# EDGAR Filing Document

**Accession Number:** 0001452936
**File Stem:** 0001452936-25-000096
**Filing Date:** 2025-9
**Character Count:** 86519
**Document Hash:** 105cace3c092aec15ed6239b64c8560c
**Contains OCR:** False
**Source Format:** 

## Filing Content

## Filing Summary
**0001452936-25-000096.hdr.sgml**: 20250902

**ACCESSION NUMBER**: 0001452936-25-000096

**CONFORMED SUBMISSION TYPE**: 8-K

**PUBLIC DOCUMENT COUNT**: 14

**CONFORMED PERIOD OF REPORT**: 20250831

**ITEM INFORMATION**: Regulation FD Disclosure

**ITEM INFORMATION**: Financial Statements and Exhibits

**FILED AS OF DATE**: 20250902

**DATE AS OF CHANGE**: 20250902

**FILER**: 

**COMPANY DATA:**
- **COMPANY CONFORMED NAME:** Pacific Oak Strategic Opportunity REIT, Inc.
- **CENTRAL INDEX KEY:** 0001452936
- **STANDARD INDUSTRIAL CLASSIFICATION:** REAL ESTATE INVESTMENT TRUSTS [6798]
- **ORGANIZATION NAME:** 05 Real Estate & Construction
- **EIN:** 263842535
- **STATE OF INCORPORATION:** MD
- **FISCAL YEAR END:** 1231

**FILING VALUES:**
- **FORM TYPE:** 8-K
- **SEC ACT:** 1934 Act
- **SEC FILE NUMBER:** 000-54382
- **FILM NUMBER:** 251284971

**BUSINESS ADDRESS:**
- **STREET 1:** 3200 PARK CENTER DR
- **STREET 2:** SUITE 800
- **CITY:** COSTA MESA
- **STATE:** CA
- **ZIP:** 92626
- **BUSINESS PHONE:** 866-722-6257

**MAIL ADDRESS:**
- **STREET 1:** 3200 PARK CENTER DR
- **STREET 2:** SUITE 800
- **CITY:** COSTA MESA
- **STATE:** CA
- **ZIP:** 92626

**FORMER COMPANY:**
- **FORMER CONFORMED NAME:** KBS Strategic Opportunity REIT, Inc.
- **DATE OF NAME CHANGE:** 20081230

?xml version='1.0' encoding='ASCII'? pacoaksor-20250831

    

**UNITED STATES**

**SECURITIES AND EXCHANGE COMMISSION**

Washington, D.C. 20549

**__________________**

**FORM 8-K**

**__________________**

**CURRENT REPORT**

**Pursuant to Section 13 or 15(d) of**

**The Securities Exchange Act of 1934**

Date of Report (Date of earliest event reported): August 31, 2025

**PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.**

(Exact name of registrant specified in its charter)

**______________________________________________________**

---

| | | |
|:---|:---|:---|
| **Maryland** | **000-54382** | **26-3842535** |
| (State or other jurisdiction of<br>incorporation or organization) | (Commission File Number) | (IRS Employer<br>Identification No.) |

---

**3200 Park Center Dr., Suite 800** 

**Costa Mesa, California 92626**

(Address of principal executive offices)

Registrant's telephone number, including area code: **(866) 722-6257**

**11766 Wilshire Blvd., Suite 1670**

**Los Angeles, California 90025**

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

☐ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

☐ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

☐ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

☐ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class Trading Symbol(s) Name of each exchange on which registered <br> <u>None</u> <u>N/A</u> <u>N/A</u>

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. □

    

------

**ITEM 7.01 REGULATION FD DISCLOSURE**

*Financial Statements - Exhibits 99.1 and 99.2*

Pacific Oak SOR (BVI) Holdings, Ltd. (the "BVI"), a wholly-owned subsidiary of Pacific Oak Strategic Opportunity REIT, Inc. (the "Company"), completed offerings of Series B and D bonds since February 2020. Such offerings were made to investors in Israel and were registered with the Israel Securities Authority. Consequently, the BVI is required to prepare and file with the Israel Securities Authority certain financial statements prepared in accordance with International Financial Reporting Standards ("IFRS").

On August 31, 2025, the BVI filed IFRS consolidated and separate interim financial statements. The English translations of the IFRS consolidated and separate interim financial statements, as of and for the three and six months ended June 30, 2025, are attached as Exhibits 99.1 and 99.2, respectively, to this Form 8-K.

The information in this Item 7.01 of Form 8-K and the attached Exhibits 99.1 and 99.2 are furnished to the Securities and Exchange Commission ("SEC"), and shall not be deemed to be "filed" with the SEC for any purpose, including for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of that section and shall not be deemed to be incorporated by reference into any filing under the Securities Act of 1933, as amended, or the Exchange Act regardless of any general incorporation language in such filing.

**ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS**

---

| | |
|:---|:---|
| **(d)**<br>**Ex.** | **Exhibits**<br>**Description** |
| 99.1 | <u>[Pacific Oak SOR (BVI) Holdings, Ltd. Consolidated Interim Financial Statements as of June 30, 2025 (unaudited)](pacificoaksorbviq22025fins.htm)</u> |
| 99.2 | <u>[Pacific Oak SOR (BVI) Holdings, Ltd. Separate Interim Financial Statements as of June 30, 2025 (unaudited)](pacificoaksorbviq22025finsa.htm)</u> |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |

---

------

**SIGNATURES**

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

---

| | | |
|:---|:---|:---|
| | **PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.** | **PACIFIC OAK STRATEGIC OPPORTUNITY REIT, INC.** |
| Dated: September 2, 2025 | BY: | /S/ PETER MCMILLAN III |
| | | **Peter McMillan III** |
| | | *Chairman of the Board, President and Director* |
| | | (principal financial officer) |

---

## Exhibit 99.1

**<u>Exhibit 99.1</u>**

**This English translation is for convenience purposes only. This is not an official translation and is not<br>binding. Whilst reasonable care and skill have been exercised in the preparation hereof, no translation can ever perfectly reflect the original Hebrew version. In the event of any discrepancy between the Hebrew version and this translation, the Hebrew version shall prevail.**

**PACIFIC OAK SOR (BVI) HOLDINGS, LTD.**

**INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS** 

**AS OF JUNE 30, 2025**

**UNAUDITED**

**U.S. DOLLARS IN THOUSANDS**

**INDEX**

---

| | |
|:---|:---|
| | &nbsp;&nbsp;&nbsp;**Page** |
| &nbsp;&nbsp;&nbsp;&nbsp;**Condensed Consolidated Statements of Financial Position** | **2** |
| &nbsp;&nbsp;&nbsp;&nbsp;**Condensed Consolidated Statements of Profit or Loss** | **3** |
| &nbsp;&nbsp;&nbsp;&nbsp;**Condensed Consolidated Statements of Equity** | **4-5** |
| &nbsp;&nbsp;&nbsp;&nbsp;**Condensed Consolidated Statements of Cash Flows** | **6-7** |
| &nbsp;&nbsp;&nbsp;&nbsp;**Notes to Interim Condensed Consolidated Financial Statements** | **8-19** |

---

**- - - - - - - - - - - - - - - - - - -**

------

**PACIFIC OAK SOR (BVI) HOLDINGS LTD**.

**CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION**

---

| | | | |
|:---|:---|:---|:---|
| | **June 30,** | **June 30,** | |
| | **2025** | **2024** | **December 31,**<br>**2024** |
| | **Unaudited** | **Unaudited** | **Audited** |
| | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** |
| **ASSETS** |  |  |  |
| **CURRENT ASSETS** |  |  |  |
| Cash and cash equivalents | $14450 | $40424 | $55856 |
| Financial assets at fair value through profit or loss | 14116 | 8598 | 13154 |
| Rents and other receivables, net | 3872 | 3041 | 2201 |
| Prepaid expenses and other assets | 4306 | 6491 | 4179 |
| Due from affiliate | 2317 |  |  |
| Restricted cash | 38439 | 22510 | 25486 |
|  | 77500 | 81064 | 100876 |
| Investment property held for sale | 39100 |  |  |
|  | 116600 | 81064 | 100876 |
| **NON-CURRENT ASSETS** |  |  |  |
| Investment properties | 1010958 | 1433138 | 1157945 |
| Property plant and equipment - hotel, net | 30000 | 36831 | 33624 |
| Goodwill | 949 | 949 | 949 |
| Investment in joint ventures | 173075 | 176493 | 177375 |
| Restricted cash | 12195 | 16504 | 16890 |
|  | 1227177 | 1663915 | 1386783 |
| **Total assets** | $1343777 | $1744979 | $1487659 |
| **LIABILITIES AND EQUITY** |  |  |  |
| **CURRENT LIABILITIES** |  |  |  |
| Notes payable | $337621 | $178813 | $157316 |
| Bonds payable | 157247 | 102843 | 20653 |
| Accounts payable and accrued liabilities | 31050 | 25500 | 27996 |
| Due to affiliate | 24652 | 13574 | 12660 |
| Other liabilities | 16574 | 20072 | 18516 |
|  | 567144 | 340802 | 237141 |
| Note payable related to property held for sale, net | 39515 |  |  |
|  | 606659 | 340802 | 237141 |
| **NON-CURRENT LIABILITIES** |  |  |  |
| Notes payable, net | 164607 | 455330 | 388582 |
| Bonds payable, net | 167848 | 262457 | 298741 |
| Lease obligation | 9270 | 9224 | 8912 |
| Other liabilities | 25876 | 14492 | 26380 |
|  | 367601 | 741503 | 722615 |
| **Total liabilities** | 974260 | 1082305 | 959756 |
| **EQUITY** |  |  |  |
| Owner's net equity | 366099 | 654858 | 523989 |
| Non-controlling interests | 3418 | 7816 | 3914 |
| **Total equity** | 369517 | 662674 | 527903 |
| **Total liabilities and equity** | $1343777 | $1744979 | $1487659 |

---

The accompanying notes are an integral part of the interim condensed consolidated financial statements.

