
							49%
$29.0M									30%
	35% Risk Rated 4	- 5		4%
	65% Risk Rated 1	- 3

Retail

8 3

15% 2%

		1	2	3	4	5
4Q23	1Q24

1 See page 20 for additional information on the risk rating definitions	ACRESREIT.COM 9

INVESTMENTS IN REAL ESTATE PROPERTIES

$162.9 million

of net investments in real estate and properties held for sale 1,2

Office $14.6M 3

• 99K SF Class A office / life science/ lab space
• Equity investment in the northeast region
• Lease up as life science / lab building
• Acquired in October 2021

Student Housing $13.0M 3

• Existing structure and development of adjacent lot
• Equity investment in the southeast region
• Value add and development project
• Acquired in April 2022
• Construction commenced in the first quarter of 2023

Hotel $38.6M 3

• 388-keyhotel next to a convention center
• Equity investment in the east north central region
• Conversion to a Hilton hotel and stabilization
• Acquired in April 2022

	Multifamily $14.2M 3			Hotel $39.8M 3
	•	12-acre parcel of land for multifamily development			•	279-key hotel next to a convention center
	•	Equity investment in the northeast region			•	Equity via lending activities in the northeast region
	•	Development of a multifamily complex			•	Acquired the deed in November 2020
	•	Acquired in November 2021			•	Reclassified to held for sale as of September 30, 2022

1. Investments in real estate comprise six properties, four of which are held at depreciated/amortized cost basis and two of which are held for sale at lower of cost or fair value. Images exclude the $20.9M property held for sale acquired via deed-in-lieu of foreclosure in June 2023.
2. Real estate related depreciation and amortization expense is $1.2 million for the 1st quarter of 2024

3 Represents value on date of acquisition	ACRESREIT.COM 10