KBS REIT III Enters Material Agreement, Creates Financial Obligation

TL;DR

KBS REIT III just signed a big deal and took on a new financial obligation.

AI Summary

On February 6, 2025, KBS Real Estate Investment Trust III, Inc. entered into a material definitive agreement and created a direct financial obligation. The company, incorporated in Maryland with its principal executive offices in Newport Beach, California, filed this 8-K report on February 12, 2025.

Why It Matters

This filing indicates a significant new financial commitment or agreement for KBS Real Estate Investment Trust III, Inc., which could impact its financial structure and future operations.

Risk Assessment

Risk Level: medium — Entering into material definitive agreements and creating financial obligations can introduce new risks related to the terms of the agreement and the company's ability to meet its obligations.

Key Numbers

• 20250206 — Event Date (Date of earliest event reported)
• 20250212 — Filing Date (Date the 8-K was filed)

Key Players & Entities

• KBS Real Estate Investment Trust III, Inc. (company) — Registrant
• Maryland (jurisdiction) — State of Incorporation
• Newport Beach, California (location) — Principal Executive Offices

FAQ

Key Financial Figures

• $465.9 million — rtfolio Loan Facility was approximately $465.9 million (the "Principal Debt"). The Eighth Modi
• $15.0 million — hth Modification Agreement provides for $15.0 million of new funding ("Additional Loan Procee
• $420.0 million — Facility Amount is not greater than (i) $420.0 million on or before December 31, 2025, (ii) $3
• $300.0 million — on on or before December 31, 2025, (ii) $300.0 million on or before December 31, 2026 and (iii
• $150.0 million — n or before December 31, 2026 and (iii) $150.0 million on or before December 31, 2027. In conn
• $30 million — dification Agreement provides for up to $30 million of sales proceeds from the sale of the
• $15 million — the first Property and up to a total of $15 million of sales proceeds from the sale of subs
• $30.0 million — as follows (i) in respect of the first $30.0 million of cash proceeds, 50% in prepayment of
• $10 million — the sale of Accenture Tower, the first $10 million of net sale proceeds shall be used to f
• $10.0 million — t of the sale of The Almaden, the first $10.0 million of net sale proceeds is required to be
• $5.0 million — de or amount guaranteed is greater than $5.0 million. Further, the occurrence of a default (
• $1.2 million — uired to pay the Portfolio Loan Lenders $1.2 million of the $2.4 million loan fee, with the
• $2.4 million — tfolio Loan Lenders $1.2 million of the $2.4 million loan fee, with the remainder of the fee
• $4.0 m — an fee and an exit fee of approximately $4.0 million, which are due on the earliest to

Filing Documents

• kbsriii-20250206.htm (8-K) — 41KB
• 0001482430-25-000006.txt ( ) — 160KB
• kbsriii-20250206.xsd (EX-101.SCH) — 2KB
• kbsriii-20250206_lab.xml (EX-101.LAB) — 20KB
• kbsriii-20250206_pre.xml (EX-101.PRE) — 11KB
• kbsriii-20250206_htm.xml (XML) — 3KB

01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT

ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT Amended and Restated Portfolio Loan Facility On November 3, 2021, certain of KBS Real Estate Investment Trust III, Inc.'s ("KBS REIT III") indirect wholly owned subsidiaries (the "Portfolio Loan Borrowers"), entered into a loan agreement with Bank of America, N.A., as administrative agent (the "Portfolio Loan Agent"); BofA Securities, Inc., Wells Fargo Securities, LLC and Capital One, National Association as joint lead arrangers and joint book runners; Wells Fargo Bank, N.A., as syndication agent; and each of the financial institutions signatory thereto as lenders (as subsequently modified and amended, the "Amended and Restated Portfolio Loan Facility"). The current lenders under the Amended and Restated Portfolio Loan Facility are Bank of America, N.A.; Wells Fargo Bank, National Association; U.S. Bank, National Association; Capital One, National Association; PNC Bank, National Association; Regions Bank; and Zions Bankcorporation, N.A., DBA California Bank & Trust (together, the "Portfolio Loan Lenders"). The Amended and Restated Portfolio Loan Facility is secured by 60 South Sixth, Sterling Plaza, Towers at Emeryville, Ten Almaden and Town Center (each a "Property," and together, the "Properties"). On February 6, 2025, KBS REIT III, through the Portfolio Loan Borrowers and KBS REIT Properties III, LLC ("REIT Properties III"), entered into the eighth loan modification agreement with the Portfolio Loan Agent and the Portfolio Loan Lenders (the "Eighth Modification Agreement"). Pursuant to the terms of the Eighth Modification Agreement, the maturity date of the facility was extended to January 22, 2027, with two additional 12-month extension options, subject to the terms and conditions in the loan documents. Pursuant to the Eighth Modification Agreement, the Amended and Restated Portfolio Loan Facility bears interest at one-month Term SOFR plus 300 basis points. Prior to closing the Eighth Modification Agreemen

Forward-Looking Statements

Forward-Looking Statements Certain statements included in this Current Report on Form 8-K are forward-looking statements. Those statements include statements regarding the intent, belief or current expectations of KBS REIT III and members of its management team, as well as the assumptions on which such statements are based, and generally are identified by the use of words such as "may," "will," "seeks," "anticipates," "believes," "estimates," "expects," "plans," "intends," "should" or similar expressions. These include statements about KBS REIT III's plans, strategies and prospects, including its ability to comply with any terms, conditions, obligations or covenants contained in any agreements related to debt obligations. These statements are subject to known and unknown risks and uncertainties. Readers are cautioned not to place undue reliance on these forward-looking statements. Actual results may differ materially from those contemplated by such forward-looking statements. Further, forward-looking statements speak only as of the date they are made, and KBS REIT III undertakes no obligation to update or revise forward-looking statements to reflect changed assumptions, the occurrence of unanticipated events or changes to future operating results over time, unless required by law. Moreover, you should interpret many of the risks identified in this report, as well as the risks set forth below, as being heightened as a result of the continued disruptions in the financial markets impacting the U.S. commercial real estate industry, especially as it pertains to commercial office buildings, the challenging commercial real estate lending environment, the current interest rate environment, leasing challenges in certain markets where KBS REIT III owns properties and the lack of transaction volume in the U.S. office market as well as general market instability. All forward-looking statements should be read in light of the risks identified in Part I, Item 1A of KBS REIT III's

SIGNATURES

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. KBS REAL ESTATE INVESTMENT TRUST III, INC. Dated: February 12, 2025 BY: /s/ Jeffrey K. Waldvogel Jeffrey K. Waldvogel Chief Financial Officer, Treasurer and Secretary

View Full Filing

View this 8-K filing on SEC EDGAR