---

| | | | |
|:---|:---|:---|:---|
| August 31, 2025 | /s/ Ryan Schluttenhofer | /s/ Jodi Kremerman | /s/ Keith David Hall |
| Date of approval of | Schluttenhofer, Ryan | Kremerman, Jodi | Hall, Keith David |
| financial statements | Chief Accounting Officer | Chairman of Board of Directors | Chief Executive Officer |

---

------

**PACIFIC OAK SOR (BVI) HOLDINGS LTD**.

**CONDENSED CONSOLIDATED STATEMENTS OF PROFIT OR LOSS**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Six months ended June 30,** | **Six months ended June 30,** | **Three months ended June 30,** | **Three months ended June 30,** | |
| | **2025** | **2024** | **2025** | **2024** | **Year ended December 31,** <br>**2024** |
| | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** | **Audited** |
| | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** |
| Revenues and other income: |  |  |  |  |  |
| Rental income | $53694 | $57615 | $27269 | $28889 | $112567 |
| Tenant reimbursements | 5975 | 5622 | 2967 | 2501 | 11672 |
| Hotel revenues | 4622 | 5039 | 1737 | 2235 | 9061 |
| Other operating income | 932 | 961 | 468 | 489 | 1899 |
| Total revenues and other income | 65223 | 69237 | 32441 | 34114 | 135199 |
| Expenses: |  |  |  |  |  |
| Operating, maintenance, and management fees | (23302) | (22945) | (11624) | (11657) | (48572) |
| Real estate taxes and insurance | (10903) | (13031) | (5422) | (6555) | (23410) |
| Hotel expenses | (3373) | (3657) | (1636) | (1781) | (6877) |
| Total expenses | (37578) | (39633) | (18682) | (19993) | (78859) |
| Gross profit | 27645 | 29604 | 13759 | 14121 | 56340 |
| Fair value adjustment of investment properties, net | (111210) | (79760) | (108665) | (27960) | (123140) |
| Depreciation | (548) | (572) | (274) | (292) | (1178) |
| Equity in loss of unconsolidated joint ventures, net | (4300) | (9281) | (2433) | (4925) | (49226) |
| Asset management fees | (7387) | (7974) | (3722) | (3872) | (15622) |
| Impairment loss - hotel | (3171) | (3454) | (3171) |  | (6400) |
| General and administrative expenses | (2877) | (4590) | (1279) | (2832) | (7425) |
| Operating loss | (101848) | (76027) | (105785) | (25760) | (146651) |
| Finance income (loss) from financial assets at fair value through profit or loss | 962 | (16551) | 962 | (1279) | (11995) |
| Finance expenses, net | (33294) | (34782) | (17151) | (18009) | (71892) |
| Foreign currency transaction (loss) gain, net | (24157) | 11280 | (30141) | 7367 | (3156) |
| Other income | 1016 | 738 | 233 | 283 | 1764 |
| Loss on extinguishment of debt |  |  |  |  | (6033) |
| Net loss before income taxes | $(157321) | $(115342) | $(151882) | $(37398) | (237963) |
| Income tax provision | (830) |  |  |  | (10000) |
| Net loss | $(158151) | $(115342) | $(151882) | $(37398) | $(247963) |
| Net loss attributable to owner | $(157890) | $(112308) | $(151422) | $(34748) | $(243177) |
| Net loss attributable to non-controlling interests | (261) | (3034) | (460) | (2650) | (4786) |
| Net loss | $(158151) | $(115342) | $(151882) | $(37398) | $(247963) |
| Total comprehensive loss | $(158151) | $(115342) | $(151882) | $(37398) | $(247963) |

---

The accompanying notes are an integral part of the interim condensed consolidated financial statements.

------

**PACIFIC OAK SOR (BVI) HOLDINGS LTD**.

**CONDENSED CONSOLIDATED STATEMENTS OF EQUITY**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Owner contributions** | **Retained earnings (deficit)** | **Paid-in Capital resulting from transactions with non-controlling interests** | **Owner's net equity** | **Non-controlling interests** | **Total equity** |
| | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** |
| | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** |
| Balance as of January 1, 2025 | $693554 | $(212639) | $43074 | $523989 | $3914 | $527903 |
| Net loss |  | (157890) |  | (157890) | (261) | (158151) |
| Total comprehensive loss |  | (157890) |  | (157890) | (261) | (158151) |
| Noncontrolling interest contribution |  |  |  |  | 10 | 10 |
| Noncontrolling interest distributions |  |  |  |  | (245) | (245) |
| Balance as of June 30, 2025 | $693554 | $(370529) | $43074 | $366099 | $3418 | $369517 |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Owner contributions** | **Retained earnings** | **Paid-in Capital resulting from transactions with non-controlling interests** | **Owner's net equity** | **Non-controlling interests** | **Total equity** |
| | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** |
| | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** |
| Balance as of January 1, 2024 | $693554 | $35538 | $43074 | $772166 | $10724 | $782890 |
| Net loss |  | (112308) |  | (112308) | (3034) | (115342) |
| Total comprehensive loss |  | (112308) |  | (112308) | (3034) | (115342) |
| Distributions to owner |  | (5000) |  | (5000) |  | (5000) |
| Noncontrolling interest contributions |  |  |  |  | 397 | 397 |
| Noncontrolling interest distribution |  |  |  |  | (271) | (271) |
| Balance as of June 30, 2024 | $693554 | $(81770) | $43074 | $654858 | $7816 | $662674 |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Owner contributions** | **Retained earnings (deficit)** | **Paid-in Capital resulting from transactions with non-controlling interests** | **Owner's net equity** | **Non-controlling interests** | **Total equity** |
| | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** |
| | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** |
| Balance as of April 1, 2025 | $693554 | $(219107) | $43074 | $517521 | $4053 | $521574 |
| Net loss |  | (151422) |  | (151422) | (460) | (151882) |
| Total comprehensive loss |  | (151422) |  | (151422) | (460) | (151882) |
| Noncontrolling interest contribution |  |  |  |  | 10 | 10 |
| Noncontrolling interest distribution |  |  |  |  | (185) | (185) |
| Balance as of June 30, 2025 | $693554 | $(370529) | $43074 | $366099 | $3418 | $369517 |

---

------

**PACIFIC OAK SOR (BVI) HOLDINGS LTD**.

**CONDENSED CONSOLIDATED STATEMENTS OF EQUITY (CONTINUED)**

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Owner contributions** | **Retained earnings** | **Paid-in Capital resulting from transactions with non-controlling interests** | **Owner's net equity** | **Non-controlling interests** | **Total equity** |
| | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** |
| | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** |
| Balance as of April 1, 2024 | $693554 | $(42022) | $43074 | $694606 | $10690 | $705296 |
| Net loss |  | (34748) |  | (34748) | (2650) | (37398) |
| Total comprehensive loss |  | (34748) |  | (34748) | (2650) | (37398) |
| Distribution to owner |  | (5000) |  | (5000) |  | (5000) |
| Noncontrolling interest contribution |  |  |  |  | 47 | 47 |
| Noncontrolling interest distribution |  |  |  |  | (271) | (271) |
| Balance as of June 30, 2024 | $693554 | $(81770) | $43074 | $654858 | $7816 | $662674 |

---

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Owner contributions** | **Retained earnings** | **Paid-in Capital resulting from transactions with non-controlling interests** | **Owner's net equity** | **Non-controlling interests** | **Total equity** |
| | **Audited** | **Audited** | **Audited** | **Audited** | **Audited** | **Audited** |
| | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** |
| Balance as of January 1, 2024 | $693554 | $35538 | $43074 | $772166 | $10724 | $782890 |
| Net loss |  | (243177) |  | (243177) | (4786) | (247963) |
| Total comprehensive loss |  | (243177) |  | (243177) | (4786) | (247963) |
| Distributions to owner |  | (5000) |  | (5000) |  | (5000) |
| Noncontrolling interests contributions |  |  |  |  | 584 | 584 |
| Noncontrolling interests distributions |  |  |  |  | (2608) | (2608) |
| Balance as of December 31, 2024 | $693554 | $(212639) | $43074 | $523989 | $3914 | $527903 |

---

The accompanying notes are an integral part of the interim condensed consolidated financial statements.

