Ladies and gentlemen, thank you for standing by. And welcome to iStar Financial’s First Quarter 2012 Earnings Conference Call. (Operator Instructions) As a reminder, today's conference is being recorded. At this time for opening remarks and introductions, I would like to turn the conference over to Jason Fooks, Vice President of Investor Relations and Marketing. Please go ahead, sir.

Thank you, John, and good morning, everyone. Thank you for joining us today to review iStar Financial’s first quarter 2012 earnings report. With me today are Jay Sugarman, Chairman and Chief Executive Officer; and David DiStaso, our Chief Financial Officer. This morning’s call is being webcast on our website at istarfinancial.com in the Investor Relations section. There will be a replay of the call beginning at 12:30 p.m. Eastern Time today. The dial-in for the replay is 1-800-475-6701 with a confirmation code of 244393. Before I turn the call over to Jay, I’d like to remind everyone that statements in this earnings release -- earnings call which are not historical facts will be forward-looking. iStar Financials actual results may differ materially from these forward-looking statements and the risk factors that could cause these differences are detailed in our SEC reports. In addition, as stated more fully in our SEC reports, iStar disclaims any intent or obligation to update these forward-looking statements except as expressly required by law. Now, I’d like to turn the call over to iStar’s Chairman and CEO, Jay Sugarman. Jay?

Thanks, Jason, and thanks for joining us on the call this morning. Our first quarter continued many of the themes from the previous quarter. We continued paid down debt, extend debt maturities, and make additional investments to maximize the value in our real estate portfolio. Many parts of the portfolio showed steady progress and assets in the reposition for sale of residential portfolio in particular are beginning to register steady gain. These gains are offset to some extend however by weakness in retail and European assets. Our goal throughout 2012 will be to continue paying down outstanding debt and improving our asset position, as we begin preparing for the next step in aligning our assets and liabilities on a long-term basis. Earnings story continues to reflect this transition period, performing loans, net leased assets, stabilized own real estate and certain strategic investments continue to carry most if not all the debt service and overhead of the company. Our non-performing loans and real estate assets that have not yet stabilized, generate losses in impairments that create a negative weight on earnings. As a result, we reported a net loss of $55 million for the quarter, but excluding depreciation and non-cash provisions, impairments and gains, results were close to breakeven for the quarter at negative $7 million. The balance sheet was also strengthened by the $880 million 2012 secured financing we closed in March and the continued deleveraging of the 2011 secured financing facility. The new facility extending debt maturities to more closely match the duration of the underlying assets, completes the second phase of our long-term financing strategy, and our goal remains use of mix of secured and unsecured debt to fund our business. New investments were limited this quarter as we focused on our debt execution. We found a few places to deploy capital at attractive rates return and continue to invest our interest in LNR property. And with that quick update, let me turn it over to Dave for more of the details.

Thanks Jay, and good morning, everyone. I’ll begin by discussing our financial results for the first quarter 2012, before moving to investment activity and credit quality. And I’ll finish with an update on liquidity. For the quarter, we reported a net loss of $55 million or a loss of $0.66 per diluted common share, compared to net income of $67 million or $0.71 per diluted common share for the first quarter 2011. Year-over-year decrease was primarily due to lower gains from the early extinguishment of debt of $2 million recognized this quarter versus $107 million for the same period last year, increased interest expense and higher provisions for loan losses and impairments. This was partially offset by increased earnings from equity method investments and income from sales of residential property. Prior to the effects of depreciation, loan loss provisions and impairments, and gains on early extinguishment of debt, all of which are non-cash items. We reported a net loss for the quarter of $7 million, compared to a net loss of $5 million for the first quarter of 2011. Adjusted EBITDA for the first quarter was $95 million, compared to $90 million for the same period last year. The year-over-year improvement was due to increases in earnings from equity method investments and income from sales of residential property, partially offset by lower revenue from a smaller overall asset base. As previously announced, during the quarter we entered into a new $880 million senior secured credit agreement providing for two tranches of term loans, a $410 million 2012 A-1 tranche due March 2016 and a $470 million 2012 A-2 tranche due March 2017. Structure of the new facility is very similar to the structure of the facility we closed last year. Outstanding borrowings under the new financing are collateralized by a…

Thanks, Dave. Now, before we open it up for questions, I want to touch briefly on some of the positive results we’ve been able achieve in the owned real state portfolio and the condo portfolio in particular. Many of you asked for more detail on the owned real estate side of the portfolio, and we like to share some details with you for those assets that have moved through their life cycle established appropriate positioning in the market. While much work remains to be done, our asset managers have continued to demonstrate our core skill at repositioning many types of asset, and we’ll be offering examples throughout this year’s earnings call that demonstrate the added value we’ve been able to bring to these investments. For this call, let me focus primarily on the overall for-sale residential side of our owned real estate portfolio. At March 31st, we controlled 18 properties with approximately 1,700 units of unsold inventory. iStar’s net book value excluding outside party interest total just over $600 million in these projects. During the first quarter, we sold over $65 million worth of units generating solid profits and we project healthy unlevered IRRs on all 18 projects based on their current book value. I think it’s probably worth noting that our largest assets in this category represents some of the finest properties in the market. In Philadelphia, we own the only new build condominium project directly on Rittenhouse Square designed by Robert Kesten and targeted at high-end residents. In Atlanta, we own the Mandarin Hotel in resident group in the high profile buckets in the submarket. In South Beach, we created an ultra-exclusive property located directly on the beach and repositioned it design and layouts with our own newly created concept known as Ocean House. In Miami, we led…

