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iStar Financial Announces First Quarter 2008 Results.

- Adjusted earnings per diluted common share were $0.87 for the first quarter 2008.

- Total revenues were $422.4 million; up 48% year-over-year.

- Company pays off interim facility used to finance acquisition of Fremont.

- Company to recognize approximately $250 million gain on sale of TimberStar Southwest joint venture.

- Company revises full year 2008 adjusted earnings per diluted common share guidance to $3.20 - $3.60 and diluted GAAP earnings per share of $3.70 - $4.10.

NEW YORK, May 2 /PRNewswire-FirstCall/ -- iStar Financial Inc. , a leading publicly traded finance company focused on the commercial real estate industry, today reported results for the first quarter ended March 31, 2008.

iStar reported adjusted earnings for the quarter of $0.87 per diluted common share. This compares with $0.93 per diluted common share for the first quarter 2007. Adjusted earnings allocable to common shareholders for the first quarter 2008 were $117.4 million on a diluted basis, compared to $118.6 million for the first quarter 2007. Adjusted earnings represent net income computed in accordance with GAAP, adjusted for preferred dividends, depreciation, depletion, amortization, gain (loss) from discontinued operations and ineffectiveness on interest rate hedges.

Net income allocable to common shareholders for the first quarter was $74.2 million, or $0.55 per diluted common share, compared to $81.7 million, or $0.64 per diluted common share for the first quarter 2007. Please see the financial tables that follow the text of this press release for a detailed reconciliation of adjusted earnings to GAAP net income.

Net investment income for the quarter was $186.4 million, compared to $120.5 million for the first quarter 2007. The year-over-year increase was due to growth in the overall loan portfolio, primarily due to the addition of the Fremont assets, as well as the amortization of $28.3 million of Fremont loan portfolio purchase discount recognized in the quarter. Net investment income represents interest income, operating lease income and earnings (loss) from equity method investments, less interest expense, operating costs for corporate tenant lease assets and gain (loss) on early extinguishment of debt.

Consistent with its expectations for slower overall asset growth, the Company announced that during the first quarter it closed four new financing commitments for a total of $101.2 million. Of that amount, $20.7 million was funded during the quarter. In addition, the Company funded $921.4 million under pre-existing commitments and received $1.3 billion in principal repayments. Pursuant to the terms of the Fremont agreement, $0.6 billion of the principal received was utilized for principal reduction on Fremont's A-participation interest.

During the first quarter, the Company recorded $44.2 million in Other Income from a profit participation related to one of its investments. Additionally, the Company completed the sale of two non-strategic corporate tenant lease assets for total proceeds of $8.2 million, net of costs, resulting in a total net book gain of approximately $2.1 million.

For the quarter ended March 31, 2008, the Company generated adjusted return on average common book equity of 20.2%. The Company's equity represented 22.4% of total capitalization at quarter end and its debt to book equity plus accumulated depreciation/depletion and loan loss reserves, each as determined in accordance with GAAP, was 3.5x.

The Company's net finance margin, calculated as the rate of return on assets less the cost of debt, was 4.11% for the quarter. Excluding the impact of the amortization of the Fremont loan portfolio purchase discount, the Company's net finance margin was 3.42% for the quarter, versus 3.16% in the previous quarter.

As of March 31, 2008, a one percentage point increase in short-term rates, excluding the impact of interest floors in certain loan assets, would have increased the Company's adjusted earnings by 1.89%, which is consistent with its match funding policy.

Summary of Capital Markets and Other Initiatives

As of March 31, 2008, the Company had $838.0 million available under $3.9 billion in revolving credit facilities. During the quarter, the Company amended its $500 million senior secured revolving credit facility to allow it to extend its maturity from September 2008 to September 2009. As of March 31, 2008, the Company had $1.3 billion outstanding on its interim facility used to fund the acquisition of Fremont General's commercial real estate lending business. Subsequent to the end of the first quarter, the Company repaid the entire balance of the interim facility.