------

**PACIFIC OAK SOR (BVI) HOLDINGS LTD**.

**CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Six months ended June 30,** | **Six months ended June 30,** | **Three months ended June 30,** | **Three months ended June 30,** | |
| | **2025** | **2024** | **2025** | **2024** | **Year ended**<br>**December 31,** <br>**2024** |
| | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** | **Audited** |
| | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** |
| <u>Cash Flows from Operating Activities:</u> |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;Net loss | $(158151) | $(115342) | $(151882) | $(37398) | $(247963) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Adjustments to reconcile net loss to net cash provided by operating activities: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Equity in loss of joint ventures, net | 4300 | 9281 | 2433 | 4925 | 49226 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Fair value adjustment on investment properties, net | 111210 | 79760 | 108665 | 27960 | 123140 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Depreciation | 549 | 572 | 275 | 292 | 1178 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Impairment loss - hotel | 3171 | 3454 | 3171 |  | 6400 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Income tax provision | 830 |  |  |  | 10000 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Deferred rent | 1104 | (325) | 620 | (290) | (859) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Credit loss on financial assets | 24 | 898 | (660) | 492 | 2682 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Finance expenses, net | 33294 | 34782 | 17151 | 18009 | 71892 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other income | (1016) | (738) | (234) | (283) | (1764) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss on extinguishment of debt |  |  |  |  | 6033 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Finance (income) loss from financial assets at fair value through profit or loss | (962) | 16551 | (962) | 1279 | 11995 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Foreign currency transaction loss (gain), net | 24157 | (11280) | 30141 | (7367) | 3156 |
|  | 18510 | 17613 | 8718 | 7619 | 35116 |
| &nbsp;&nbsp;&nbsp;&nbsp;Changes in assets and liabilities: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Restricted cash | (1698) | 10405 | (6103) | (3310) | (154) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Rents and other receivables, net | (2454) | (573) | (922) | (241) | (1517) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Prepaid expenses and other assets | (130) | (1129) | 1291 | (2425) | 485 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable and accrued liabilities | (4102) | (3009) | (945) | 611 | (1697) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Due to affiliates | 1992 | 2886 | 1291 | 47 | 4676 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Other liabilities | 3021 | (3833) | 3814 | 229 | 7264 |
|  | (3371) | 4747 | (1574) | (5089) | 9057 |
| Net cash provided by operating activities | 15139 | 22360 | 7144 | 2530 | 44173 |
| <u>Cash Flows from Investing Activities:</u> |  |  |  |  |  |
| Improvements to investment properties | (6458) | (17512) | (2193) | (7650) | (27512) |
| Proceeds from sales of investment properties, net | 1845 | 3126 | 494 | 1628 | 242347 |
| Distribution of capital from joint venture | 759 | 1497 | 759 | 1497 | 1497 |
| Advance to associate | (2317) |  | (815) |  |  |
| Other income received | 1016 | 738 | 174 | 108 | 1764 |
| Payments for development obligations | (2311) | (3905) | (456) | (1655) | (11540) |
| Taxes paid related to sales of investment properties |  |  |  |  | (10000) |
| Contributions to joint ventures |  | (38689) |  | (23055) | (79530) |
| Proceeds from the sale of investments in financial assets at fair value through profit or loss, net |  | 16379 |  | 2070 | 16379 |
| Purchase of interest rate caps |  | (1447) |  | (506) | (1447) |
| Proceeds from interest rate caps |  | 1687 |  | 209 | 2813 |
| Payments on foreign currency derivatives, net |  | (478) |  |  | (478) |
| Dividend income received from financial assets at fair value through profit or loss |  | 81 |  | 3 | 81 |
| Proceeds for development obligations |  | 5 |  | 1 | 16461 |
| Net cash (used in) provided by investing activities | (7466) | (38518) | (2037) | (27350) | 150835 |

---

The accompanying notes are an integral part of the interim condensed consolidated financial statements.

------

**PACIFIC OAK SOR (BVI) HOLDINGS LTD**.

**CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Six months ended June 30,** | **Six months ended June 30,** | **Three months ended June 30,** | **Three months ended June 30,** | |
| | **2025** | **2024** | **2025** | **2024** | **Year ended** <br>**December 31,** <br>**2024** |
| | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** | **Audited** |
| | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** |
| <u>Cash Flows from Financing Activities:</u> |  |  |  |  |  |
| Principal payments on notes and bonds payable | $(26564) | $(115169) | $(2167) | $(6173) | $(348667) |
| Payments of deferred financing costs and extinguishment of debt | (167) | (3890) |  | (2468) | (9813) |
| Interest paid | (26925) | (30490) | (7870) | (14395) | (60399) |
| Noncontrolling interest contributions | 10 | 397 | 10 | 47 | 584 |
| Noncontrolling interest distributions | (245) | (271) | (185) | (271) | (2608) |
| (Distribution) release of restricted cash for debt service obligations | (6259) | 15212 | (6541) | (5344) | 13962 |
| Proceeds from loans from owner | 10000 |  | 2000 |  |  |
| Proceeds from notes and bonds payable |  | 98850 |  | 77288 | 179787 |
| Distributions to owner |  | (3850) |  | (3175) | (6554) |
| Net cash (used in) provided by financing activities | (50150) | (39211) | (14753) | 45509 | (233708) |
| Effect of exchange rate changes on cash and cash equivalents | 1071 | 701 | 1120 | (44) | (536) |
| Net (decrease) increase in cash and cash equivalents | (41406) | (54668) | (8526) | 20645 | (39236) |
| Cash and cash equivalents, beginning of period | 55856 | 95092 | 22976 | 19779 | 95092 |
| Cash and cash equivalents, end of period | $14450 | $40424 | $14450 | $40424 | $55856 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| <u>Supplemental Disclosure of Noncash Activities:</u> |  |  |  |  |  |
| Accrued development obligations | $9188 | $7313 | $9188 | $7313 | $12135 |
| Distribution payable to owner | $— | $2704 | $— | $2704 | $— |
| Asset management fee reimbursement payable to owner | $16342 | $9658 | $16342 | $9658 | $12006 |
| Deposit applied to sale of investment property | $— | $— | $— | $— | $9472 |

---

The accompanying notes are an integral part of the interim condensed consolidated financial statements.

------

**PACIFIC OAK SOR (BVI) HOLDINGS LTD**.

**NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**U.S. Dollars in thousands**

**NOTE 1:&nbsp;&nbsp;&nbsp;&nbsp;GENERAL INFORMATION**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.These financial statements have been prepared in a condensed format as of June 30, 2025 and for the six and three months period then ended ("interim condensed consolidated financial statements"). These interim condensed consolidated financial statements should be read in conjunction with the Company's annual financial statements as of December 31, 2024 and for the year then ended and the accompanying notes ("annual financial statements").

The Company and its subsidiaries (the "Group") operate in the investment real estate industry in the United States, which includes mainly investment in office, residential real estate, and undeveloped lands. In addition, the Company invests in joint ventures and a real estate equity security. The Company has three reporting segments: 1) strategic opportunistic properties 2) residential homes and 3) hotel.

As of June 30, 2025 the Company consolidated eight office complexes, encompassing, in the aggregate, approximately 2.8 million rentable square feet and these properties were 64% occupied and had one office property held for sale. In addition, the Company owned one residential home portfolio consisting of 2,078 residential homes, and one apartment property containing 317 units, which were 92% and 90% occupied, respectively. The Company also owned one hotel property with 196 rooms, three investments in undeveloped land with approximately 247 developable acres, and one office/retail development property, two investments in unconsolidated joint ventures and one financial asset at fair value through profit or loss. Subsequent to June 30, 2025, the Company completed the sale of Georgia 400 Center, an office property and as a result the sale, the Company classified this property as held for sale as of June 30, 2025. Refer to Note 7 for additional details on the sale.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.Due to the increase in the interest rates and among other factors, we are experiencing restrictions in our liquidity with respect to certain financial covenant requirements, unable to refinance maturing debt in part or in full as it comes due and bear higher debt service costs and reduced yields relative to cost of debt. If we are unable to find alternative sources of financing, there is a possibility that we will not have sufficient funds to cover our ongoing operating expenditures. Based on interest rates as of June 30, 2025, if interest rates were 100 basis points higher or lower during the six months ending June 30, 2025, the annualized interest expense on our variable rate debt would increase or decrease by $3.6 million.

In addition, tenants and potential tenants of the Company's properties may be adversely impacted by inflation and rising interest rates, which could negatively impact the Company's tenants' ability to pay rent and the demand for the Company's properties. Such adverse impacts on the Company's tenants may cause increased vacancies, which may add pressure to lower rents and increase the Company's expenditures for re-leasing.

------

**PACIFIC OAK SOR (BVI) HOLDINGS LTD**.

**NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**U.S. Dollars in thousands**

**NOTE 1:&nbsp;&nbsp;&nbsp;&nbsp;GENERAL INFORMATION (CONTINUED)**

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;c.The financial condition of the Company and the going concern assumption.

As of June 30, 2025, the Company had a working capital shortfall amounting to $490.1 million, primarily attributed to loans maturing in the year following the date of the statement of financial position, including: mortgage loans related to our residential homes portfolio of $190.2 million (October 2025 - April 2026 maturities), Series B bonds of $115.1 million (January 2026 maturity), Series C bonds of $42.1 million (repaid on August 17, 2025), and a mortgage loan related to the Crown Pointe office building of $54.7 million (forbearance agreement until September 2025), and $65.1 million of loans are in technical default as of the date of this report. In July 2025, the Company completed a secured financing transaction of $80.0 million (the "WhiteHawk Loan"), the proceeds, of which were used primarily for the full redemption of the Series C bonds and a pre-payment interest penalty, totaling $43.7 million, reserved $13.1 million for Series B and Series D interest payments and the remainder designated for operating needs, refer to Note 7 for additional details on this transaction. As a result of completing this transaction, a trustee that represents the bondholders of the Series B and Series D bonds (the "Trustee"), issued a series of communications alleging potential breaches of duty, see below "Negotiations between the Company and the Trustee and the representatives of the holders of the Series B and Series D bonds of the Company" for further details.

As of June 30, 2025, the Company was non-compliant with the minimum consolidated equity requirement and Net Adjusted Financial Debt to Net Adjusted Cap covenants related to the Series B and Series D bonds and according to the deeds of trust, if the Company is not in compliance for two consecutive quarters, the Series B and Series D bonds may become due and payable. Refer to Note 4 for additional details on the covenants. Furthermore, in July 2025, S&P Global Ratings Maalot ltd. announced an update to the rating for the Series B and Series D bonds from to ilA to ilBBB. As a result of the downgrades, the annual interest rate for the Series B and Series D bonds increased to 5.18% and 11.00%, respectively.

