As reported by HW on Wednesday, beleaguered Wachovia Corp. (WB) is selling off a $40 million portfolio of distressed residential construction loans to LandCap Partners. LandCap Partners is a 50/50 joint venture between Goldman Sachs’ (GS) Whitehall Real Estate Funds and commercial mREIT NorthStar Realty Finance (NRF). The joint venture is part of NorthStar’s strategy to improve its return on equity by making selective investments in distressed and non-performing residential real estate. NorthStar has committed a total of $175 million to this risky, but potentially lucrative, venture. Speaking of distressed residential real estate, nonconforming lender Thornburg Mortgage (TMA) continues its comeback bid with the announcement earlier this week that over 80 percent of each class of its outstanding preferred stock had been tendered — satisfying a key requirement for a reduction in the interest rate on its senior subordinated secured notes. Thornburg extended the tender offer for the remaining outstanding shares to September 2 in order to give shareholders more time to review its upcoming (yet tardy) second quarter 10-Q. A major Thornburg competitor, Impac Mortgage Holdings (IMH), also announced a deal — but not necessarily a financial transaction. Instead, Impac announced that the NYSE had agreed to give the company a four-month cure period to allow Impac to get its common stock price back above $1.00/share on a consistent basis. The exchange intends to “closely monitor the company during this timeframe both with regards to share price levels and progress on its planned initiatives.” Show Me the Money A couple of third quarter dividends were declared this week. Dynex Capital (DX) continued to build its portfolio of agency MBS and continued to lift its quarterly dividend. The company recently declared a dividend of $0.23/share — 53 percent more than the prior quarter dividend of $0.15/share. The declaration lifted the forward annual yield on the common stock to 11.4 percent. Redwood Trust (RWT) also declared its third quarter dividend, which was a continuation of the $0.75/share payout — at least for now. Although Redwood plans to continue the $0.75/share through the rest of 2008, the Company has yet to set its 2009 dividend policy. Given the sharp decline in Redwood’s taxable income this year, shareholders better enjoy the good times while they last. Editor’s note: Patrick Harden is a Certified Public Accountant with three years of experience in auditing publicly-traded real estate investment trusts. For the past two years, he has been involved in the mortgage finance industry as a member of the financial reporting group at a publicly-traded mortgage bank. His column covering mortgage REITs runs every Friday. Disclosure: The author held no positions in any of the stocks mentioned when this story was published. HW reporters and writers follow a strict disclosure policy, the first in the mortgage trade.