On May 1, 2008, the Company entered into a $960 million first mortgage financing transaction secured by 34 properties, representing $1.1 billion of net book value and an appraised value of $1.6 billion. The Company has received approximately $810 million of proceeds from the initial closing of the financing and expects to receive the balance of the proceeds prior to the end of the second quarter, subject to the satisfaction of customary real estate closing conditions. The three-year financing is being provided by a major financial institution and is pre-payable in 20 months.

During the first quarter, the Company entered into a $300 million, 364-day term loan secured by collateral within the company's corporate loan and debt portfolio. In addition, the Company completed a $53 million mortgage financing on a small pool of corporate tenant lease assets within its AutoStar portfolio.

As previously announced, on April 1, 2008, the Company closed on the sale of its TimberStar Southwest joint venture and the venture's approximately 900,000-acre portfolio of forestland and related assets for $1.7 billion, including the assumption of debt. TimberStar Southwest purchased the properties in October 2006 for approximately $1.2 billion. iStar received net proceeds of approximately $400 million, representing a gain of approximately $250 million.

Risk Management

At March 31, 2008, first mortgages, participations in first mortgages, senior loans and corporate tenant lease investments collectively comprised 86.4% of the Company's asset base, versus 87.0% in the prior quarter. The Company's loan portfolio consisted of 78.4% floating rate and 21.6% fixed rate loans, with a weighted average maturity of 2.8 years.

The weighted average last dollar loan-to-value ratio for all structured finance assets was 69.5%. At quarter end, the Company's corporate tenant lease assets were 95.6% leased with a weighted average remaining lease term of 11.8 years. At March 31, 2008, the weighted average risk ratings of the Company's structured finance and corporate tenant lease assets were 3.12 and 2.51, respectively, versus 3.07 and 2.50, respectively, in the previous quarter.

On March 31, 2008, the Company had 30 loans on non-performing loan (NPL) status representing $1.1 billion of gross loan value, compared to 31 loans on NPL status representing $1.2 billion of gross loan value in the prior quarter. Gross loan values represent iStar's book value plus Fremont's A-participation interest. During the quarter, the Company took title to three properties that served as collateral on its loans, resulting in $36.5 million of charge-offs against the Company's reserve for loan losses. All of the loans were previously on NPL status and had a gross loan value of $191.5 million, prior to the Company receiving title to the properties.

At the end of the first quarter, the Company had 30 loans on its watch list representing $1.2 billion of gross loan value, compared to 40 loans on its watch list representing $1.6 billion of gross loan value in the prior quarter.

Excluding Fremont's A-participation interest on the associated assets, NPL and watch list assets were $796.9 million and $1.0 billion, respectively, compared to NPL and watch list assets in the prior quarter of $719.4 million and $1.2 billion, respectively. The Company's policy is to stop the accrual of interest on loans placed on NPL status. The Company believes it has adequate collateral and loan loss reserves to support the book value for each of the NPL and watch list assets.

The Company had $252.9 million in loan loss reserves at March 31, 2008 versus $217.9 million at December 31, 2007. During the first quarter, the Company recorded $89.5 million in loan loss provision versus $113.0 million in the prior quarter. The provision reflects the continued deterioration in the overall credit markets and its impact on the Company's portfolio as determined in its regular quarterly risk ratings review process.

The Company's total loss coverage, defined as the combination of loan loss reserves of $252.9 million and remaining purchase discount from the Fremont acquisition of $114.2 million, was $367.1 million or 2.8% of gross loan value at the end of the first quarter. This compares to total loss coverage of $384.7 million or 2.8% of gross loan value in the prior quarter. The Company continues to believe its loss coverage provides adequate protection against future loan losses.

Summary of Fremont Contributions to Quarterly Results

At the end of the first quarter, the Fremont portfolio, including additional fundings made during the quarter, had a gross loan value of $4.9 billion consisting of 193 loans versus $5.4 billion consisting of 221 loans at the end of the fourth quarter 2007.

