Company: KW
Filing Date: 2025-11-07
Form Type: 10-Q
Source: 0001408100-25-000179
Chunk: 19

Company: Kennedy-Wilson Holdings, Inc.
Filing Date: 2025-11-07
Form: 10-Q
Item: Part I, Item 2
Chunk 19
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 period, computed using a market reversionary capitalization rate.  For our investment in VHH the Company fair values its general partner ("GP") interests net cash flows utilizing a levered discount rate.

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Under the direct capitalization approach, the Company applies a market derived estimated capitalization rate to current and future income streams with appropriate adjustments for tenant vacancies or rent-free periods. These estimated capitalization rates and future income streams are derived from comparable property and leasing transactions and are considered to be key inputs in the valuation.

Other factors that we take into account under both approaches may include transaction structuring efficiencies, tenancy details, planning, building and environmental factors that might affect the property.

The Company also utilizes valuations from independent real estate appraisal firms on some of its investments ("appraised valuations"), with certain investment structures periodically (typically annually) requiring appraised valuations. All appraised valuations are reviewed and approved by the Company.

The Company's investment in Zonda is accounted for at fair value and is valued using a multiple on trailing twelve month EBITDA.

The methodology to determine the value of the Company’s investment in VHH is described above under "Multifamily-Affordable Housing." 

The table below describes the range of inputs used as of September 30, 2025 for real estate assets:

Estimated Rates Used forCapitalization RatesDiscount RatesMultifamily - AffordableIncome approach - discounted cash flow6.15% —6.50%8.15% — 8.50%Multifamily - Affordable GP interestIncome approach - discounted cash flow6.15% —6.50%17.50% — 19.50%Multifamily - Market RateIncome approach - direct capitalization4.50% — 6.90%N/AOfficeIncome approach - discounted cash flow5.20% — 7.50%7.50% — 9.30%Income approach - direct capitalization5.40% — 10.90%N/AIndustrial Income approach - discounted cash flow5.00% — 6.30%6.30% — 7.80%Income approach - direct capitalization4.00% — 9.00%N/AHotelIncome approach - discounted cash flow6.00% 8.30% 

    In valuing indebtedness, the Company considers significant inputs to be the term of the debt, value of collateral, market loan-to-value ratios, market interest rates and spreads, and credit quality of investment