Company: KBSR
Filing Date: 2025-03-14
Form Type: 10-K
Source: 0001482430-25-000021
Chunk: 50

Company: KBS Real Estate Investment Trust III, Inc.
Filing Date: 2025-03-14
Form: 10-K
Item: Item 15
Chunk 50
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 for non-sale disposition.  The assets and liabilities related to real estate held for non-sale disposition are included in the Company’s consolidated balance sheets and the results of operations are presented as part of continuing operations in the Company’s consolidated statements of operations for all periods presented.  Operating results of properties that will be disposed of other than by sale are included in continuing operations on the Company’s consolidated statements of operations until the ultimate disposition of real estate.Real Estate Equity SecuritiesReal estate equity securities are carried at fair value based on quoted market prices for the security. Unrealized gains and losses on real estate equity securities are recognized in earnings.  Cash and Cash EquivalentsThe Company considers all highly liquid investments purchased with an original maturity of three months or less to be cash equivalents.  Cash equivalents may include cash and short term investments.  Cash and cash equivalents are stated at cost, which approximates fair value.  There are no restrictions on the use of the Company’s cash and cash equivalents as of December 31, 2024.  The Company’s cash and cash equivalents balance exceeds federally insurable limits as of December 31, 2024.  The Company monitors the cash balances in its operating accounts and adjusts the cash balances as appropriate; however, these cash balances could be impacted if the underlying financial institutions fail or are subject to other adverse conditions in the financial markets.  To date, the Company has experienced no loss or lack of access to cash in its operating accounts.  Restricted CashRestricted cash is composed of lender impound reserve accounts on the Company’s borrowings.  In addition, restricted cash includes asset management fees restricted from payment to the Advisor pursuant to the Advisory Agreement and held in a separate account for purposes of the Bonus Retention Fund.  See below under, “— Related Party Transactions — Asset Management Fee.”  

F-12

Table of ContentsKBS REAL ESTATE INVESTMENT TRUST III, INC.NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)December 31, 20243.      SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (CONTINUED)

Rents and Other ReceivablesThe Company makes a determination of whether the collectibility of the lease payments in its operating leases is probable.  If the Company determines the lease payments are not probable of collection, the Company would fully reserve for any outstanding rent receivables related to contractual lease payments and variable leases payments, would write-off any deferred rent receivable and would recognize rental income only to the extent cash has been