Thank you. (Operator Instructions) Our first question from the line of Michael Kim with CRT Capital Group. Please go ahead. Michael Kim – CRT Capital Group: Hi. Good morning and thanks for taking my question. Jay, really appreciate the detail on the real estate on the assets. I guess as you are booking these gains and looking at the rest of the portfolio within real estate owned, is there any sense of kind of an average premium as a percent of book value that you can extrapolate or is that pretty difficult right now?

I don’t want to give you a specific number, but as I said, we think there is pretty healthy profits embedded in those, both on an IRR standpoint and in terms of the premium to book. But it’s going to be project-by-project but we think the embedded gains that you are seeing shop and earnings will continue for quite a while. Michael Kim – CRT Capital Group: Okay. Thanks. And my next question is from the strategy for asset sales over the coming quarters and -- in the 10-K, you provided some guidance around the level of potential asset sales or unencumbered assets that have been much for asset sales this year. What is the strategy? Do you plan on caching wide net and putting a number of assets for sale or is there, I guess they -- a number of releasing activity they need to occur before you can put certain assets in some market, and just thinking about the timeline of certain transactions. Can you give us a sense of the timeline in terms of closing on these transactions before the fourth quarter?

I think if I understand your question, it’s a good insight, which is we do try to maximize the value of our asset before widely marketing them. As you know, probably over the past three or four years, we’ve got a lot of reverse (inaudible) and lot of unsolicited offers and certainly we will evaluate those and consider those. But within the -- sort of planned asset sale program, we know which assets we think are ripe and ready to be widely marketed. There are specific buyers who may come in early and try to pre-empt that process. But we scheduled out really since late ‘09, how to think about the different ways coming through the portfolio. Right now, obviously the condominium piece is ripe and we’re seeing good traction there. We’ll continue to work on the land piece. We think -- we saw some interesting statistics start coming out. And in the last six months, I think I saw something this morning about some of these markets having very limited supply. We think we are positioning a big piece of our land portfolio to capture that tightening not this quarter, not next quarter but over the relevant time period for us, which is the next several years. So each part of the portfolio is in its own life cycle obviously. We think sale leaseback today is extremely valuable with a high-yield, long duration and inflation protection. We think all those different parts of the portfolio have a natural sales rhythm. And we’ll continue to work the parts of the portfolio that aren’t quite ready for the prime time and we see those as future possibilities to either redeploy that capital or continue to invest in those assets. Michael Kim – CRT Capital Group: And just a follow-up on the land side, I guess, in our coverage of the public condos, you have been hearing a lot more positive commentary about absorption trends and submarkets where you do have exposure on the land side. Could you just give us an idea of the state of completion for the land that you have on the books, the 803 million of land assets under real estate held for investment. I guess, a range in terms of the state of completion for those land assets?

Well, I think it’s fair to say there are near-ready medium-term and then there are some long-term assets in there that I would say are not ready to hit the market in the near future. So I can’t give you again, a generic metrics. It’s going to be useful, but I can tell you certainly in Southern California and certain markets on the East Coast. Those markets are recovering. We do see good supply and demand balance starting to be achieved. We think affordability in those markets is leaning towards home purchase versus rent. So those are the quite the near-term opportunities. Medium-term, our positions where we think we need to change the entitlements to really hit the market correctly. Either they were mis-entitled or we just don’t think they are maximizing their value. Those are going to take longer, that’s not a quick process. And then we have some long live land positions that have enormous long-term embedded potential, but in the market just hasn’t reach them yet. And those are going to take longer. Michael Kim – CRT Capital Group: Got you.

I’m giving you a generic breakdown. [Third, a third, a third] is probably not that helpful. But I would say, it’s probably little more skewed to the near-term and medium-term then it is for the very long-term. Michael Kim – CRT Capital Group: Understood. I guess it is my last question. Sorry, to take so many questions. But we spend a lot of time identifying your real estate assets and pretty much identify the majority of them. And doing this work observed the tenant exposure to AMF.

All right. Michael Kim – CRT Capital Group: AMF bowling, I guess what’s the impact to iStar if AMF bowling went through restructuring? How would leases be treated? Are these subjects to master lease agreement? Thank you.

Yeah. I think -- again, difficult in most of our large sale leasebacks, we try to create a mission critical position in the company. So that we are a key player. In the case of AMF, we controlled the vast majority of the loan portfolio at AMF. I have very significant coverage to our rent. So there is no issue certainly in our portfolio at this point that gives us pause. Corporately, given the leverage at the apparent level, they have thought the best solution is to continue to work the portfolio. And we continue to be thoughtful about how to maximize the value in their overall controlled lands. So I think it’s a position we’re quite happy with, continue to be happy with and continues to perform well. But obviously we’d like AMF as a company to grow and prosper as well.