At the end of the first quarter, the value of Fremont's A-participation interest in the portfolio was $2.4 billion versus $3.0 billion on December 31, 2007. The book value of iStar's B-participation interest at the end of the first quarter was $2.5 billion versus $2.4 billion on December 31, 2007. During the quarter, iStar received $803.6 million in principal repayments of which the Company retained 30%. The balance of principal repayments was paid to Fremont through its participation interest. The weighted average maturity of the portfolio is approximately nine months.

During the first quarter, iStar funded $411.7 million of commitments related to the portfolio. Unfunded commitments at the end of the first quarter were $1.5 billion, of which the Company expects to fund approximately $1.4 billion based upon its comprehensive review of the portfolio. This compares to unfunded commitments of $2.2 billion on December 31, 2007.

At March 31, 2008, there were 20 Fremont loans on NPL status with a gross loan value of $494.1 million versus 23 loans at the prior quarter end, with $825.4 million of gross loan value. In addition, there were 14 loans on the Company's watch list with a gross loan value of $405.4 million versus 25 loans at the prior quarter end, with $733.7 million of gross loan value. Excluding Fremont's A-participation interest on the associated assets, NPL and watch list assets for the Fremont portfolio were $238.1 million and $233.3 million, respectively, versus $351.1 million and $358.5 million in the prior quarter.

Earnings Guidance

Consistent with the Securities and Exchange Commission's Regulation FD and Regulation G, iStar Financial comments on earnings expectations within the context of its regular earnings press releases. For fiscal year 2008, the Company expects diluted adjusted earnings per common share of $3.20 - $3.60, and diluted GAAP earnings per common share of $3.70 - $4.10.

Dividend

On March 7, 2008, iStar Financial declared a regular quarterly dividend of $0.87 per share. The first quarter dividend was paid on April 30, 2008 to shareholders of record on March 17, 2008.

Annual Meeting

The Company will host its Annual Meeting of Shareholders at The Harvard Club of New York City, located at 35 West 44th Street, New York, New York 10036 on Wednesday, May 28, 2008 at 9:00 a.m. ET. All shareholders are cordially invited to attend.
 [Financial Tables to Follow]

 * * *




iStar Financial Inc. is a leading publicly traded finance company focused on the commercial real estate industry. The Company primarily provides custom-tailored investment capital to high-end private and corporate owners of real estate, including senior and mezzanine real estate debt, senior and mezzanine corporate capital, as well as corporate net lease financing and equity. The Company, which is taxed as a real estate investment trust ("REIT"), seeks to deliver strong dividends and superior risk-adjusted returns on equity to shareholders by providing innovative and value added financing solutions to its customers.

iStar Financial will hold a quarterly earnings conference call at 10:00 a.m. ET today, May 2, 2008. This conference call will be broadcast live over the Internet and can be accessed by all interested parties through iStar Financial's website, http://www.istarfinancial.com/, under the "Investor Relations" section. To listen to the live call, please go to the website's "Investor Relations" section at least 15 minutes prior to the start of the call to register, download and install any necessary audio software. For those who are not available to listen to the live broadcast, a replay will be available shortly after the call on the iStar Financial website.

(Note: Statements in this press release which are not historical fact may be deemed forward-looking statements within the meaning of Section 27A of the Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. Although iStar Financial Inc. believes the expectations reflected in any forward-looking statements are based on reasonable assumptions, the Company can give no assurance that its expectations will be attained. Factors that could cause actual results to differ materially from iStar Financial Inc.'s expectations include completion of pending investments, continued ability to originate new investments, the mix of originations between structured finance and corporate tenant lease assets, repayment levels, the timing of receipt of prepayment penalties, the availability and cost of capital for future investments, competition within the finance and real estate industries, economic conditions, loss experience and other risks detailed from time to time in iStar Financial Inc.'s SEC reports.)
 Selected Income Statement Data
 (In thousands)
 (unaudited)

 Three Months Ended
 March 31,
 2008 2007
 ---- ----
 Net investment income (1) $186,363 $120,463
 Other income 59,890 28,472
 Non-interest expense (2) (162,040) (62,471)
 Minority interest in consolidated entities (204) 564
 ---------- ----------
 Income from continuing operations 84,009 87,028

 Income from discontinued operations 324 5,653
 Gain from discontinued operations 2,056 1,415
 Preferred dividends (10,580) (10,580)
 ---------- ----------
 Net income allocable to common shareholders
 and HPU holders (3) $75,809 $83,516
 ========== ==========
 (1) Includes interest income, operating lease income and earnings (loss)
 from equity method investments, less interest expense, operating costs
 for corporate tenant lease assets and gain (loss) on early
 extinguishment of debt.

