Company: BHM
Filing Date: 2025-03-20
Form Type: 424B3
Source: 0001104659-25-026164
Chunk: 167

Company: Bluerock Homes Trust, Inc.
Filing Date: 2025-03-20
Form: 424B3
Chunk 167
---
 have occurred had the property been vacant at the time of acquisition and subject to lease-up. We amortize the value of in-place leases to expense over the remaining non-cancelable term of the respective leases, which is on average six months. Estimates of the fair values of the tangible assets, identifiable intangibles and assumed liabilities require us to make significant assumptions to estimate market lease rates, property operating expenses, carrying costs during lease-up periods, discount rates, market absorption periods, prevailing interest rates and the number of years the property will be held for investment. The use of inappropriate assumptions could result in an incorrect valuation of acquired tangible assets, identifiable intangible assets and assumed liabilities, which could impact the amount of our net income (loss). Differences in the amount attributed to the fair value estimate of the various assets acquired can be significant based upon the assumptions made in calculating these estimates. Capital Additions, Depreciation and Amortization We capitalize costs incurred in connection with our capital additions activities, including redevelopment, development and construction projects, other tangible improvements, and replacements of existing components. Repair and maintenance and tenant turnover costs are expensed as incurred. Repair and maintenance and tenant turnover costs include all costs that do not extend the useful life of the real estate asset. Accordingly, many factors are considered as part of our evaluation processes with no one factor necessarily determinative. Depreciation and amortization expense are computed on the straight-line method over the asset’s estimated useful life. We consider the period of future benefit of an asset to determine its appropriate useful life and anticipate the estimated useful lives of assets by class to be generally as follows:

| ​                                 | ​ | ​             |
| Buildings                         |   | 30 – 40 years |
| Building improvements             |   | 5 – 15 years  |
| Land improvements                 |   | 5 – 15 years  |
| Furniture, fixtures and equipment |   | 3 – 8 years   |
| In-place leases                   |   | 6 months      |

81

Table of Contents

Impairment of Operating Real Estate Assets

We
continually monitor events and changes in circumstances that could indicate that the carrying amounts of our operating real estate and
related intangible assets may not be recoverable. The evaluation of real estate assets for potential impairment requires our management
to exercise significant judgement and make certain key assumptions, including the following: (i) capitalization rate, (ii) discount rate,
(iii) number of years the property will be held, (iv)