During the three and six months ended June 30, 2025, the Company recognized fair value losses of investment properties (including as a result of the sale of an asset) of $108.7 million and $111.2 million, respectively, due to declines in market conditions and projected cash flows, changes in sales comparisons, and based on quoted prices and continued declines in fair values may limit our ability to sell assets or refinance debt at attractive terms. The Company may negotiate a turnover of one or more secured properties back to the related lender and remit payment for any associated loan guarantee. To meet its repayment obligations in the coming year as mentioned above, the Company expects to generate cash flow from ongoing operations, additional sales of assets and securities, refinance loans, and exercise loan extension options. On August 22, 2025, the Company entered into a Purchase and Sale Agreement for the Richardson office and undeveloped land assets for a sales price of $30.0 million and on August 25, 2025, also entered into a non-binding Letter of Intent for 1,799 residential homes (to one buyer as a portfolio) for a sales price of $230.0 million. Refer to Note 7 for additional details of these events. The Company's residential homes portfolio is classified as Level 3 within the fair value hierarchy. Valuations are typically performed using the individual residential home as the unit of account, rather than assessing the portfolio on an aggregate basis. A market participant evaluating a single residential home property may not apply the same portfolio-level discounts that another market participant would require when acquiring the portfolio, where the weighted average cost of capital, including current market costs of debt and equity, would more directly influence pricing. Management estimates that if the residential homes will be sold as a portfolio, instead of individually, a discount of approximately 10-25% may be applied.

------

**PACIFIC OAK SOR (BVI) HOLDINGS LTD**.

**NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**U.S. Dollars in thousands**

**NOTE 1:&nbsp;&nbsp;&nbsp;&nbsp;GENERAL INFORMATION (CONTINUED)**

These plans are subject to change based on market conditions in the commercial real estate lending environment, the current interest rate environment, leasing and transaction volume challenges in certain markets, successful negotiations with the Trustee and Representatives, and such plans are not within the control of the Company, and therefore, there is no assurance that the Company will be successful in implementing its plans and fulfill its obligations upon maturity. The uncertainty regarding the Company's plans could be mitigated through the potential sale of its residential home portfolio, successful negotiations with the Trustee and Representatives, and other strategic actions currently under consideration. As a result, the Company's management and the Board of Directors have concluded that there are significant doubts regarding the Company's ability to continue as a going concern. No adjustments were made to the financial statements to the values or classifications of assets and liabilities that might be necessary if the Company is unable to continue operating as a going concern.

**Negotiations between the Company and the Trustee and the representatives of the holders of the Series B and Series D bonds of the Company.**

The following is a summary of the main actions and the decisions that were carried out and made in the framework of the aforementioned negotiations:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.Letter of commitment to Reznik Paz Nevo Trustees Ltd., the trustee for the holders of the Company's Debentures (Series B and Series D)** 

On August 19, 2025, the Company reported that a Letter of Commitment (Standstill) was signed in favor of Trustee and in favor of the holders of the Company's Series B and Series D bonds.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.Decision to order negotiations in accordance with the debt settlement principles document**

On August 3, 2025, the meetings of the holders of the Series B and Series D bonds have approved an instruction to the Trustee, the representatives of the holders of the Series B and Series D bonds of the Company (the "Representatives") and the Trustee's counsel and the holders of the Series B and Series D bonds to conduct negotiations with the Company for the purpose of reaching a debt arrangement on the basis of the debt settlement principles document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.Decision to Notify the Company of the Objection of the holders of the Series B and Series D bonds to the engagement in the Financing Agreement**

On July 27, 2025, the meetings of the holders of the Series B and Series D bonds have approved a resolution to instruct the Trustee to notify the Company and the Company's officers that the holders of the Series B and Series D bonds object to the Company entering the WhiteHawk Loan in which the Company ultimately entered into.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.Appointment of Representatives**

**Appointment of a joint representation**

On July 21, 2025, the meetings of the holders of the Series B and Series D bonds decided to appoint a joint representation for the holders of the Series B and Series D bonds.

------

**PACIFIC OAK SOR (BVI) HOLDINGS LTD**.

**NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**U.S. Dollars in thousands**

**NOTE 1:&nbsp;&nbsp;&nbsp;&nbsp;GENERAL INFORMATION (CONTINUED)**

**Appointment of Legal Advisor to the Trustee, the Holders of the Debentures Series and the Joint Representation**

On July 28, 2025, the meetings of the holders of the Series B and Series D bonds approved the appointment of a legal advisor for the joint representation of the Trustee and Representatives (the "Joint Representation"). The candidates who received the most votes in aggregate were Adv. Raanan Kalir and Adv. Alon Binyamini of Erdinast, Ben Nathan, Toledano & Co.

**Appointment of a member of the Joint Representation**

On July 28, 2025, the meetings of the holders of the Series B and Series D bonds have decided that the Joint Representation. At those meetings, the candidate who received the most votes in aggregate was Mr. Ofer Gazit.

**Appointment of an American Advisor to the Joint Representation of the Trustee of the Debenture Series and the Holders of the Debenture Series**

On July 31, 2025, the meetings of the holders of the Series B and Series D bonds have approved the appointment of Mr. Amir Jiris as an American counsel for the Joint Representation.

**Appointment of an American Legal Counsel for the Joint Representation**

On July 31, 2025, the meetings of the holders of the Series B and Series D bonds have approved the appointment of Adv. Michael Friedman of the law firm Chapman and Cutler LLP as an American legal counsel for the Joint Representation.

**NOTE 2:&nbsp;&nbsp;&nbsp;&nbsp;SIGNIFICANT ACCOUNTING POLICY**

Basis of presentation of the interim condensed consolidated financial statements:

The interim condensed consolidated financial statements have been prepared in accordance with generally accepted accounting principles for the preparation of financial statements for interim periods, as prescribed in IAS 34, "Interim Financial Reporting", and in accordance with the disclosure requirements of Chapter D of the Securities Regulations (Periodic and Immediate Reports), 1970.

The accounting policies adopted in the preparation of the interim condensed consolidated financial statements are consistent with those followed in the preparation of the annual consolidated financial statements.

------

**PACIFIC OAK SOR (BVI) HOLDINGS LTD**.

**NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**U.S. Dollars in thousands**

**NOTE 3:&nbsp;&nbsp;&nbsp;&nbsp;INVESTMENT IN JOINT VENTURES**

As of June 30, 2025, the Company's investment in joint ventures was composed of the following (dollars in thousands):

---

| | | | | | | |
|:---|:---|:---|:---|:---|:---|:---|
| | **Properties as of June 30, 2025** | | | **Investment Balance as of** | **Investment Balance as of** | **Investment Balance as of** |
| | **Properties as of June 30, 2025** | | | **June 30,** | **June 30,** | **December 31, 2024** |
| | **Properties as of June 30, 2025** | | | **2025** | **2024** | **December 31, 2024** |
|<br><br>**Joint Venture** | **Properties as of June 30, 2025** |<br><br>**Location** |<br><br>**Ownership %** | **Unaudited** | **Unaudited** | **Audited** |
| 110 William Joint Venture | 1 | New York, New York | <sup>(1)</sup> | $138402 | $141133 | $142899 |
| Pacific Oak Opportunity Zone Fund I | 4 | Various | 47.0% | 34673 | 35296 | 34476 |
|  |  |  |  | $173075 | $176429 | $177375 |

---

_____________________

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)As of June 30, 2025, the Company owned 77.5% of preferred interest and 100% of common interest in the 110 William Joint Venture.

The equity in (loss) profit of joint ventures for the six and three months ended June 30, 2025 and 2024 and the year ended December 31, 2024 was as follows (in thousands):

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Six Months Ended June 30,** | **Six Months Ended June 30,** | **Three Months Ended June 30,** | **Three Months Ended June 30,** | **Year ended December 31, 2024** |
| | **2025** | **2024** | **2025** | **2024** | **Year ended December 31, 2024** |
| | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** | **Audited** |
| 110 William Joint Venture | $(4497) | $(10006) | $(2371) | $(5293) | (49066) |
| Pacific Oak Opportunity Zone Fund I | 197 | 725 | (62) | 368 | (160) |
| Equity in loss of unconsolidated joint ventures | $(4300) | $(9281) | $(2433) | $(4925) | $(49226) |

---

*<u>110 William Joint Venture:</u>*

Summarized information about the statements of financial position and the statements of profit or loss of Pacific Oak SOR SREF III 110 William, LLC (100%) (in thousands):

---

| | | | |
|:---|:---|:---|:---|
| | **June 30,** | **June 30,** | |
| | **2025** | **2024** | **December 31,**<br>**2024** |
| | **Unaudited** | **Unaudited** | **Audited** |
| Current assets | $9816 | $16026 | $8676 |
| Non-current assets (investment property) | 503552 | 407413 | 464900 |
| Current liabilities | 26945 | 8594 | 23824 |
| Non-current liabilities <sup>(1)</sup> | 326343 | 248628 | 277558 |
| Equity | 160080 | 166217 | 172194 |
| Equity attributable to equity holders of the Company (Based on the waterfall mechanism) | $138402 | $141133 | $142899 |

---

------

**PACIFIC OAK SOR (BVI) HOLDINGS LTD**.

**NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**U.S. Dollars in thousands**

**NOTE 3:&nbsp;&nbsp;&nbsp;&nbsp;INVESTMENT IN JOINT VENTURES (CONTINUED)**

_____________________

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;(1)During the three months ended June 30, 2025, the 110 William Joint Venture entered into a loan agreement for $21.0 million. The loan has an initial maturity date of July 5, 2026 with two annual extensions available and has an annual interest rate of one-month SOFR plus 15.0%.