 (2) Includes depreciation and amortization, general and administrative
 expenses, provision for loan losses and other expenses.

 (3) HPU holders are Company employees who purchased high performance
 common stock units under the Company's High Performance Unit Program.



 Selected Balance Sheet Data
 (In thousands)
 As of As of
 March 31, 2008 December 31, 2007
 -------------- -----------------
 (unaudited)

 Loans and other lending investments, net $10,878,095 $10,949,354
 Corporate tenant lease assets, net $3,328,210 $3,309,866
 Other investments $956,887 $856,609
 Total assets $16,112,295 $15,848,298
 Debt obligations $12,566,913 $12,399,558
 Total liabilities $13,206,823 $12,894,869
 Total shareholders' equity $2,851,742 $2,899,481



 iStar Financial Inc.
 Consolidated Statements of Operations
 (In thousands, except per share amounts)
 (unaudited)

 Three Months Ended
 March 31,
 2008 2007
 ---- ----
 REVENUES

 Interest income $276,100 $180,860
 Operating lease income 86,439 75,942
 Other income 59,890 28,472
 -------- --------
 Total revenues 422,429 285,274
 -------- --------
 COSTS AND EXPENSES

 Interest expense 168,215 128,527
 Operating costs - corporate tenant
 lease assets 5,363 6,461
 Depreciation and amortization 25,931 19,921
 General and administrative (1) 42,809 37,550
 Provision for loan losses 89,500 5,000
 Other expense 3,800 -
 -------- --------
 Total costs and expenses 335,618 197,459
 -------- --------
 Income from continuing operations
 before other items 86,811 87,815
 Earnings (loss) from equity method
 investments (2,598) (1,351)
 Minority interest in consolidated
 entities (204) 564
 -------- --------
 Income from continuing operations 84,009 87,028

 Income from discontinued operations 324 5,653
 Gain from discontinued operations 2,056 1,415
 -------- --------
 Net income 86,389 94,096
 Preferred dividends (10,580) (10,580)
 -------- --------
 Net income allocable to common
 shareholders and HPU holders $75,809 $83,516
 ======== ========
 Net income per common share
 Basic $0.55 $0.64
 Diluted (2) $0.55 $0.64

 Net income per HPU share
 Basic (3) $104.60 $122.00
 Diluted (2) (4) $104.20 $120.93


 (1) For the three months ended March 31, 2008 and 2007, includes $4,848
 and $4,409 of stock-based compensation expense, respectively.

 (2) For the three months ended March 31, 2008 and 2007, includes the
 allocable share of $1 and $28 of joint venture income, respectively.

 (3) For the three months ended March 31, 2008 and 2007, $1,569 and $1,830
 of net income is allocable to HPU holders, respectively.

 (4) For the three months ended March 31, 2008 and 2007, $1,563 and $1,814
 of net income is allocable to HPU holders, respectively.



 iStar Financial Inc.
 Earnings Per Share Information
 (In thousands, except per share amounts)
 (unaudited)

 Three Months Ended
 March 31,
 2008 2007
 ---- ----
 EPS INFORMATION FOR COMMON SHARES

 Income from continuing operations per
 common share (1)
 Basic $0.54 $0.59
 Diluted (2) $0.54 $0.59

 Net income per common share
 Basic $0.55 $0.64
 Diluted (2) $0.55 $0.64

 Weighted average common shares
 outstanding
 Basic 134,262 126,693
 Diluted 134,862 127,867

 EPS INFORMATION FOR HPU SHARES

 Income from continuing operations per
 HPU share (1)
 Basic $101.26 $111.66
 Diluted (2) $100.93 $110.66

 Net income per HPU share (3)
 Basic $104.60 $122.00
 Diluted (2) $104.20 $120.93

 Weighted average HPU shares outstanding
 Basic 15 15
 Diluted 15 15


 (1) For the three months ended March 31, 2008 and 2007, excludes preferred
 dividends of $10,580.

