Company: BHM
Filing Date: 2025-03-20
Form Type: 424B3
Source: 0001104659-25-026164
Chunk: 122

Company: Bluerock Homes Trust, Inc.
Filing Date: 2025-03-20
Form: 424B3
Chunk 122
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 not be treated as qualifying income for purposes of the REIT gross
income tests, and might also give rise to an asset that does not qualify for purposes of the REIT asset tests.

Our ability to provide certain services to our tenants may be limited by the REIT rules or may have to be provided through a TRS.

As
a REIT, we generally will not be able provide services to our tenants other than those that are customarily provided by landlords, nor
will we be able to derive income from a third party that provides such services. If we forego providing such services to our tenants,
we may be at a disadvantage to competitors that are not subject to the same restrictions. However, we can provide such non-customary services
to tenants and share in the revenue from such services if we do so through a TRS, though income earned by such TRS will be subject to
U.S. federal corporate income tax.

Any
ownership of a TRS will be subject to limitations, and our transactions with a TRS will cause us to be subject to a 100% penalty tax on
certain income or deductions if those transactions are not conducted on arm’s-length terms.

Overall,
no more than 20% of the value of a REIT’s assets may consist of stock or securities of one or more TRSs. A TRS will be subject to
applicable U.S. federal, state and local corporate income tax on its taxable income, and its after-tax net income will be available for
distribution to us but is not required to be distributed to us. In addition, the Code limits the deductibility of interest paid or accrued
by a TRS to its parent REIT to assure that the TRS is subject to an appropriate level of corporate taxation and, in certain circumstances,
other limitations on deductibility may apply. The Code also imposes a 100% excise tax on certain transactions between a TRS and its parent
REIT that are not conducted on an arm’s-length basis. We will monitor the value of our respective investments in any TRS for the
purpose of ensuring compliance with TRS ownership limitations and will structure our transactions with any TRS on terms that we believe
are arm’s-length to avoid incurring the 100% excise tax described above. There can be no assurance, however, that we will be able
to comply with the 20% limitation or to avoid application of the 100% excise tax.

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