KBS Real Estate Investment Trust III, Inc. 8-K

What Happened
KBS Real Estate Investment Trust III, Inc. (KBSR) filed an 8‑K (Dec 19, 2025) announcing the board-approved estimated net asset value (NAV) of its common stock of $2.70 per share (mid-point of a Kroll‑calculated range of $2.30 to $3.13) as of December 18, 2025. The NAV is based on asset and liability estimates as of September 30, 2025 (with an adjustment for the Company’s Prime US REIT units as of November 14, 2025). Independent appraiser Kroll, LLC performed appraisals for 12 consolidated office properties (total appraised value $1.6 billion), and KBS’s external advisor provided valuations for cash, other assets and liabilities. The valuation is being provided to assist broker‑dealers with FINRA Rule 2231 customer statement reporting; the estimate is not audited and is not GAAP fair value.

Key Details

• Estimated value per share: $2.70 (range $2.30–$3.13); prior reported estimate (Dec 12, 2024) was $3.89 — a decline of $1.19 per share.
• Appraised real estate value: $1.6 billion for 12 office properties; Kroll’s appraisals reflect a ~31.6% decrease versus aggregate purchase price plus capital improvements.
• Prime US REIT investment: 237,426,088 units (ownership reduced to ~16.5% after a private placement); Kroll valued the stake at $39.1 million as of Nov 14, 2025 after applying a holding‑period/blockage discount.
• Debt and cash: GAAP/fair value of notes payable (adjusted for one loan) about $1.3 billion; six loan facilities (≈ $1.3B secured debt) are subject to cash‑sweep arrangements that increased restricted cash per share.

Why It Matters
This NAV update shows a material decline in per‑share estimated value driven mainly by lower office property appraisals, property dispositions and the challenging U.S. office market amid elevated interest rates. For investors, the filing highlights liquidity and credit pressures: several loans have maturities or paydown requirements, cash‑sweep arrangements restrict cash flow, and management cautions there remains substantial uncertainty about refinancing, asset sales or the Company’s ability to continue as a going concern. The Company also notes the NAV is an estimate (based on assumptions and third‑party appraisals), is not audited GAAP fair value, and may differ materially from prices at which shares could trade or be redeemed.