Company: KBSR
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001482430-25-000042
Chunk: 159

Company: KBS Real Estate Investment Trust III, Inc.
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 8
Chunk 159
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 and we cannot predict when economic activity and demand for office space will return to pre-pandemic levels in those markets.  Both upcoming and recent tenant lease expirations and leasing challenges in certain markets amidst the aforementioned headwinds coupled with slower than expected return-to-office, most notably in the greater San Francisco Bay Area where we own several assets, have had direct and material impacts to property appraisal values used by our lenders and have impacted our ability to access certain credit facilities and our ongoing cash flow, which, in large part, provide liquidity for capital expenditures needed to manage our real estate assets.

Since February 2024, we have refinanced, restructured or extended $1.3 billion of maturing debt obligations.  As of August 14, 2025, we had debt obligations in the aggregate principal amount of $1.4 billion, with a weighted-average remaining term of 1.1 years.  

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Table of ContentsPART I. FINANCIAL INFORMATION (CONTINUED)Item 2.  Management’s Discussion and Analysis of Financial Condition and Results of Operations (continued)

In order to refinance, restructure or extend our maturing debt obligations, we have been required to reduce the loan commitments and/or make paydowns on certain loans, and we have agreed to satisfy certain conditions that are not in our sole control, including making principal paydowns during the terms of the loans, selling assets and taking identified actions relating to our portfolio. 

As of August 14, 2025, we have $556.5 million of loan maturities and required principal paydowns during the next 12 months and $503.0 million of loan maturities and required principal paydowns from August 14, 2026 through December 31, 2026.  Our loan agreements require us to sell two properties in 2025, two properties in 2026 and up to four properties in 2027.  Subsequent to June 30, 2025, we closed on the sale of one real estate property and we received a nonrefundable deposit related to another property that was under contract to sell with an anticipated close in the third quarter of 2025.  Selling real estate assets in the current market may result in a lower sale price than we would otherwise obtain.  We may continue to evaluate raising capital through the issuance of new equity or debt to the extent we see improvement in the capital markets.  We may also defer non