 (2) For the three months ended March 31, 2008 and 2007, includes the
 allocable share of $1 and $28 of joint venture income, respectively.

 (3) As more fully explained in the Company's quarterly SEC filings, three
 plans of the Company's HPU program vested in December 2002, December
 2003 and December 2004. Each of the respective plans contain 5 HPU
 shares. Cumulatively, these 15 shares were entitled to $1,569 and
 $1,830 of net income for the three months ended March 31, 2008 and
 2007, respectively. On a diluted basis, these cumulative 15 shares
 were entitled to $1,563 and $1,814 of net income for the three months
 ended March 31, 2008 and 2007, respectively.



 iStar Financial Inc.
 Reconciliation of Adjusted Earnings to GAAP Net Income
 (In thousands, except per share amounts)
 (unaudited)

 Three Months Ended
 March 31,
 2008 2007
 ---- ----
 ADJUSTED EARNINGS (1)

 Net income $86,389 $94,096
 Add: Depreciation, depletion and amortization 27,638 21,878
 Add: Joint venture income 4 30
 Add: Joint venture depreciation,
 depletion and amortization 8,625 10,837
 Add: Amortization of deferred financing costs 8,350 6,444
 Add: Hedge ineffectiveness, net 1,491 -
 Less: Preferred dividends (10,580) (10,580)
 Less: Gain from discontinued operations (2,056) (1,415)
 -------- --------
 Adjusted earnings allocable to common
 shareholders and HPU holders:
 Basic $119,857 $121,260
 Diluted $119,861 $121,290

 Adjusted earnings per common share:
 Basic (2) $0.87 $0.94
 Diluted (3) $0.87 $0.93

 Weighted average common shares outstanding:
 Basic 134,262 126,693
 Diluted 134,862 127,867

 Common shares outstanding at end of period:
 Basic 134,406 126,708
 Diluted 134,909 127,883

 (1) Adjusted earnings should be examined in conjunction with net income as
 shown in the Consolidated Statements of Operations. Adjusted earnings
 should not be considered as an alternative to net income (determined
 in accordance with GAAP) as an indicator of the Company's performance,
 or to cash flows from operating activities (determined in accordance
 with GAAP) as a measure of the Company's liquidity, nor is this
 measure indicative of funds available to fund the Company's cash needs
 or available for distribution to shareholders. Rather, adjusted
 earnings is an additional measure the Company uses to analyze how its
 business is performing. It should be noted that the Company's manner
 of calculating adjusted earnings may differ from the calculations of
 similarly-titled measures by other companies.

 (2) For the three months ended March 31, 2008 and 2007, excludes $2,481
 and $2,657 of net income allocable to HPU holders, respectively.

 (3) For the three months ended March 31, 2008 and 2007, excludes $2,471
 and $2,634 of net income allocable to HPU holders, respectively.



 iStar Financial Inc.
 Consolidated Balance Sheets
 (In thousands)


 As of As of
 March 31, 2008 December 31, 2007
 -------------- -----------------
 (unaudited)
 ASSETS

 Loans and other lending investments, net $10,878,095 $10,949,354
 Corporate tenant lease assets, net 3,328,210 3,309,866
 Other investments 956,887 856,609
 Other real estate owned 284,134 128,558
 Assets held for sale 79,163 74,335
 Cash and cash equivalents 119,404 104,507
 Restricted cash 34,135 32,977
 Accrued interest and operating
 lease income receivable 125,097 141,405
 Deferred operating lease income receivable 107,245 102,135
 Deferred expenses and other assets 156,647 105,274
 Goodwill 43,278 43,278
 -------------- -----------------
 Total assets $16,112,295 $15,848,298
 ============== =================