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Six Months Ended June 30,** | **Six Months Ended June 30,** | **Three Months Ended June 30,** | **Three Months Ended June 30,** | **Year ended December 31, 2024** |
| | **2025** | **2024** | **2025** | **2024** | **Year ended December 31, 2024** |
| | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** | **Audited** |
| Revenues | $6480 | $8065 | $2898 | $3979 | $15890 |
| Gross (loss) profit | (1796) | 427 | (707) | 430 | (93) |
| Operating (loss) profit \*) | (1592) | 438 | (894) | 414 | (24854) |
| Net loss \*) | (12149) | (8983) | (6586) | (4400) | (43834) |
| &nbsp;&nbsp;&nbsp;&nbsp;Share of equity in loss from joint venture (Based on the waterfall mechanism) | (4497) | (10006) | (2371) | (5293) | (49066) |
| \*) Includes revaluation of investment properties | $240 | $30 | $(184) | $— | $(24748) |

---

In April 2025, the 110 William Joint Venture successfully delivered a tranche of office space to a major tenant and as a result, received $14.7 million from the tenant.

*<u>Pacific Oak Opportunity Zone Fund I:</u>*

Summarized information about the statements of financial position and the statements of profit or loss of Pacific Oak Opportunity Zone Fund 1, LLC (100%) (in thousands):

---

| | | | |
|:---|:---|:---|:---|
| | **June 30,** | **June 30,** | |
| | **2025** | **2024** | **December 31,**<br>**2024** |
| | **Unaudited** | **Unaudited** | **Audited** |
| Current assets | $2268 | $2973 | $1970 |
| Non-current assets (investment properties) | 129132 | 130830 | 129133 |
| Current liabilities | 904 | 1108 | 828 |
| Non-current liabilities | 58173 | 58245 | 57837 |
| Equity | 72323 | 74450 | 72438 |
| Equity attributable to equity holders of the Company (Based on the waterfall mechanism) | $34673 | $35296 | $34476 |

---

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Six Months Ended June 30,** | **Six Months Ended June 30,** | **Three Months Ended June 30,** | **Three Months Ended June 30,** | **Year ended December 31, 2024** |
| | **2025** | **2024** | **2025** | **2024** | **Year ended December 31, 2024** |
| | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** | **Audited** |
| Revenues | $4109 | $4615 | $1971 | $2332 | $9184 |
| Gross profit | 2365 | 3979 | 1032 | 2121 | 7687 |
| Operating profit (loss) \*) | 406 | 2205 | (817) | 970 | 1915 |
| Net (loss) profit \*) | 384 | 1242 | (164) | 411 | (479) |
| Share of profit (loss) from joint venture (Based on the waterfall mechanism) | 197 | 725 | (62) | 368 | (160) |
| \*) Includes revaluation of investment properties | $— | $361 | $— | $— | $(1359) |

---

------

**PACIFIC OAK SOR (BVI) HOLDINGS LTD**.

**NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**U.S. Dollars in thousands**

**NOTE 3:&nbsp;&nbsp;&nbsp;&nbsp;INVESTMENT IN JOINT VENTURES (CONTINUED)**

The Company does not attach the financial statements related to the investment in joint ventures, as the report do not add more information to the contained above.

**353 Sacramento Joint Venture**

The Company previously suspended the equity method of accounting for the 353 Sacramento Joint Venture and in June 2025, the Company disposed its 353 Sacramento Joint Venture through a deed-in-lieu of foreclosure agreement with the lender and as a result.

**NOTE 4:&nbsp;&nbsp;&nbsp;&nbsp;FINANCIAL INSTRUMENTS** 

The following were the fair values of the Company's financial instruments as of June 30, 2025 and 2024, and December 31, 2024 (in thousands):

---

| | | | |
|:---|:---|:---|:---|
| | **June 30,** | **June 30,** | |
| | **2025** | **2024** | **December 31,**<br>**2024** |
| | **Unaudited** | **Unaudited** | **Audited** |
| Notes payable | $535910 | $627950 | $540191 |
| Series Bonds | $272643 | $373457 | $329141 |
| Related party loan | $10000 | $— | $— |

---

The Series B bonds contain the following covenants: (i) Consolidated Equity Capital of the Company (not including minority rights) shall not be less than USD 475 million; (ii) the Net Adjusted Financial Debt to Net Adjusted Cap (shall not exceed a rate of 75%); (iii) Adjusted NOI shall be no lower than USD 35 million; and (iv) the consolidated scope of the projects for development of the Company shall not exceed 10% of the adjusted balance. As of June 30, 2025, the Company's covenant calculations are as follows: (i) Consolidated Equity Capital of the Company as of June 30, 2025 was $366.1 million, (ii) the Net Adjusted Debt to Net Adjusted Cap was 75.2%; (iii) the Adjusted NOI was $50.4 million for the trailing twelve months ended June 30, 2025; and (iv) the consolidated scope of projects was $0 as of June 30, 2025. The Company was not compliant with the Consolidated Equity Capital of the Company and Net Adjusted Financial Debt to Net Adjusted Cap covenants and if the Company is not compliant for two consecutive quarters, the bonds may become immediately due and payable. The non-compliance does not result in further increases in interest rates, nor does it constitute an event of a default.

The Series C bonds contain the following covenants: (i) Consolidated Equity Capital of the Company (not including minority rights) shall not be less than USD 450 million; (ii) the Net Adjusted Financial Debt to Net Adjusted Cap (shall not exceed a rate of 75%); and (iii) the Loan to Collateral Ratio shall not exceed a rate of 75%. As of June 30, 2025, the Company's covenant calculations are as follows: (i) Consolidated Equity Capital of the Company as of June 30, 2025 was $366.1 million; (ii) the Net Adjusted Debt to Net Adjusted Cap was 75.2%; and (iii) the Loan to Collateral Ratio as of June 30, 2025 was 73%. The Company was not compliant with the Consolidated Equity Capital of the Company and Net Adjusted Financial Debt to Net Adjusted Cap covenants and if the Company is not compliant for two consecutive quarters, the bonds may become immediately due and payable. The non-compliance does not result in further increases in interest rates, nor does it constitute an event of a default.

------

**PACIFIC OAK SOR (BVI) HOLDINGS LTD**.

**NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**U.S. Dollars in thousands**

**NOTE 4:&nbsp;&nbsp;&nbsp;&nbsp;FINANCIAL INSTRUMENTS (CONTINUED)**

The Series D bonds contains the following covenants: (i) Consolidated Equity Capital of the Company (not including minority rights) shall not be less than USD 450 million; (ii) the Net Adjusted Financial Debt to Net Adjusted Cap (shall not exceed a rate of 75%); (iii) Adjusted NOI shall be no lower than USD 35 million. As of June 30, 2025, the Company's covenant calculations are as follows: (i) Consolidated Equity Capital of the Company as of June 30, 2025 was $366.1 million; (ii) the Net Adjusted Debt to Net Adjusted Cap was 75.2%; and (iii) the Adjusted NOI was $50.4 million for the trailing twelve months ended June 30, 2025. The Company was not compliant with the Consolidated Equity Capital of the Company and Net Adjusted Financial Debt to Net Adjusted Cap covenants and if the Company is not compliant for two consecutive quarters, the bonds may become immediately due and payable. The non-compliance does not result in further increases in interest rates, nor does it constitute an event of a default.

The Company's investments in real estate equity securities are carried at their estimated fair value based on quoted market prices (Level 1) for the securities. Unrealized gains and losses are reported in finance loss from financial assets at fair value through profit or loss.

**NOTE 5:&nbsp;&nbsp;&nbsp;&nbsp;SEGMENT INFORMATION**

The operating segments are identified on the basis of information that is reviewed by the chief operating decision maker ("CODM") to make decisions about resources to be allocated and asses its performance. All corporate related costs are included in the strategic opportunistic properties segment to align with how financial information is presented to the CODM. The selected financial information for the reporting segments as of and for the six and three months ended June 30, 2025 and 2024 and as of and the year ended December 31, 2024 is as follows (in thousands):

------

**PACIFIC OAK SOR (BVI) HOLDINGS LTD**.

**NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**U.S. Dollars in thousands**

**NOTE 5:&nbsp;&nbsp;&nbsp;&nbsp;SEGMENT INFORMATION (CONTINUED)**

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** | **June 30, 2025** |
| | **Strategic Opportunistic Properties** | **Residential Homes** | **Hotel** | **Total** |
| | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** |
| Investment properties (including held for sale) | $658776 | $391282 | $— | $1050058 |
| Property plant and equipment - hotel, net | $— | $— | $30000 | $30000 |
| Total assets | $903086 | $405709 | $34982 | $1343777 |
| Total liabilities | $751944 | $198970 | $23346 | $974260 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Six months ended June 30, 2025** | **Six months ended June 30, 2025** | **Six months ended June 30, 2025** | **Six months ended June 30, 2025** |
| | **Strategic Opportunistic Properties** | **Residential Homes** | **Hotel** | **Total** |
| | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** |
| Total revenues and other income | $42328 | $18273 | $4622 | $65223 |
| Gross profit | $19479 | $6917 | $1249 | $27645 |
| Finance expenses, net | $27502 | $4727 | $1065 | $33294 |
|  | **Three months ended June 30, 2025** | **Three months ended June 30, 2025** | **Three months ended June 30, 2025** | **Three months ended June 30, 2025** |
|  | **Strategic Opportunistic Properties** | **Residential Homes** | **Hotel** | **Total** |
|  | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** |
| Total revenues and other income | $21503 | $9201 | $1737 | $32441 |
| Gross profit | $9583 | $4075 | $101 | $13759 |
| Finance expenses, net | $14193 | $2446 | $512 | $17151 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **June 30, 2024** | **June 30, 2024** | **June 30, 2024** | **June 30, 2024** |
| | **Strategic Opportunistic Properties** | **Residential Homes** | **Hotel** | **Total** |
| | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** |
| Investment properties | $1025158 | $407980 | $— | $1433138 |
| Property plant and equipment - hotel, net | $— | $— | $36831 | $36831 |
| Total assets | $1287193 | $419230 | $38556 | $1744979 |
| Total liabilities | $856553 | $202283 | $23469 | $1082305 |

