Company: BHM
Filing Date: 2025-07-08
Form Type: DRS
Source: 0001104659-25-066400
Chunk: 80

Company: Bluerock Homes Trust, Inc.
Filing Date: 2025-07-08
Form: DRS
Chunk 80
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 if our Manager does not identify profitable investment
opportunities for us, it will still receive material compensation from us. This compensation structure may reduce our Manager’s
incentive to devote time and effort to seeking profitable opportunities for our portfolio.

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If we acquire properties from affiliates of our Manager, the price may be higher than we would pay if the transaction were the result of arm’s-length negotiations.

We may acquire properties
or investments from Bluerock, our Manager, directors or officers, or their respective affiliates. The prices we pay for such properties
will not be the subject of arm’s-length negotiations, which means that the acquisitions may be on terms less favorable to us than
those negotiated in an arm’s-length transaction. Even though we expect to use an independent third-party appraiser to determine
fair market value when acquiring properties from our Manager and its affiliates, we may pay more for particular properties than we would
have in an arm’s-length transaction, which would reduce our cash available for investment in other properties or distribution to
our stockholders.

If we internalize our management functions, we could incur other significant costs associated with being self-managed.

At any time, our board of
directors may, but is not obligated to, pursue the internalization of the functions performed for us by our Manager through the acquisition
of our Manager or similar transaction through which we would bring onboard our Manager’s management team. The method by which we
could internalize these functions could take many forms, and may require agreement with the Manager. While we believe that there may be
substantial benefits to internalization of management functions at the appropriate time, there is no assurance that internalization will
be beneficial to us and our stockholders, and internalizing our management functions could reduce earnings per share and funds from operation
per share. For example, we may not realize the perceived benefits or we may not be able to properly integrate a new staff of managers
and employees or we may not be able to effectively replicate the services provided previously by our Manager or its affiliates. Internalization
transactions involving the internalization of managers affiliated with entity sponsors have also, in some cases, been the subject of litigation.
Even if these claims are without merit, we could be forced to spend significant amounts of money defending claims which would reduce the
amount of funds available for us to invest in properties or other investments to pay distributions. All these factors could have a material
adverse effect on our results of operations