Company: KBSR
Filing Date: 2025-03-14
Form Type: 10-K
Source: 0001482430-25-000021
Chunk: 167

Company: KBS Real Estate Investment Trust III, Inc.
Filing Date: 2025-03-14
Form: 10-K
Item: Item 1A
Chunk 167
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 notably in the greater San Francisco Bay Area where we own several assets, have had direct and material impacts to property appraisal values used by our lenders and have impacted our ability to access certain credit facilities and our ongoing cash flow, which, in large part, provide liquidity for capital expenditures needed to manage our real estate assets.  

Since February 2024, we have refinanced, restructured or extended $1.3 billion of maturing debt obligations. As of March 14, 2025, we had debt obligations in the aggregate principal amount of $1.5 billion, with a weighted-average remaining term of 1.5 years.  

In order to refinance, restructure or extend our maturing debt obligations, we have been required to reduce the loan commitments and/or make paydowns on certain loans, and we have agreed to satisfy certain conditions that are not in our sole control, including making principal paydowns during the terms of the loans, selling assets and taking identified actions relating to our portfolio. 

As of March 14, 2025, we have $467.0 million of loan maturities and required principal paydowns during the next 12 months and $672.7 million of loan maturities and required principal paydowns from March 14, 2026 through December 31, 2026. Our loan agreements require us to sell two properties in 2025, two properties in 2026 and up to four properties in 2027.  Selling real estate assets in the current market may result in a lower sale price than we would otherwise obtain.  We may continue to evaluate raising capital through the issuance of new equity or debt to the extent we see improvement in the capital markets.  We may also defer noncontractual expenditures to manage our liquidity needs.

There is no assurance that we will be able to satisfy the terms and conditions of our existing loan agreements or the terms and conditions of any future extension or refinancing agreements that are entered into. If we are unable to make required principal paydowns under certain loans, sell assets or satisfy certain covenants and conditions in our loan agreements, the lenders may seek to foreclose on the underlying collateral. Additionally, our loan agreements contain cross default provisions and we have pledged the equity of certain of our subsidiaries (and all proceeds therefrom) in connection with the restructuring of certain debt facilities. 

As a result of certain upcoming loan maturities and required principal paydowns, the challenging commercial