Company: KW
Filing Date: 2025-02-28
Form Type: 10-K
Source: 0001408100-25-000084
Chunk: 36

Company: Kennedy-Wilson Holdings, Inc.
Filing Date: 2025-02-28
Form: 10-K
Item: Item 1A
Chunk 36
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) or may involve loans and loan portfolios in some cases that may be non-performing or sub-performing and may be in default at the time of purchase or may become "sub-performing" or "non-performing" following our origination or acquisition thereof.  In general, the distressed loans and loan portfolios we may acquire are speculative investments and have a greater than normal risk of future defaults and delinquencies as compared to newly originated loans. Returns on loan investments depend on the borrower’s ability to make required payments or, in the event of default, our security interests and our ability to foreclose and liquidate whatever property that secures the loans and loan portfolios.  We may be unable to collect on a defaulted loan or foreclose on security successfully or in a timely fashion in the future. There may also be instances when we are able to acquire title to an underlying property, but we may not be able to successfully reposition the property or  sell it to make a profit on our investment.  In addition, in the event of a decline in real estate values, we are more likely to incur losses on our loans in the event of default because the value of our collateral may be insufficient to cover our cost on the loan significantly increases. 

Additionally, our real estate debt investment business primarily originates and invests in floating interest rate instruments. While our income from such variable rate loans and investments has increased as the market interest rates increased, borrowers may be unable to continue to service their debt at the applicable rates. Returns on loan investments depend on the borrower’s ability to make required payments or, in the event of default, our security interest. We may be unable to collect on a defaulted loan or foreclose on security successfully or in a timely fashion, either of which may adversely affect our business and results of operations. Additionally, potential borrowers may be unable or unwilling to accept variable rate loans, which would result in less transaction activity for our real estate debt investment business and could adversely affect our business, financial condition, liquidity and results of operations.

Our reliance on third-parties to operate certain of our properties may harm our business. 

We rely on third party property managers and hotel operators to manage the daily operations of our properties.  We are also parties to hotel management agreements under which unaffiliated third-party property managers manage our hotel.  These 

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third parties are directly responsible for the day-to-day operation of our properties with limited supervision by us, and they often have potentially significant decision-making authority with respect to those properties.  Thus