---

------

**PACIFIC OAK SOR (BVI) HOLDINGS LTD**.

**NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**U.S. Dollars in thousands**

**NOTE 5:&nbsp;&nbsp;&nbsp;&nbsp;SEGMENT INFORMATION (CONTINUED)**

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **Six months ended June 30, 2024** | **Six months ended June 30, 2024** | **Six months ended June 30, 2024** | **Six months ended June 30, 2024** |
| | **Strategic Opportunistic Properties** | **Residential Homes** | **Hotel** | **Total** |
| | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** |
| Total revenues and other income | $46176 | $18022 | $5039 | $69237 |
| Gross profit | $20240 | $7982 | $1382 | $29604 |
| Finance expenses, net | $28899 | $4709 | $1174 | $34782 |
|  | **Three months ended June 30, 2024** | **Three months ended June 30, 2024** | **Three months ended June 30, 2024** | **Three months ended June 30, 2024** |
|  | **Strategic Opportunistic Properties** | **Residential Homes** | **Hotel** | **Total** |
|  | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** |
| Total revenues and other income | $23013 | $8866 | $2235 | $34114 |
| Gross profit | $9951 | $3716 | $454 | $14121 |
| Finance expenses, net | $15066 | $2339 | $604 | $18009 |

---

---

| | | | | |
|:---|:---|:---|:---|:---|
| | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** | **December 31, 2024** |
| | **Audited** | **Audited** | **Audited** | **Audited** |
| | **Strategic Opportunistic Properties** | **Residential Homes** | **Hotel** | **Total** |
| | **Audited** | **Audited** | **Audited** | **Audited** |
| Investment properties | $762350 | $395595 | $— | $1157945 |
| Property plant and equipment - hotel, net | $— | $— | $33624 | $33624 |
| Total assets | $1043333 | $408875 | $35451 | $1487659 |
| Total liabilities | $737527 | $198764 | $23465 | $959756 |
|  | **Year ended December 31, 2024** | **Year ended December 31, 2024** | **Year ended December 31, 2024** | **Year ended December 31, 2024** |
|  | **Strategic Opportunistic Properties** | **Residential Homes** | **Hotel** | **Total** |
|  | **Audited** | **Audited** | **Audited** | **Audited** |
| Total revenues and other income | $90938 | $35200 | $9061 | $135199 |
| Gross profit | $38015 | $16141 | $2184 | $56340 |
| Finance expenses, net | $60252 | $9371 | $2269 | $71892 |

---

**NOTE 6:&nbsp;&nbsp;&nbsp;&nbsp;SIGNIFICANT EVENTS DURING THE REPORTING PERIOD**

**Series B Bond Payment**

In January 2025, the Company made a principal installment payment of 75.3 million Israeli new Shekels ($21.0 million as of January 31, 2025) in connection with the Company's Series B bonds. Subsequent to this installment payment, one Series B Bond installment remain, due on January 31, 2026.

------

**PACIFIC OAK SOR (BVI) HOLDINGS LTD**.

**NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**U.S. Dollars in thousands**

**NOTE 6:&nbsp;&nbsp;&nbsp;&nbsp;SIGNIFICANT EVENTS DURING THE REPORTING PERIOD (CONTINUED)**

**Loan Agreements**

During the six months ended June 30, 2025, the Company entered into loan agreements and subsequently amended loan agreements with Pacific Oak Strategic Opportunity Limited Partnership, the Company's sole owner. As of June 30, 2025, the outstanding loan balance was $10.0 million, carried an annual interest rate of 10.00%, and matures to the earlier of June 30, 2028 or a triggering event. The loan interest is recorded as finance expenses, net, net in the accompanying consolidated statements of profit or loss. Additionally, the loan is secured by equity of Pacific Oak Residential Trust, Inc., the Company's subsidiary.

**Crown Pointe Mortgage Loan**

In April 2025, in light of the decision of the Company to market and sell the property, the borrowing company and the current lender in the property entered into a forbearance agreement in which the parties agreed to postpone the final repayment date of the loan in the amount of $54.7 million until September 2025 with the possibility of an additional extension, at the sole discretion of the lender, until December 2025.

As part of the aforesaid agreement, it was agreed that during the term of the agreement, the expiration of the final repayment date would not constitute an event of default of the loan, that the borrowing company would pay the monthly interest payments in accordance with the provisions of the loan agreement, and that a cash sweep mechanism would be activated.

**NOTE 7:&nbsp;&nbsp;&nbsp;&nbsp;SUBSEQUENT EVENTS**

The Company evaluates subsequent events up until the date the interim condensed consolidated financial statements are issued.

**WhiteHawk Loan and Series C Bonds Payoff**

In July 2025, the Company entered into a loan agreement with WhiteH awk Capital Partners LP for $80.0 million. The loan has an annual interest rate of one-month SOFR plus 6.50% with a SOFR floor of 3.50% and a maturity date of the earlier of December 1, 2027 or a triggering event. The loan is secured by the Company's undeveloped lands in Park Highlands and Richardson and 210 West 31st Street, a development property. As a result of entering into the loan, the Company early paid all outstanding Series C bonds of 142.0 million Israeli new shekels ($42.2 million as of July 29, 2025) and was subject to a 5.0 million Israeli new shekels ($1.5 million as of July 29, 2025) early pay interest penalty.

**Real Estate Sale**

In July 2025, the Company sold Georgia 400 Center, an office property, for gross sale proceeds of $39.1 million, before closing costs and credits. In connection with the sale, the Company repaid $39.5 million of the outstanding principal due under the secured mortgage loan.

**110 William Joint Venture**

In July 2025, the 110 William Joint Venture successfully delivered a second tranche of office space to a major tenant and as a result, the 110 William Joint Venture received a lump sum payment of $18.1 million from the tenant.

------

**PACIFIC OAK SOR (BVI) HOLDINGS LTD**.

**NOTES TO INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS**

**U.S. Dollars in thousands**

**NOTE 7:&nbsp;&nbsp;&nbsp;&nbsp;SUBSEQUENT EVENTS (CONTINUED)**

**Pending Transactions**

On August 22, 2025, the Company entered into a Purchase and Sale Agreement for the Richardson office and undeveloped land assets for a sales price of $30.0 million, which is approximately the carrying amount in these financial statements, and on August 25, 2025, also entered into a Letter of Intent for 1,799 residential homes (to one buyer as a portfolio) for a sales price of $230.0 million, which is approximately a 24% discount on the carrying amounts in these financial statements. The closing of the residential homes transaction is contingent on the Company refinancing the existing debt on the residential homes. There can be no assurance that the Company will complete these transactions. The purchasers are not affiliated with the Company or the Company's advisor.

## Exhibit 99.2

**<u>Exhibit 99.2</u>**

**This English translation is for convenience purposes only. This is not an official translation and is not<br>binding. Whilst reasonable care and skill have been exercised in the preparation hereof, no translation can ever perfectly reflect the original Hebrew version. In the event of any discrepancy between the Hebrew version and this translation, the Hebrew version shall prevail.**

**PACIFIC OAK SOR (BVI) HOLDINGS, LTD.**

**PRESENTATION OF SEPARATE FINANCIAL DATA FROM THE** 

**CONSOLIDATED FINANCIAL STATEMENTS ATTRIBUTABLE TO THE COMPANY**

**June 30, 2025 (Unaudited)**

------

**PACIFIC OAK SOR (BVI) HOLDINGS, LTD.**

**PRESENTATION OF SEPARATE FINANCIAL DATA** 

**FROM THE CONSOLIDATED FINANCIAL STATEMENTS** 

**ATTRIBUTABLE TO THE COMPANY**

**AS OF JUNE 30, 2025**

**(UNAUDITED)**

**U.S. DOLLARS IN THOUSANDS**

**INDEX**

---

| | |
|:---|:---|
| | **Page** |
| Special Report Presented Pursuant to Regulation 38d | 2 |
| Financial Information from the Consolidated Statements of Financial Position Attributable to the Company | 3 |
| Financial Information from the Consolidated Statements of Profit or Loss Attributable to the Company | 4 |
| Financial Information from the Consolidated Statements of Cash Flows Attributable to the Company | 5 |
| Additional Information | 6-9 |

---

- - - - - - - - - - -

------

**<u>Special Report in accordance with Regulation 38d</u>**

**<u>Financial Information and Financial Data from the</u>**

**<u>Consolidated Financial Statements Attributable to the Company</u>**

Below is separate financial information and financial data attributable to the Company from the Group's consolidated financial statements as of June 30, 2025, published as part of the periodic reports ("consolidated financial statements"), presented in accordance with Regulation 38d to the Israeli Securities Regulations (Periodic and Immediate Reports), 1970.

