Company: BHM
Filing Date: 2025-03-28
Form Type: POS AM
Source: 0001104659-25-029225
Chunk: 62

Company: Bluerock Homes Trust, Inc.
Filing Date: 2025-03-28
Form: POS AM
Chunk 62
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Our policies do not limit
us from incurring debt. For purposes of calculating our leverage, we include our consolidated real estate investments, include our preferred
equity and loan investments at cost, include assets we have classified as held for sale, and include any joint venture level indebtedness
in our total indebtedness.

Higher debt levels will cause
us to incur higher interest charges, resulting in higher debt service payments, and may be accompanied by restrictive covenants. Interest
we pay reduces cash available for distribution to stockholders. Additionally, with respect to our variable rate debt, increases in interest
rates increase our interest costs, which reduces our cash flow and our ability to make distributions to you. In addition, if we need to
repay existing debt during periods of rising interest rates, we could be required to liquidate one or more of our investments in properties
at times that may not permit realization of the maximum return on such investments and could result in a loss. In addition, if we are
unable to service our debt payments, our lenders may foreclose on our interests in the real property that secures the loans we have entered
into.

As of December 31, 2024,
we had approximately $177 million of mortgages payable and revolving credit facilities outstanding that are indexed to the Secured Overnight
Financing Rate (“SOFR”), and our future variable rate debt may bear interest at a rate derived from SOFR. SOFR is a relatively
new reference rate. The publication of SOFR began in April 2018, and, therefore, it has a very limited history. The future performance
of SOFR cannot be predicted based on the limited historical performance. Since the initial publication of SOFR, changes in SOFR have,
on occasion, been more volatile than changes in other benchmark or market rates, such as United States dollar LIBOR. Additionally, any
successor rate to SOFR may not have the same characteristics as SOFR or LIBOR. As a result, the amount of interest we may pay on future
variable rate debt indexed to SOFR is difficult to predict.

High mortgage rates may make it difficult for us to finance or refinance properties, which could reduce the number of properties we can acquire, our cash flow from operations and the amount of cash distributions we can make.

To maintain our qualification
as a REIT, we will be required to distribute at least 90% of our REIT taxable income (determined without regard to the deduction for dividends
paid and excluding net capital