 LIABILITIES AND SHAREHOLDERS' EQUITY

 Accounts payable, accrued expenses
 and other liabilities $639,910 $495,311

 Debt obligations:
 Unsecured senior notes 7,384,795 7,916,852
 Unsecured revolving credit facilities 2,822,387 2,681,174
 Interim financing facility 1,289,811 1,289,811
 Secured term loans 727,156 413,683
 Other debt obligations 342,764 98,038
 -------------- -----------------
 Total liabilities 13,206,823 12,894,869

 Minority interest in consolidated entities 53,730 53,948
 Shareholders' equity 2,851,742 2,899,481
 -------------- -----------------
 Total liabilities and shareholders'
 equity $16,112,295 $15,848,298
 ============== =================


 iStar Financial Inc.
 Supplemental Information
 (In thousands)
 (unaudited)

 PERFORMANCE STATISTICS
 Three Months Ended
 Net Finance Margin March 31, 2008
 ------------------ ------------------
 Weighted average GAAP yield of loan
 and CTL investments 9.64%
 Less: Cost of debt (5.53%)
 -----------
 Net Finance Margin (1) 4.11%

 Net Finance Margin Excluding Amortization of Discount
 on Fremont Loans 3.42%

 Return on Average Common Book Equity
 ------------------------------------
 Average total book equity $2,875,612
 Less: Average book value of preferred equity (506,176)
 -----------
 Average common book equity (A) $2,369,436

 Net income allocable to common
 shareholders and HPU holders $75,809
 Net income allocable to common
 shareholders and HPU holders -
 Annualized (B) $303,236

 Return on Average Common Book Equity (B) / (A) 12.8%

 Adjusted basic earnings allocable to
 common shareholders and HPU holders (2) $119,857
 Adjusted basic earnings allocable to
 common shareholders and HPU holders - Annualized (C) $479,428

 Adjusted Return on Average Common Book Equity (C) / (A) 20.2%

 Expense Ratio
 -------------
 General and administrative expenses (D) $42,809
 Total revenue (E) $422,429
 Expense Ratio (D) / (E) 10.1%

 (1) Weighted average GAAP yield is the annualized sum of interest income
 and operating lease income (excluding other income), divided by the
 sum of average gross corporate tenant lease assets, average loans and
 other lending investments, average SFAS No. 141 purchase intangibles
 and average assets held for sale over the period. Cost of debt is the
 annualized sum of interest expense and operating costs-corporate
 tenant lease assets, divided by the average gross debt obligations
 over the period. Operating lease income and operating costs-corporate
 tenant lease assets exclude SFAS No. 144 adjustments from discontinued
 operations of $334 and $(70), respectively. The Company does not
 consider net finance margin to be a measure of the Company's liquidity
 or cash flows. It is one of several measures that management
 considers to be an indicator of the profitability of its operations.

 (2) Adjusted earnings should be examined in conjunction with net income as
 shown in the Consolidated Statements of Operations. Adjusted earnings
 should not be considered as an alternative to net income (determined
 in accordance with GAAP) as an indicator of the Company's performance,
 or to cash flows from operating activities (determined in accordance
 with GAAP) as a measure of the Company's liquidity, nor is this
 measure indicative of funds available to fund the Company's cash needs
 or available for distribution to shareholders. Rather, adjusted
 earnings is an additional measure the Company uses to analyze how its
 business is performing. It should be noted that the Company's manner
 of calculating adjusted earnings may differ from the calculations of
 similarly-titled measures by other companies.



 iStar Financial Inc.
 Supplemental Information
 (In thousands)
 (unaudited)

 CREDIT STATISTICS Three Months Ended
 March 31, 2008
 ------------------
 Book debt (A) $12,566,913

 Book equity $2,851,742
 Add: Accumulated depreciation/depletion and
 loan loss reserves 769,657
 --------------
 Sum of book equity, accumulated depreciation/depletion
 and loan loss reserves (B) $3,621,399