------

**PACIFIC OAK SOR (BVI) HOLDINGS, LTD.**

**Financial Information from the Consolidated Statements of Financial Position Attributable to the Company** 

---

| | | | |
|:---|:---|:---|:---|
| | **June 30,** | **June 30,** | |
| | **2025** | **2024** | **December 31,**<br>**2024** |
| | **Unaudited** | **Unaudited** | **Audited** |
| | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** |
| **ASSETS** |  |  |  |
| **NON-CURRENT ASSETS** |  |  |  |
| Investments in investees | $709073 | $1000140 | $849492 |
| Restricted cash | 5154 | 4536 | 10109 |
|  | 714227 | 1004676 | 859601 |
| **CURRENT ASSETS** |  |  |  |
| Cash and cash equivalents | 591 | 18934 | 704 |
| Restricted cash | 9488 | 14273 | 3252 |
|  | 10079 | 33207 | 3956 |
| **Total assets** | $724306 | $1037883 | $863557 |
| **EQUITY** | $366099 | $654858 | $523989 |
| **NON-CURRENT LIABILITIES** |  |  |  |
| Bonds payable, net | 167848 | 262457 | 298741 |
| **CURRENT LIABILITIES** |  |  |  |
| Accounts payable and accrued liabilities | 9045 | 5357 | 8208 |
| Bonds payable | 157247 | 102843 | 20653 |
| Due to owner | 24067 | 12368 | 11966 |
|  | 190359 | 120568 | 40827 |
| **Total liabilities** | 358207 | 383025 | 339568 |
| **Total equity and liabilities** | $724306 | $1037883 | $863557 |

---

The accompanying notes are an integral part of the condensed interim financial data.

---

| | | | |
|:---|:---|:---|:---|
| August 31, 2025 | /s/ Ryan Schluttenhofer | /s/ Jodi Kremerman | /s/ Keith David Hall |
| Date of approval of | Schluttenhofer, Ryan | Kremerman, Jodi | Hall, Keith David |
| financial statements | Chief Accounting Officer | Chairman of Board of Directors | Chief Executive Officer |

---

------

**PACIFIC OAK SOR (BVI) HOLDINGS, LTD.**

**Financial Information from the Consolidated Statements of Profit or Loss Attributable to the Company**

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Six months ended June 30,** | **Six months ended June 30,** | **Three months ended June 30,** | **Three months ended June 30,** | |
| | **2025** | **2024** | **2025** | **2024** | **Year ended December 31,**<br>**2024** |
| | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** | **Audited** |
| | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** |
| Share of loss from investees, net | $(112790) | $(103104) | $(110394) | $(31263) | $(190035) |
| Advisory fees to affiliate | (5396) | (5961) | (2739) | (2874) | (11593) |
| General and administrative expenses | (1255) | (1572) | (765) | (967) | (2645) |
| **Operating loss** | (119441) | (110637) | (113898) | (35104) | (204273) |
| Finance expense | (14493) | (13470) | (7475) | (7222) | (30720) |
| Finance income | 201 | 519 | 91 | 211 | 1005 |
| Loss on extinguishment of debt |  |  |  |  | (6033) |
| Foreign currency transaction (loss) gain, net | (24157) | 11280 | (30141) | 7367 | (3156) |
| **Net loss** | $(157890) | $(112308) | $(151423) | $(34748) | $(243177) |
| Total comprehensive loss | $(157890) | $(112308) | $(151423) | $(34748) | $(243177) |

---

The accompanying notes are an integral part of the condensed interim financial data.

------

**PACIFIC OAK SOR (BVI) HOLDINGS, LTD.**

**Financial Information from the Consolidated Statements of Cash Flows Attributable to the Company** 

---

| | | | | | |
|:---|:---|:---|:---|:---|:---|
| | **Six months ended June 30,** | **Six months ended June 30,** | **Three months ended June 30,** | **Three months ended June 30,** | |
| | **2025** | **2024** | **2025** | **2024** | **Year ended** <br>**December 31,**<br>**2024** |
| | **Unaudited** | **Unaudited** | **Unaudited** | **Unaudited** | **Audited** |
| | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** | **U.S. dollars in thousands** |
| **Cash flows from operating activities** |  |  |  |  |  |
| Net loss | $(157890) | $(112308) | $(151423) | $(34748) | $(243177) |
| Adjustments to reconcile net loss to net cash (used in) provided by operating activities: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Share of loss from investees | 112790 | 103104 | 110394 | 31263 | 190035 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Finance expense | 14493 | 13470 | 7475 | 7222 | 30720 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Distribution from investees, net | 22988 | 27576 | 10684 | 13730 | 49109 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Foreign currency transaction loss (gain), net | 24157 | (11280) | 30141 | (7367) | 3156 |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Loss on extinguishment of debt |  |  |  |  | 6033 |
| Changes in operating assets and liabilities: |  |  |  |  |  |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Accounts payable and accrued liabilities | (472) | 81 | (594) | (111) | (247) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Restricted cash for operational expenditures | (1043) | 646 | (672) | (8925) | (3389) |
| &nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;Due to affiliates | 2101 | 1680 | 1487 | 184 | 3982 |
| **Net cash provided by operating activities** | 17124 | 22969 | 7492 | 1248 | 36222 |
| **Cash flows from investing activities** |  |  |  |  |  |
| Distributions from (to) investees, net | 4640 | 5096 | (9173) | (44473) | 47280 |
| Payments on foreign currency derivatives, net |  | (478) |  |  | (478) |
| **Net cash provided by (used in) investing activities** | 4640 | 4618 | (9173) | (44473) | 46802 |
| **Cash flows from financing activities** |  |  |  |  |  |
| Proceeds from loans from owner | 10000 |  | 2000 |  |  |
| Payment on bonds payable | (21184) | (106021) |  |  | (253229) |
| Interest paid | (11526) | (11012) | (1195) | (4578) | (21990) |
| Proceeds from bonds payable |  | 75627 |  | 75627 | 156746 |
| Payments of deferred financing costs |  | (2334) |  | (2233) | (4850) |
| (Distribution) release of restricted cash for debt service obligations | (238) | 16733 | (268) | (3823) | 26590 |
| Distributions to owner |  | (3850) |  | (3175) | (6554) |
| **Net cash (used in) provided by financing activities** | (22948) | (30857) | 537 | 61818 | (103287) |
| Effect of exchange rate changes on cash and cash equivalents | 1071 | 701 | 1120 | (44) | (536) |
| (Decrease) increase in cash | (113) | (2569) | (24) | 18549 | (20799) |
| Cash, beginning of the period | 704 | 21503 | 615 | 385 | 21503 |
| **Cash, end of the period** | $591 | $18934 | $591 | $18934 | $704 |
| **Supplemental Disclosure of Noncash Activities:** |  |  |  |  |  |
| Asset management fee reimbursement payable to owner | $16342 | $9658 | $16342 | $9658 | $11961 |
| Distribution payable to owner | $— | $2704 | $— | $2704 | $— |

---

The accompanying notes are an integral part of the condensed interim financial data.

------

**PACIFIC OAK SOR (BVI) HOLDINGS, LTD.**

**Additional Information**

**NOTE 1:&nbsp;&nbsp;&nbsp;&nbsp;BASIS OF PREPARATION** 

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;a.Separate financial information is prepared in a condensed format as of June 30, 2025 and for the three and six months then ended, in accordance with Regulation 38D of the Securities Regulations (Periodic and Immediate Reports), 1970.

Please refer to the separate financial information in this regard to the financial information on the annual financial statements of the Company as of December 31, 2024 and for the year then ended, and the information accompanying notes (hereinafter - the annual consolidated financial statements).

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;b.The financial condition of the Company and the going concern assumption.

As of June 30, 2025, the Company had a working capital shortfall amounting to $180.3 million, primarily attributed to January 31, 2026 Series B bonds principal repayment of $115.1 million and Series C bonds principal of $42.1 million (repaid in August 2025). In July 2025, the Company, through investees, completed a secured financing transaction of $80.0 million, the proceeds of which were used primarily for the full redemption of the Series C bonds and a pre-payment interest penalty, totaling $43.7 million, reserved $13.1 million for Series B and Series D interest payments and the remainder designated for operating needs, refer to Note 3 for additional details on this transaction. As a result of completing this transaction, a trustee that represents the bondholders of the Series B and Series D bonds (the "Trustee"), issued a series of communications alleging potential breaches of duty, see below "Negotiations between the Company and the Trustee and the representatives of the holders of the Series B and Series D bonds of the Company" for further details.

As of June 30, 2025, the Company was non-compliant with the minimum consolidated equity requirement and Net Adjusted Financial Debt to Net Adjusted Cap covenants related to the Series B and Series D bonds and according to the deeds of trust, if the Company is not in compliance for two consecutive quarters, the Series B and Series D bonds may become due and payable. Refer to Note 2 for additional details on the covenants. Furthermore, in July 2025, S&P Global Ratings Maalot announced an update to the rating for the Series B and Series D bonds from to ilA to ilBBB. As a result of the downgrades, the annual interest rate for the Series B and Series D bonds increased to 5.18% and 11.00%, respectively.

