Company: KBSR
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001482430-25-000042
Chunk: 238

Company: KBS Real Estate Investment Trust III, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 2
Chunk 238
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2025, we completed the sale of Sterling Plaza, an office property containing an aggregate of 313,609 rentable square feet located on approximately 2.1 acres of land in Dallas, Texas, to a purchaser unaffiliated with us or our advisor, for a gross sales price of $126.5 million, or $117.7 million of net sales proceeds, after credits given to the purchaser for outstanding tenant improvements and lease incentives, prorations, third-party closing costs and $0.8 million of disposition fees paid to our advisor.

On July 11, 2025, pursuant to an amendment to the Amended and Restated Portfolio Loan Facility, we used the net sales proceeds of $117.7 million from the sale of Sterling Plaza to (i) paydown the outstanding principal of the Amended and Restated Portfolio Loan Facility by $87.7 million and (ii) fund $30.0 million into cash collateral accounts for the Amended and Restated Portfolio Loan Facility.  Sterling Plaza was released as security for the Amended and Restated Portfolio Loan Facility.  Following the release of Sterling Plaza, the Amended and Restated Portfolio Loan Facility is secured by 60 South Sixth, Towers at Emeryville, Ten Almaden and Town Center. 

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Table of ContentsPART I. FINANCIAL INFORMATION (CONTINUED)Item 3.  Quantitative and Qualitative Disclosures about Market Risk

We are exposed to the effects of interest rate changes as a result of borrowings used to maintain liquidity and to fund property improvements, repairs and tenant build-outs to properties, to pay for other capital needs, to refinance existing indebtedness and to provide working capital.  We have also funded distributions to stockholders and redemptions of common stock with borrowings.  Our profitability and the value of our real estate investment portfolio may be adversely affected during any period as a result of interest rate changes.  Our interest rate risk management objectives are to limit the impact of interest rate changes on earnings, prepayment penalties and cash flows and to lower overall borrowing costs.  We may manage interest rate risk by utilizing a variety of financial instruments, including interest rate caps, floors, and swap agreements, in order to limit the effects of changes in interest rates on our operations.  When we use these types of derivatives to hedge the risk of interest-earning assets or interest-bearing liabilities, we may be subject to certain risks, including the risk that losses on a hedge