Company: KBSR
Filing Date: 2025-03-14
Form Type: 10-K
Source: 0001482430-25-000021
Chunk: 76

Company: KBS Real Estate Investment Trust III, Inc.
Filing Date: 2025-03-14
Form: 10-K
Item: Item 15
Chunk 76
---
 substantial doubt as to the Company’s ability to continue as a going concern for at least a year from the date of the issuance of these financial statements.  In order to refinance, restructure or extend the Company’s maturing debt obligations, the Company has been required to reduce the loan commitments and/or make paydowns on certain loans, and the Company may be required to make additional reductions to loan commitments and paydowns on the loans maturing during the next 12 months in order to refinance, restructure or extend those loans.  As a result of reductions in loan commitments and paydowns and the ongoing liquidity needs in the Company’s real estate portfolio, the Company may be required to sell assets into a challenged real estate market in an effort to manage its liquidity needs.  Selling real estate assets in the current market may result in a lower sale price than the Company would otherwise obtain.  In addition, the Company may continue to evaluate raising capital through the issuance of new equity or debt.  The Company may also defer noncontractual expenditures.  Additionally, elevated interest rates, reductions in real estate values and future tenant turnover in the portfolio will have a further impact on the Company’s ability to meet loan compliance tests and may further reduce the available liquidity under the Company’s loan agreements.  See also, Note 2, “Going Concern.”During the years ended December 31, 2024, 2023 and 2022, the Company’s interest expense related to notes payable was $126.6 million, $120.5 million and $60.3 million, respectively, which excludes the impact of interest rate swaps and caps put in place to mitigate the Company’s exposure to rising interest rates on its variable rate notes payable.  See Note 9, “Derivative Instruments.”  Included in interest expense was the amortization of deferred financing costs of $9.5 million, $4.2 million and $3.9 million for the years ended December 31, 2024, 2023 and 2022, respectively.  As of December 31, 2024 and 2023, $8.6 million and $9.9 million of interest expense were payable, respectively.  The following is a schedule of maturities, including principal amortization payments, for all notes payable outstanding as of December 31, 2024 (in thousands): 2025$557,717 2026865,846 202727,500 2028—