Company: CMCT
Filing Date: 2025-03-07
Form Type: 10-K
Source: 0000908311-25-000017
Chunk: 59

Company: Creative Media & Community Trust Corp
Filing Date: 2025-03-07
Form: 10-K
Item: Item 1A
Chunk 59
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 to recover on a claim against a director or officer who negligently causes us to incur losses.

•The liability of the Administrator and the Operator to us under the Master Services Agreement and the Investment Management Agreement, respectively, is limited and we and CIM Urban have agreed to indemnify the Administrator and the Operator, respectively, against certain liabilities. As a result, we could experience poor performance or losses for which neither the Administrator nor the Operator would be liable.

Risks Related to Real Estate Assets

•Our operating performance is subject to risks associated with the real estate industry.

•A significant portion of our properties, by aggregate net operating income and square feet, are located in California. We are dependent on the California real estate market and economy, and are therefore susceptible to risks of events in the California market that could adversely affect our business, such as adverse market conditions, changes in local laws or regulations and natural disasters.

•Tenant concentration increases the risk that cash flow could be interrupted.

•If a major tenant declares bankruptcy, we may be unable to collect balances due under relevant leases, which could have a material adverse effect on our financial condition and ability to pay distributions on our Common Stock or Preferred Stock. 

•We may be unable to renew leases or lease vacant office space.

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Table of Contents

•A significant portion of our net operating income is expected to come from our hotel and, as a result, our operating performance is subject to the cyclical nature of the lodging industry. 

•The outbreak of a highly infectious, contagious or widespread disease, such as COVID-19, can result (and has resulted) in reductions in travel and adversely affect demand for our hotel.

•We may be unable to renew leases or release apartment units as leases expire, or the terms of renewals or new leases may be less favorable than current leases.

•Income from our long-term leases at our office properties is an important source of our cash flow from operations and is subject to risks related to increases in expenses and inflation.

•Real estate-related taxes may increase, and if these increases are not passed on to tenants, our income will be reduced.

•We face risks associated with development, redevelopment, repositioning or construction of real estate projects.

•Inflation may adversely affect our real estate operations. 

•Supply chain disruption and increased costs in labor and materials may adversely affect our real estate operations.

•Our real estate business is subject to risks from climate change.

Risks Related to Debt Financing

•We have incurred significant indebtedness and may incur significant additional indebted