 Book Debt / Sum of Book Equity,
 Accumulated Depreciation/Depletion
 and Loan Loss Reserves (A) / (B) 3.5x

 Ratio of Earnings to Fixed Charges 1.6x

 Ratio of Earnings to Fixed Charges and
 Preferred Stock Dividends 1.5x

 Interest Coverage
 -----------------
 EBITDA (1) (C) $290,867
 GAAP interest expense (D) $168,215

 EBITDA / GAAP Interest Expense (1)(C) / (D) 1.7x

 Fixed Charge Coverage
 ---------------------
 EBITDA (1) (C) $290,867

 GAAP interest expense $168,215
 Add: Preferred dividends 10,580
 --------------
 Total GAAP interest expense and preferred dividends (E) $178,795

 EBITDA / GAAP Interest Expense and
 Preferred Dividends (1) (C) / (E) 1.6x

 Covenant Calculation of Fixed Charge Coverage Ratio (2) 1.6x

 RECONCILIATION OF NET INCOME TO EBITDA (1)

 Net income $86,389
 Add: GAAP interest expense 168,215
 Add: Depreciation, depletion and amortization 27,638
 Add: Joint venture depreciation, depletion and amortization 8,625
 --------------
 EBITDA (1) $290,867

 (1) EBITDA should be examined in conjunction with net income as shown in
 the Consolidated Statements of Operations. EBITDA should not be
 considered as an alternative to net income (determined in accordance
 with GAAP) as an indicator of the Company's performance, or to cash
 flows from operating activities (determined in accordance with GAAP)
 as a measure of the Company's liquidity, nor is this measure
 indicative of funds available to fund the Company's cash needs or
 available for distribution to shareholders. It should be noted that
 the Company's manner of calculating EBITDA may differ from the
 calculations of similarly-titled measures by other companies.
 (2) This measure, which is a trailing twelve-month calculation and
 excludes the effect of $134.9 million of non-cash impairment charges
 recorded in the fourth quarter of 2007, is consistent with covenant
 calculations included in the Company's unsecured credit facilities;
 therefore, we believe it is a useful measure for investors to
 consider.



 iStar Financial Inc.
 Supplemental Information
 (In thousands)
 (unaudited)


 Three Months Ended
 March 31, 2008 LOANS
 -------------------------------
 Total/ CORPORATE
 Floating Weighted TENANT OTHER
 Fixed Rate Rate Average LEASING INVESTMENTS
 ---------- -------- --------- -------- -----------
 Amount funded $30,942 $845,965 $876,907 $41,477 $23,716
 Weighted average yield (1) 9.92% 7.57% 7.65% 10.10% N/A
 Weighted average all-in
 spread/margin (bps) (2) 651 490 496 N/A N/A
 Weighted average first
 $ loan-to-value ratio 54.10% 0.60% 2.49% N/A N/A
 Weighted average last
 $ loan-to-value ratio 79.99% 69.41% 69.78% N/A N/A




 UNFUNDED COMMITMENTS

 Number of assets with unfunded commitments 263


 Discretionary commitments $827,998
 Non-discretionary commitments 4,175,306
 -------------
 Total unfunded commitments $5,003,304
 Estimated weighted average funding period Approximately 2.1 years

 UNENCUMBERED ASSETS / UNSECURED DEBT

 Unencumbered assets (A) $15,028,153
 Unsecured debt (B) $11,644,219

 Unencumbered Assets / Unsecured Debt (A) / (B) 1.3x



 RISK MANAGEMENT STATISTICS
 (weighted average
 risk rating) 2008 2007
 --------- -------------------------------------
 March 31, Dec. 31, Sept. 31, June 30, March 31,
 --------- -------------------------------------
 Structured Finance Assets
 (principal risk) 3.12 3.07 2.92 2.78 2.64
 Corporate Tenant Lease
 Assets 2.51 2.50 2.48 2.50 2.45

 (1=lowest risk; 5=highest risk)

 (1) Yield on Fremont loans does not take into account income associated
 with the amortization of fees and discounts.

