Company: BHM
Filing Date: 2025-03-28
Form Type: POS AM
Source: 0001104659-25-029225
Chunk: 148

Company: Bluerock Homes Trust, Inc.
Filing Date: 2025-03-28
Form: POS AM
Chunk 148
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 non-revenue
generating improvements that occur on a regular ongoing basis, such as flooring and appliances.

Funds from Operations and Core Funds from Operations Attributable to Common Stockholders and Unit Holders

We believe that funds from
operations (“FFO”), as defined by the National Association of Real Estate Investment Trusts (“NAREIT”), and core
funds from operations (“CFFO”) are important non-GAAP supplemental measures of operating performance for a REIT.

FFO attributable to common
stockholders and unit holders is a non-GAAP financial measure that is widely recognized as a measure of REIT operating performance. We
consider FFO to be an appropriate supplemental measure of our operating performance as it is based on a net income analysis of property
portfolio performance that excludes non-cash items such as depreciation. The historical accounting convention used for real estate assets
requires straight-line depreciation of buildings and improvements, which implies that the value of real estate assets diminishes predictably
over time. Since real estate values historically rise and fall with market conditions, presentations of operating results for a REIT,
using historical accounting for depreciation, could be less informative. We define FFO, consistent with the NAREIT definition, as net
income (loss), computed in accordance with GAAP, excluding gains or losses on sales of depreciable real estate property, plus depreciation
and amortization of real estate assets, plus impairment write-downs of certain real estate assets and investments in entities where the
impairment is directly attributable to decreases in the value of depreciable real estate held by the entity. Adjustments for notes receivable,
preferred equity investments and joint ventures will be calculated to reflect FFO on the same basis.

CFFO makes certain adjustments
to FFO, removing the effect of items that do not reflect ongoing property operations such as acquisition and other transaction costs,
non-cash interest, unrealized gains or losses on derivatives, provision for (recovery of) credit losses, losses on extinguishment of
debt and debt modification costs (includes prepayment penalties incurred and the write-off of unamortized deferred financing costs and
fair market value adjustments of assumed debt), one-time weather-related costs, equity compensation expense, and preferred stock accretion.
We believe that CFFO is helpful to investors as a supplemental performance measure because it excludes the effects of certain items which
can create significant earnings volatility, but which do not directly relate to our core recurring property operations. As a result,
we believe