Company: KBSR
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001482430-25-000054
Chunk: 38

Company: KBS Real Estate Investment Trust III, Inc.
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 1
Chunk 38
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CLOSURES (CONTINUED)

During the nine months ended September 30, 2025, the Company measured the following asset at fair value on a nonrecurring basis (in thousands):  Fair Value Measurements Using TotalQuoted Prices in Active Markets for Identical Assets(Level 1)Significant Other Observable Inputs(Level 2)SignificantUnobservable Inputs(Level 3)Nonrecurring Basis:Impaired real estate (1)$343,100 $— $— $343,100 _____________________(1) Amount represents the fair value for real estate assets impacted by an impairment charge during the nine months ended September 30, 2025, as of the date that the fair value measurement was made, which was September 30, 2025.   

At September 30, 2025, 60 South Sixth, Towers at Emeryville and The Almaden were measured at their estimated fair values based on a discounted cash flow approach.  The significant unobservable inputs the Company used in measuring the estimated fair value of 60 South Sixth included a discount rate of 10.00% and a terminal cap rate of 8.50%.  The significant unobservable inputs the Company used in measuring the estimated fair value of Towers at Emeryville included a discount rate of 11.00% and a terminal cap rate of 9.00% and the significant unobservable inputs the Company used in measuring the estimated fair value of The Almaden included a discount rate of 10.00% and a terminal cap rate of 8.75%.  See Note 4, “Real Estate – Impairment of Real Estate” for further discussion of the impaired real estate property.  

11.    RELATED PARTY TRANSACTIONS

The Company has entered into the Advisory Agreement with the Advisor.  The Company’s Dealer Manager Agreement with the Dealer Manager terminated on March 15, 2024 upon termination of the Company’s dividend reinvestment plan.  These agreements entitled the Advisor and/or the Dealer Manager to specified fees upon the provision of certain services with regard to the Offering and reimbursement of organization and offering costs incurred by the Advisor and the Dealer Manager on behalf of the Company and entitle the Advisor to specified fees upon the provision of certain services with regard to the investment of funds in real estate investments, the management of those investments, among other services, and the disposition of investments, and entitle the Advisor to reimbursement of certain costs incurred