 (2) Represents spread over base rate LIBOR (floating-rate loans) and
 interpolated U.S. Treasury rates (fixed-rate loans) during the
 quarter.



 iStar Financial Inc.
 Supplemental Information
 (In thousands, except per share amounts)
 (unaudited)

 LOANS AND OTHER LENDING INVESTMENTS CREDIT STATISTICS

 As of
 ---------------------------------------
 March 31, 2008 December 31, 2007
 ------------------ ------------------
 Value of non-performing loans (1) /
 As a percentage of total gross
 loan value $1,052,921 8.04% $1,193,669 8.71%
 Reserve for loan losses /
 As a percentage of total gross
 loan value $252,884 1.93% $217,911 1.59%
 As a percentage of non-performing
 loans (1) 24.02% 18.26%


 RECONCILIATION OF DILUTED GAAP EPS GUIDANCE
 TO DILUTED ADJUSTED EPS GUIDANCE (2)


 Year Ending
 December 31, 2008
 -----------------
 Earnings per diluted common share guidance $3.70 - $4.10
 Less: Gains, depreciation and other adjustments, net $0.10 - $0.90
 -----------------
 Adjusted earnings per diluted common share guidance $3.20 - $3.60

 (1) Non-performing loans include iStar's book value and Fremont's
 A-participation interest on the associated assets.
 (2) Adjusted earnings should be examined in conjunction with net income as
 shown in the Consolidated Statements of Operations. Adjusted earnings
 should not be considered as an alternative to net income (determined
 in accordance with GAAP) as an indicator of the Company's performance,
 or to cash flows from operating activities (determined in accordance
 with GAAP) as a measure of the Company's liquidity, nor is this
 measure indicative of funds available to fund the Company's cash needs
 or available for distribution to shareholders. Rather, adjusted
 earnings is an additional measure the Company uses to analyze how its
 business is performing. It should be noted that the Company's manner
 of calculating adjusted earnings may differ from the calculations of
 similarly-titled measures by other companies.



 iStar Financial Inc.
 Supplemental Information
 (In millions)
 (unaudited)

 PORTFOLIO STATISTICS AS OF MARCH 31, 2008 (1)

 Security Type
 -------------
 First Mortgages / Senior Loans $9,936 61.8%
 Corporate Tenant Leases 3,951 24.6
 Mezzanine / Subordinated Debt 1,195 7.4
 Other Investments 988 6.2
 --------- ---------
 Total $16,070 100.0%
 ========= =========
 Collateral Type
 ---------------
 Apartment / Residential $3,491 21.7%
 Land 2,250 14.0
 Office (CTL) 1,766 11.0
 Retail 1,607 10.0
 Industrial / R&D 1,509 9.4
 Corporate - Real Estate 1,262 7.9
 Other 1,079 6.7
 Entertainment / Leisure 947 5.9
 Hotel 858 5.3
 Mixed Use / Mixed Collateral 660 4.1
 Corporate - Non-Real Estate 386 2.4
 Office (Lending) 255 1.6
 --------- ---------
 Total $16,070 100.0%
 ========= =========
 Collateral Location
 -------------------
 West $3,487 21.7%
 Northeast 2,898 18.0
 Southeast 2,658 16.5
 Mid-Atlantic 1,647 10.3
 Various 1,205 7.5
 Central 952 5.9
 International 921 5.7
 Southwest 862 5.4
 South 780 4.9
 Northcentral 409 2.5
 Northwest 251 1.6
 --------- ---------
 Total $16,070 100.0%
 ========= =========

 (1) Figures presented prior to loan loss reserves, accumulated
 depreciation and impact of Statement of Financial Accounting Standards
 No. 141, "Business Combinations."



CONTACT: Catherine D. Rice, Chief Financial Officer, or Andrew G. Backman, Senior Vice President - Investor Relations, both of iStar Financial Inc., +1-212-930-9400

Web site: http://www.istarfinancial.com/
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