Thanks, Mike. Michael Kim – CRT Capital Group: Thanks.

The next question is from Josh Barber with Stifel Nicolaus. Please go ahead. Josh Barber – Stifel Nicolaus: Hi. Good…

Go ahead. Mr. Barber… Josh Barber – Stifel Nicolaus: Can you hear me?

Yeah. Josh Barber – Stifel Nicolaus: Good morning. I am sorry about that. Following up on Mike’s question and I may have missed this before. It looked that you guys took an impairment on your CPL portfolio. Was that related to AMF or was that related with different tenants?

That was a property that’s been vacant and the market is moving in a way that we think is going to impair our ability to release it. Josh Barber – Stifel Nicolaus: Okay.

Single asset, that not have any of the dynamics in some of the larger CPLs that we think have a fundamentally different dynamic. Josh Barber – Stifel Nicolaus: So that was one of your larger assets because occupancy did fairly sharply?

It’s an asset that we inherited from the TriNet transactional five years ago that lead tenant class. We had the number of prospects that we have been chasing. I think it’s our evaluation that the market itself is not going to be able to replace that tenant anywhere near, kind of, rents performance tenant has? Josh Barber – Stifel Nicolaus: Can you clarify a little bit the pickup in loan loss reserve and what’s going on in the watch list? What do you guys think in terms of credit because it seems like the portfolio sales are picking up and otherwise fundamental seems okay. How come the watch list and the reserves have sort of gone up in the last two or three quarters?

You know, it’s a big portfolio. We are quite pleased with the majority of the positions. We do see them benefiting from a similar recovery here in the U.S. And the European side is not quite as favorable, particularly in positions where we have junior means. That’s a much more difficult animal to predict and we’ve been taking a very hard look at that stuff and thinking reserves were appropriate. We also think in different parts of the market, like called out retail a little bit. We just haven’t seen the same uplift. So we’re working hard on that as well. We’re spending money in those markets to try to position those assets correctly but as we push out, kind of, the day of return to profitability on a book basis, we are required to take reserves. Josh Barber – Stifel Nicolaus: Can you remind us what your total European exposure is and breakout I guess, between senior and junior?

That’s been going down. It’s a little bit under $300 million at this point. And some of the positions are quite solid but some of the positions I would say are going to be impacted by the overall macro conditions over there. Josh Barber – Stifel Nicolaus: Is 300 million is gross or net of reserves?

I think it’s under 300 and it’s net of reserve. Josh Barber – Stifel Nicolaus: Okay. And last question, I know that we’ve talked about before but is there any change in your posture thinking on share buybacks, given, I guess the amount of cash that you’ll be paying down in the next couple of months on the debt payments and also with maturity schedule looking pretty clear for the next nine months after that?

We haven’t announced anything and again it’s really a alternative use of capital decision depending on what we’re seeing in the investment world, what we’re seeing in our own portfolio opportunities and where we see the potential opportunities in our capital structure. We do want to continue to do some de-leveraging, paying down debt will ultimately benefit, I think, shareholders. So we think that’s been job one going into 2012. But certainly we continue to consider all appropriate uses of any free cash. Josh Barber – Stifel Nicolaus: Thanks very much.

Thanks Josh.

(Operator Instruction) And we’ll go to Jonathan Feldman with Nomura Securities. Please go ahead. Jonathan Feldman – Nomura Securities: Good morning. Just a question in terms of any thoughts that you guys have in terms of respectively lowering your cost of debt capital, particularly as you approach maturity of the 2011 transaction, the maturity, I guess, of the A-1 tranche. Did you see an opportunity to -- whether it be in CMBS market or otherwise lower your cost of debt capital prospectively?

Well, we’ve been pleased to see as the 2011 secured facility has seasoned. We’ve seen it trade quite well in the marketplace and obviously that’s -- gives us some view point on where the capital in our company can be priced. I wouldn’t say Jonathan, we’re going to be all that optimistic about maturely lowering the cost of funds until we do more de-leveraging until we are able to get an upgrade from the agencies. So right now we’ve done the kind of financing that we think are appropriate but longer term, yeah, we’re going to try to create an interesting mix of financing capabilities and bring the cost in line with what we think the underlying strength of the portfolio is. Jonathan Feldman – Nomura Securities: Got you. That’s all from me. Thank you very much.

And I’ll turn it back to our presenter for any closing comments.

Thanks, John, and thanks everyone for joining us this morning. If you have any additional questions on today's earnings release, please feel free to contact me directly. John, would you please give the conference call replay instructions once again. Thank you.

Certainly. And ladies and gentlemen, this conference is available for replay. It starts today at 12.30 p.m. Eastern, will last until May 11 at midnight. You may access the replay at any time by dialing 800-475-6701 and entering the access code 244393. That does conclude your conference for today. Thank you for your participation. You may now disconnect.