During the three and six months ended June 30, 2025, the Company's investees recognized fair value losses of investment properties (including as a result of the sale of an asset) of $108.7 million and $111.2 million, respectively, due to declines in market conditions and projected cash flows, changes in sales comparisons, and based on quoted prices and continued declines in fair values may limit the investees ability to sell assets or refinance debt at attractive terms and make distributions to the Company. The Company's investees may negotiate a turnover of one or more secured properties back to the related lender and remit payment for any associated loan guarantee. To meet its repayment obligations in the coming year as mentioned above, the Company expects to generate cash flow from ongoing operations and intends to refinance and/or pay down debt as they come due through distributions from the Company's investees. On August 22, 2025, the Company, through investees, entered into a Purchase and Sale Agreement for the Richardson office and undeveloped land assets for a sales price of $30.0 million and on August 25, 2025, also entered into a non-binding Letter of Intent for 1,799 residential homes (to one buyer as a portfolio) for a sales price of $230.0 million. The Company's residential homes portfolio, held through investees is classified as Level 3 within the fair value hierarchy. Valuations are typically performed using the individual residential home as the unit of account, rather than assessing the portfolio on an aggregate basis. A market participant evaluating a single residential home property may not apply the same portfolio-level discounts that another market participant would require when acquiring the portfolio, where the weighted average cost of capital, including current market costs of debt and equity, would more directly influence pricing. Management estimates that if the residential homes will be sold as a portfolio, instead of individually, a discount of approximately 10-25% may be applied. These

------

**PACIFIC OAK SOR (BVI) HOLDINGS, LTD.**

**Additional Information**

plans are subject to change based on market conditions in the commercial real estate lending environment, the current interest rate environment, leasing and transaction volume challenges in certain markets, successful negotiations with the Trustee and Representatives, and such plans are not within the control of the Company, and therefore, there is no assurance that the Company will be successful in implementing its plans and fulfill its obligations upon maturity. The uncertainty regarding the Company's plans could be mitigated through the potential investee sale of its residential home portfolio, successful negotiations with the Trustee and Representatives, and other strategic actions currently under consideration. As a result, the Company's management and the Board of Directors have concluded that there are significant doubts regarding the Company's ability to continue as a going concern. No adjustments were made to the financial statements to the values or classifications of assets and liabilities that might be necessary if the Company is unable to continue operating as a going concern.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**c.Negotiations between the Company and the Trustee and the representatives of the holders of the Series B and Series D bonds of the Company.**

The following is a summary of the main actions and the decisions that were carried out and made in the framework of the aforementioned negotiations:

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**1.Letter of commitment to Reznik Paz Nevo Trustees Ltd., the trustee for the holders of the Company's Debentures (Series B and Series D)** 

On August 19, 2025, the Company reported that a Letter of Commitment (Standstill) was signed in favor of Trustee and in favor of the holders of the Company's Series B and Series D bonds.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**2.Decision to order negotiations in accordance with the debt settlement principles document**

On August 3, 2025, the meetings of the holders of the Series B and Series D bonds have approved an instruction to the Trustee, the representatives of the holders of the Series B and Series D bonds of the Company (the "Representatives") and the Trustee's counsel and the holders of the Series B and Series D bonds to conduct negotiations with the Company for the purpose of reaching a debt arrangement on the basis of the debt settlement principles document.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**3.Decision to Notify the Company of the Objection of the holders of the Series B and Series D bonds to the engagement in the Financing Agreement**

On July 27, 2025, the meetings of the holders of the Series B and Series D bonds have approved a resolution to instruct the Trustee to notify the Company and the Company's officers that the holders of the Series B and Series D bonds object to the Company entering the WhiteHawk Loan in which the Company ultimately entered into.

&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;**4.Appointment of Representatives**

**Appointment of a joint representation**

On July 21, 2025, the meetings of the holders of the Series B and Series D bonds decided to appoint a joint representation for the holders of the Series B and Series D bonds

**Appointment of Legal Advisor to the Trustee, the Holders of the Debentures Series and the Joint Representation**

On July 28, 2025, the meetings of the holders of the Series B and Series D bonds approved the appointment of a legal advisor for the joint representation of the Trustee and Representatives (the "Joint Representation"). The candidates who received the most votes in aggregate were Adv. Raanan Kalir and Adv. Alon Binyamini of Erdinast, Ben Nathan, Toledano & Co.

**Appointment of a member of the Joint Representation**

On July 28, 2025, the meetings of the holders of the Series B and Series D bonds have decided that the Joint Representation. At those meetings, the candidate who received the most votes in aggregate was Mr. Ofer Gazit.

------

**PACIFIC OAK SOR (BVI) HOLDINGS, LTD.**

**Additional Information**

**Appointment of an American Advisor to the Joint Representation of the Trustee of the Debenture Series and the Holders of the Debenture Series**

On July 31, 2025, the meetings of the holders of the Series B and Series D bonds have approved the appointment of Mr. Amir Jiris as an American counsel for the Joint Representation.

**Appointment of an American Legal Counsel for the Joint Representation**

On July 31, 2025, the meetings of the holders of the Series B and Series D bonds have approved the appointment of Adv. Michael Friedman of the law firm Chapman and Cutler LLP as an American legal counsel for the Joint Representation.

**NOTE 2:&nbsp;&nbsp;&nbsp;&nbsp;SIGNIFICANT EVENTS DURING THE REPORTING PERIOD** 

**Israeli Bond Financings**

As of June 30, 2025, the Company had Series B, C, and D bonds ("Series Bonds") outstanding of 1.1 billion Israeli new shekels ($331.3 million as of June 30, 2025), of which 142.0 million Israeli new shekels ($42.1 million as of June 30, 2025) were collateralized by real estate held through an investee. On January 31, 2025, the Company made the remaining second principal installment payment of 75.3 million Israeli new shekels ($21.0 million as of January 31, 2025) in connection with the Company's Series B bonds. As of the date of this report, the Series Bonds principal payments range from January 2026 to February 2029 with interest rates of 5.18% and 11.00%.

The Series B bonds contain the following covenants: (i) Consolidated Equity Capital of the Company (not including minority rights) shall not be less than USD 475 million; (ii) the Net Adjusted Financial Debt to Net Adjusted Cap (shall not exceed a rate of 75%); (iii) Adjusted NOI shall be no lower than USD 35 million; and (iv) the consolidated scope of the projects for development of the Company shall not exceed 10% of the adjusted balance. As of June 30, 2025, the Company's covenant calculations are as follows: (i) Consolidated Equity Capital of the Company as of June 30, 2025 was $366.1 million, (ii) the Net Adjusted Debt to Net Adjusted Cap was 75.2%; (iii) the Adjusted NOI was $50.4 million for the trailing twelve months ended June 30, 2025; and (iv) the consolidated scope of projects was $0 as of June 30, 2025. The Company was not compliant with the Consolidated Equity Capital of the Company and Net Adjusted Financial Debt to Net Adjusted Cap covenants and if the Company is not compliant for two consecutive quarters, the bonds may become immediately due and payable. The non-compliance does not result in further increases in interest rates, nor does it constitute an event of a default.

The Series C bonds contain the following covenants: (i) Consolidated Equity Capital of the Company (not including minority rights) shall not be less than USD 450 million; (ii) the Net Adjusted Financial Debt to Net Adjusted Cap (shall not exceed a rate of 75%); and (iii) the Loan to Collateral Ratio shall not exceed a rate of 75%. As of June 30, 2025, the Company's covenant calculations are as follows: (i) Consolidated Equity Capital of the Company as of June 30, 2025 was $366.1 million; (ii) the Net Adjusted Debt to Net Adjusted Cap was 75.2%; and (iii) the Loan to Collateral Ratio as of June 30, 2025 was 73%. The Company was not compliant with the Consolidated Equity Capital of the Company and Net Adjusted Financial Debt to Net Adjusted Cap covenants and if the Company is not compliant for two consecutive quarters, the bonds may become immediately due and payable. The non-compliance does not result in further increases in interest rates, nor does it constitute an event of a default.

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**PACIFIC OAK SOR (BVI) HOLDINGS, LTD.**

**Additional Information**

The Series D bonds contains the following covenants: (i) Consolidated Equity Capital of the Company (not including minority rights) shall not be less than USD 450 million; (ii) the Net Adjusted Financial Debt to Net Adjusted Cap (shall not exceed a rate of 75%); (iii) Adjusted NOI shall be no lower than USD 35 million. As of June 30, 2025, the Company's covenant calculations are as follows: (i) Consolidated Equity Capital of the Company as of June 30, 2025 was $366.1 million; (ii) the Net Adjusted Debt to Net Adjusted Cap was 75.2%; and (iii) the Adjusted NOI was $50.4 million for the trailing twelve months ended June 30, 2025. The Company was not compliant with the Consolidated Equity Capital of the Company and Net Adjusted Financial Debt to Net Adjusted Cap covenants and if the Company is not compliant for two consecutive quarters, the bonds may become immediately due and payable. The non-compliance does not result in further increases in interest rates, nor does it constitute an event of a default.

**Loan Agreement**

During the six months ended June 30, 2025, the Company entered into loan agreements and subsequently amended loan agreements with Pacific Oak Strategic Opportunity Limited Partnership, the Company's sole owner. As of June 30, 2025, the outstanding loan balance was $10.0 million, carried an annual interest rate of 10.00%, and matures to the earlier of June 30, 2028 or a triggering event. The loan interest is recorded as finance expenses, net in the accompanying consolidated statements of profit or loss. Additionally, the loan is secured by equity of Pacific Oak Residential Trust, Inc., the Company's investee.

**NOTE 3:&nbsp;&nbsp;&nbsp;&nbsp;SUBSEQUENT EVENT**

The Company evaluates subsequent events up until the date the consolidated financial statements are issued.

**Series C Bonds Payoff**

In July 2025, the Company, through investees, entered into a loan agreement with WhiteHawk Capital Partners LP for $80.0 million. The loan has an annual interest rate of one-month SOFR plus 6.50% with a SOFR floor of 3.50% and a maturity date of the earlier of December 1, 2027 or a triggering event. The loan is secured by the Company's investments in undeveloped lands in Park Highlands and Richardson and 210 West 31st Street, a development property. As a result of entering into the loan, part of the proceeds were used to early paid all outstanding Series C bonds of 142.0 million Israeli new shekels ($42.2 million as of July 29, 2025) and was subject to a 5.0 million Israeli new shekels ($1.5 million as of July 29, 2025) early pay interest penalty.

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